Hate to say it, but it looks like history is not on your side

http://www.nytimes.com/imagepages/2006/08/26/weekinreview/27…

Notice that whenever the bubble popped, it took at least 5 years before the bottom was reached. If history were to repeat itself, we are looking at 2012. Plenty of realtors have an entire carton of egg on their face trying to call a bottom. There will be plenty more to come.

I hope you don't lose your shirt. But yes, it can happen. If you put 10% down, and the market goes down 4%, and you find yourself in a situation where you need to sell (e.g. lost job and can't pay mortgage) you will lose all your equity (it cost 6% to sell).

Good Luck

Ben Doesn't know his Real Estate Ass from his Elbow. People who think that an national economic indicator will forcast a local market are what continue to cause this market to stay down. You don't watch the weather channel for its national forcast, you watch it because you want your "LOCAL" forcast. Only a local real estate expert can help you figure out your own local market. What the New York Times article illustrates is the average sales price of a home taking out economical factors like inflation. That would be like saying the average salary for an electrician hasn't changed in 120 years if you take out inflation. The truth is that the housing industry absolutely has ups and downs unlike any other market, but the value of a home is much greater than any other asset you have, so when inflation is up 6% you home appreciates more than your income or other assets simply because of economics. If you own a $500,000 house and make $100,000 a year a 6% inflation rate would make your house worth $530,000 while your salary is now valued at $106,000. I'll take that any year. Do yourself a favor, treat Real Estate as a long term investment, not something you will make money with overnight. And when you are looking for information, look for local stats and figures, just like you do for sports, weather, and the stock market.

Many people are saying there won't be appreciation for 2-3 years. I agree. However the market will be dropping for those 2-3 years back to historic levels.
Your question is when will you see 2004 prices again? Adjusted for inflation, maybe never. If you bought it on speculation, bad move. If you bought it for an investment? Bad move. If you bought it to enjoy? Congratulations!

The Japanese RE bubble lasted 17 years. We just had more serious restriction on credit this week. The Alt-A mortgages are due NEXT year, 2009 looks like it could be worse than 2008.

Attached is Alt-A explained, it is taken from Govt data.

Ben is correct, you will probably not see any appreciation for 10 years.

I wouldn't say you were stupid. Enjoy the house, live your life. Houses have historically appreciated with inflation, but they are not a great investment. They are work and can be costly, not guaranteed to be a money maker.

BTW
"The National Association of realtors says that this is great time to buy and I agree!"

Yea, they have said that every year for their entier existance. Give me a break. Look at the T2 report link and tell me now is a great time to buy. The NRA says it is a great time to buy an AK47 too. lol.

The real estate agents here will say, soon, next year for example. Not me. I say when income is 1/3 of median price in a town or section. Wages are not likely to rise so that means prices will have to decline. Since the system is full of optimistic spinners it will take 3-5 years to cycle up, IMO. If more people were heard to say prices must come down, the cycle would shorten by prices coming down. Here and there are areas where enough buyers can buy the inflated properties and because there is not enough housing the prices stay up longer. Look at local factors, median income, median prices and the rule of 3 maybe 4 times income for housing availability. Call me old fashioned. But don't call me Shirley. Be careful who you listen to about real estate.

"The National Association of realtors says that this is great time to buy and I agree!"

please, please- can ANYONE can give me an example of the NAR saying that ANYTIME was not a great time to buy?

and to the dude that told us that with 6% inflation, the house would be 530,000 but the salary would only be 106,000- everything else rose by 6% too. you know, groceries, bills, consumer goods, other houses. which means you make 106,000, which is more, but you get a lot less for your money spent than before.

so yeah, if an electrician's salary only rose by the amount of inflation through the years- they really aren't making any more than before.

What Ben does know is how not to fall for realtor spin.
Housing has its ups and downs. But in recent years, it became a giant bubble and is now deflating.
Real estate may be local, but lending is global. Banks everywhere are not lending unless the borrower has excellent credit and a large down payment. This has a price effect everywhere.

