Thoughts on the Washington, DC, and Northern Virginia Real Estate Market » Seller Resources

What Do I Need to Do To Get Ready To Sell My Home This Spring?

Katie Wethman — Fri, 22 Jan 2010 02:17:22 +0000

Spring is coming early to the DC area. Buyers are out there! Low prices, low rates, and the imminent expiration of the $8000 first time home buyer credit have them circling and looking for the right property, in the right condition, for the right price. And for those properties that are positioned and marketed properly, this could be your best shot at a smooth and quick transaction. But putting your home on the market takes a significant amount of preparation.

The first 30 days your home is on the market is absolutely critical, because those buyers who are circling will come look—once—and if your property is not exactly right then they will just continue their circling, and likely will never return to your property. You will anxiously watch the days on market tick up, and the price tick down. Buyers ARE buying, but they expect a property to be in pristine condition right out of the gate.

To catch the biggest buyer waves, typically you should plan on putting your home on the market in March or April. This year, however, I think there’s a very strong argument to go out early for the reasons outlined above—buyers ARE out there. However, you can’t just throw your home into the MLS and expect the buyers to pounce.

Here’s a short list of things you should be doing now to get your home ready:

* De-clutter. I can’t stress this enough. If it’s not something you use every day, get it out of sight. Put away out of season clothing. No collections of knick-knacks, no personal photos, no college degrees or awards. You want the buyer to be able to imagine themselves in the property, and trust me, buyers are easily distracted by your personal items. Don’t pile things into closets and cabinets—buyers look there too. Get things out of the property and into storage if you have to. Same for extra furniture pieces. Less is more.
* Paint & Clean. A fresh coat of paint does wonders, and is cheap. And clean like you’ve never cleaned before, especially the kitchen and bath.
* Make all minor repairs. The buyer is going to make you do them anyway and it will be cheaper for you to do it now.
* Start monitoring the market, both broadly and in your specific neighborhood. Pricing is absolutely critical, and you need to be realistic. Work with an agent to start getting property updates now.

When you’re ready to put your home on the market:

* Consult a stager. I hire both an interior stager and an exterior landscape consultant for my listings. They look at your property with fresh eyes and have extensive training in how to create a neutral, yet welcoming canvas for buyers.
* Photos, photos, photos. Buyers start their search on the internet, and if you don’t have photos they will skip your house completely. Use professional photographers, or at a minimum, a wide-angle lens if you (or your agent) insist on taking them personally.
* If your home has unique features, consider how to best market them. For example, if the house has an unusual floorplan or is bigger than it looks, consider including professionally drawn floorplans in with the photos. (I do this for some of my listings.)

If you’re interested in hearing more about how to get your home ready, or want to learn more about the home selling process, contact us for an appointment.

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FAQ: High Investor (Low Owner-Occupancy) Ratio Condos: How Can I Buy or Sell?

Katie Wethman — Wed, 02 Dec 2009 18:07:18 +0000

One of the most common issues a condo buyer or seller faces in obtaining financing is meeting the owner-occupancy ratio required by lenders or the FHA. Owner-occupants means the units are actually occupied by their owners as primary residences, rather than those owners who choose to rent out their units. Renting units out is particularly popular with long-time owners, who bought a unit years ago, used the equity to buy a bigger property which they moved in to, and kept the original condo as an investment property. A good way to build wealth, but now causing headaches for other owners in the building.

The tightening of the credit markets in the past few years has been particularly hard on condos. Even long-standing buildings in the most popular parts of the Washington area are now facing problems with financing. This obviously matters to buyers because it’s difficult to get financing. Many condo owners, however, don’t realize until they go to sell that it’s an equally big problem for them—if loans aren’t available at competitive market rates, then the pool of potential buyers becomes very, very small.

