Home Prices Stabilize in Arlington VA & DC
Posted by Jay Seville on Friday, April 27th, 2007 at 8:37am.It's common knowledge that the market shifted in the last 18 months. But it's only now that the statistics are verifying some of the price corrections....Many of us on the front lines knew prices in reality were different a long time ago, however this was not being illustrated by the monthly stats as far as the price variable was concerned. Why not? Well the stats on price only reflect sold homes. Thus all the homes that
- did not sell,
- rented
- expired
- or were withdrawn due to not being able to get a price the owner wanted
Home Sales Increase 3 Consecutive Months in Arlington & Washington DC
So here are the latest numbers for real estate in Arlington VA:
What do the numbers tell us? Well there has been an increase in the numbers of home sold 3 consecutive months. Simultaneously, the median sold price dropped 3 months in a row compared with January, February and March 2006. The price was down 16% in Jan, 8% in Feb and stayed completely flat -0.02% in March. So it looks like a fixed market....More transactions than a year ago and identical prices as of March. Looks like a very healthy market. Sorry bubbleheads that you didn't get the disaster for which you were rooting!
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Only time will tell if the correcting is over but my instincts tell me in the single family and townhouse market it's done. For condos there is still more time needed for the stats to tell the tale as many owners have not dropped the prices of their Arlington Condos yet. An example from last week was Lexington Square. Lots of upside down owners there I'm sure which is tragic. But we were looking under $500,000 for 2/2 and found 2 real estate listings to view in Ballston / Clarendon area. But there were tons of lockboxes on the building. Turns out there were a bunch of 2/2s listed higher than $500,000 even though comps were around $470-495,000 after I ran the numbers for my client. I will not let you overpay!
In Washington DC we similar trends:
Prices dropped slightly from a year ago for sold homes while the number of DC real estate transactions increased dramatically. What I will have to figure out is how to specifically get data for condos for some of my market reports. It is imperative when buying a condo that you plan on owning it at least 3 years and that you comp it correctly when putting forth initial contract offers....
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In January and Feb 2007 prices were about 25% lower in terms of median sold price for the Clarendon/Ballston/Courthouse area of 22201. Then in March totally flat. To me that says something. I do thing there is more fluff in the condo market though especially. I'm seeing a number of overpriced listings at Lexington Square and Clarendon 1021 for example. A 1Br just listed for 399 and 375,000 at Clarendon 1021 and Odyssey. Units for $375,000 at 1800 Wilson, a unit for $365,000 at Hawthorn and a couple left at Park at Courthouse.
Most condos have room to negotiate down right now.
I did state: "Only time will tell if the correcting is over but my instincts tell me in the single family and townhouse market it's done. For condos there is still more time needed for the stats to tell the tale as many owners have not dropped the prices of their Arlington Condos yet."
The foreclosure issue is one that I do not know too much about. I see a few being listed as preforeclosure. So many people in the area of Arlington have such high credit scores, incomes and intelligence, I don't think Arlington would be hit as hard on foreclosure rates. But I'm open to hearing what others have to say....
Most condos have room to negotiate down right now.
I did state: "Only time will tell if the correcting is over but my instincts tell me in the single family and townhouse market it's done. For condos there is still more time needed for the stats to tell the tale as many owners have not dropped the prices of their Arlington Condos yet."
The foreclosure issue is one that I do not know too much about. I see a few being listed as preforeclosure. So many people in the area of Arlington have such high credit scores, incomes and intelligence, I don't think Arlington would be hit as hard on foreclosure rates. But I'm open to hearing what others have to say....
Posted on Friday, May 4th, 2007 at 2:46 PM.
million wrote:
so the spring was a bust? that's not great, Jay. the rest of the year typically lags the pre-Memorial Day period, especially the summer months w/ a slight uptick in activity after school starts... then it falls off a cliff for winter.
and at the rate foreclosures are popping up, particularly the condo market but even in SFHs (yes, there too) we'll feel more downward price pressure.
AND with RedFin coming to DC in June (their words) it will be much easier for this information to spread to those "intelligent" Arlington home-buyers.
so the spring was a bust? that's not great, Jay. the rest of the year typically lags the pre-Memorial Day period, especially the summer months w/ a slight uptick in activity after school starts... then it falls off a cliff for winter.
and at the rate foreclosures are popping up, particularly the condo market but even in SFHs (yes, there too) we'll feel more downward price pressure.
AND with RedFin coming to DC in June (their words) it will be much easier for this information to spread to those "intelligent" Arlington home-buyers.
Posted on Tuesday, May 15th, 2007 at 12:06 PM.
I don't recall saying the Spring was a bust. The chart shows more sales in from Jan-March (all 3 months) in 2007 versus 2006.