Anyhow, here is a video version of the Times article
http://tinyurl.com/4gmglh

It's hard to say what your exact market is doing since I am in NC, but overall if you are not moving anytime soon I think it's fairly safe to say you will not lose your shirt. Houses as a whole appreciate over time. The real estate market goes in waves, like most things it has it's ups and downs. Right now is just one of those lulls. Don't panic and just enjoy your home and take care of it. They estimate by next year things should be leveled out. A home is a great investment. You are building equity and not throwing money away on rent so that alone you are building towards your future. I would advise you to stop listening to the media, they play on people fears and that's how they get a story. For the facts I would call a local real estate office in your area and just ask them what your market is doing. That might help calm your fears some.

I'll keep it short in answering your question:

-when inventory can't keep up with demand.


When will that happen?

-when foreclosure velocity eases
-when median incomes catch up with median home prices
-after retracement in the housing bull market.

"Stop listening to the news on how bad America is and only think good and postive about your investment."
Here is a perfect example of the pollution on these boards by those WHO ARE NOT UNBIASED! In other words, Ms Ridens and others of her ilk would have you put your head in the sand, switch off your brain, and spend, spend, spend yourself into economic prosperity. Why do you think the Fed needs to orchestrate a bailout? Because too many people ignored what made economic sense and bought into what these people told them. Go ask a car salesperson if you need a new car -- see what they say! If anything, we need a good housing downturn (prolonged too) just to shake these types of people out and back to whence they came.

Remember that the realtors who troll these boards are about as FAR FROM UNBIASED as you can get. They definitely have been drinking the kool-aid brewed and served up by the NAR. Their income and lifestyle depend on housing going up and up and continually changing hands so what else are they going to say? Moreover, a lot of these people have no skills - not even viable selling skills. Their boats rose with the tide from 2003 - 2006 and they are scared to even think about a stagnant market - and in fact refuse to do so. They can't code in C++, most have no management skills, and most don't have enough education to go into teaching. Many too are in debt as much as their homedebtor clients are, having bet the farm on future price increases of 15 - 20% well into the indefinite future. That's right - I'm talking about you with the 5-series BMW and the 3500 sq. ft house with nary a sale in the last 2 months! If we do get a stagnant market, articles will appear in the USA today (probably about October or November) about how realtors are 'changing careers' or 'between jobs' or even bankrupt and on welfare. Want to make money? Start a blog or website geared toward assisting ex-realtors with this transition to another job. If the housing market really dives, as they fear, they will simply fade away - like the lone penguin on his late walk in March of the Penguins - "swallowed by the vast whiteness all around him" in the words of Morgan Freeman. Hopefully I scare some of them out of here or at least wake some up!

Bridget Laszlo is not completely correct - "home is a great investment. You are building equity and not throwing money away on rent". Add in maintainence, real estate taxes (the % that is really not deductable) and homes appreciate on average 0.4% a year. There are a number of rent vs. buy calculators that will show renting can be a better deal, assuming you place any extra $$ into stocks & bonds.

Ignore all of the agents here telling you 'the sun will come out, tomorrow'! These people are desperate! Here's your answer: A home is not an investment nor is buying one like spinning a roulette wheel!! You are confused and so is your post! First you say you are 'just looking for a home', and then you say 'when can I sell'? Which is it? I think you were a wannabe flipper who is in denial and who is now telling yourself (and us) that you were only looking for a home. Unless you can locate a buyer just stay put. Otherwise, bite the bullet and sell for what the market will bring. Of course, Bush and Bernanke may come along and rescue you with a bailout if (as I suspect) you are 'underwater' on your home.

This question is very specific to the economics of the local market. For example NYC will definitely be different from Detriot which will be different from Atlanta. Some people have been pushing that R/E is a bad investment, but if you really look at the facts, it is a great way to accumulate wealth. There is a quote about statistics that says,

"There are lies...damn lies...and statistics."

The problem with all the numbers on the R/E market coming out is that most people honestly don't know how to interpret the numbers, except to support their pre-conceived agenda. It may actually take a little thought and not restating canned articles, but the truth is that you have to account for all the specifics of your local market as well as the national factors.

