It’s certainly true that residential sales in our area in the under $500,000 price range have hit new highs as far as market activity is concerned. That’s a good thing.
But what’s not so good is the fact that the price levels are not rising as a result of that activity.
Inventory levels of these “affordable” houses (only in Loudoun County would we say that) are lower than they’ve been in some times. And mortgage loan rates are still unbelievably low. I was just party to a transaction where the 30 year interest rate was 3.85 percent! It’s amazing how much buying power you have with that kind of rate.
But the opposite side of that price pendulum is the continuing emergence of short sale, and increasingly foreclosure properties that hold prices down. Not every distressed property is necessarily a “good buy”, but rest assured, every buyer looks at the most recent SOLD price for these, and ALWAYS compares that to the house he is considering. And he should.
What’s important to keep in mind is the fact that time continues to march along. Although it seems like only yesterday that we all became aware of the fact that “something bad” was happening to our local economy, and that the “recession-proof” notion of home values here in Northern Virginia, for the first time since the early 90s was somehow under siege.
But pay attention to today’s date! It has been over four years since we learned that the “Great Recession” was upon us…. but life goes on. And more and more, your neighbors and friends have finally had enough of hunkering down and waiting for a better tomorrow; they have given themselves permission to move forward with their lives. Hence, resale activity.
The FEDs recent announcement that they would keep interest rates at, or near, zero until the END of 2014 should tell you all you need to know about the state of our economy….. it isn’t good.
In a recent article in the Washington Post by Peter Whoriskey, he said:
“Since the depths of the recession, key aspects of the economy have rebounded. The nation’s output has grown. The stock market began an ascent. The unemployment rate drifted down.
When it comes to the value of what many Americans consider their biggest financial asset, no such return appears in sight.
Data released Tuesday showed that seasonally adjusted housing prices have reached a post-bubble low, as the minor surge that began in 2009 fizzled, to be followed by the almost continuous slide of the past 18 months.
The housing bust, in other words, appears to be even worse than it was at the nadir of the recession….”
But you should also take heart in the knowledge that employment, ever so slowly, continues to improve, and businesses are once again starting to expand.
For the first time in many years, I am beginning to sell building lots. That market has been dead and gone since 2006. And most of the folks who are buying lots intend to build within the next six to eighteen months.
For rest of us, it comes down to a simple question: “Do I continue to be held hostage by the uncertainty that is all around me? Or do I sit down rationally and consider what would be in my best interest at this time, then move boldly forward?” Life is far to short to ever endure feeling “trapped” for long; it’s contrary to our basic nature.
So if your family situation has changed (added or lost a member), your need to grow and expand is constantly on your mind, or your date for retirement is slowly drawing nearer, think about “trying on” a few changes. Look at some homes to buy that may hold the promise of a new life together.
See what your present home is worth now, so that you can take advantage of the market on the “buy” side. And if either direction feels right, take the next step to enjoying your time here on earth. It’s good for you.
Leave the “status quo” to others; there are plenty who are very good at being “victims” of a “down economy” or “bad breaks” and worrying about the future.