Reston, VA Real Estate The High~Low Game

So let me come clean here and admit that the the title this post isn’t original. In fact I’ve, err, um, well lets just say I’ve borrowed it from another blogger, our own local mystery man (I assume man) blogger, Restonian.

Of course when he writes about the high and the low of Reston real estate he’s full of witticisms that I will not be able to replicate. However I love the idea and would like to offer some insights into the high/low and in between real estate in Reston.

Reston Town Center - Image by Matthew and Tracie via Flickr

We are fortunate to have so much diversity in our real estate market. There are 115 properties in between the high and the low—which is a painfully small number of properties On the low end we have a 2 bedroom 2 bath condo listed at $102,500.00, it’s a short sale over in South Reston. At the other end of the spectrum is single family home with 4 bedrooms, 2.5 baths and 2 fire places also in South Reston listed at $1,399,000.

The inventory in Reston, (yes, inventory is what we real estate agents call your home once we’ve put it on the market), has been low for the past 18 months. While this lack of inventory usually creates pent up demand, the market is still very price sensitive, leaving properties listed above market value languishing unsold, while appropriately priced properties sell fairly quickly. The average price of these 115 properties is $461,000.00. The housing types include 26 single family home, 47 townhouses and 42 condominiums.

What does this mean for you?

If you’re a buyer it may seem there’s not a lot to choose from, but doing a little home work could make all the difference. Consider focusing on properties that have been on the market for more than 90 days. Have your agent pull comparable listings and make your offer based on the data. Most important: when you find the home you want, don’t wait! If it’s priced right it won’t last. If you feel it’s priced too high still– make your best offer. There’s nothing worse than losing “the one” because of inactivity.

If you are a seller low inventory suggests that the market is in your favor and it is… At least, it could be… If you’ve cleared away the clutter (including your husband’s college beer can collection), put fresh neutral paint on the walls and priced it within spitting distance of the comparable properties in your area. Then you are in good shape and can expect a sale within a fairly short period of time. However, if you add an extra 10 or 15 thousand to the number your agent recommends so that you’ll have some “room to negotiate” it’s going to be a long winter.

Bottom line — when inventory is tight, and the market competitive, all sides are best served by coming well prepared to the high/low real estate game.

News that the Northern Virginia housing market continues to improve with several areas seeing appreciation as high as 8% can only be viewed as positive. The carnage of the ruptured housing bubble that was so clearly visible in many neighborhoods is receding.

Trickier to assess is the damage to the credit of former home owners who for whatever reason lost their homes to short sale or foreclosure. Living without enough financial cushion, a lost job, a sick child; things that in the normal course of a life might cause one to decide they should sell their home and live smaller until they were back on their feet, when combined with plummeting home values created a quagmire that dragged many people down the foreclosure/short sale path.

Careful management can make it happen for you.

In speaking with my lender colleagues the news is not all doom and gloom for a buyer that has a foreclosure/short sale on their credit record. Depending on factors in place at the time of the foreclosure or short sale FHA Loans may still be a viable option. All buyers need to be super mindful of paying their creditors on time, even a few late pays can make a huge impact on your credit score.

Like most things in life–time will heal the wounds of housing market and the fall out of a short sale or foreclosure on your credit. Being mindful of due dates and credit balances and saving a reserve fund can help put you in a position to buy in 2011.