Personally, I think markets like NYC metro, San Francisco, Chicago, and Seattle (and maybe Atlanta and DC) have come close to the floor and will see appreciation faster than markets such as Phoenix, Miami, Dallas, and Detroit. I have a specific methodology behind my beliefs...but it is something that looks at the specifics of the market...not general NY Times articles.

If you hold on to your property for several (5, 10 or more) years, you'll likely be ok, at least in terms of nominal prices. In real dollars possibly less so, but again in the long term real estate usually turns out ok.

For a sobering perspective: we bought a place in So Cal in 2000. Our nominal price was only 15% higher than the previous owner had paid in the 1980s. In real terms (adjusting for inflation etc) we paid less than he did, 15 years or so later.

But if you enjoy your home and don't foresee moving anytime soon, then you should probably focus on that enjoyment :) The market value of your home only matters when you sell it (or refi).

That is a good question. Many of my collegues and I think that prices will hit bottom this year and level off. Then they remain somewhat flat for the remainder of this year and begin a return to a modest rate of increase in 2009. This is only an opinion. There is no way to predict the end of these troubles in the real estate market.

Since you state that you plan to stay in your home for a few years, I believe that you will weather the remainder of the storm well. I think you made a good decision and as long as you do not have to sell anytime soon, you will end up with a net gain in your home's value.

The National Association of realtors says that this is great time to buy and I agree! Good luck with your new home and I hope you have many happy years there.

Real estate is local, true to a certain extent. The economy is global. Lending is global. Banks everywhere are not lending unless the borrower has very good credit score and a large downpayment. So with the economy in the tank and few qualified buyers around, it can mean only one thing everywhere - downward pressure.

http://www.cnbc.com/id/24311464

I guess I am the "disgruntled homeowner buyer"? You know what happens whey you "ass/u/me"

I am a homeowner for 15 years, and I LOVE my house. It will end up being a great investment. I bought in 1997, a great time to buy. It was luck, I just wanted to move then. 2004 was the peak of the biggest bubble in history. It was bad lucky that you bought then. Houses will appreciate again. I agree with that. However, it will be after we return to historic levels. They never should have gotten to the 2004 level in the first place. If you spend more than 3x your family income on your house you are hostage to it, that it why we will drop back to historic prices.

Yes, don't listen to Yale Economists, instead listen to a Louisiana RE Agent. He knows more. LOL

We will be down for many years. You paid at the peak of a market artificailly created by the sale of mortgages packets. People got burned buying them at too high a rating. You won't see them buying those again in our lifetime.

Enjoy the house, but don't think you made any money on it, you didn't. Sorry for the truth.

you should be ok by 2012, but that depends on some other things, like how long this recession is going to be

Ben is correct about the lending. If banks had followed the nuts and bolts lending they are getting back to now from the beginning this bubble would not have been as big. In areas where the borrowers did not have excellent credit and are starting to feel the crunch, you will continue to see declines in prices as these sellers will have to sell. In areas where people bought within their means and have a good financial standing you will see things remain flat. Once again only locally can you find out what is truly happening in your market.

Firsttimer: If you recently purchased a home for the same price that it was at in 2004, I'd say you did well. Pricing should go up again nationally, but no one has the crystal ball to predict exactly when and how much. I don't see how you could possibly "lose your shirt" if you're not even considering selling for several more years. You should do fine, based on past history. Just hang on!
Peggy Nelsen
Relocation Director
Prudential California Realty

Interesting RAY. I'm curious, have you begun to embrace reality yet?

Bottome line: As I said before, when foreclosure velocity decreases, median incomes catch up with median home prices and unemployement wanes; only THEN will this market change directions. Any RE agent that tries to dazzle you with BS (EX: Ray) should be shown the door. By the way, some of us DID precict the housing crisis. I admit it has surpassed even my negative projections, but some folks actually pay attention to the indicators.

I think you will need to wait for 10 years before you will be able to make a profit or break even. Prices will continue to fall...most likely to 2000 or 2001 levels, which is where this housing mess began. They may even overshoot and go back into the 98-99 range. I wouldn't be surprised if that happens. They'll come back up, but it will take time.