FHA has always been harsh on condo lending (see post here for more). They currently require at least 51% of the units to be owner occupied as one of the many hoops they make condo buyers jump through. New rules on the horizon call for this to be reduced to 50%. That same set of new rules (which has been delayed in implementation several times) calls for the pre-sale requirements of new construction projects to be eliminated. Currently, at least half of a project must be pre-sold before FHA will do loans in a building.

But in today’s climate, even conventional loans can be difficult to get in a low owner-occupant ratio building. Many conventional loans (or rather, the investors who purchase those conventional loans) require the building to be 60% or even 70% owner occupied! If the loan is Fannie Mae or Freddie Mac eligible then certain requirements apply as well. Who would have thought that conventional loans, with their larger down payments, would be stricter than FHA?!

So what can you do if you are a seller trying to sell (or refinance) your unit in a high investor ratio building or a buyer trying to buy one?

First, ask your lender whether the condo is subject only to a limited review, rather than a full review. Many lenders aren’t aware of the limited review option. In a limited review, the lender doesn’t even ask for the occupancy percentage.

Next, see if there are any REO (bank owned or foreclosed) units in your building. Recent changes allow lenders to count REO as owner-occupied.

While these rule changes may help, if the ratio is still too high, then as a seller you have no choice but to find a buyer who has all cash or is willing to take on a non-30-year-fixed mortgage, for example a 5/1 ARM or 7/1 ARM. Rates are low enough now that you have a shot at that, especially if you are able to offer the unit at a low enough price that a buyer is willing to take the risk. And as a buyer, the 5/1 or 7/1 is not a bad option if you don’t plan on staying in the condo very long, or as long as you have reasonable caps on the interest rate hikes going forward.

If you’re looking for a top notch lender to help you refinance or purchase in a high-investor building, please contact me. I recently refinanced my own condo which fell in between 50% and 75% owner occupancy so faced some of these challenges. And if you need to sell your high-investor condo, let’s talk about your options and how a marketing plan might need to be adjusted.

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Why is the $6500 home buyer tax credit important?

Katie Wethman — Sun, 15 Nov 2009 16:50:03 +0000

By this time, most people are aware of the extension and expansion of the $8000 first time buyer tax credit, and many even know about the new “category” of “first time buyers” who are eligible for a $6500 credit. You can read more details here. Income limits were raised (previously $75,000 AGI for a single up to $125,000), and the new deadline is April 30 (under contract).

These changes obviously made a lot of buyers very mad; those who purchased in 2009 but didn’t meet the income eligibility now look like suckers (but take heart…at least you had low prices, fantastic interest rates, and likely a lot more choice in inventory than today’s buyers have.) And what about those souls that purchased back in 2008 when the “credit” was just a $7500 loan? (Again, take heart…low rates, low prices, and you really did have the pick of the litter on inventory. Just look at the inventory lines on this graph of Northern Virginia Homes for Sale and compare the 2008 line to today. What good is a big credit if everything available to buy is not worth buying?)

With inventory so tight, why do we need an extension and expansion, and on top of that a new category (the so called “move up” buyer, though in reality it could just as easily be a “move down” buyer, or even just someone who wants to convert their current residence into an investment property)?

The first reason is that the DC area is unique with its suddenly tight inventory. DC has long been predicted to lead the nation’s real estate recovery given the incredibly strong job market, well above average incomes, and stimulus money flowing freely.

The second reason is that the pool of buyers has dwindled towards the end of the credit period (which was due to expire at the end of this month) so we needed to find a way to increase it again. Why didn’t this initial rush of buyers lead us to a full recovery? Again, it varies by area…the progress towards a stable market in DC was much more evident than in the rest of the country. But two complicating factors: (1) the pool of entry level housing dropped too quickly and buyers were left circling and competing against other buyers for remaining homes and (2) much of the inventory they were buying were vacant, foreclosures, or short sales–meaning that those sellers were not, in turn, trading up to buy the next level of housing. So the recovery stalled at the entry level price point (in our area, I’d approximate this at $450k and below).

