Chesapeake V.A. good or should holding out a little while to see how the market goes for a buyer..?? Thanks

Asked by Thomas, ALOIA Tue Oct 2, 2007

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23
Charles Farl…, Home Buyer, Chantilly, VA
Sat Dec 15, 2007
Now is not a buyers market, prices are still way outside the norms. Google for Professor Shiller's chart from the 2nd edition of Irrational Exuberance. Once you see it, you will know what is up with real estate in America (and Australia, New Zealand, Spain, Ireland I believe, England and some others). My suggestion would be to really research what has happened to the USA's real estate market. A good starting point would be http://www.thehousingbubbleblog.com, and look back in the 2005/2006 years. READ THE COMMENTS. There is quite a bit to learn. Also, Credit Suise published an ARM reset chat that is interesting, and perhaps a bit scary. I go to Bloomberg for my financial information. The market really hasn't start to tumble yet. If you still buy into the "I've gotta own because renting is for loosers" mantra, go for new home builders. They should be getting desperate, and can undercut the used home market. A big part of the value of new homes was the land was very expensive, but look any big home builder and you will see them dumping millions of dollars of land options and what not. Land value is tumbling down, and this is a big part of the cost of homes (of course, you get no land with a condo or townhome, but don't let that stop people from pricing them way high).
2 votes
Hi, , Virginia
Mon Mar 10, 2008
I agree with Frank Bigans. If the house is priced properly it will sell. Here is a link to a house on trulia. The price now is $239,000 but in 2003 it was $129,000. When this house is correctly priced at $159,000 it will sell( lets assume 4% increase in value ).
1 vote
Kelly Nance, , nationwide
Tue Feb 5, 2008
Not being a realtor...all I can recommend is that it is a GREAT time to buy. Rates are LOW....very low and people think they are going to drop lower. What will happen then if the market comes back strong? Rates will still be good but it could change back to a seller's market then....the deals are not a good. I see alot of contracts and right now....sellers are VERY negotiable. They are paying closing costs and some are offering and paying for "special" buydown options. I have one contract where the seller is paying for a 3/2/1 buydown and the buyers start rate is below 3%!!! I personally think it is a GREAT time to buy!!!
1 vote
Spivey76, , Chesapeake, VA
Fri Dec 28, 2007
I find it funny 3 real estate agents have said the same thing all agents said all last year and at the end of 2006, yet the market still hasn't even started to recover.

The funny thing about Hampton Roads is the heavy military saturation. Every year real estates agents look forward to military transfer time, which does give a little bump to the market. Slow winter? Just want until the spring when service families start transferring. This gives the 3.4% figure mentioned by one reply a little credibility, but in no way are things getting any better for sellers.

I've lived and grown up in this area. While it is a nice place to live, it's also expensive. Back in the late 80's and early 90's the style of house that had dark wood, carpet throughout, and 3 beds with 2.5 baths was all rage. If you look at most of houses now, the only think the sellers did was add wall paper - when they first bought the house. Nothing updated, nothing renovated....just over sellers expecting to much. Not all houses are like this, but most are.