Side note--Richard Heirs could be a bit misleading about renting...depending on the situation, renting can actually be better financially. If you took the extra money saved on rent instead of a mortgage and invested it in the S&P, you will usually come out with more money in the long run. But that would only be in situations such as now, where the cost of renting versus purchasing is a large difference. When rents are the same or more than mortgage payments, then it makes sense to buy and make your home a solid investment.

Remember this, homes are not assets...they are liabilities that require monthly payments just like a car or any other item you have a loan for. It only becomes asset money once sold for a profit. In the meantime it is nothing but a liability.

Barbara
Local experts are fine if they are objective. Agents are not objective, you can't be when your income depends on houses selling.

Attached is a Zillow chart for the area, they too seemed to peak later. However you don't have to be a mathematician to see where it is headed.

Again, the answer to her question is: No not stupid, just don't expect to make money on the house if you sell in a few years.

Any nitwit can be a "RealEstatePro", in fact most are. Don't believe anyone on here who speaks in absolutes, like "you will definitely make money" or "it's definitely the time to buy." Over the long term, you should probably make money, but remember what John Maynard Keynes said, "in the long run, we're all dead."

The only way you know if you're getting a good deal is to know what comparable properties are selling for when you buy.

Were you stupid? No. Just not sufficiently educated about determining value in real estate. A lot of people made far worse mistakes. Since you don't have to sell and you ended up with a place you like, you're fine.

No one knows for sure what the real estate market will do. And, as others note, real estate is also local. I'm familiar with much of Alexandria: I worked for 7 years on Mill Rd. near the Eisenhower Metro stop, and I've worked another 7 years on the north end of Old Town. Alexandria's holding up pretty well. I'm a bit concerned about all the new construction along Eisenhower Avenue--whether that'll be a glut on the market--but otherwise it should do OK. As for prices in Alexandria and surrounding areas, considering BRAC a bit to the south, all the associations in Alexandria, all the federal employees, and the new office space around the Hoffman Building, my best guess (only a guess) is that prices will dip a bit more this year and maybe even next (2009). Then they'll stabilize and start climbing upward. And it might not even take quite that long.

No, you're not going to lose your shirt and you're not going to end up in financial ruin. And if you hold the property for another 4 years or so, you most likely will come out ahead.

Hope that helps.

"I wonder what RE hell is like. The devil chasing us with his pitch fork around an Open House that won't sell?"

That's hilarious, Carl. Made me laugh. A broker who doesn't walk around with Rosy glasses, who writes well and who has a sense of humor. You are a rarity in your profression, sir.

Wow. A post from the past, 2008. Thurston, I admire your reading stamina. Funny, my middle name is Ben and my friends know me as that.
Yes, here we are in 2012 and prices have declined slowly almost everywhere. I note another 2-3 years at best before leveling. Incomes and prices still do not match very often in local markets.
We can now see the damage down when 2000-2006 mortgage products were created (no money down, 40 years, no doc loans, then interest only) by the banking-financial industries, unregulated as they were. I still encounter victims. Sympathy for banks and "those buyers should have to live with their mortgages, because a contract is a contract" has shifted to "those greedy bastaxxds should be in jail." When the Comptroller of the Currency is finished with its investigation and we learn the stories of how banks created a culture leading to our present condition, we will be shocked beyond imagination. They convinced loan agents to sell high risk loans for more commissions over the lower paying conventional loans. It was pervasive. As RE, we contributed if we encouraged buyers to talk to our mortgage reps with those exotic loans. I wonder what RE hell is like. The devil chasing us with his pitch fork around an Open House that won't sell? A closing inside a burning inferno of a conference room? A sales meeting with sellers of web sites, inspections, stagers, movers, mortgage reps, and direct mail that never ends?
But money can be made by serving those who need to sell and those who want to buy. What a country.

