NOVA is not immune (Manassas: bank owned, sale, foreclosure)

[McScootch]

Soaring housing costs are not soley the result of creative financing schemes. The basic economics rule of supply and demand plays a huge role. Demand was high, so the supply dwindled. When this happens prices rise. Now demand is low and the prices are conforming to that demand.

HOWEVER, incorporate that into the number of foreclosures and short sales on the market and you end up with what we have today, a dilluted market where the inventory is becoming pickeled from over-extending its shelf life.

[mojo_1979]

Originally Posted by McScootch

Soaring housing costs are not soley the result of creative financing schemes. The basic economics rule of supply and demand plays a huge role. Demand was high, so the supply dwindled. When this happens prices rise. Now demand is low and the prices are conforming to that demand.

HOWEVER, incorporate that into the number of foreclosures and short sales on the market and you end up with what we have today, a dilluted market where the inventory is becoming pickeled from over-extending its shelf life.

If you look carefully, the demand was artificially inflated BECAUSE of the lax lending. $0 down, horrible credit, $30k per year income, no problem we'll get you that $500k home... just sign here! Allowing that type of "lending" (note its not really lending b/c the banks are never going to get paid back) drove demand artificially high.

Now, for the first time in a while, we're seeing the REAL demand. Most lenders are now requiring 5-10% down and this number will inevitibly jump back to the traditional 20%. At that point in time, demand will be extremely low and prices will plunge further.

America, as a whole, has a negative savings rate (i.e. we actually go into debt more each year). How can the average American with no savings even think about buying a home?

[McScootch]

While everyone is screaming, including the media, that the market is tanking, lets look at the REPORTED Numbers ( Monthy Real Estate Trend Indicator ):

In the month of December 2007, there were 1,086 property listings in Prince William County (30K to 500K). Take into account that of those new listings 394 where placed under contract. Meaning that for the month of December, roughy 1 in 3 homes on the market found a buyer. Not too shabby

Numbers from Previous months?

November / Listising = 1255 Contracts = 361 about 1 in four homes found buyers.

Oct / Listings = 1356 Contracts = 419 = about 1 in 4

Sept / Listings = 1345 Contracts = 339 = about 1 is 4.5

August / Listings = 1530 Contracts = 382 = about 1 in 5

July / Listings = 1539 Contract = 362 = about 1 in 5


Seems as the trends point to a better out look in the local PWC Market!

[mojo_1979]

Originally Posted by McScootch

While everyone is screaming, including the media, that the market is tanking, lets look at the REPORTED Numbers ( Monthy Real Estate Trend Indicator ):

In the month of December 2007, there were 1,086 property listings in Prince William County (30K to 500K). Take into account that of those new listings 394 where placed under contract. Meaning that for the month of December, roughy 1 in 3 homes on the market found a buyer. Not too shabby

Numbers from Previous months?

November / Listising = 1255 Contracts = 361 about 1 in four homes found buyers.

Oct / Listings = 1356 Contracts = 419 = about 1 in 4

Sept / Listings = 1345 Contracts = 339 = about 1 is 4.5

August / Listings = 1530 Contracts = 382 = about 1 in 5

July / Listings = 1539 Contract = 362 = about 1 in 5


Seems as the trends point to a better out look in the local PWC Market!

So what exactly is your point? That there are still idiots out there buying? It is a fact that it is now tougher to get a loan now than it was a year ago... and as I said previously it will get even tougher as we move forward and require Joe 6-pack to drop 20% on the table (does Joe 6-Pack have $100k in the bank?). But since you're talking about numbers, specifically Prince William County, let's look at the numbers that really matter, year-over-year sales prices, PWC prices down 16% IN ONE YEAR !! How in the world do you associate prices dropping 16% per year with "trends point to a better outlook in the local PWC Market" ??

Avg sales price (dec. 2006): $414k
Avg sales price (dec. 2007): $349k
% change: -15.6%

The median yoy decline is exactly the same !!

