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Friday, July 15, 2011
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18 comments:
http://franklymls.com/MC7571836
Any feedback on house would be appreciated. Essentially, a building company bought this foreclosure in Nov 2010 for $355K and fixed it up (new windows, dual climate zone, open floor plan, renovated bathroom). They are now asking $550K. We are debating putting in an offer of $500K. This sounds excessive given that's $150K more than what the company paid a 1 1/2 years ago. However, the house is in downtown Silver Spring which we really like. Thoughts?
Dragnet-
I don't know the area, so I don't know if it is priced right, but I do know you shouldn't worry about how much they paid for it. Whether or not they got an amazing price last year doesn't really impact the current value of the house. So if the house really is worth 500K and you like it you should put in an offer.
Thx Housebuyer. Problem is I don't know if it is worth $500K. For Silver Spring, $500K is the top of the market. We were looking to spend in the $300-$450K range, but this home is beautiful, recently renovated by a builder, and is right in downtown Silver Spring which has been redeveloped w/ exciting new stuff coming (Metro center etc..).
Dragant, to follow up on what HB said, there is often some sort of premium that people pay over the mere 355K purchase price + renovation costs. Its really a question of what price the market will bear.
That said, I dont know the SS market. If as you say 500K is the top of the market, then they may be reaching a bit.
Are there any comps you can look at? If so, what are they going for?
http://franklymls.com/MC7544707
This is the best comp I have. It is 2 doors down and sold for $460K. However, the builder as part of their renovation did an expansion in the back thus increasing the square footage of the house. This is why they are justifying the higher price...
Hmmm - if those stats are right, it appears that your house is 2983 sf versus the 1226 sf on the comp. If accurate, then it seems like getting a house double the size for 40K more (500K) is not a bad deal.
Based on that info, I would feel more confident paying 500k for the place. Maybe start with a 475K bid and see if they are willing to negotiate on their price?
The sq footage of 8611 cedar is 1790 and the other is 1290, quite a significant difference in sq footage. Also the 8605 home only has one
upper bedroom.
Hey Anon,
Want to buy a condo?
"A report from WTOP. “According to the latest Delta Associates Mid-Year Washington/Baltimore Condominium Report, condo sales in the Washington region plummeted 43 percent from June of 2010 to June of this year. In fact, there are so many unsold condos on the market right now, it would take nearly two and a half years to sell them off. Steve Cohen, of First Place Bank, points to a rule by Freddie Mac and Fannie Mae that states, ‘more than half of the units must be held owner-occupied, meaning the people that own them actually live there in order for Freddie and Fannie to be able write a loan in the complex.’”
“So when there are a high number of rentals or foreclosures in a condominium complex, the scale is tipped and Freddie and Fannie are unable to write a loan for any units in the complex. Another rule is also having an impact, Cohen says. The rule says a loan cannot be written by Freddie or Fannie if more than 15 percent of unit owners are late on condo fees. Cohen says, ‘In harder economic times, as people are losing their jobs, perhaps they are late on their fees or not paying their fees at all.’”
Glug, Glug, Glug...
The Capital in Maryland. “You probably wouldn’t find it unless you were looking for it. The 13,400 square foot mansion, complete with eight bedrooms, a guest cottage and a horse barn, sits on Round Bay in Severna Park. Not surprisingly, this kind of luxury doesn’t come cheap, and that’s likely why the estate sat on the market off and on for five years.”
“The Annapolis plastic surgeon who owns the home originally listed the property for upward of $12 million, but had no takers, his Realtor Warren Prins said. So he dropped the price several times before finally turning to DeCaro Real Estate Auctions Inc., which put the estate on the auction block. ‘Like everyone else, (the homeowner) is chasing the market down,’ said Auctioneer Daniel DeCaro. ‘He’s come to the conclusion that he has to take a more aggressive approach.’”
“The figures seem to back up his theory. According to Metropolitan Regional Information Systems, a real estate tracking company, there were 284 properties listed for sale in Anne Arundel County for at least $1 million between January and June. So far, only 69 of those properties have sold. Another 105 listings were either withdrawn, or they expired unsold. ‘A lot of people are looking for a new way to sell their real estate,’ DeCaro said. ‘The old way isn’t working for them.’”