My advice would be to wait. Rent something - save your down payment because I think there are going to be some big changes over the next year. After another military transfer cycle takes place and the market is still dead, then we'll see some changes. Agents don't like to think about this - lower housing prices mean lower commissions. Remember, they have to think about their pockets also.
1 vote
NonRealtor, , 23456
Fri May 23, 2008
voices member. You can still flip houses in this area. That person just made 110K in just 5 years. That's 22K per year. It goes to show you, that if you wait long enough, someone will buy your house. There was a bigger house, just down the street from this house, that sold recently for 226K, but it was a bank owned home.
Golf Course Community
978 Willbrook Rd
Newport News
0 votes
Tim Churchwe…, Agent, Chesapeake, VA
Tue May 20, 2008
Forgot to say something to John:
John,
Cudos for doing your homework. Sounds like a wise decision, providing it won't cause emotional distress. More money and lower cost of living! Feel free to use my website at http://www.tchurchwell.com if you want to look up demographics, crime, do comparisons, etc.
Web Reference:  http://www.tchurchwell.com
0 votes
Tim Churchwe…, Agent, Chesapeake, VA
Tue May 20, 2008
Wow, comments are all over the place! Some good, some bad. Thomas, you have to decide on a few things first. 1. How long do you intend to occupy the property? If you are confident you will be leaving the area in less than five years, then perhaps you shouldn't buy, unless you think you will be able to rent it out. Less than five years is the case regardless of the market conditions if you can't afford not to make money on it (this applies to any investment). For the Realtors on here, I know that the average homeowner only stays 5-7 yrs, but I'm talking about "investment horizon".
2. What are your decision factors for purchasing? Investment? Home ownership? Family?
3. What is the after-tax equivalent of purchasing versus renting?
There are more questions, but these should be a starting point. As for concern over the market, wouldn't you rather be buying when everyone else is scared to purchase? or buy when everyone is buying and telling you that you should purchase as well? The former creates opportunity, the latter creates price inflation. I would rather buy during firesale prices in a home in which I would be comfortable waiting out the market if it doesn't turn up. Let us know how it turns out.
Tim
Web Reference:  http://www.tchurchwell.com
0 votes
John Jamison, Home Buyer, Baltimore, MD
Sun May 18, 2008
Wow, that is insane, I am now looking at TEXAS as a possibility. It's not my first choice but the prices are reasonable. At 250,000 you can get over 2500 sqft and make more money as a software engineer compared to here. Well, that is to bad but I got to leave my options open.
0 votes
Concerned Ci…, Home Buyer, Virginia
Fri May 16, 2008
To the Voices Member from March 10... Funny but the link you posted to the house that you did not think will sell for 239K sold exactly for 239,900 on March 27th. Shows you that none of you can predict anything and these "answers" should really be taken with a grain of salt.

http://www.trulia.com/homes/Virginia/Newport_News/sold/29237…
0 votes
Phil Young, , 23323
Thu May 15, 2008
If someone bought at the top of the market and that area declined in value than they will take a loss. (Long Sentence)

Do some math about the tax benefits about homeownership.

There are a few local areas that have declining value. Most neighborhoods have stable values.

Price it Right and it will sell!
0 votes
NonRealtor, , 23456
Thu May 15, 2008
I read a post from a man in newport news, va that is trying to sell his house. He is not having good luck. The post was on zillow. I think the military have wised up to the fact that a declining market, mixed with 4 year relocation, spells trouble, so they're not buying. What happens to the military man that transfered and is forced to sell now that bought at the peak of the bubble in 2005?
0 votes
Phil Young, , 23323
Thu May 15, 2008
Everyone has different housing needs. In our area many military families would rather purchase using their BAH than rent or stay in housing. They can pick the area and schools.

There are a lot of affordable housing options for buyers. Sellers need to do the math and determine whether the bottom line makes sense.

We always assist our clients make sense of the current market. A little more that a traditional REALTOR does for a client. If I say NO!, I mean NO You might not agree at first but I've bought and sold 15 properties myself and never lost a nickle.

One comission won't make or break me. My past clients are more important.

Good Luck!. Call 456-5440 and ask for Theresa if you need an immediate answer.