The extension and, more importantly, the new category attempts to address the second issue in particular. First, now that a higher AGI buyer has an incentive, that category might be buying up inventory in the “next tier” of pricing, driving a recovery up the ladder, so to speak. Second, by creating a new category of credit eligible buyers–the $6500 crowd–it’s likely that those trading up will also be selling their entry-level homes in order to afford their new purchase, relieving some of that inventory pressure on the first time buyer category. So in other words, just as the $8000 stabilized entry level pricing, the hope is that the $6500 will stabilize “trade up” level pricing.

But those people are all underwater on their homes and can’t sell, you say! Ah, the eligibility restrictions cover that: one must have owned and occupied the property for 5 of the last 8 years (meaning they purchased in 2004 or earlier), and while there will certainly be some who cashed out equity and are indeed underwater, there will be many more who have plenty of equity in their property and want to use this opportunity to move into the home more appropriate for the next stage of their lives. This last point, of course, might not play out if those owners decide to hold on to their current property as an investment, and simply buy a second property. I suspect the people who do that will be limited though: the AGI limit, even when raised, along with the $800,000 maximum purchase price will limit people in the DC area from taking full advantage of that.

It will be interesting to see how this all plays out, but I suspect we’ll see an increase in the entry level category of inventory in early 2010, both from continuing foreclosures, trade up buyers, and simply sellers who recognize that the market at the lower price points in our area has stabilized and maybe is even on the upswing in certain neighborhoods.

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Ready to start your home search? Contact us to be notified of our next free First Time Home Buyer Seminar or to meet for a cup of coffee to discuss market conditions where you want to buy.

Thinking of selling? If you have a property priced below $450k or so and in a desirable neighborhood, there very well could be a lack of inventory. Sell “high”, and use the proceeds (along with historically low interest rates) to buy “low” at the next pricing category. Read more below:

Sign up for a free MLS Market Snapshot to see what’s been going on in your neighborhood (Northern Virginia, DC, and Maryland only)

Buying & Selling at the Same Time: Part III

Katie Wethman — Fri, 13 Nov 2009 02:31:39 +0000

Read the first two posts in the series here (Home of Choice contingency) and here (Home Sale Contingency).

Our next tool is a two-for-one: Occupancy Agreements. There are Pre-Settlement Occupancy Agreements and Post-Settlement Occupancy Agreements (aka Rent-Backs).

Occupancy agreements help facilitate a buyer’s or seller’s move date when it doesn’t coincide with a settlement date. They essentially act as pseudo-leases, with one party as “landlord” and another as “tenant” (though it’s important to note that those words are not used explicitly. Landlord-tenant relationships create all sorts of new requirements, especially in DC.)

Why would a seller need a rent-back? Usually it’s because of the timing of receipt of funds. Often a seller needs to proceeds from a sale in order to buy their next home. But in some jurisdictions, like Virginia, funds are not released to the seller until the deed and mortgage are recorded at the courthouse, which could be days after settlement. Even if proceeds are received the same day, banks often put holds on checks so the cash may not be immediately available to a seller. (The timely transfer of funds is the reason that many sellers will request a particular settlement company, too.)

Why would a buyer need a pre-occupancy agreement? Generally because their lease timing or their own sale (in the case of a move-up or move-down buyer) doesn’t coincide with settlement.

What protections does the “landlord” have during an occupancy agreement? For one, a deposit, just like in a lease, plus a clause that any damages will be paid for by the “tenant.” There’s a walk through of the property at settlement, and also one at the conclusion of the occupancy agreement.

There are a lot of other clauses in a standard Pre- or Post-Occupancy Agreement. Make sure you discuss the risks with your agent.

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How Do I Protect Myself if I Need to Buy and Sell a House at the Same Time? (Part II)

Katie Wethman — Sun, 08 Nov 2009 20:12:50 +0000

This is the second part in a series about tools that sellers have at their disposal to help manage a simultaneous purchase and sale of property. Click here to read the first post in the series about Home Sale Contingencies.

