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Economy Adds 431K Jobs but Private Sector Hiring Disappoints
All but 20K of those jobs were census jobs. The street expected 540K jobs.
CR today: This is a very weak report. The decrease in the unemployment rate was because of a decline in the participation rate - and that is not good news. I'll have much more soon ... "
Friday, June 4, 2010
Northern Virginia Bits Bucket 6/4/2010
Posted by Harriet at 6:00 AM
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56 comments:
"ATLANTA (Reuters) - Three top Federal Reserve officials said on Thursday it may soon be time to begin raising interest rates as the economic recovery in the United States gathers momentum, despite persistently high unemployment."
It was indeed a very dissappointing employment picture.
I don't really understand what the signs are of "gathering momentum" when employment is doing so poorly...
REPOST alert:
what's the deal with this N Arl walk to Ballston REO SFH? priced $40K/10% below assessed land value?
i'd need an agent who knows about renos for this listing....
MM,
Well, tearing the thing down would cost money too, so under assessed land value isn't inherently insane.
The kitchen, baths, water-trashed basement, other water damage/mold throughout the house... could add up to this being a totally appropriate price. I'm not sure you'd want to renovate it given the potential for additional hidden damage. Best use could very well be as a tear-down.
You'd need a contractor to come with you in this place.
4/10 comp but with inferior location. listed and sold near land value.
yeah, i guess it's not inherently insane.
MM, I agree with Cara. Tear down. And, that part of N. Arlington is a bit dicey--some nice places right next to many like this listing, occasional crime. I don't know why it has been slower to turn around--too far from metro? too many places need work? Could be the bank wants a bidding war.
Liv, here's another McLean house for your delusional pleasure:
--buy a handyman special near the height of the bubble for $650K? check
--immediately put in $150K? check
--have trouble flipping it in 2006? probably
--rent it out, putting 4 years of wear on your renos? check
--try to sell a 1600 square ft. split foyer now for $1.15 mill., hoping to make $350K? uhhh....
oops, forgot this
http://franklymls.com/FX7354537
MM,
I think the comp has better curb appeal plus having 4/3 vs 3/1.5 is a big difference.
On the current one; I don't think it's that bad. Except the basement (where it's hard to discern), I see no mold damage.
CAC will be expensive as there is no ductwork. You tend to lose closet space to ductwork as well.
Otherwise you need a new kitchen and baths, maybe electrical and plumbing, refinish floors, paint (outside too?), roof?, sump pump?, termite damage?, rip out basement panelling?, windows?, furnace?.
I redid a 1920 home and have some idea of the issues. Ours was in as bad or worse condition.
Va,
My worry would be unknown structural damage. Having done one, how much can you diagnose the potential for this before you actually start tearing the place apart?
(the blue room looked like it may have had mold around the front window to me))
Va_Investor,
good point on 4/3 vs 3/1.5.
loss of closet space to ductwork would be the least of my concern, haha.
what would the total costs be like if doing all the items you listed? i've got estimates before for CAC and new kitchen/bath, finished basement, but not electrical and plumbing, roof, sump pump, and furnace...
cara,
isn't home inspection supposed to discover potential structure problems, REO or not? or are you saying REOs tend to have more of structural damages? termites?
MM,
I'm saying that I would trust the structural integrity of a property that had otherwise been well maintained more than I would one that has not.
Yes, a home inspection attempts to discern the structural integrity, but without ripping off the drywall and other external coverings, there are things that just can't be seen. I would think.
But maybe that's not true. Maybe any underlying damage would show up as things that the home inspector could see. I don't know. Hence why I asked VA_investor who has (a) bought the most houses of all of us, and (b) done rehab.
cara,MM,
The only "structural" damage I have had was caused by termites. It cost 10K to remedy in 1993 and required a structural engineer to draw up the specifications.
I know of someone who bought an reo (at the courthouse) that had major structural issues. The stairstep crack down one side of the exterior was so bad it cracked the interior walls. He lost his deposit rather than close.
I wouldn't think that lack of cosmetics and failure to upgrade hvac, plumbing and electric would in any way affect the structural integrity of a building. Structure means foundational issues and such. Highly sloped floors, doors not closing, foundation cracks etc. are usually quite visible. Some people even carry a marble with them to place on the floor.
Some "settling" should be expected in an old house and plaster cracks should not necessarily make you run for the hills. One can tell alot about the construction by examining the joists (attic and basement). I happen to believe that the older homes were far better built.
We had to replace all the horizontal pipes running throughout the basement and the water main (corrosion had so blocked the pipes that water pressure was very low - ie. can't run dishwasher and shower at same time). I was happy to hear from my plumber that the vertical pipes don't get this accumulation so no walls had to be opened. It cost me around 5K which I felt was a great bargain at the time.