Source: http://www.mris.com/reports/stats/route.cfm (broken link)

[scimitar12]

Here is a page from Trulia.com. I happen to have price per square foot for Sterling, but you can select any town in the area. Click on Avg. price/sq. foot. In just six months the price per square foot for all homes in Sterling dropped a whopping 11.4 percent for the last half of '07.

Sterling, VA real estate guide - Trulia.com

And, here is the average price per square foot decline for Reston; a healthy 10.7% drop in just six months.

Reston, VA real estate guide - Trulia.com

[scimitar12]

Originally Posted by mojo_1979

Comeon Normie.. if I hear about how its a "buyers market" or a "great time to buy" one more time I will puke. It will be a great time to buy in a few years when housing once again is affordable. Check out this article below.. then tell me if its a good time to buy:

Housing prices to free fall in 2008 - Jan. 23, 2008

Great article. Course, I had to chuckle when I read the statement from the National Association Realtors saying prices in 2008 would be flat, indicating the worst is over. They probably said the same thing early in 2007 and look what happened.

[mojo_1979]

Originally Posted by scimitar12

Great article. Course, I had to chuckle when I read the statement from the National Association Realtors saying prices in 2008 would be flat, indicating the worst is over. They probably said the same thing early in 2007 and look what happened.

Actually the NAR said they expect prices to begin rising in the 2nd half of 2008 !!! What a crock !!

[normie]

Originally Posted by mojo_1979

Comeon Normie.. if I hear about how its a "buyers market" or a "great time to buy" one more time I will puke. It will be a great time to buy in a few years when housing once again is affordable. [/url]

Ummm... if you look at my post, I believe you will see this quote:

The hardest part will be building up a demand for housing again (because everyone who thought they might be in the market bought in the last few years when the rates were low; new buyers will probably wait a year because they want to see what the bottom will be.)

Seems to me the big difference is I think it will take a year, you think it will be a few years. But puke away, if you'd like.

By the way, like it or not it is called a buyer's market because the times favor a buyer more than they favor the seller. In other words, it is not a seller's market. A buyer can approach a seller, and make an offer for what he thinks the future bottom price would be. If the seller is desparate and can't wait until 2009, he might be willing to negotiate.

[mojo_1979]

Originally Posted by normie

Ummm... if you look at my post, I believe you will see this quote:

The hardest part will be building up a demand for housing again (because everyone who thought they might be in the market bought in the last few years when the rates were low; new buyers will probably wait a year because they want to see what the bottom will be.)

Seems to me the big difference is I think it will take a year, you think it will be a few years. But puke away, if you'd like.

By the way, like it or not it is called a buyer's market because the times favor a buyer more than they favor the seller. In other words, it is not a seller's market. A buyer can approach a seller, and make an offer for what he thinks the future bottom price would be. If the seller is desparate and can't wait until 2009, he might be willing to negotiate.

Regardless of the fact that prices are falling, I believe it is a fallacy to call it a "buyers market" when houses are still IMO about 25% overpriced.

If Honda doubled the price of their vehicles over the next 4 years and then slowly starting lowering the price.. would it then be a buyers market for Honda automobiles? Definitely not because the vehicles are still way overpriced!

[normie]

Originally Posted by mojo_1979

Regardless of the fact that prices are falling, I believe it is a fallacy to call it a "buyers market" when houses are still IMO about 25% overpriced.

If Honda doubled the price of their vehicles over the next 4 years and then slowly starting lowering the price.. would it then be a buyers market for Honda automobiles? Definitely not because the vehicles are still way overpriced!

Well, if you don't wish to use the proper terminology, that is your choice. And, if you think that the way to buy a house is to pay the asking price, that is your choice, too.

As I just said, a house is not like an item for sale with a non-negotiable price tag. A house is worth what a buyer is willing to pay for it. Therefore, there is no need to wait to buy a house--just look for a seller who is willing to sell his property now for what it will be worth when it hits bottom.