Another contract clause available for use to help manage both a purchase and sale is a “Home of Choice Contingency,” sometimes abbreviated at HOC and also known as “Contingent on the Seller Purchasing Another Home.”

This is a particularly useful clause when a seller believes that it will take longer to sell their current home (“Old House”) than it will to find a new home that they want to buy (“New House”). Most sellers are always on the lookout for their next property, but if the average days on market for sales is high in your area, you may need to get a head start on listing before you put a contract in to buy.

This contingency allows a seller to accept a contract on their current home, but provides for a negotiable number of days in which the seller can go out and negotiate an acceptable contract for themselves on New House. If the seller fails to find New House, then the seller has the option to void the contract if it’s within the contingency period. If a seller hasn’t been looking at homes along the way, it’s unlikely that this brief contingency period will be helpful, but if a seller has already been touring homes, and has a favorite in mind, this is usually just what they need to make sure they can get both the sale and purchase locked in at the same time.

It’s important to note that in our standard NVAR addendum, this contingency automatically expires at the end of the negotiated number of days unless the seller gives notice to the purchaser, so pay attention to those deadlines!

Tip for Buyers: If your contract has a home of choice contingency, you may wish to negotiate a provision for the seller to reimburse you your actual out of pocket costs for inspections, appraisals, etc., if the seller exercises their right to void.

Read Part III in the series about buying and selling at the same time here.

Disclaimer: This post is not intended as legal advice. Consult your agent or attorney if you need assistance with contract clauses or negotiations.

Read and Learn More:

$6500 “Move Up” Buyer Credit for those who have lived in their home for 5 of the last 8 years and are under contract by April 30, 2010 (restrictions apply)

Sign up for a free MLS Market Snapshot to see what’s been going on in your neighborhood (Northern Virginia, DC, and Maryland only)

$8000 First Time Home Buyer Extension and New $6500 “Move Up” Buyer Credit Details

Katie Wethman — Fri, 06 Nov 2009 23:41:31 +0000

It’s officially passed the House and Senate, and is now awaiting the President’s signature. Along with the extension of the $8000 First Time Buyer credit (now applies to any buyer under contract by April 30, 2010 and settling by June 30, 2010), there is now a new credit category: long-time residents of the same principal residence which has been given the shorthand name of “move up buyers”–though in reality it could just as easily apply to “move down buyers.”

If a homeowner has owned and used the same residence as their principal residence for any five consecutive years in the last eight (as of the date of purchase of a subsequent residence), then they are treated as a “first time home buyer” eligible for a (up to) $6500 tax credit when they file their next return. Other key points:

This credit applies to purchases under contract between December 1, 2009 and April 30, 2010.
Income limits are higher than with the previous credit: $125,000 AGI for a single individual and $225,000 AGI for a married couple (and then phases out until $145k/$245k).
Homes with a ‘purchase price’ (as defined by the IRS) above $800,000 are ineligible.
Thanks to all the fraudsters out there, purchasers must now submit documentation of purchase along with their tax return.

Some other restrictions apply (e.g., must keep the home for at least a year), but the key points are above. Update 11/14: here’s a nice summary article that appeared in the Washington Post. Some other FAQs that have since been answered:

There is no requirement that you sell your current home. You can rent it out, or sell it later. BUT you must occupy the new home as a primary residence
Many types of dwellings are eligible: new construction, existing homes, condos, mobile homes, or boats that function as a primary residence BUT in no case can it cost more than $800,000 or the property is ineligible.
If you close between Nov 6 and Dec 31 of 2009, you can claim the credit on your 2009 return or even amend your 2008 return (important to know if your income has changed, making you ineligible in 2010!)