As to the electrical. The first thing to check is to see if it's been upgraded to circuit breakers. If not, expect several thousand. You may even need additional breakers for cac. CAC cost me 10 or 12K for a very upgraded 2 zone system with electronic airfilters and humidifier. Leave the radiators alone!!!! I didn't break open any walls to look for old wiring.
Ace,
wow, that is a find. I am working on a market comparison for that contemporary and am coming to the conclusion it is very overpriced.
Here are some recent sales in the neighborhood:
http://franklymls.com/FX7188652
fully updated with an acre and a half, with a garage, sold at 90% of assessment
http://www.redfin.com/VA/Mc-Lean/817-Carrie-Ct-22101/home/9277634
Not sure about updating but a full acre and a garage and swimming pool, sold at 88% of assessment
http://franklymls.com/FX7236033
Same lot size, definitely not updated, but has a garage and pool, sold at 104% of assessment
http://franklymls.com/FX7242606
Not really updated, garage, same size lot, slightly larger house. Sold at 80% of tax assessment.
and the most similar:
http://www.redfin.com/VA/Mc-Lean/7005-Duncraig-Ct-22101/home/9278735
Contemporary, same lot size, with a garage, though backing onto Georgetown Pike, a short sale at 80% of assessment.
I can't imagine why the contemporary we are looking at (http://franklymls.com/FX7323987) is priced so high.
Perhaps they took out lots of equity? Does anyone know how to check the value of the liens outstanding in Fairfax County?
cara,MM,
Forgot about the asbestos that seller had to remove from boiler area and the french drain and sump pump
seller had to install.
Also, I kept the old windows (over 40!). They were not efficient but there was no way I was getting rid of those 6 over 1 windows and old wavy glass. I opted for storms.
Va,
Termites count as structural. I also was thinking roof, gutters, rotting window-casings, ill-repair of the siding leading to more rot. Indeed the cosmetic things won't cause damage, nor will an old HVAC (except possibly damage to the basement). But one kind of neglect implies the lack of funds that may imply other kinds of neglected maintainence.
Didn't someone here pretty much say the same thing a few months ago?
Kudos to whoever....
Housing Credit Pulled Demand Forward says Fannie Mae Chief
cara,
We have differing ideas of "structural" but it really doesn't matter - the bottom line is $$$.
I'd only call a roof structural is the underlayment is rotted. I'd never consider gutters structural. Some termite damage is structural and some isn't. Wood rot around a window is not structural in my mind...but it all is $$$$.
When I think "structual", I think integrity of the structure. Wood rot can be either, but it would have to be major for me to think "structural". OK, enough.
Blogger MM said...
REPOST alert:
what's the deal with this N Arl walk to Ballston REO SFH? priced $40K/10% below assessed land value?
i'd need an agent who knows about renos for this listing....
Good lord if I was still doing houses I would so snag that Kitchen sink. Those are hot hot hot with the retro crowd. We used to find those in old 1950's homes in Texas and the re-sale value on those went over a grand each during the height of the craziness. It has the deep sink and tall spigot holes that home chefs love.
Home ownership = just fine.
Leaving the rental market?
That's been a pain in the ass.
VA_investor,
Yes, back to the $$$ and away from definitions...
So, what is your opinion on how accurately/realistically a home inspection would be on finding and assessing all the various and sundy damages?
Or what amount of fudge factor for further costs would you generally budget in?
Or would a contractor who can also give their own price estimates be a better gauge?
Xpovos,
Really? your former landlord is being a PITA? Moving angst? What?
Sorry to hear it in any case.
Cara,
Former landlord's management company, more than anything else. We needed to break the lease in order to buy. My own fault, I could have gone month to month last year, but I seriously didn't expect to be in the position to buy within 12 months, and the second pregnancy came faster than expected, too.
Anyway, we're on the hook for it until they rent it out again. But it's been three weeks and it's not even on the market. Note, that's three weeks since we finalized all requirements for leaving.
So, that's annoying enough, but I can't even get them to return a phone call.
Xpovos,
There was no set price for termination? Just the lack of double-dipping on their part? Yikes.
If you can somehow document that it isn't advertised, I would. And I would say, you have the house, what do you care about your credit, stop paying, let them take you to small claims court for the rent money. Right now, with you still paying on time, they have no incentive to quickly find a new renter.
Did they give you a quote for a month to month price when you renewed? Calculate what the difference is between that and what you've already paid, and then don't pay them more than that from here on out. Or offer to pay them essentially that back rent in exchange for being done with the whole thing.