http://www.teamfavorite.com
0 votes
Kq, Home Buyer, Chesapeake, VA
Sun Apr 6, 2008
I'm suprised no one has analyzed the military housing allowance and how that impacts Hampton Roads prices. The military is one of the few employers who pays a seperate line labled "basic allowance for housing" which most military members use as an anchor when determining how much they can afford to pay for a house. It is generally looked at as a floor, i.e. most military families plan on paying at least their housing allowance for housing. The rates are determined based on the cost of housing in the area, so its very much a self-perpetuating machine. Go to http://perdiem.hqda.pentagon.mil/perdiem/bah.html and type in 23451 for the zip to get an idea of housing allowance rates. The number of O-3 with dependants and above ($1750-2140/month) probably numbers in the thousands and the number of E-6 and above ($1480-$1800/mo) numbers in the many thousands. At current rates (5 1/2%) this supports a $250k to $375K loan. Also remember that the majority of these military families who are "foolish" for buying because they have to move every 4 years, were by definition all forced to sell their houses over the last 3 years into the height of the bubble, so most are sitting on tens or hundreds of thousands in profits from their last house to use as a down payment. For example, some of the E-5's who worked for me sold their townhouses in Hawaii for $250K profits in 2006-07 and I know San Diego families in the same situation. While I agree that the oxymoronic "This is a great time to buy AND sell" mantra of the realtors is out of touch with reality, I would like to see some more thoughtful analysis of this particular market wrinkle that probably impacts Hampton Roads more than anywhere else in the country.
0 votes
Spivey76, , Chesapeake, VA
Mon Mar 31, 2008
It depends. Most of Chesapeake is over priced if you ask me, and I've lived there since 1990. Incomes in the entire area are lower (yes, the military has a big part to play with that) and unless your going to work for a government contractor you'll have a hard time making what you might somewhere else.

That said, here is what is going to become of Chesapeake once this bubble has deflated all the way. This area is one the more expensive (in terms of what you get for your dollar)....

http://norfolk.craigslist.org/apa/620292009.html
0 votes
John Jamison, Home Buyer, Baltimore, MD
Sun Mar 30, 2008
Their are some interesting comments on here, to say the least. Maybe one of the realtors can help me. I have notice the price of homes in neighborhoods I regard as safe and comparable to what I am use to over 300k range. But I notice the average income in the area is between 60 - 70k. I am a software engineer and it seems the salaries in my profession are porportional to the average income. Are the prices of homes higher due to heavy military presence? I have a little over a year to decide if I want to uproot and raise my family here. It looks like a nice place from what I see, my only concern is will I be able to make enough to sustain a comfortable living standard with the drop in salary. So what is the driving force for home prices?
0 votes
Charles Farl…, Home Buyer, Chantilly, VA
Wed Mar 5, 2008
Kelly - market springs back how? DO YOU PEOPLE NOT GET IT!? PEOPLE HAVE NO MONEY. It was all high risk lending that fueled it. It can't come back, because all the investors that got taken it are melting down. Prices are not based on income, they are based on the false speculation that prices will continue to increase at the unsustainable rate. Go look at professor Shillers chart. Google it. I'll wait... .seriously. YEA, you see that spike? UNSUSTAINABLE. The market has no where, and I mean NO WHERE to go but down. Now that you've seen the Shiller chart, look at Credit's Suisse's ARM reset chart on google. Yea, I'lll wait again. Check that out, YEARS left of mortgage resets that will likely result in foreclosures, on top of the fact everyone in the real estate biz (not the bankruptcy lawyers tho!) will be hurting from loss of work.
0 votes
Charles Farl…, Home Buyer, Chantilly, VA
Wed Mar 5, 2008
Spivey - yea the military is funny. All these people that are going to be here 2 or 4 years buying up homes. Very bad move. A friend's relative had purchased a townhouse 4 years ago, and put it on the market for 100% more than it frigging cost (look at the salary increases in the area). Finally some idiot buyer and his girl step forward, both in the Navy. They got *0* money to their name, but are wanting to buy the stupid townhouse. So they needed closing cost assistance and all that. What does the seller do? Rejects them because "she wasn't going to get RIPPED off." The whole run up was madness and now the falling is going to be gruesome. I don't think people see what is going on with the banks and stuff. America is tapped out, too much debt, people don't produce, so many of our workers are useless. I think it could be a very long time before a rebound. Too much greed. Rent now and remain mobile versus having some pressboard box anchored around your leg.
0 votes
Frank Bigans…, Agent, Newport News, VA
Tue Jan 22, 2008
Thomas,

If you're considering purchasing in Chesapeake, just contact me through my website for a list of properties that have recently sold. This will show you list price, sold price, and days on market. Despite national news, properties that are priced correctly have no trouble selling and this list is proof to that.

Recently, I have been able to negotiate up to $9,000 in closing cost assistance on a property that was priced right. In addition, my clients are also receiving interest rates as low as 5.25% fixed rate for 30 years. In my opinion, this is the perfect time to buy!

