Northern Virginia Market Update: January 2010
January 23, 2010 by admin ·
Spring has sprung early as far as the real estate market is concerned. Buyers are out and circling, anxiously waiting for inventory to hit. I know I’m starting to sound like a broken record, but the lack of ‘good’ inventory continues to be the story in real estate circles.
Check out our market data graphs: Arlington is down to 4 months of inventory
and Northern Virginia is down to just 3 months
. That’s the lowest level of inventory since August 2005.
Remember August 2005? When there were bidding wars, and properties sold for tens of thousands above asking?? Looking at the graphs, you can see that the number of contracts stays roughly the same each month (and has for many years)…so it’s not the buyers that are driving market changes…it’s the inventory.
The implication for buyers is very important: 1) get started early because it may take you a lot longer than you think to find the house you want and 2) when you finally do find one that meets your needs, jump on it!
Changes were announced on Wednesday for FHA loans, which currently account for 30% of all purchase loans. The upfront mortgage insurance premium was increased from 1.75% to 2.25% of the loan value. While most FHA borrowers can continue to make down payments of as little as 3.5 percent when they take out a loan, those with a credit score of less than 580 will have to make a down payment of at least 10 percent, possibly starting in the early summer. The agency will reduce seller concessions from 6 percent to 3 percent of the home’s value, in line with the industry norm, this summer. They’re also tightening the screws (again) on condos.
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