Va_Investor,
reading between the lines... you think this REO could be a good deal (on paper, of course)?
btw, your definition of structural is closer to mine (or the home inspector's i used before)
Cara,
Yeah, it was a rougher deal than I was expecting, particularly since, in a sense, I was letting them out of the lease in peak season. If they put the house on the market at our current rent, it's gone within two weeks, I think. It was a competative price.
I have our real estate agent checking the rental listings (since I can't--not quite like the MLS, ya know) and she confirmed it's not there. I also want her checking later to know that they're not screwing me by offering it for rent, but at $300 more--which it would probably rent for, but that would delay it, and cost me money as well.
MM,
dude she's just misinterpreting me for the zillionth time and I was trying to tactfully drop it.
We all understand what structural means, what I was trying to get across is that things like not painting your trim in a timely fashion can lead to rot which can spread to an extent such that one would call it structural, likewise a roof not being replaced can lead to damage in the superstructure... Some of these things will be hidden behind walls or ceilings such that they can't be inspected.
MM We know people who live in that neighborhood, and my impression is that the houses are pretty expensive. There are many new houses in the $1.2 million range. For even the fairly modest renovations we did in our house, I think you should add a factor of at least 10% to everything. Our house was in pretty good condition, but every time we did one thing, we discovered something that did not need to be fixed immediatly, but made sense to fix while the particular contractor was already in the house. We had some extra money, so it was okay, but still unexpected. We just replaced the entire heating and air conditioning system which we knew was needed because it was 25 years old and did not work well. That was $11,000. But we then decided to add a humidifier for $700 and to run the condensate line differently so that the water would drip into the grass rather than into dirt where it caused a little erosion. That was about $500. We don't feel like we bought a money pit, but there are many hidden costs that you don't know about until you are in a house. And did I mention how many coats of paint it takes to cover a red dining room!! But on the plus side, I just found out from a neighbor that Tipper Gore still owns a house in our neighborhood. Maybe she will come back!
MM
I'd rather take on a place where the owner has done very little work, then a place where the owner "Remuddled" it.
You realize 50% of all home Renovation dollars are spent redoing bad work by an intermediate owner?
I redid crazy work by the prior guy on my Mom's place and i'm sure someday the new owner will say "Man this guy was nuts on electrical work".
i like original houses from the 30's and 40's. it's gorgeous stuff, and as for AC, i'd stick in fans and a window shaker to the bedrooms.
cara,
I should say that I was attempting to be tactful about your "ideas" of "structural". I guess we were both trying not to insult the other - but I am insulted about the "misrepresenting" stuff. Where are you coming from with that?
I think you are now back-peddling on the structural nonsense. Gutters? Really? Windowsill rot?
MM,
I'm saying it could be a deal. I don't know the prices in that area.
I'd get a really good inspector or contractor who knows older homes.
It was easy for me to guesstimate re-finishing floors, painting, new kitchen and baths (it would be great if you could convert the half bath to a full), new roof and cac, etc.
You should bring someone who knows the numbers and always count on surprises....stuff could always turn out to be STRUCTURAL!
With the Down and SP plummeting today more than 3 percent and the trend down since April 23, more analysts are saying we may have another recession before we see a recovery in employment. The recession supposedly ended last July (it has not being officially confirmed by the organization that confirm this -- it name escapes me right now).
Question, how do you think a double dip recession will affect the housing market, particularly in NOVA?
Cara,
On your comment regarding inventory levels a couple of days ago, you are right I should not necessarily focus on the 2005 but more recent years.
However, I have see an increase in over 1 million dollar homes in Arlington, and these homes are staying longer on the market. My comment about house depreciation was in reference to this higher priced market. Time will tell.
MM, I haven't reno'd as many houses as Texas Native, VA_Investor, and maybe others here, but my 2c would be that you would be much more likely to get your money back on resale--given the land value and the expensive work the whole house needs--if you were to build new. I realize that may be out of the question for what you want to spend given your prior statements--in which case, I'd pass this one by. (I should probably have done that on my present house, but it's too late now.)
Cara, I hope this doesn't make things worse, but...what else did you have in mind that an inspector or structural engineer could not see? I can't think of much - maybe mold inside walls, or beams/wall studs being too far apart, etc. I agree with VA_I that even though one can't see all the electrical or plumbing work, usually you can make pretty good inferences based on what you can see in the basement and attic (or circuit box), unless of course it's finished. I wonder if anyone ever negotiates that his/her inspector be allowed to remove any part of the drywall?