This is key news for our area, which has seen a dramatic drop in housing inventory, especially at the first time buyer price point–this could well create demand in the next category up (up to $800,000 that is) of homes, and will create some breathing room, inventory wise, for the continuing first time buyer demand.

This could be the ideal time for these move-up or move-down buyers:

Prices for inventory at the first time buyer price point are stable or even rising
Interest rates are still at historic lows
Upper end homes have dropped (and are continuing to drop) in price

Combine these three points and you get “sell high” and “buy low”. If you’re thinking of selling your home to “move up” or “move down” and want more information on the tax credit, please contact me.

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Sign up for a free MLS Market Snapshot to see what’s been going on in your neighborhood (Northern Virginia, DC, and Maryland only)

How Do I Protect Myself if I Need to Buy and Sell a House at the Same Time? (Part I)

Katie Wethman — Thu, 05 Nov 2009 16:18:59 +0000

Now that the first time buyer rush is nearing its end (unless it’s extended…stay tuned…), and there’s a lack of inventory for entry-level price points (below $450k-ish) in much of our area, this might be the ideal time for owners to start thinking about putting their homes on the market in our area. Yes, despite the holidays coming up…especially if the credit gets extended.

But many sellers worry:

What happens if I can’t sell my home and I’m already under contract on another?
What if I have a contract on my home but it falls through?
What if I can’t even find a home that I want to buy and someone has already bought mine?
How do I coordinate the closings so that I’m not homeless?

These are tricky issues to work through, but there are several tools we have at our disposal, which I’ll cover over a few posts.

The first tool we have is called a Home Sale Contingency, aka Sale of Purchaser’s Property and Kick Out. This contingency protects the seller (let’s call them “Bob & Mary”) in case they can’t sell their current home (let’s say “Old House”). It allows the Homeowner to effectively cancel their next purchase (“New House”) if a buyer doesn’t sell Old House. It’s Bob & Mary saying “I”ll buy your house if I can sell mine.”

While this is a standard contingency, it is NOT included in the main Regional Sales Contract in our area–you MUST include it in a separate addendum. In short, it allows, for a negotiable number of days, for Bob & Mary to try to sell Old House while still being under contract on New House. Meanwhile, New House’s owner is typically afforded the opportunity to continue to market the home and accept backup offers. If New House’s owner accepts a back up offer, then they deliver a notice that gives Bob & Mary “x” number of days to either remove the contingency or void the contract. This is called a “kickout.” However, in our area, the status is changed from “Active” to “Contingent/Kickout” and many buyers will not look at properties that have any sort of contingent status.

Obviously a clause that protects Bob & Mary so well is not desirable to New House’s owner, so sometimes it’s difficult to negotiate these clauses in our area. New House’s owner may not want to change the status and potentially lose other buyers who don’t have a home sale contingency. And New House’s owner should of course do their own due diligence to make sure Bob & Mary are doing all they can to sell Old House before they accept this type of contingency. Can you imagine the string of events if Bob & Mary, for example, also accept this type of contingency from a buyer? New House’s owner may not be willing to take this risk. But if New House’s owner is convinced Bob & Mary’s house will sell, and it’s the only offer they have, there’s a chance they will take the offer.

(Note to sellers: there are serious pros and cons to accepting this type of contingent offer, and steps you can take to provide maximum assurance. Consult your agent!) If not, then Bob & Mary need to consider other options, which we’ll cover in other posts. (Contact me to be notified of new posts on this topic, or to discuss other tools at a seller’s disposal.)

Read Part II in the Series

Disclaimer: This post is not intended as legal advice. Consult your agent or attorney if you need assistance with contract clauses or negotiations.

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Fairfax County, VA Inventory and Median Sales Price

Katie Wethman — Wed, 04 Nov 2009 14:36:26 +0000

This chart shows inventory vs median price for single family homes in Fairfax County for the past year. Inventory is continuing to fall in Northern Virginia, and in particular Fairfax County.