Keep in mind, business models that are focussed on rebates probably cost buyers more than they save for reasons I will try to lay out soon. Time is the issue w/ 4-5 homes under contract and the 3 kids I got in the last year.... :)
I think is already easy for info to spread anywhere, Million. I certainly try to put it out there with 2500 visitors a week. There are plenty of bubble sites out there making spouting off their takes on the marketplace for anybody who wants the info. There are numerous flat fee and discount services available in the local marketplace. Who cares if Redfin comes. There is already at least one twin of theirs here already. It doesn't matter much. Most consumers want some input and expertise on a home that costs a LOT of money, especially if it's their 1st home.
What good is a 1-2% rebate if you pay just as much or more in the net $$$ due to lack of expertise, instincts, experience and negotiating prowess. I would venture that many buyers using these rebate oriented companies for their real estate transactions are being screwed up the arse and don't even know it. It's sad, bogus and it's the other side of the topic that isn't being discussed.
In VA, real estate is already totally competitive with all business models allowed that I know of. No conspiracies. I will agree that some states need to clean up and let the free market reign in terms of their policies on real estate, competition and their local MLS. But we're cool in this area already.
In our market most of the deals I do involve the closing costs being paid for at the table by the Seller and the difference in monthly payment to the buyer is extremely small for the sales price that is $6,000-15,000 higher. Not to mention I can save a buyer more $$$ than anybody who uses rebates as their business model for attracting business. Do you think some Redfin rep is going to step into our market and know it inside and out like I do and be able to advise a buyer on the nuances thereof like I can? The answer is no.
I'll have to check and see the latest, numbers, Million, regarding the Spring market being a bust. From Jan-March the Spring market was fine locally. Did something terrible happen in April? Or are you looking at national data? All that matters is local in the RE world.
Keep in mind, business models that are focussed on rebates probably cost buyers more than they save for reasons I will try to lay out soon. Time is the issue w/ 4-5 homes under contract and the 3 kids I got in the last year.... :)
I think is already easy for info to spread anywhere, Million. I certainly try to put it out there with 2500 visitors a week. There are plenty of bubble sites out there making spouting off their takes on the marketplace for anybody who wants the info. There are numerous flat fee and discount services available in the local marketplace. Who cares if Redfin comes. There is already at least one twin of theirs here already. It doesn't matter much. Most consumers want some input and expertise on a home that costs a LOT of money, especially if it's their 1st home.
What good is a 1-2% rebate if you pay just as much or more in the net $$$ due to lack of expertise, instincts, experience and negotiating prowess. I would venture that many buyers using these rebate oriented companies for their real estate transactions are being screwed up the arse and don't even know it. It's sad, bogus and it's the other side of the topic that isn't being discussed.
In VA, real estate is already totally competitive with all business models allowed that I know of. No conspiracies. I will agree that some states need to clean up and let the free market reign in terms of their policies on real estate, competition and their local MLS. But we're cool in this area already.
In our market most of the deals I do involve the closing costs being paid for at the table by the Seller and the difference in monthly payment to the buyer is extremely small for the sales price that is $6,000-15,000 higher. Not to mention I can save a buyer more $$$ than anybody who uses rebates as their business model for attracting business. Do you think some Redfin rep is going to step into our market and know it inside and out like I do and be able to advise a buyer on the nuances thereof like I can? The answer is no.
I'll have to check and see the latest, numbers, Million, regarding the Spring market being a bust. From Jan-March the Spring market was fine locally. Did something terrible happen in April? Or are you looking at national data? All that matters is local in the RE world.
Posted on Tuesday, May 15th, 2007 at 12:27 PM.
million wrote:
Jay,
I'm talking about these stats right here at NVAR that show Mar-07 as being pretty flat compared to last year, and last year was nothing like the frenzy/speculative mania we saw in 2005/2004/2003...
http://www.nvar.com/market/marketstats/mar07/AR%20-%20CONDO.pdf
And do these stats net the closing costs you save all your buyers? Probably not. Is the local economy based on debt? Yes. Can it continue at this pace? Probably not. Should it continue at this pace? Definitely not. Would a normal company that operates like the local economy sustain itself for more than one reporting period? Absolutely not.
Jay,
I'm talking about these stats right here at NVAR that show Mar-07 as being pretty flat compared to last year, and last year was nothing like the frenzy/speculative mania we saw in 2005/2004/2003...
http://www.nvar.com/market/marketstats/mar07/AR%20-%20CONDO.pdf
And do these stats net the closing costs you save all your buyers? Probably not. Is the local economy based on debt? Yes. Can it continue at this pace? Probably not. Should it continue at this pace? Definitely not. Would a normal company that operates like the local economy sustain itself for more than one reporting period? Absolutely not.
Posted on Tuesday, May 15th, 2007 at 4:20 PM.
