John: I have heard from coworkers that there are unbelievable prices on bank owned, foreclosed homes in Prince William…I am renting a townhouse near Fair Lakes and want buy something bigger than I am renting.
I work at Tysons Corner, and don’t mind the commute I have now... but I know I can’t get a single family home around here for under $400k. I think I could stand driving more, if I can get more house.
Is it possible to get some halfway decent bank owned homes under 10 years old in Prince William county?
Steve Bachman:Yes,there are plenty available in Prince William, however you may want to consider Herndon and Sterling as well, which is a lot closer to where you work. Jan and I just got back from showing 5 3+ bed, 2+ bath single family, detached homes in those communities under $400k that had sold in 2005-6 for over $500k. No joke.
However, you are faced with the classic choice that buyers face in every metro area...far out, bigger and cheaper...close in, smaller and more expensive. Should you decide to move further out in Loudoun or Prince William counties, we believe that you need to be able to commit to that home for…. at least 5 years. No one knows when the market will turn and there is a lot of inventory that has to be bought up before prices can rise …AND builders are still building adding to the problem. This situation can be found all the way over to the river in Woodbridge and down into Stafford and beyond.
Roger: Why do you think that prices in Loudoun and Prince William have fallen faster than in 
Fairfax, Arlington etc…the inner suburbs?
Steve Bachman:Warning Roger... this is a long answer...Some observations and speculation….. Prince William and Loudoun have fallen further then Fairfax mainly due to over-building. There is no room to build sprawling developments in Fairfax anymore...no available land…..houses go on the market one at a time as the individual seller has motivation.
In the outlying areas, hundreds of homes were coming on the market all at once in 2003-2006…competing for buyers with regular re-sale homes. Since Fairfax and areas in toward DC are closer to employment...there is more demand from folks all over the US and the world, with deep pockets who have no interest in a 90 minute commute. All this building was started before gasoline was priced where it is now...if folks worked in close to the city...they started to think twice about that long drive to and from….weighing the gasoline expense against the cheaper price of housing further out.
In addition to the glut of new homes…the easy credit that fueled the building and buying frenzy dried up. Many first time buyers came out of their rentals during the time of easy credit and poured out to Loudoun and Prince William, drawn by the desire for new homes. Since many of them were just barely able to qualify under easy credit standards, if they had any life crisis (divorce, job loss, sickness etc.)They needed to try to sell the homes they just bought, or re-finance them….. but they could do neither.
Credit had tightened, the builders were hurting because of the credit situation as well, and were dropping their asking prices far below what they had just sold the new-built homes for to that last wave of eager buyers. People ended up owing $400k on homes that would now only bring $325k IF they could sell…they couldn’t re-finance(the home would not appraise for what they owed)…and they couldn’t sell… hence the increase in short sale attempts and properties headed toward foreclosure.
There is a lot of stress on sellers now…it is not a pretty picture...however the seller’s pain has become the buyer's gain. These difficulties have opened opportunities for buyers who were on the sidelines or locked out during the price run up of 2002-2005. Some prices have fallen back to 2003 levels.
We just contracted a townhouse in the below $250k, that was purchased for $350k in 2005. 
Another client ratified a contract on a 5 bedroom single family home in Manassas at $350k on a home that sold for $550k in 2005. Opportunities exist...but the market is unpredictable ...that is why we tell prospective buyers that they need to plan to be in a home for 5 years...there is no more easy flipping or getting in and out in 2 years without a loss, unless you are really knowledgeable and are willing to fund significant repairs.
If you want to pursue bank owned foreclosed property you need to be patient and have a tough stomach…some of these properties can be very, very rough....in addition there may be delays caused by problems getting the bank to come up with a clear title. In summary, great opportunity exists...but patience, care and an eye toward the longer run are necessary.
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Moving to Northern Virginia?
Here is a photo ensemble of homestyles and countryside:
http://video214.com/play/ngb0RJKin5pR3jr2CUotnw/s/dark
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