It’s easy to see on this graph that median price has closely correlated to level of inventory–that is, until recently. Has pricing hit bottom in our area? Certainly the combination of historically low rates and the first time buyer credit spurred purchase activity. But we’re down to just a few months’ of inventory for buyers to choose from (5 to 7 months is considered a balanced market), so unless something happens to bring it back in to balance we can expect rising prices.

So what can bring it back in to balance? If the much discussed “shadow inventory” appears, that would certainly add to the inventory, though it’s unclear which price points would benefit. The potential extension and expansion of the $8000 first time buyer credit, coupled with a potential “repeat buyer credit” could spur sellers to decide to go ahead and list their home for sale. And by limiting the credit to those who have owned for at least five years, chances are good that those sellers are not underwater on the homes and can afford to sell at today’s lower prices. (Though it may be painful for them to remember what their home was ‘worth’ just a few years ago.)

Sellers, if this credit passes, this could be a very unique opportunity for you:

Prices are hovering above the historical correlation with inventory
A potential extension of the first time buyer credit will create temporary demand, even in what is usually a slow time of year
Interest rates are still at historical lows for your purchase
Prices at upper end homes (above $500k) have taken a bigger hit than entry-level (which was supported by the previous first time buyer credits), so you might get more for your money than in a normal, fully recovered market

If you have owned your home more than five years and you believe it is priced under $800k, this is the time to consider selling!

Contact me to sign up for a market analysis of your home (no pressure, I swear), and discuss how the listing process works.

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State of the DC Area Real Estate Market: June 2009

Katie Wethman — Sat, 13 Jun 2009 13:37:00 +0000

The Spring market is hopping, but some recent changes are making it difficult to predict what’s around the corner. Here’s what’s going on in the local real estate world:

Interest Rates Jump: Mortgage rates took a significant jump in the past few weeks. The short story is that optimism about the economy combined with fears about inflation are pushing rates up. But if you want the long story, you can read more about the relationship between the bond markets and MBS markets here.

Foreclosures and short sales continue to be a very active segment. Banks have finally figured out that the trick to selling foreclosures quickly is to price them ridiculously low and get a bidding war going. It’s not uncommon to have dozens of offers in during the first few days for entry-level price points ($200-300k). Short sales continue to be a source of frustration for buyers, as noted in this good NPR story.

The area’s inventory remains flat (Arlington and DC) to declining (NoVA)

–check out the significant decline in Northern Virginia inventory here.

Case-Shiller is still reporting significant price declines year-over-year, but here’s a good article explaining why, if you read the data more carefully, the news is much less ominous.

New Appraisal Code Scuttles Deals: The new Home Valuation Code of Conduct was implemented in May, and is wreaking havoc with deals. This Code created intermediaries to manage the appraisal process, and some argue that quality has dropped. Many appraisals are coming in low, opening the door to a secondary round of price negotiations in many transactions.

Monetization of Tax Credit: Of significant note to first time buyers is the emergence of programs that will allow a buyer to “monetize” the $8000 tax credit. VHDA has developed a program to structure a second trust of $8000 with no principal or interest payments due during the first 12 months. Details are still evolving, but it is expected that a buyer could use this $8000 second trust as part of their downpayment.

If you are a first time buyer hoping to take advantage of the $8000 tax credit – start your search NOW! The lack of “good” inventory may make it difficult to find something that fits your needs and your price range. Settlements must occur by November 30 to file for the credit, and with the current volume of lending and refinancing banks are backed up. No doubt this backlog will increase for both lenders and settlement companies as we approach November 30 – plan ahead! Contact me to start your search – I’d love to help you!

And finally, just for fun: For all you Arlingtonians and those who want to be an Arlingtonian — check out this rap.

As always, please let me know if I can do anything to help you or your friends with your real estate needs.