“At Annapolis Towne Centre at Parole, 25 luxury condos will be up for auction later this month. The units in the GrandView are expected to sell for up to 70 percent off their original prices, according to the company handling the auctions. Auctioning off the GrandView condos, built by Sturbridge Homes, became a necessity, said Mark Troen, chief operating officer of auctioneer Sheldon Good and Co. ‘In 2009, the market died after we sold 45 units,’ he said. ‘People were afraid.’”
“An auction, though, seems to boost their confidence. ‘The price that they’re paying is the market price,’ Troen said. ‘We’re not setting the price. The buyer is.’ As for the sellers? ‘They like it because the units get sold,’ he said.”
anon
this is pat, i'm using my GF's acct by mistake.
Google wants to use ehr's as a default
The Wall Street Journal ran an op-ed Monday titled ‘A Home Is a Lousy Investment.’ It was written by Robert Bridges, professor of clinical finance and business economics at the University of Southern California’s Marshall School of Business. Bridges based his analysis on the California housing market over the past 30 years.”
“In the op-ed, Bridges concedes that home-building has an immediate economic benefit. But he said the positive effects are fleeting, whereas business investment creates permanent jobs and income. Bridges concludes that housing should take a back seat in importance to creating sustainable jobs. A solid labor market should lead to a good housing market, not the other way around.”
“‘Owner-occupied homes will always be the basis for healthy and stable neighborhoods,’ Bridges writes. ‘But coming generations need to realize that while houses are possessions and part of a good life, they are not always good investments on the road to financial independence.’”
Cherie/Pat -- you know, when something in a report doesnt seem right, its time to double check.
Sure enough, it looks like WTOP botched the story. Let me rewrite the first paragraph
"A report from WTOP. “According to the latest Delta Associates Mid-Year Washington/Baltimore Condominium Report, NEW condo sales in the Washington region plummeted 43 percent from June of 2010 to June of this year. In fact, there are so many unsold condos on the market right now, it would take nearly two and a half years to sell them off, down from last year, and a dramatic decrease from 4 years ago when there was 7+ years of supply."
Gee doesnt seem so ominous now does it? I mean, ya think one of the reasons sales are down so dramatically is because they pretty much quit builing new condos and are running out of places to sell?
If you prefer, take a look at it graphically.
http://dc.urbanturf.com/articles/blog/report_2.4_years_of_new_condo_supply_in_dc_area/3758
Down from near 20K inventory at peak to 3,600 today? So much for that "tsunami" of inventory.
Say did you notice too that WTOP did not mention price? Had you looked that up you would have found prices are down for the whole area, but up for Arl, Alex, & DC. So, good news for the bears in PWC & PG, but yet another kick in the nuts for the close in shoppers.
In February 2005, the masses believed that real estate would only go up. David Lereah even published his most poorly timed book that month. Only a handful of skeptics and rational thinkers believed otherwise.
We are now at the other end of that spectrum in my opinion. The masses now fear the housing market. Everyone knows there are problems and property is not a gauranteed investment if an investment at all.
If the mass psychology can't get any lower, in my opinion that means we're positioned to go up from here long term.
My $0.02
anon
thanks for the additional data.
but don't ever worry about shortages of spaces for condos, it's easy to buy up a block and throw up a condo building.
"Pat said...but don't ever worry about shortages of spaces for condos, it's easy to buy up a block and throw up a condo building."
Longterm, yeah, its not an issue. But in the shortterm, my point was to look for developers to continue doing what they have done for the last 4 years...lessen the pace of building...continue to dwindle the pipeline...squeezing buyers tighter and tighter as they fight over the last part of the inventory "glut" til developers again obtain the upperhand and prices rise (everywhere).
In any event, this article serves as a lesson to occasionally "take a step back" when something about the article just doesnt seem right compared to everything else you have been seeing and hearing.
The article you posted as written, clearly hints at doom. Thus, you breathlessly posted it here, along with the taunting "glug glug glug" as if its a sign of clear trouble on the horizon.
The irony of course is, the article is factually incorrect (the backlog is only in New condos, not resales), and suggests the backlog is huge, when in fact it is a massive, massive improvement over the past 4 years.
So again, just be more critical when it comes to stuff like this and you likely will improve your perspective (both positive and negative). I dont mind an occasional snark when warranted, but the irony is the only person deserving of a "glug, glug, glug" here is you...
http://www.washingtonpost.com/wp-srv/special/real-estate-map/
the map is very interesting, you can see prices rising, but when you look at volume, it's real thin.
i wonder if the sales are mostly happening at the high end only?
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