In answer to Darin, I am a real estate agent with two Masters Degrees and a CFA. Not that this means I am any more knowledgeable than others, but I amused by condescending comments about the intelligence levels of real estate agents vis-a-vis other fields.
The Case-Shiller Index, although flawed in many ways, clearly points out what most real estate agents have known all along: residential markets are very local. There are several areas of the country in which prices are stable and rising now, while others continue to languish. Even in the D.C. Metro area, there are huge differences in price trends from town-to-town-, county-to-county, and neighborhood-to-neighborhood.
There are Northern Virginia neighborhoods I work which have severe demand/supply imbalances, and prices should be rising faster than they are. The misconception that appraisers determine value (wrong---the market determines value in arms length transactions between willing buyers and sellers) is keeping many sellers from realizing this. Unfortunately, many agents have gone along with the "if the appraisal doesn't come in at our sale price, we must reduce to the sale price and move on...." WRONG!!!! If you are a seller and hear this from your Realtor, GET ANOTHER REALTOR! Appraisers are forced to look at price history; it is a backward-looking mechanism which does not, and will not, catch price reversals and markets which are trending upward. If your Realtor cannot meet with the appraiser and help point out the rising trend in the specific neighborhood you live in, but rather takes the easy way out and tells you "we are stuck because of a lower than sale price appraisal", you have the wrong Realtor.
Before accepting an offer in a rising market, make sure the buyer is able to put down more down payment if the appraisal comes in too low.
I realize that the above is valid only in select markets right now, but I am in one. It is frustrating to see prices inch back up when there are 5-to-1 supply/demand imbalances in many neighborhoods I work.

Ray Wedell
RE/MAX Allegiance
703-855-7299 http://www.RayMaxInternational.com

According to the Homebuilder's Economic conference in Washinton several months ago, we're looking at 2009 before things start turning around. Will it happen then? There's still a lot of inventory that needs to be absorbed before we see it happen.

Were you stupid?...No Way- You made a great decision to purchase a home! Not only did you make an investment in your lifestyle where you will receive many non-monetary benefits, your home is the best long term investment you could make! Enjoy it!

Hello Firsttimer,

"Was that really stupid?"

From my life experiences, of which there are many, I feel pretty confident saying that most people in the USA do not think it is a stupid idea to buy a house that you can afford to pay for, which you are going to live in and make your home. If you have bought a house that is within your means to pay for, then you don't really have anything financially to be very concerned about, unless you just like to worry about things you have no control over (like predicting the future). Given that some of the alternatives to buying a home are paying rent, living with mama, or in a travel trailer, all of which I have experienced, I like the own your own home option.

The price you paid is largely irrelevent at this point. Think of it like buying a new car and always wondering if you could have bought it somewhere for less. Of course, you could. There is always another day or another place to pay a few bucks less or more for something. But once you have bought your home, guess what, it's yours! Now you get to take care of it, improve it, and pay it off. Quit worrying about the value of it in dollars and cents, and squeeze out of it all the value it has as your home, a haven from an otherwise cruel world. Play your CD's loud, dance around in the kitchen, cook for freinds and family, and plant flowers, it's yours to enjoy!

Here is a new idea--If you really work on paying some extra towards the principal amount owed on your home mortgage, you will wake up some day and find that you have it paid for! yes, this actually works! And having your own home paid for is acknowledged by many independent financial advisors to be a pretty smart thing to do, since it provides you a roof over your head and allows you to invest the part of your income otherwise going towards your mortgage payment into home improvements, cash savings, retirement plans, tuition for kids educations, and other investments of your choice.

Congratulations on making a great choice. You'll do just fine. Quit reading any news about real estate and this forum!

Dan Therrell
Fairhope, AL

I bought a place in Alexandria and essentially paid what the home probably would have sold for in 2004, and this represented about $75K less than the sellar's asking price. Believe me, I was very squeamish about this because prices were (are) declining; but the houses are selling. The deciding factors for me was we love the area, we're not going anywhere for awhile (ten years at least), and we won't outgrow the place. I still watch the area houses come on the market and cheer when someone pays more than I did, and frown when someone pays less...and I cheer more than I frown...so life is pretty good in Alexandria.

While there is no definite answer, I have been told in conversations about three years...

No one can accurately predict when home values will start appreciating again. We are in a cyclical downturn and eventually the market will turn back up. If you are not selling for several more years you should be just fine. The time to feel safe in selling is when you see listings in your area start to decrease and can find out from a professional realtor what pricing has done in your area over the past six months.