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Northern Virginia Inventory Sees MASSIVE Drops

Katie Wethman — Fri, 01 May 2009 14:38:00 +0000

Update 5/9/09: Looks like I’ve got some investigating to do – the final MRIS numbers are published (updated graphs now available at my website here – click on the “Market Stats” in the left sidebar) and they aren’t even close to the “live” data I ran on the last day of the month. Not sure what’s going on — seriously, how can hundreds of listings be not there on the last day of the month but then appear retroactively 9 days later? I’ll look into it and post results here when I get them. The short story is that inventory didn’t drop in most cases–just a tiny increase of about 2% over last month for NoVA, for example. Still surprising but not nearly the big story the initial data hinted at. Contracts are up about 12% over last month, so the buyers are definitely biting! Obviously with an increase in contracts disproportional to the slight increase in inventory, it still indicates a shift in the market, just perhaps not that dramatic a shift as originally indicated.

In the meantime, here are some excellent charts detailing real estate inventory levels that illustrate my points and appear to be using the “live” data just as I had.

Original Post:
This. Is. Big. News. Typically in the Spring (from February through June) we see run ups in inventory as sellers prepare their homes for market. The final numbers aren’t out just yet, but I think both buyers and sellers are going to be shocked by April’s real estate statistics.

Let’s take a look at the Arlington numbers I ran from today’s MRIS (the consortium that owns our area’s multiple listing service.) The spring run up looks like this for January through April: 875 – 925 – 986 ——–and 793 for April! What?! That is the lowest number of homes available since February 2007. A 21% DROP in inventory in Arlington?! During SPRING?

And Northern Virginia as a whole: 7545 – 7811 – 8069 —— and 5435!
A WHOPPING 33% DROP and the lowest number of homes for sale in NoVA since August 2005! Remember August 2005? When buyers were running around bidding things up like crazy because there weren’t enough homes to go around?

What’s going on?? First, buyers are getting it! Low prices, the lowest interest rates in 50 years, and the $8000 first time buyer tax credit have them out in droves. Just in the past week I had 3 of 4 buyers who submitted offers get outbid on properties in various locations.

To add insult to inventory, potential sellers are waiting to put their homes on the market because they don’t want to have to take low offers. Much of the inventory, especially in the suburbs, is “distressed” (foreclosures and short sales) and many are in such poor condition that they will not sell for a very, very long time. So the level of “good” inventory (that is, will realistically sell within the next few months) is even lower than the numbers show. Homeowners who are on the fence about selling don’t want to be lumped in with distressed comps, so aren’t putting their homes on the market.

Finally, the ‘moratorium’ on foreclosures in the first quarter contributed to a lack of new distressed inventory coming on the market. But if there’s another wave coming, it’s not in the pipeline yet: a review of “preforeclosure” filings in Arlington listed just 73 properties, and Fairfax County showed 1000 (a big number, no doubt, but not enough to make up for the 2500 drop in inventory from March to April.)

What are the implications of this?

Buyers: Unless there’s a big wave in May, you’re going to have a lot less to choose from, especially if you want something that is ‘move in ready.’ Less inventory means more competition for the ‘good’ listings — expect to pay closer to list price for those, and be ready to move quickly when you see one you like. Chances other other people are circling it too. Hope for a big bump in the coming weeks – otherwise it may be a tough road if you’re trying to buy before November 30 to take advantage of the tax credit. Typically inventory peaks in June, with another much smaller bump in Sept/Oct.

Get started with your search:
Sign up to attend a free first time home buyer class or search the MLS

Sellers: If you are on the fence about selling, go ahead and get it on the market asap, especially if your home is a good option for a first time buyer. Make sure you put your best foot forward with some sprucing up, staging, multiple photos taken by a professional, a home warranty, and an extensive web presence as part of a comprehensive marketing plan. And it still needs to be priced right, of course. If you’re wondering what the comps are for your neighborhood, contact me or visit my sellers resource center.

Source for all data: MRIS as of 5/1/2009. Data deemed accurate but not guaranteed

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