When will home values go up again? (Manassas, Fairfax: for sale, foreclosure)

[spidercharm]

We are in a secular decline for home prices. I would not hope for any rebound. Median income to home prices are STILL way out of whack...I still see asking prices in FX at almost triple of what it was in late 90s, double of what it was just a few years back. Talk about unsustainable.

Here is a sample townhome in FX:

2001 sold for ~320k
2004 sold for ~625k
2009 asking ~ 600k

Obama is selling our country for greedy banks and home flippers. We are on the verge of giving up US AAA debt rating because of what he is doing. I am disappointed as someone who was inspired by him initially.

The fact remains that we are in deflating cycle. (and rightly so) Washington policies may slow this down a bit - and hurt more in the long run, but can hardly change the end result. Most economists and politicians know this well that home prices will adjust to where they must have belong to begin with. Just be careful if you are a buyer. Renting is a no-brainer in the declining market. If you do have to sell, this is probably the best time to do it in next few years to come.

Originally Posted by Junes_reston

Housing prices continue to decline. Financial planners are predicting 10% to 20% declines through year end, when values will level off and then start to slowly increase around mid 2010.

This is a buyers market and homebuyers should not be pressured by realtors to commit to a contract price that is not at least 10% below the current assessment. Even using this percentage guideline, expect your "new" home to dip a little in value during the next year.

Although this is hardly a "comprehensive" home value source, it does provide the most recent county assessment that can be used as a starting point to better negotiate a fair offer. To find the assessed value of a property in Fairfax County, use the link below. Then, click on address, type in the address of the property and then select Values.

Fairfax County

[HarryLou]

@Novaslasher...Thanks for this look at the real numbers. Clearly shows how crazy things got. Probably anyone who bought during these years is upside down and will take a loss to sell now. "Dr. Housing Bubble" (www.doctorhousingbubble.com) emphasizes the relationship between income and housing .
@spidercharm: It has been only 4 months. Give our President a chance. He is new to the job, much to be done. I don't believe for a minute that the economy will be a quick fix.

[Margery]

[quote=spidercharm;8939054]We are in a secular decline for home prices.

What is a "secular decline"? Is that the opposite of a "religious decline"?

[neighborhoodfind]

Originally Posted by spidercharm

Obama is selling our country for greedy banks and home flippers. We are on the verge of giving up US AAA debt rating because of what he is doing. I am disappointed as someone who was inspired by him initially.

WTF? Obama did not cause this problem. Having someone, anyone buy up housing stock will help to stabalize housing. Buying a home when prices have adjusted to a reasonable level (instead of being overinflated) is smart not greedy. Greed, among other things, is what caused the bubble to begin with.

[spidercharm]

Originally Posted by neighborhoodfind

Obama did not cause this problem.

Never said Obama caused the problem, but he isn't helping either by allowing to print money in the way of supporting bailouts to every sector you can imagine. There are no shortcuts and the bubble has to burst normally before we can build from there. The current policies is leading us towards Japan like stagnancy for years to come and I am sure that's not a good thing.

I am not against Obama - have been a huge supporter and still is. Just a reality check - capitalism for the common man and socialism for the rich has to end. I think he is starting to understand that bailouts will not help the matter but make it worse by causing moral hazard (economics 101)

neighborhoodfind - You might like your tax dollars going to bonus payments for ultra-rich. But, I don't like it a bit when I know it can be used for things that are really necessary.

[spidercharm]

Nothing Will Stop House Prices From Tanking But Low Rates Help: Tech Ticker, Yahoo! Finance

Originally Posted by spidercharm

We are in a secular decline for home prices. I would not hope for any rebound. Median income to home prices are STILL way out of whack...I still see asking prices in FX at almost triple of what it was in late 90s, double of what it was just a few years back. Talk about unsustainable.

[handy dan]

I agree with spidercharm and novaslasher. Housing prices are still much too high in NoVA and will continue to fall. There are several factors that are working against home price increases, including rising mortgage rates, unemployment, inflation in everyday essentials (gas prices, food prices, healthcare costs, college tuition, etc.).

Banks are reluctant to lend and more and more potential buyers are beginning to understand that real estate does NOT always go up and that there are huge risks in taking on a lot of mortgage debt. During the boom, there was this idea that "there's no better investment than real estate". Well, now that the bubble has burst and people are more sober in assessing risk, you will probably not see home prices reach the 2005 peak for at least 15 to 20 years (see Japan).

Finally, there are several reports and analyses by Credit Suisse and Moody's that indicate we are headed for another huge wave of defaults and foreclosures in 2011 and 2012 in the Alt-A and Option ARM categories.

Bottom line is we are still a long, long way from a bottom in the housing market.

[handy dan]

One more factor I forgot to mention is property taxes. Tax receipts are way down (especially sales taxes b/c consumers have cut back on purchases). You can expect local governments to increase property tax rates here in NoVA, and this will be one more factor that will discourage potential buyers from purchasing a home b/c it just makes renting that much more attractive.

[ajzjmsmom]

Originally Posted by handy dan

One more factor I forgot to mention is property taxes. Tax receipts are way down (especially sales taxes b/c consumers have cut back on purchases). You can expect local governments to increase property tax rates here in NoVA, and this will be one more factor that will discourage potential buyers from purchasing a home b/c it just makes renting that much more attractive.

Would the homeowners not pass the rising cost of taxes on to the tenants by raisiing the rent?

[horseplayer]

They would like to, but might not be able to--like in Florida. Depends on how many are available. Many different dynamics working in the rental market.