2009 Spring Real Estate Update
I hope this finds you well and ready for summer. Below is my January thru April 2009 update on the Reston real estate market and general ‘goings on’ in the market.
SOLD – January thru April 2008 vs. January thru April 2009
|JAN 08||JAN 09||FE 08||FE O9||MR O8||MR 09||AP 08||AP 09|
Of note: Number of homes sold is up every month of this year compared to last with April numbers up 25%. In March 2009 the average sales price was up over the year before while in the other three months it was down and down substantially. While units sold are up, total volume for each of the four months is about the same due to lower sales prices this year. Lower price ranges may be seeing increased activity due to the first time buyer tax credit. Sales are increasing monthly.
Opinion: So what does all this mean? I see a positive trend in that monthly sales have increased each month so far this year from 58 in January to 99 in April. Due to the current economic climate I am content with getting inventory moved and into the hands of new owners. And while these are distressing times for many, especially anyone who purchased a home in the last three to four years, the market determines the current value and people are buying when they perceive prices to be fair. I do not anticipate further erosion in prices. The average seller in April 2009 received 97% of their asking price. Days on market to sell are trending down.
FORECLOSURES AND SHORT SALES: The topic of the day. A ‘short sale’ occurs when the home seller owes more on the mortgage than the current value of the property and wants to sell it. The house may or may not be pending foreclosure. In many cases the lender does not want to talk to you if you are current on the payments since they have a long list of people who are behind and deserve priority. Foreclosures, generally, I see several a month in Reston – several not many. Short sales are more common but not prevalent in Reston, unlike many other areas. Short sales are predominantly in two categories – condos around Reston Town Center due to lots of investor activity and speculative purchasing at the top of the market and townhouses where people bought high and have either been transferred or there is a loss of job/income and the property needs to be sold.
Purchase-wise they are two totally different animals. The foreclosure you buy from a bank. The bank is the owner/seller. There is a popular misconception that you can ‘steal’ a house at foreclosure – not happening. You probably will pay fair market value, maybe a little less and be forewarned, you are buying it ‘as is’ from the bank – no warranties so be careful. Remember…if it sounds too good to be true…The short sale you are buying from the seller and a bank or two. They require a ton of work as the bank does not own the house and yet you are forced to deal with them. Every bank is different, every short sale is different; they can take months to get resolved. Many never go to settlement. This is not to say that some folks are not getting a good deal, some are. For the young person living at home, those renting month to month, investors or for someone with a ‘just don’t care attitude’ they can be accomplished but it takes lots of work and patience.
VALUES: Will foreclosures and short sales affect the value of my house? Most likely not. We have been told that the appraisers take into account the circumstances and other sales should more than offset the lower than market sale price.
GREAT RATES: Mortgage rates continue to improve and are currently below 5% for 30-year conventional fixed rate conforming money (under $729,000).
And with that said, there goes all the space for this issue. As always, I wish you much success and happiness! If you know of anyone looking to buy or sell a home please think of me. You can always search all homes for sale, get email updates of homes for sale, learn more and contact me thru our website.