Spring of 2010 was filled with home buyers in the market wanting to take advantage of the $8000 tax credit. That filled the positive sign in the real estate market. So what is in for the real estate market in Northern Virginia for Spring 2011?
From the New Construction Perspective: Builders in the Fairfax, Loudoun & Prince William counties have raised their base price, incentives/credits have reduced and lot premiums are back. Speaking to them and at the pace they are selling the market they are very positive about the spring market.
From the Resale Market Perspective: We still have low inventory. I have buyers waiting on the homes in subdivisions/area to be on the market so they can submit an offer and purchase a home. This has caused in some cases multiple offer/ bidding war situation. So if you are a seller and thinking about selling your home my advice is you may want to take advantage of the current low inventory market. In winter cold months though we have smaller pool of buyers but they are serious buyer house hunting.
From the Buyer's Perspective: While I personally think they are divided. Some are more prepared to take advantage of the market and others are on the fence about what is unknown in the near future of the market. Fortunately Northern Virginia's low unemployment (4.2%) has attracted relocation, increase buyer confidence to consider moving up into a large home, buy an investment property and definitely attract lot first time home buyer since rentals are expensive in our area.
From the Mortgage/Lender Perspective: Although interest rate inch a bit compared to Fall of 2010, however comparing to a decade ago or a couple years ago we are still at a historic lower interest rate. Financial guidelines are getting restricted. Banks have implemented new restriction that requires certain the credit scores which will determine your interest rate and/or down payment requirement. On the positive note, few lenders had introduce new in house incentive programs for example with Wells Fargo you can purchase a home with 2% down payment. FHA (3.5% down payment) is still the strongest mortgage type loan for most of the primary resident buyers. 203K Loan has attracted the purchase of distress homes. Speak to your lender to understand your financial qualification.
My Perspective as a Realtor® : In the current real estate market housing is like a half filled glass of water. As I say to my buyers and sellers we are going to have a good percentage of pessimist and optimist house hunter in the market just like any other market place. Depending on what is the purpose/goal of your purchase, housing market can be great for a long term investor or a home owner. If you are ready to put your roots down, spread your eggs in different investment stream and/or enjoy the pride of home ownership a HOME is for you. Even if the market slides with the uncertainty of the foreclosure or short sale in a long run the rewards may pay off. Forbes recently had an article where our area (Bethesda & DC) ranked the cities where home values will increase in 2011.
For home owners who are under water you have more options than four or five years ago. With programs like Home Affordable Modification Program (HAMP), Home Affordable Foreclosure Alternatives (HAFA) and Short Sale you can avoid foreclosure on your credit history. Many home owners who lost their homes to short sale or HAFA may be eligible to purchase a home as early as within three years.
We do have a slow 2011 start blame in on weather, changes in the financial industry or low inventory in the area. I have personally several buyers and sellers waiting for this winter blues to be over to be on the market place. I am not here to convenience you whether you should buy or not. But knowing the facts will help you decide whether this market is for you or not.
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