Drew Hitt

The only value I can see in homes in Virginia Beach dropping through the floor will be no new construction! We might still be able to have trees left in Virginia Beach! When home prices drop below what it costs to build a home of that size then building will grind to a halt. It won't ever happen. But it sure would be nice to have more trees! - Sun Nov 16 2008, 19:35

Ox, I notice a pattern in your responses. But I wouldn't dare call it negligence.

Also looking at the question again...there really isn't a time frame put. But to assume it's talking about the here and now, my crystal ball says no. Unless we have a huge financial crisis and income falls by 50%, we won't see those prices here locally ever again. Just imagine if we did, people would buy up property so quickly and it would increase the prices right back up, simple economics 101 as I hear it put... - Wed Oct 29 2008, 18:41

While it is true there are a vast increase in the number of houses for sale doesn't constitute a drop in prices. It simply implies a longer period of time to sell your property. Price decreases only happen when situations arise that people need to sell their property more quickly and aren't willing to wait for that individual to come along that will pay market value, so they drop market value to find a buyer willing to buy faster. Then you start to see price decreases. We're simply seeing more people willing to wait for more realistic time frames to sell their property, 3-6 months vs 3-6 hours. When you're selling the house you live in, you have more flexibility than a builder selling a liability they need to get out from under.

While Realtors do maintain a positive outlook on the market at most times. I, on the other hand don't list other peoples homes for sale, I buy, renovate and sell my own properties. I'm still buying which means I'm comfortable at where the market is in certain price ranges. When I stop buying, there is a problem. Realtors will always sell property, but if investors leave the marketplace it's time to watch out. Markets like California, Nevada, Florida, investors have left the marketplace or turn into landlords, those are the indicators to watch out for. Just like the builders, we know what's going on before many homeowners and agents do. So just stay in an affordable range and you'll be okay. Stick to a good school zone, and nice neighborhood and you'll always win out in the long run, sometimes a longer run than you might want. This isn't get rich quick, it's gain wealth over time.

-Drew - Tue Oct 28 2008, 19:28

Absolutely not. The only way that would be possible would be a complete financial collapse of all the nations banks at once. The government came in and prevented a global collapse here. We're still not seeing prices of late 2005! At least it depends on what price range you are seeing. Under 250k, you're sitting pretty. I wouldn't say you'll have appreciation, but you'll be protected for the most part. More distressed sales will come up on the market, but those sales are typically not used in residential appraisals, for the reason they had to sell and discounted their price accordingly. The notion that 1 foreclosure in your neighborhood brings down prices is inaccurate (along with most other news reportings). Appraisers are told NOT to use foreclosures in their analysis because they don't reflect true value.

Got a house over $275k in Virginia beach and you will probably see a value decrease. Some dropping to 2005 prices, but financing is still low and more affordable housing is still in demand.

Hypothetically if you saw prices drop to 2001 levels while rents stayed high, you wouldn't see properties for sale, landlords would buy them all up, which would increase demand and inflate prices. So no we will not see 2001 prices, don't listen to Ethan or Bubbleboy locally!

Expect stability in affordable price ranges and wait and see what the economy does.

When investors stop buying houses, then be worried. But we're still buying houses, so things are okay. All the speculators are getting flushed out of the market right now. - Tue Oct 28 2008, 12:37

The recent run up didn't have to do with "flipping investors" we've always existed. It had to do with media hype and creative loan products and lots of speculators. Over zealous mortgage brokers making things work when they shouldn't, ie mortgage fraud. I know people like to use us as the fall guys, but it was speculation that drove prices higher. Not flippers. We don't pay market value and try to resell immediately for a profit, we market to find sellers that need to sell quickly, and we buy junkers that need work. We rehabiliate neighborhoods, not speculate.

My concern to your question would also be if the Virginian-Pilot did an article saying that, bigger issue since they are here and have a better picture of what's going on. Overal data doesn't always show the right picture as the Forbes article illustrates. - Sun Nov 16 2008, 08:08

I have to disagree greatly with the information in the new article. I'm a real estate investor here locally, not an agent, so it doesn't matter what the market is doing, I make money so I don't need it to look rosey or not. I don't understand this quote "Virginia Beach homeowners who bought homes this year possess a paltry 5.2% of home equity, and 34.5% owe more on their property than it's worth, according to Zillow.com, a real estate research group." How is it that all owners who bought this year already have equity? and 34.5% owe more than it's worth? You can't have both it's either one or the other. The biggest problem is when you categorize all home prices together as a lump and not separate price points. You buy a million dollar home and the neighbor needs to sell and prices it to 900k. Yeah, you're now underwater technically. But the same doesn't go in all neighborhoods. I do not agree with anyone buying this year actually having equity. But to go with Zillow figures is like buying stocks because your friend told you it's a good choice. Zillow isn't hardly accurate, that's why they have a disclosure about it. Every city is the best place to ride out a recession, provided your real estate is still affordable when compared with the median income of the area.

California real estate is dropping because really, who can make 75k a year and afford a 750k house? You can't, so prices drop back to more affordable prices. And if no creative loan products ever exist again, prices will continue to decrease in my opinion. If you can't find new buyers at higher prices you'll never sell your house and move to anything else.

So Virgina beach is fine to ride out a recession in, but Hampton Roads is horrible as far as a place to buy rental property that cash flows without putting a ton of money down. There are better cities where your return on investment is substantially higher than Hampton Roads, and it's not anywhere close.

I have a link to that forbes article on my website if anyone is interested, it's under Local news. - Sun Nov 16 2008, 06:21

It may come down to price if things aren't working out. Everything will sell at the right price. And maybe it's going to take a better price for a buyer to forego having 2 half baths. Is there a possibilty to convert a half bath into a full bath? The cost wouldn't be too substantial, it all depends. But you can look at it this way, $5,000 (approx) to convert to a full bath, or $10,000 off the price. If you think the property is getting proper exposure then it just comes down to the price or waiting for the right buyer to come along. You've got to remember, when you are selling a house, you need that exact person who sees the potential for them to live in your neighborhood, your school district, your house. It's sometimes hard to match up those things, after all your asking for someone to want to buy your house at the exact time you're looking to sell. That's why sometimes it takes a bit longer. I just got done with 2 remodels where we added a half bath, so that it was a 3 bedroom 1.5 bath. Another project we took a 4 bedroom 1 bath and converted a room into a master bathroom and laundry room on the other half. So it's about trying to make your property work for the masses out there. Sometimes it just doesn't work. - Tue Nov 11 2008, 11:01

Awesome name, I'd have to admit.

And what they said. You hired that agent to work for you, now make them work for you! - Mon Nov 10 2008, 14:42

There is still the $250,000 and $500,000 tax exempt gain from a home sale, as long as you are within the guidelines set by the IRS. It's not set in stone any changes to the capital gains tax, but it's that fear or belief that it might possibly happen that will fuel people to sell their property now and get into another one. Whether an agent or someone with a house for sale, we can't complain. The more stability in the real estate market the better. Now we just need some reasonable loan products to still exist. Most of us out there never had to deal with the days of 20% down, it's a different animal! - Sat Nov 8 2008, 05:55