A few things:

I won't have to sell because I can't make the mortgage/lose my job. I have a really secure job that I love. It's more a matter of, its a condo and I (and my now serious significant other) may want a bigger place in four years, five years (2011, 2012 ish). I'm never leaving the geographic area, so I'll have some flexibility about when to sell.

Is there any data out there on the percentages that rents tend to increase from year to year (particularly in a city suburb-- I live 15 minutes outside of Washington DC). I couldn't rent it out for exactly the mortgage now, I'd be a couple hundred shy at most. But am trying to figure out if I'd be able to rent it for closer in a few years.

My other question is... in Ben's scenario below, he's only counting the 10% down, not the equity building up through my mortgage payment, correct? I know its a small amount every month but over 4-5 years it adds up.

Thanks so much to everyone!

So far Ben has been 100% correct and almost all the real estate cheerleaders (impartial brokers! LOL) have been wrong. In fact, It's now 2012 and after nearly 4 years prices in most market are LOWER than they were when Firsttimer first posed this question.

The only agent who had the cajones to admit trees don't grow to the sky was Shirley, I mean Carl Witzig. Well done Carl.

Hopefully your real estate agent discussed the market with you and did not lead you to expect a market rebound soon....if ever. This is not a good time for flipping property and coming out ahead.

Whatever you say, Darin. Case-Shiller pointed out, I think, 11 similar markets around the country. And for those of you who want to anticipate that at some time your market will also rebound, keep the appraisal issue in mind.

...and of course the DC area isn't based on anything even close to resembling reality. The big-government money and fantasy island economics isn't occuring throughout the rest of country.

The last person qualified to answer this question is a RE agent that doesn't have a college degree. RE agents with an education are more toleratable. To answer your question: when foreclosure velocity decreases and median household incomes fall into line with median home values by region. We are almost there but the unemployment rate plays a role in these variables as does demographics in terms of the baby boomer population unloading second homes and downsizing. RE is local but most locales are suffering from the same negative trend lines.

Until this nation abandons the nanny state regulations that have handcuffed business and the micro economies begin to see inflows of capital from outside sources, this economy will continue to stagnate and housing will continue to decline slowly. However if you are in a strong liquid position with a rock solid job, this winter will yield some very nice deals...do not offer asking price and do not buy without a VERY rigorous inspection process.

Home prices continue to go down every single year. Just when you thnk they won't get lower, they do.
Don't count on home prices to ever go up again. A home will cost roughly the same price as a loaf of bread in 10 years.

Dear First Time Buyer,

My experience in real estate and on Wall Street leads me to this conclusion: Anyone telling you definitively that a certain market is going to do up, down or sideways, whether in stocks, commodities, or real estate, is generally less accurate than a flip of the coin.

Both the economic and technical factors affecting a residential real estate purchase are so different from region-to-region; from state-to-state; from city-to-city; from zip code-to-zip-code; from block-to-block. So global answers to this question are to be taken with a grin of salt.

How many "gurus" predicted the major decline of national real estate in 2006-2007? How many "gurus" predicted that the stock market would rebound and regain all losses in a two year period from 2009-2011? I don't know of any. Beware global statements, polyanhish predictions, or Chicken Little "The Sky is Falling" voices.


You should be asking yourself questions like: "How long do I intend to remain in the house I will purchase?"; "How favorable is the financing I can achieve?"; "Which neighborhood(s) should I be focused on and which ones are really where I want to live?" ; "Is the type of home I am considering going to satisfy my requiremnts for year?" ; "What is the comparison of rent to buy and is this a neighborhood which is likely to show strong/weak demand in the near future?"

Most of the key questions are best answered by an exerienced LOCAL agent. This goes way beyond simple CMAs(competitive market analysis) but by working with someone who you trust to help you reach the right decision for you. This requires that you go beyond using "a friend of a friend" and truly have a face-to-face conversation with agents who can openly and accurately answer your questions, and with whom you get the "feeling" he/she is the right person to help you. Yes, such intangibles are important as well.

In the Northern Virginia market, there are many areas which have already "bounced back." Others are clearly pointing toward favorable economic and supply/demands forces, while other areas are not. So to make a blanket statement on market direction does you no service.

