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Tuesday, March 20, 2012
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18 comments:
Looks like we'll see some downward pressure on rents and/or rent increases.
WaPo: "Could D.C. area soon become a renter’s market? Yes and no"
In the near term, the market will be more of a renter’s market because of the large amount of supply that’s coming online.
Northern Virginia will see the bulk of new stock this year, with 5,895 units expected to come on the market. The flood of units should put downward pressure on rent prices, according to Delta, but demand will remain strong in highly sought areas, including the Rosslyn-Ballston corridor.
http://www.washingtonpost.com/realestate/could-dc-area-soon-become-a-renters-market-yes-and-no/2012/03/16/gIQAXku0QS_story.html?hpid=z4
Pat,
I agree with HB's assertion. As I wrote previously, I understand strategic deafult and also understand that it isn't whether one can afford the mortgage or not.
Some people buy things at the store for $x and sell the same item elsewhere for 10$x. Perhaps people in Arlington are just willing to pay more for the same product and don't care how much it's "worth" to another. Have you ever thought about that?
Sure, it sucks for those of us that don't want to pay 10$x or so, but that's the way it is. I sure as heck don't want to be paying the prices in the zipcode I am looking for the homes we are contemplating, (when there are actually homes on the market), but that is the price in this area.
Some poker tables have a $5 buy-in and some have a $5k buy-in. That's the way the world works...
Certainly a lot of inventory added in the corridor of North Old Town Alexandria up through Crystal City on the last few years - and more under construction.
In one sense, a lot of it is good, high-density development near public transportation options. On the other hand, weekend errand traffic and some afternoon/evening commuting traffic in in Alexandria (Duke & King Streets) has really deteriorated in recent years; and there's really no way to increase capacity on Rt. 1 or GW Parkway.
I am so going to miss the old place in arlington with the cheap rent.
Why is that?
I read an article/map about the "bull trap" that some people think is currently happening.
Any thoughts?
sehrwunderbar said...
I read an article/map about the "bull trap" that some people think is currently happening.
Any thoughts?
Sehr - I think it depends upon the context in which that term is used.
Sometimes people describe a "bull trap" meaning despite the recent price rises (2009-2011), we are still much closer to the top than the bottom. Thus the argument goes, once the downturn begins again, it will be another massive, severe, "woosh" type event similar to what we saw in 2006-09. So, if thats what people are expecting when they say "bull trap", then no, I dont think thats likely in the slightest.
However, some people use the term "bull trap" to describe one who buys expecting gains, only to be disappointed when stagnation or slight declines assert themselves. If thats the way they are using the term, then yes, I think that is not only possible, but likely.
BTW, I think thats true not only nationally, but also here locally as well. Nationally, reasonable types like Calculated Risk are calling nominal bottom this year, but there is way too much slack in the economy to expect much in the way of gains.
Even here where the economy is much stronger, and 2012 may turn out to be a very good year in terms of prices, I think its likely that those gains are given back in 2013 as austerity hits the DC area...and moreso here than elsewhere.
Again, I think the 2009 lows are, were, and will continue to be the bottom for this area. Still, I think alot of people who buy into DC in 2012 expecting healthy nominal gains in 2013 very well may be disappointed.
The next generation of home owners emerges: article.
My $0.02
A couple new, interesting listings in Arlington today:
This one is going to sell fast. I predict within a week. My only gripe is that they didn't switch out the cabinet doors in the kitchen - this seems like a low-cost update that would make a big difference.
This listing is just odd. Selling a vacant .09 acre lot next to Bluemont park with plans for a SFH included? Maybe the financing fell through.
Jewel,
Re: 1, It appears not to have any green space in the back yard--the large lot is all on the side and in the front, which (if true) will reduce the # of prospective buyers. Vacation Lane is semi-busy, and the baths haven't been updated, but the price seems to reflect some of that. The interior design will appeal to some but will turn off others.
The description does not describe any expensive systems/roof/etc. updates, and as you noted, the kitchen update is very superficial. I have two neighbors that bought houses with more renos than are apparent in those photos and both have spent enormous amounts in the past couple of years fixing corners that had been cut in previous renos that focused on what was showy.
So I would speculate that there is a lot of non-cosmetic work that needs to be done. If so, I don't think it will go quickly at that price, which is well over assessed value but not in the nutty range.
Re: 2, my hunch is that the lot is too small to be buildable without getting an exception to zoning from Arlington, which may not be forthcoming, and that is why it is being marketed with plans that are yet to be approved.
Ace,
I agree with your cons on house. I believe the primary pros for this house are 1) the neighborhood 2) large master bedroom (27 x 16) 3) Open kitchen/family room area.
I guess we will see when it sells ;-)
Anyone heard of the new buyer-agent law taking effect in Virginia June 1st?
VA-
I have never heard of it. What is is about?
I haven't heard about it. What does it say?
It was in The Examiner. Sorry I don't have the link. It was forwarded to me from an article in the Wash. Bus. Journal.
It's going to require buyers to sign a buyer agent agreement or a "no client agreement" prior to being shown any homes. It seems that the Realtors are trying to counteract the web competition.
I found it again by searching "buyer agent agreement required in Virginia beginning June 1, 2012.
Anyone have other ideas for the purpose of this?
btw - where is the enforcement of Antitrust Laws when the NAR is involved? 6%? Really?
VA-
I totally agree with you that this is absurd and their should be laws to break up the monopoly rather than enforce it. In addition to 6% being really high, almost ever agent charges the exact same fee and that fee scale linearly with home prices. How could they possibly claim that this is a fair market without collusion. Did 99% of agents randomly end up at the same price and stay there for years.
I'm with you HB and have been since the early 80's when I became aware of the "price fixing". It's outrageous. I can't believe that it continues 30yrs later.
VAI said...btw - where is the enforcement of Antitrust Laws when the NAR is involved? 6%? Really?
Sadly, its gonna be a while til the DOJ takes on the NAR again... after they bungled their first tangle with them in 2005
http://www.justice.gov/atr/public/press_releases/2008/233605.htm
I remember when that suit was first announced, envisioning the days of 6% accross the board comissions would cease.
Instead, all we got was discounters like Redfin gaining access to the MLS, and once that was secured, the DOJ let the NAR off the hook.
Anon-
Although I agree I would like more from the DOJ I think the Redfin's of the world are a big step forward. They did effectively cut the price in half and are growing pretty rapidly. Hopefully overtime they will break the monopoly... Although DOJ should break it and could do this much more quickly.
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