It’s not just sellers feeling the pain…

In August new home sales fell to the lowest level in more than 16 years.      In our area, new home builders are either choosing to sell  inventory at a substantial discount or stop building all together; waiting for the market to come back.

And now, the crisis Wall Street’s is experiencing, has put the  brakes on  all kinds  of lending.   Home loans are not an  exception.

We are seeing  some very well-qualified home buyers getting turned down for mortgages.   For the past two years it has just been the seller’s who have felt the pain from our nation’s foreclosure crisis.   (Foreclosures and shortsales  flooded the market and in effect sent home prices plunging.)  

As of tomorrow, NEAMIA, will no longer be an option.   The rules for FHA loans are changing too.  

Don’t count traditional sellers out, just yet…

   If you are buying, do not make the mistake of ignoring traditional sellers.  

In real estate for the past two years, it is very common for buyers to want that  foreclosure or short-sale deal and choose to ignore traditional sellers altogether.

By doing this, in my opinion, you are selling yourself short.   The majority of the traditional homes that are for sale are beautiful, clean and attainable without the high risk of a foreclosure and short-sale purchase.  

Our sellers are more than willing to negotiate for the most part, and you don™t have to wait weeks to get a response.   There are some great deals on the market right now, that are for sale by traditional sellers.   Don™t hold out for that deal¦It might never come, and sooner or later things will turn around and you don’t want to find yourself left behind.

Another SMALL Step in the RIGHT Direction

This past August filings for foreclosures did increase as compared to the same time last year.   How can this be good news?  

Reports that have come out today, say that filings have been dramatically slower than in the past few months.  

Finding relief from this real estate crisis is a step by step process.   If you are an avid reader of my blog, you know that in my opinion, their are many different factors that have led to our real estate crisis.  

The next few months will be very critical for our nation.   A new President will be  elected.  We will see how the new housing bill will effect the market. Other factors will also come into play: How will  tighter restrictions on loans effect the market?   How will  the government handle the take over of the two  biggest mortgage giants in our country?  

Only time will tell, but in my opinion we are taking the steps to put us onto the road to recovery.

   

Community Information for Investors, Families and Tax Payers

Last Thursday evening, I had the opportunity to meet with the Brentsville District Supervisor, Wally Covington.   Fortunately, we have done much needed work to our roads  in the area over the past 2 years.   Unfortunately, Mr. Covington expressed concerns about future budget  cuts  coming from the Governor’s office  in the future.

We spoke about future projects coming to our area.   I know this information is very valuable to my clients who are looking to the future for investments.   I also get calls about future schools to deal with overcrowding issues.   I have also included information on potential projects that will greatly effect our area.

The Arts Center that is under construction  across from George Mason is under construction.  George Mason is also in the process of acquiring more land to expand the Freedom and Aquatic Center.   They are also very interested in putting in student housing in the coming  years, and this is only the begining.      The road network in this area is going to work well with businesses, the college campus and the community.    Mr. Covington expressed that the future development of this area is slated to be modeled after  the communities you  would see in  Blacksburg or Charlottesville.      

 Here is some more information that you might find useful:

*A new  high school  is being planned  on Kettle Run.   (Projected  to open in 2011)  

*The movie theatre and other high-end restaurants are in the process of going up at Wellington and Linton Hall.   The movie theatre has been delayed due to the fact that it was bought out by another company.  

*The construction on Linton Hall and 28  should be completed by the end of the year.  

*The New Wegman’s grocery store, on 29,  is scheduled to open in November.

*A Fire Station is being planned to be built close to the Freedom and Aquatic Center.

*The REAL work on 29 and 66 is scheduled to begin on 2010.

Do we really want to learn from our mistakes?

The topic  I will be discussing is a very hot topic among real estate professionals  all over the country.      

The Housing stimulus law will take effect on October 1st.   A key provision of this plan, in my opinion will actually play a major part in helping to end our foreclosure crisis in Northern Virginia.  

FHA can NO longer insure mortgages that have the seller or another interested party who pays the buyer’s down-payment.   (For example:   We have all seen New Home Builder’s signs for “Zero Down Payment”.     The builder is actually paying the buyer’s down payment.)   As of October 1st, this will not be legal.   The National Association of Realtors is reporting that more than 28% of these types of loans ended up in default.   This is approximately 3 times greater than FHA loans without seller funded payment assistance.

Down payment assistance from government programs, family members  or charities that are not seller funded will still be allowed.
 

I believe this is going to greatly effect the New Home industry.   I do think this is unfortunate. On the other hand, I can’t tell you how many new home communities I have been in lately that have 3 to 4 or even more foreclosures on each street.  

This provision will keep some from buying, which is unfortunate,  but it should help prevent future foreclosures….isn’t that our goal?   There are many factors that have caused this foreclosure crisis we are in.   If you have read my prevoius blogs, I speak about how we are headed to recovery, but it will be slow.   There is NOT just 1 factor that has caused this real estate downfall.   If this was the case , we could just fix the problem and go on.   The good news is that our nation is fixings the problems that have contributed to  this crisis.  We do want this crisis to come to an end.   We want to learn from our mistakes not repeat them.