Please post your local house search updates, MLS finds, on-topic ideas, and links here.
At the Rappahannock Homes Blog: Warrenton Foreclosure Sale. The standout to me on this one is the difference between the bank's asking price in September and the final sales price.
Tuesday, January 13, 2009
Northern Virginia Bits Bucket 1/13/2009
Posted by Harriet at 1:52 PM
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While most of this presentation is NVAR propoganda, the graphic on page 12 of this NVAR presentation ("Income vs. Price") is interesting. It shows price to income by county as compared to the "historic" average level of affordability.
http://tinyurl.com/95psbq
The outlying areas are close to historic levels of affordability, while Arlington and Alexandria still have a lot of correction ahead in order to revert to the mean. In this sense, because prices have fallen more in outlying areas than they have close in, Arlington and Alexandria could be said to be more overpriced now than two years on a relative basis (even though prices have in fact fallen on an absolute basis in Arlington and Alexandria).
As I posted last week, we made an offer on a short sale over 2 months ago. The seller's bank approved it two weeks ago and we just had an appraisal done this week. The appraisal came back over 10% below the original offer price! It will be interesting to see how the seller's bank responds as we will not be paying a penny above appraised value and are more than willing to walk.
dgg,
Stick to your guns! I hope the bank's rep. is smart enough to capitulate. Good luck!
dgg,
Sounds like a good plan. Best of luck. Thanks for sharing, on behalf of all of us who will be looking to buy and potentially deal with these situations soon.
I am planning to make contract on a house in gainsville which is listed for 370K. this was bought for 615K from builder at end of 2005. Has over 3000sqft finished space including basement. has granite, hardwood at kitchen,fireplace, 2 story family room and brick front. now i am planning to ask for 360k and 12k for closing. is this reasonable..or is it low. i checked the comps looks they sold for 365K or so around 10/08. now can some one please give me some thoughts....thanks.
re: the Warrenton Foreclosure Sale
the numbers are stunning for this sale but it has to be in line with the comps right? i mean if the market could support say 5% more sales price the bank wouldn't have settled for it, would it? or are we seeing desperate behaviors now? i'm itchy to low-ball (but really sensible and affordable to us) the Harrison home but the bank would have to be really desperate to accept my offer... (their cost was $650K I think)
mm,
it looks as if the sale price was in line with the comps, but that the bank just never bothered to change the list price accordingly, but was more than willing to unload it.
In your case, I think you can fairly use 3-bedroom similar houses as your comps, add 40k for the 4th bedroom and subtract it back for the foreclosure sale discount and offer amything over $400k. If you like the house, and it is a nice house, what can it hurt? It's not as if the bank will have sore feelings.
Manju,
look on frankly to see if that most recent comp had a seller subsidy. If so, which is probably the case, then you are not in anyway low-balling. The original sale price is irrelevant. Completely irrelevant. In addition to the bubbleness of the price, there's also the premium that was paid for being the first owner of a new house and having input into the final layout and finishings. You don't have those privileges, so in a normal market you'd be able to discount at least 5-10% of the purchase price as the second buyer. In this market that portion is chump change, and all that matters is the comps and whether you think that neighborhood has reached market-clearing prices such that you will have neighbors, not vacant overpriced homes.
Here's another one selling over 60% below the previous sale, but this one is in McLean:
http://www.franklymls.com/FX6834977
And in more recession news, the impact of the recession has finally smacked the wider economy.
CR retail-sales-collapse-in-december
If consumers cut back 9-11% YoY on regular purchases, how much worse will be the news for the spring selling season for major purchases, like you know, houses?
zerodown
OMG!!!
Wow. That may actually be a steal at 2.5 million dollars. It appears as if the previous owners built it in 2002, decided to move or downsize in 2007, couldn't find a buyer at 4.7 million and after ~6-8 months on the market let it go back to the bank.
Cara, did you see 2002 information somewhere? There's a 2005 sale price of 6.5 million but that's all I could find. I wonder what it feels like to buy a house for 6.5 mil and then see it on the market 3 years later for 4 million less. ouch! I guess if the bank owns it then the 6.5 buyers probably weren't that financially savvy in the first place.
Jeff,
whoops, I was just seeing the 2002 build date and assuming. sorry.
Did you notice the neighbors who share a stone driveway and fountain? It's gotta suck to have a two house compound and still have constantly changing neighbors.
Cara:
I think the previous owners paid $6,500,000 for it on 8/2/2005.
The house went to foreclosure on 4/1/2008.
It looks like the bank bid $3,918,004 at the foreclosure sale and then listed it for $4,250,000 on 8/1/2008 and is now attempting to sell it for $2,499,900.
You can pick this one up for about 500k less than the other McLean house:
http://www.franklymls.com/FX6957360
that house shares a driveway with a Washington Redskins player.
i'm not convinced $2.5 million is a steal. the house's backyard faces the road, which is pretty strange.
zerodown.