The stats show significantly fewer active condo listings compared to a year ago in Arlington. That's a good thing and helps preserve market value.
I did just get some more info on April stats and quarterly report. There were 16% fewer transactions in Northern VA this year compared to 2006 in the first quarter. In Arlington though, we had another 16% increase in the number of transactions in April 2007 versus 2006. Cool! The median sold price in Arlington was at 7 or 8% lower than April 2006. When you take lots of more transactions + sold prices 8% lower, you have a healthy market and a soft landing--at least for Arlington. DC also showed flat prices and a few more transactions if I recall.
Anyway, Million, I need to tap into some of the reports that NVAR offers. Thanks for illuminating me on that.
And I do stand by my being able to get buyers a better net than realtors who use rebates as their main business model.
I'm getting ready to send out 88 postcards to a community where my buyer wants to live--she has narrowed it down and it has to be in that subdivision. I'm looking for a home for her to buy that's not listed. I doubt any rebater looks after his buyers that way, etc.
I did just get some more info on April stats and quarterly report. There were 16% fewer transactions in Northern VA this year compared to 2006 in the first quarter. In Arlington though, we had another 16% increase in the number of transactions in April 2007 versus 2006. Cool! The median sold price in Arlington was at 7 or 8% lower than April 2006. When you take lots of more transactions + sold prices 8% lower, you have a healthy market and a soft landing--at least for Arlington. DC also showed flat prices and a few more transactions if I recall.
Anyway, Million, I need to tap into some of the reports that NVAR offers. Thanks for illuminating me on that.
And I do stand by my being able to get buyers a better net than realtors who use rebates as their main business model.
I'm getting ready to send out 88 postcards to a community where my buyer wants to live--she has narrowed it down and it has to be in that subdivision. I'm looking for a home for her to buy that's not listed. I doubt any rebater looks after his buyers that way, etc.
Posted on Tuesday, May 15th, 2007 at 4:28 PM.
mike wrote:
Jeff, How does an increase in people selling their homes for 8% lower from last year (~$25k less on a $300k home) represent a healthy market? All I see is more people jumping ship and selling for lower prices than last year even.
Jeff, How does an increase in people selling their homes for 8% lower from last year (~$25k less on a $300k home) represent a healthy market? All I see is more people jumping ship and selling for lower prices than last year even.
Posted on Thursday, May 17th, 2007 at 6:27 AM.
Mike, first my name is Jay...not Jeff :)increases of 50%+ the
When you have more transactions than a year ago 4 months in a row (Arlington), an average list price much lower than a year ago, that means you have buyers and sellers on the same page--a reasonable level of equilibrium in our Arlington market. So there was a price correction from Fall of 2005 till early this year, after huge increases in home values (in some cases over 100%) the last 6 years that's not much of a shakeup--almost everybody except those who bought at the peak came out ahead big time.
From the behavior of the buyers and sellers it looks like most of the correction is done in Arlington. This is far from what the bubbleheads were predicting.
Now there may still be depreciation going on in the rest of Northern Virginia and if I have time I'll write about it. Arlington TOTALLY went against the trend with 16% more transactions in April 2007 versus 2006 while the rest of Northern Virginia had much fewer transactions for the same month compared to 2006.
peace out,
j
When you have more transactions than a year ago 4 months in a row (Arlington), an average list price much lower than a year ago, that means you have buyers and sellers on the same page--a reasonable level of equilibrium in our Arlington market. So there was a price correction from Fall of 2005 till early this year, after huge increases in home values (in some cases over 100%) the last 6 years that's not much of a shakeup--almost everybody except those who bought at the peak came out ahead big time.
From the behavior of the buyers and sellers it looks like most of the correction is done in Arlington. This is far from what the bubbleheads were predicting.
Now there may still be depreciation going on in the rest of Northern Virginia and if I have time I'll write about it. Arlington TOTALLY went against the trend with 16% more transactions in April 2007 versus 2006 while the rest of Northern Virginia had much fewer transactions for the same month compared to 2006.
peace out,
j
Posted on Thursday, May 17th, 2007 at 6:35 AM.
SAZ wrote:
Hi Jay.
Do you think the Phoenix condos could be in your list of top-edge condos like Odissey and Continental?
Thanks
SAZ
Hi Jay.
Do you think the Phoenix condos could be in your list of top-edge condos like Odissey and Continental?
Thanks
SAZ
Posted on Sunday, July 8th, 2007 at 10:57 PM.
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What about the foreclosure market in Arlington condos. How will that affect the market. Also I don't get the conclusion that the market has stabilized because March 06 and March 07 were the same. Can you pull up a chart showing all the months in between? How have prices adjusted over the last 5 months for example?
Posted on Friday, May 4th, 2007 at 2:39 PM.