Frank Biganski, Realtor ABR
0 votes
Spivey76, , Chesapeake, VA
Fri Dec 28, 2007
So your saying the lots just get passed around until a home buyer picks it up? Doesn't that create an artificial price value? It sounds like racketeering to me.
0 votes
J Paul Picco…, , Virginia Beach, VA
Fri Dec 28, 2007
Bubble Boy makes some interesting points, but in regards to new construction, don't assume they're slashing prices. Most in this area that I've talked to in the last few days (the reason for those calls is completely unrelated to this topic) have very little standing inventory which is where they stand to lose the most money. Most have a model built and then empty lots. Any developer that doesn't have the financial ability to stand on unsold lots for an extended period typically brings in multiple builders, sells them the lots at a "discount", they all build models, thus leaving a 20 lots subdivison with 7 standing models, and 14 lots being held by individual builders who will sit on them for a while before they'll take any sort of loss. I know there is a builder (excuse me while I get specific) that just wrote 16 contracts last WEEK on a subdivision off Volvo Parkway and Kempsville Rd in Chesapeake. How exactly do people think this market crash will lay itself out? Assuming borrowers with their ARMs decide to just stop paying on their mortgages altogether. Will Countrywide (among others) decide to sell these houses after foreclosure for pennies on the dollar? Not quite. I'm working with a lender now on a foreclosed property. They are definitely not pricing them for a quick sale. Until some higher power comes out and tells EVERYONE to drop their prices 10-20%, no one will do it. Its basically a price war with 1000s of participants. Until you absolute have to, no one will just cut the price. We've been through at least round 1 of this "bubble" and no one has quite flinched yet.
0 votes
Angie Nishni…, Agent, Virginia Beach, VA
Mon Dec 10, 2007
When it was a seller's market, all buyers wanted was a 'deal' and room to negotiate.

Now is the perfect time to buy (anywhere in Hampton Roads). Sellers and builder are offering incentives, inventory is good, and mortgage rates are still low. Buyers who are buying now are going to look back in a few years and pat themselves on the back for the deal they got. Locally our sales are up 3.4% and holding.

For those who wait, well... look at this way....
If the rates gets even better and sales keep going up.. the media will say how great the market is.
What happens then..(since everyone believes the media)... EVERYONE wants to buy and sellers won't have to negotiate anything.

If you find a home in Chesapeake and you can picture living there. Ask your agent to do a CMA on the area and then discuss what you should offer. Sellers are more willing to negotiate now, in December when the showings are slim (due to holidays). The market usually picks up again in January.

Best of luck to you !

Angie Nishnick
Your native local Hampton Roads Expert
angie@nishnickhomes.com
http://www.nishnickhomes.com

William E Wood & Associates
Great Bridge Office
0 votes
J Paul Picco…, , Virginia Beach, VA
Tue Oct 2, 2007
That depends on a lot of things. Chesapeake is one of the most diverse cities in Hampton Roads. From Great Bridge to South Norfolk to Western Branch to Deep Creek its one of the largest cities in Virginia by both population and total land. The market is primed for buyers to make aggressive yet reasonable offers. Sellers can still do well as long as they do realize there is competition and market themselves accordingly. Depending on what part of Chesapeake and what price range you are referring to it is hard to speculate on your particular situation. If you are interested in purchasing a home now you should be able to get a pretty good deal with the help of a good Realtor. The main thing to realize now is that there are a lot of incorrectly priced homes and, as such, find a home that works for you that is close to your price range. Let your Realtor justify any offer you might consider making before they just "do what you told them to" and you'll be just fine, regardless of the market we're in.
0 votes
Rosalind Boy…, Both Buyer And Seller, Chesapeake, VA
Tue Oct 2, 2007
It's a good time to buy. There is inventory to look at and interest rates are still at near record lows. Unlike a few years ago, you are much less likely to have to settle for a house that is "OK". As long as you plan on staying in the home for about 5 years you should be fine. Not a good time to try flips though.
0 votes
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