These are gems. High-end foreclosure heaven.
I especially like the comment:"NO COMMISSION PAID TO THE BUYER HOLDING REAL ESTATE LICENCE"
heh heh. (john stuart's GW Bush laugh)
Zerodown: I thought that place look familiar -- apparently we discussed it this past summer:
http://novabubblefallout.blogspot.com/2008/06/northern-virginia-bits-bucket-642008.html
Thanks Cara. i checked the comps. 3 of them sold in last qtr 2008 in the same street and similar homes.
1.374k - 10k sub on 11/08
2.375k -11k sub on 11/8
3. 399k - 0k sub on 10/08.
So i just want to start low with 360K - 10K sub. if they come back i can go back to the previously sold number. what do you think. let me know.
"If consumers cut back 9-11% YoY on regular purchases, how much worse will be the news for the spring selling season for major purchases, like you know, houses?"
If this trend continues, then the housing market is in big big trouble.
Last year when the credit markets were first starting to blow up, the average consumer wasn't really feeling things much. Now that the overall public sentiment has shifted and we are clearly in a recession people are choosing to hold on to their dollars.
Most housing downturns take place during periods when the overall economy is weak. This particular downturn started while the economy as a whole was still moving along at a decent clip, even if it was unsustainable.
I strongly suspect we are going to see an intensification of the correction in the housing market now.
does any one know where to look for total number of active listing in each county/city etc... i want to see the graph also if it is avilable..
Manju,
Virginia MLS
NoVAwatcher:
Apparently, that was one of the houses we discussed in that thread; however, the fact that the house is still around and the asking price has been reduced an additional $1,750,100 seems somewhat relevant.
hi,
a quick question on buying bank-owned: does it matter if i get the loan from the bank? i know i should shop for the best rates but (i know it sounds silly but here goes) ...would the bank be more willing to accept my (lower) offer if i bank with them if their rates aren't too far off?
ALSO, has anyone used FranklyRealty? any recommendation of their agents?
Thanks!
mm,
What my best friend's little sister found was that for the purpose of the offer, it didn't matter, and in some ways it was better to have an outside bank (for the appraisal, lack of conflict of interest etc). But, some seller-banks (hers included) require you to get a pre-approval from them regardless. Then when it came time to close the deal, the bank she was buying from (on Cape Cod, MA) offered her both a 0.5 point lower rate than the one she had locked in and closing costs plus paying for the new roof which was needed for FHA approval of the loan. The new roof, they would have to have done anyway, but it smoothed out the closing process.
The general sense I've gleaned from everyone's stories is that it's always in your best interest to have more than one bank competing for your business once you've chosen the house and the price.
zerodown: missed that it was dropped even further. So much for the high-end being immune.
cara,
thanks for the info. i'm debating whether to work with the listing agent directly so the contractual obligations are limited to this property only. i read it here that an 'offer' to a bank-owned property is no more than a LOI and the bank always counters with addendum. i much rather pay for a RE lawyer to go over the addendum with me. all in all i'm not ready to commit to any agent just yet.
mm,
I was looking at a bank-owned property with an agent from Frankly in 2007. After visiting the property with me, she asked me how much I was willing to offer and when I suggested starting with 20% below listing, she never responded. So I let go of Frankly.
I accidentally met another agent from Weichert and she was willing to work with me regardless of how low an offer I made. Indeed, for the same property, the bank was willing to consider my 20% off offer and made a counter at substantial discount, and the negotiations went ahead. My wife later decided that property was not suitable for us, so we didn't move ahead on a final offer, but came close to buying it. The way the Frankly agent handled it, it seemed she was not willing to 'waste' her time with people who make low-ball offers.
I am still working with the Weichert agent and she has never shown any frustration with my low-ball offers. She doesn't do a lot of research for me on the price because she knows I use my own metrics without depending much on agent's market analysis.
So, while I appreciate all that Frank is doing via franklymls, when it comes to actually buying a property, you have to find someone who is willing to patiently work with you. There could be other agents at Frankly who can satisfy that need. You will need to check them out and decide.
TedK,
That's very interesting to know. Frankly has an "old" (2008?) video on how low-balling doesn't work. But given that his example data was (A) Arlington, and (B) at the start of this mess, I wonder if they've changed their attitude any. I mean the CRA (comparitive realtor analysis) should show them which banks price aggressively (accurately for the market) and which ones price passively (waiting for buyers to name their price) such that they should be able to help you make an informed decision on what offer to make.
I've also basically been wondering who in the world would want my business when I plan on trying to keep my house price under $220k, so a commision of at most $6600, which for around here is small potatoes, such that if you're dealing with buyers like me, you need to make up for it in volume, so wouldn't necessarily want to invest as much time looking at different properties as I know I'll want to.
TedK,
thanks for the info. i guess when interviewing agents i'll be upfront with my low-balling 'strategy.' i'll start with the two i've worked with before and see how they react...
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