Buyers - Buyers — Where For Art Thou?
February 18th, 2008 Categories: Alexandria Dirt, Arlington Dirt, Falls Church Dirt, First Time Buyers Club, McLean Dirt, Northern Virginia Home Buying, Northern Virginia Real Estate Dirt, Reston Dirt
Some people see the glass half empty – others see it half full. But those that see this market as an enormous buying opportunity will be those who prosper in the end! You think that’s crazy? Let’s look at the current market conditions.
Inventory of Homes in Northern Virginia
Let’s see… There are over 6,600 homes for sale in Fairfax County alone, 2/3 of those under $500K! Think you might have some choices now? Uh huh! I think yes. Choices mean you get to be picky – picky about location, condition and, um, yes, PRICE!
Seller Contributions for Closing Cost Assistance
Yep - you betcha! In many cases we are seeing sellers more than willing to cover buyer closing costs. And, if your lender allows, you can accept as much as 6% subsidy from the seller, which often enables the already low interest rates to be bought down even further! There is a lot of creative financing being offered now and it’s NOT the types of programs that got folks into trouble - these are programs that can help you as a buyer get into your home by taking advantage of market conditions.
Price Flexibility
More than ever, sellers are making every attempt to price their homes properly. That is, pricing in order to get an offer in the first week or so at or near their asking price. Not all are able to hit this number, so once a property has been on the market for 30+ days, sellers are beginning to see their way to reducing prices and/or negotiating. Don’t be afraid to put an offer out there. You never know what a seller might be willing to accept - they even surprise us sometimes!
Interest Rates and how they translate to Purchasing Power
Interest rates are still in the extremely low ranges! Especially for borrowers who have been careful with their credit scores and have enough saved for good loan-to-value ratios (20% or more down). Did you know that on a $300,000 loan, the difference in just 1/2% of interest rate (say from 6% to 6.5%) either 
increases the payment by $100 OR it reduces your purchasing power by a whopping $16,000!!! That’s HUGE –
So I ask – why were buyers clamoring to make purchases while chasing the market upwards? Remember 2004 and 2005? Buyers were waiving their rights for inspection and sometimes appraisal; they were outbidding the nearest bidder sometimes by thousands of dollars; often they were behaving like this for homes they weren’t really in love with – it was just the home that happened to be available.
Here we sit in 2008 with inventory (read: choices), seller flexibility, and fantastic interest rates in our corner. Why on earth would you NOT think this would be a more ideal time to buy? You may be nervous about not hitting “bottom” yet – that’s valid - however, economic signs point to a healthy economy here in the Northern Virginia area for the forseeable future, so as long as you intend to stay in your home for the next 3–5 years MINIMUM, I say get your comfy shoes on, put in a call to your local lender and give me a call to get started.
Happy President’s Day!
Jennifer Klaussen
Serving all of your real estate needs in Arlington, McLean and the entire Northern Virginia Region!
Contact me today for a free home valuation or buyer counseling session! The Time is NOW!
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This is a very specific and pertinent post Jennifer and I hope the local buyers and sellers appreciate your info.
I am just building my blog and yours is very much admired. Keep up the important local info and I am sure you will weather this challenging real estate marketplace.
Look me up when you come up North!
I couldn’t agree more it is a great time to buy a home. The most important part is to meet with a lender and see what amount of home you qualify for and then you can go out and find the perfect home.
Since the lending process has been slowed down by recent activities I think starting her is best.
For the first time buyer do your homework first and make sure you credit is in good standing if not ask for copy of credit reports and make any corrections. A steady job for two years and good credit and savings sounds like what lenders want to see.
I heard last weekend on many blogs that they had more people at open houses than in a long time. People are starting to see that it really is a great time to buy.