I agree with MM that you should plan on at least 10% over what you think you'll have to spend, not only for the good reasons she gave but also because you may want to go with the top of the line materials, etc., and of course, the unexpected problems. Some people get lucky; others don't.
Liv, interesting comps. I agree with you. Unfortunately I can't answer your question; hope someone else can.
Hope everyone has a good weekend.
oops, I meant I agreed with Waiting Too.
xpovos, I have watched enough of those cheesy judge shows on TV to know that in many states, the landlord has a duty to mitigate damages. So if s/he is not meeting this by advertising the apartment etc., you aren't responsible for paying the rent beyond a period in which it would be reasonable for someone trying hard to find a new tenant. Is VA law similar? If os, maybe you should let the landlord know that you are aware of this.
MM,
Arlington crime map
X,
I put something on CL yesterday for rent 8/1. I have 5 appts tomorrow.
LL does have a duty to mitigate and evidence of failure to market would be essential for you if it came to Court. It's always best to try to agree in writing to an early termination fee, but LL's are under no obligation to do this.
When did you give notice? When did you leave? When is your lease up? Did you leave it in rentable condition? Is it a complex or simply a management company for an individual owner?
"Ace said...that part of N. Arlington is a bit dicey--some nice places right next to many like this listing, occasional crime. I don't know why it has been slower to turn around--too far from metro? too many places need work? Could be the bank wants a bidding war."
"Dicey?"
Huh?
Tom, I suggest you (a) look at the crime map; (b) take a really close look at every one of the houses near there; and (c) walk there at night. Although there are some expensive tear downs/new builds, the one MM linked is definitely not unusual in that area of Stafford, Taylor, etc. I'm in that area every week and I know it well.
"dc2 said - Question, how do you think a double dip recession will affect the housing market, particularly in NOVA?"
Some here will say,
- NOVA is immune, no matter what happens in the world.
- Regardless of prices far outpacing wage growth over the last decade, it is all normal...it is NOVA after all.
- There will be more stimulus if economy tanks, even though public debt is at a record-high.
IMHO...market is already lot weaker after expiry of 8k credit. And, if economy and stocks tank, it is not going to be pretty for property market. Behind the wall of government support for housing market lies the stark reality. A classic buffett quote: "Only when the tide goes out, you discover who's been swimming naked."
"Tom, I suggest you (a) look at the crime map; (b) take a really close look at every one of the houses near there; and (c) walk there at night. Although there are some expensive tear downs/new builds, the one MM linked is definitely not unusual in that area of Stafford, Taylor, etc. I'm in that area every week and I know it well."
Me too. And I looked/did a-c.
I still don't know what you're talking about. Is there the occasional run-down house in that area? Yes. Is it a crime-ridden area? Absolutely not.
spider,
I doubt anyone here would say DC is immune. If there is a double-dip, the question becomes how long and how bad AND how much excess "value" has already been removed from the market.
Have the majority of weak hands been washed out? What is the real shadow inventory?
I would argue that an entended period of recession would result more in a flat market than further steep declines.
Will we fare better than most regions? That question has already been answered.
As to visible weakness following the 8K; wow, I think it's awfully soon to be able to determine anything. We are heading into the summer doldrums. Let's revisit inventory and MOI 6 months from now.
Tom, I know two of the recent crime victims (shown on the crime map) there. If you want to confirm this with some details of the crimes, feel free to PM me. I don't want to put any info on the web that isn't already public.
I did not say it was a crime-ridden neighborhood. I said MM should check out the crime map and that there is crime there. That's true. I said it was a bit dicey. It is, by North Arlington standards. Anyone who is paying a lot for a house needs to factor all that in.
Your definition of "occasional" run down houses is rather different from mine. As you go farther north (from Fairfax/W Blvd), the proportion of nicely kept older homes and new builds increases. Maybe you are talking about only the area farther north (and farther from the metro), but I'm talking about the area from the house MM's looking at, south FF/W Blvd.
I know you are interested in pumping your neighborhood, and I do agree that most of Willet is very nice. But I think we need to be honest here about certain parts of it.
"south TO FFX & Wash Blvd."
"I did not say it was a crime-ridden neighborhood. I said MM should check out the crime map and that there is crime there. That's true. I said it was a bit dicey. It is, by North Arlington standards."
Sorry, saying this neighborhood is "a bit dicey" is just plain wrong. None/none of my many neighbors has ever expressed any concern over crime and safety in this area. It's never been a topic of conversation. The occasional chats I have with Arlington police (like standing on a corner after dinner in Clarendon, or at the County Fair each August) back up this view, your friend's unfortunate experience notwithstanding. If you can produce some crime stats that show this neighborhood experiences a higher crime rate than adjoining neighborhoods, I promise to study those stats sincerely.