Feel free to call with any questions or concerns you have about your potential purchase. I can be reached at 703-855-7299, or raywedell@comcast.net.

Hello Firsttimer - in order to break even or slightly positive on your sale - your current house value would need to be in the range of 6-10% higher than what you bought it for, to account for the costs of selling. It varies based on the fee structures of different agents, as well as whether the buyer requests help with closing costs. In order to determine what you can sell the house for right now, you can ask a realtor to do a CMA. Getting a few opinions is a good idea.

And what I said above doesn't take into account the equity in your home. If you didn't have an interest only mortgage, you would have paid off some principal, so you would get that money back at closing.

Good luck - in a lot of parts of Alexandria, you would be fine if you're going to sell now or even better in a year or two.

Thanks,
Sonal

There is no spin on this...based on the Northern Virginia Association of Realtors looking at the data in Northern Virginia, median and average home prices have increased YoY. Inventory is at an all time low meaning there are not enough houses for us to sell vs. the number of buyers that are in the market wanting to purchase because the interest rates are at historic lows (around 4.75%). We currently only have 2.5 months of inventory in Alexandria City and under 2 months in Fairfax Cty. We look for at least 5-6 months to consider it an even/stable market. If you bought in 2004 there is a chance you may break even now depending on where you bought and how much equity you have in the home....or you may need to wait a year or two...it all depends on the comparable sales in your particular area of Alexandria (because as you know each community within the city is very different). Take a look at the link I have included below to review stats and definitely watch the "market watch video"....and feel free to call me with questions. I am happy to give you a truthful valuation of your home based on it's unique features and what the surrounding sales have looked like. I would have to see your house to do this though :).

Hope this helps!
Kristen K. Foley
703-232-2292
kristen@kfoleyhomes.com
http://www.kfoleyhomes.com

House prices in Alexandria started going up at the end of 2010 and are continuing to rise. The DC Market is expected to raise another 10-29% according to a recent article focused on this area. You can read it on my my blog here.

Delaine Campbell, REALTOR
Alexandria, VA http://www.delainesoldtown.com

There's only two stupid things you can do:

1. Rent: This is a 100% loss, and is completely and totally stupid. There's no money to be saved or gained here. If you (whomever is reading this) have your blood boiling over this comment, that's fine, I still think you're stupid.

2. The only thing dumber than renting: Buying a property blindly because you think it's "cute" whatever. There are plenty of morons in big cities who are dying to move into some trendy neighborhood to the point where they inflated the costs of some houses to three or four times what they should be. These people buy based on how "cool" they think something is, rather than a realistic market value. Buying a house like that in a market like this is a guarantee to get stuck in that house for a few decades trying to get above water.

You always need a home, so it serves a dual purpose, home and investment. If I sold and lost money, and its an amount that I can make up for in a year, I wouldn't feel too bad. Rent is 100% money out the window, unless your the landlord. As always when investing, buy low, sell high, if you can't then rent out a room. Maybe it'll be a wash. I've found that realtors and mortgage brokers don't make for very good financial advisors, so make decisions based on your own math.

This sudden depreciation of homes is exactly that. Now, what some are overlooking is the fact that this housing crash is exactly that--a crash. One must first determine what caused the crash before a plausible expectation can be offered for when prices may rise again. It is fair to say that some areas have almost maintained their value through this crisis. Nevertheless, even in areas where homes have retained their value the market is sluggish. One way a person may come out is by getting lower interest rates through refinancing. This may in some occasions outweigh the sales price. For example, if you have an interest rate of 4.25 and you choose to sale your home for 15,000 less than what you paid and finance the home for 2% more than what you are paying this may make the difference for you, depending on the asking price of your home. If you financed to someone else at a likely higher interest rate in a couple of years at 6.5 for at 210,000 you would be getting your money back providing they were able to stay and make payments. Not too many years ago we were able to make a good profit this way off of a house that we absolutely had to sell. They were willing to pay the interest rate since we were financing the home for them. Of course it all depends on your circumstances, and some of this may not interest you at all, as far as possibilities go.