"Your definition of "occasional" run down houses is rather different from mine."
That could be true; it could also be that we're just not talking about the same area.
"south TO FFX & Wash Blvd."
Agree, as a general rule.
"I know you are interested in pumping your neighborhood, and I do agree that most of Willet is very nice. But I think we need to be honest here about certain parts of it."
It's true that I do think N. Arlington is a very nice place to live (and so do a ton of other people, obviously, given the prices here), but, again, I'm trying to be sincere in sticking to facts.
"DC2 said... I have see an increase in over 1 million dollar homes in Arlington, and these homes are staying longer on the market"
DC2 -- are you sure about that? MRIS stats for Arlington (April 2010 vs 2009) 1-2.5 million category:
2009
158 listings
9 sales
17.5 months of inventory
2010
121 listings
15 sales
8.1 months of inventory
Sorry, Tom, you can't restate my position inaccurately and then argue with that, and expect to win anyone over.
Once again, go back and read my posts. I never claimed that the area near the house MM posted was "crime-ridden" or that the incidence was higher than in other parts of No. Arlington, though the latter may be true. I simply said that there has been some crime in the area near that house on Taylor and backed it up with the crime map. I was with one of the victims shortly after it happened; she had to use my cell phone while I stayed with her for over an hour because hers (along with other valuables) had been stolen. I also know one of the other people victimized; her car window was smashed in (the car was locked) and a laptop computer and other items were stolen. This happened in broad daylight. I'm also aware of another incident near 12th and Stafford that does not show on that map. Whether these incidents alarm anyone enough to deter a purchase is up to him or her. But the facts are that these incidents occurred and they are a legitimate basis for concern.
If you want to focus on a very small area near that house, that is fine with me, but that does not change the factual information I reported.
Tom, your friends may simply not be aware of these incidents, or know about them but are not concerned. That's fine but it does not mean that the events did not occur or shouldn't concern anyone.
"I never claimed that the area near the house MM posted was "crime-ridden" or that the incidence was higher than in other parts of No. Arlington..."
Since you agree the incidence of crime in this neighborhood is no higher than in other parts of N. Arlington, I'm satisfied. Case closed as far as I'm concerned.
Tom,
It's fine with me to close the case. However, I did not say I agreed that the incidence was not higher--I don't know whether it is or it isn't, over time -- I will leave that for someone else who wants to investigate it.
Just so you don't feel I'm picking on one area, I also consider parts of Clarendon a bit dicey also. For example, some parts of Danville, Cleveland, etc. Streets, south of Tenth, still have lots of run down properties - some next to million $ houses, and yes, there is some crime there, in part because it's near a main drag.
"I also consider parts of Clarendon a bit dicey also. For example, some parts of Danville, Cleveland, etc. Streets, south of Tenth, still have lots of run down properties - some next to million $ houses, and yes, there is some crime there, in part because it's near a main drag."
Well, I have to agree with you there on the crime situation in Clarendon. An Arlington police officer said as much three months ago as we chatted outside the Liberty Tavern. That being said, it's nothing like what you find in, say, Adam's Morgan!
The Aonymous,
Are you sure you looked at all $1 million dollar homes or all inventory? If so, 2010 is still not over. I am talking about inventory of homes priced over a million. These inventory is growing and growing in proportion to all inventory in Arlington.
VA
Those are things that can _cause_ structural damage.
That's what I've been saying the entire FREAKING Time. Yes, there were careless wordings like "is" instead of "can be".
Just like every other fight we've ever had. I write something, you read something, it gets distorted.
EVERY time. Why do you think it'd be different this time?
Ace,
I've only had two inspections ever, that's whay I was asking for VA's opinion on how much comes up when work gets started.
Waiting too provided the most useful answer.
Things that cost a lot of money that could be unseen, asbestos under shingling, rot, water damage or termites in load bearing beams, mold in walls (as you said). Maybe these things would have visible consequence that a contractor or inspector would pick up on. I don't know, hence why I was trying to drag this out of VA, who was apparently as usual more interested in finding an excuse to insult my intelligence.
dc2,
I wasn't aware that >$1 mil homes was a segment that interested you in particular. It's possible to break that down in the MRIS numbers but one would have to collate it yourself to follow it, CRT and Tabitha used to do this, sort of. (I think the cutoff was 700 or 800k but close enough).
"dc2 said...I am talking about inventory of homes priced over a million."
I am too. Not only is there less inventory, the MOI is much lower too. I agree that 2010 is not over. However, dont say there is more inventory and it is taking longer to sell when the facts (thus far) say thats not the case.
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