Loudoun County Real Estate Statistics and News

Don't Fall Prey To "Quick-Fix" Foreclosure Scams

As a home owner facing foreclosure, you may be desparate to find a way out - a way to turn things around and get back on your feet. But don't let that desparation cloud your judgement or stop you from doing your homework when approached by someone promising to "fix everything" and "keep you out of foreclosure."

Here is the latest case involving scam artists preying on home owners facing foreclosure (via InmanNews):

"Federal officials announced the indictments of 20 people Thursday in two California-based foreclosure rescue and equity-stripping schemes that allegedly netted more than $12 million from more than 100 victims who were left without their homes.

Prosecutors said victims believed that they were making rental payments to "investors" whom they agreed to add to the title of their home. The "investors" were actually straw buyers who often replaced homeowners on the title. After taking out a new mortgage to extract the home's equity, the defendants would sell the victims' home, stop making the mortgage payments, or begin eviction proceedings against the victims, prosecutors said."

Be careful out there, do your homework and remember...there is no quick fix.

Loudoun County Foreclosure Filings Up Despite Virginia & US Down

Here's the latest data regarding foreclosure filings in Loudoun County as well as the rest of the state and nationally (via VAR's Commonwealth Online):

Home foreclosures dropped in the majority of the Washington, D.C. area and across the country, from January to February.

The one-month decrease comes at the start of the spring season, when real estate activity tends to pick up.

The number of properties with foreclosure filings fell 32.5 percent in the District of Columbia in February, with 340 foreclosure filings on properties, down from 504 the month before, according to Irvine, Calif.-based RealtyTrac, a Web-based foreclosure listing company, which releases monthly foreclosure data.

In Northern Virginia, filings slid 18.7 percent, with only one county, Loudoun, seeing a slight increase of 1.3 percent, from 388 properties with foreclosure filings to 393 properties. Prince William County, which has been hit hard by the mortgage crisis, saw a decrease in filings of 23.7 percent, from 1,504 properties to 1,147 properties.

Fairfax County's number of foreclosures dipped 19.2 percent, from 1,330 properties to 1,074 properties, and Arlington County dropped 12.8 percent from 94 properties with foreclosure filings to 82 properties.
Overall, in the state of Virginia, foreclosures dropped 18.7 percent over the past month as well, from 5,152 properties with filings to 4,187 properties.

Across the entire country, the number of properties with foreclosures dipped 4.0 percent from Janury to February.

2 Out of 3 Homes Listed in Loudoun County Never Sell

During the fourth quarter of 2007, 1902 homes were listed for sale in Loudoun County.  Through today, only 638 of those homes have sold or gone under contract.  Of the 67% that haven't sold, 688 have either withdrawn their listing or expired.  The remainder of the homes (572) are still actively listed for sale. 

Rate of New Foreclosures/REOs and Short-Sales For Sale Steady

The rate at which new foreclosure/REO and short-sale properties are coming on the market in Loudoun County remains steady.

• January saw 308 new foreclosure/REO and short-sale properties come on the market. That's 9.9 new properties for sale per day.
• February saw 258 new foreclosure/REO and short-sale properties come on the market. That's 8.9 new properties for sale per day.
• So far this month (3/1-3/16), 153 new foreclosure/REO and short-sale properties have come on the market. That's 9.5 new properties per day.

As you can see, the rate at which new foreclosure/REO and short-sale properties come on the market has remained steady so far this year. Until we see the number per day go down, property values will have a tough time going anywhere but sideways.

In addition to this type of inventory, another thing to keep a close eye on is the overall inventory in Loudoun County (click here for the post on that).

Our Broker, Simon Warner, Named "Realtor Of The Year"

We're proud to announce that our broker, Simon Warner (Market Advantage Real Estate in Sterling, Virginia), was named "2007 Realtor® Of The Year" by the Dulles Area Association of Realtors®. This honor is given to the one Realtor® that has demonstrated active involvement in the community; active participation in local, state and national Realtor® association events and functions; education; teaching; etc.

Continue reading the post on Loudoun Stats

Houses for Sale Climb Back Over 500 in Ashburn

The number of resale properties for sale in Ashburn just went back over 500 for the first time this year.  This number has slowly been going up since the first of the year and will more than likely continue to increase into the summer months. 

The number of properties for sale in the entire county now stands at 2640 after getting as low as 2400 in the beginning of January.

As long as inventory goes up prices will remain suppressed.

A Loan Program Perfect for Foreclosures

Mike Pfeffer of Fidelty and Trust Mortgage recently gave me some insight into a loan program that could be a perfect fit for some of the homebuyers here in Loudoun County.  The program comes from section 203(k) of the FHA Insurance Program and is a Renovation Loan.  Here is Mike's explanation of the program and his contact information in case you have any other questions.

The section 203(k) program is a little known piece of the FHA insurance program that was designed to allow borrowers to purchase or refinance and rehabilitate a property with one loan closing.  The funds for renovations are fully dispersed at closing but often held in escrow (depending on the scope of work) and released as work is completed.  This managed escrow dispersal helps ensure the timeliness and quality of the chosen contractors work.  Renovation Loans are a great vehicle for borrowers to finance renovations and spread the cost out over 30 years, especially in a world in which home equity loans are increasingly difficult to obtain.

For borrowers - this is a common sense means to finance repairs/upgrades that can make your existing home look and feel like new, or put your personal touch on prospective purchases.

Renovation or rehabilitation loans are not well known but play an important role in the revitalization of neighborhoods.  These loans have maximum loan limits based upon geography but will soon increase substantially (for example the newly released loan limit for the Washington, DC, metropolitan area is $729,750, up from $362,790).  These new limits have not yet become fully accepted but they will shortly, and may only be available through the end of 2008.  Since these new limits are temporary in nature, now is the time to research this option.

You can contact Mike directly at 703.967.0709 or email him at mpfeffer@ftloan.com

203k Loan Program for Renovation of Homes

Mike Pfeffer of Fidelty and Trust Mortgage recently gave me some insight into a loan program that could be a perfect fit for some of the homebuyers here in Loudoun County.  The program comes from section 203(k) of the FHA Insurance Program and is a Renovation Loan.  Here is Mike's explanation of the program and his contact information in case you have any other questions.

The section 203(k) program is a little known piece of the FHA insurance program that was designed to allow borrowers to purchase or refinance and rehabilitate a property with one loan closing.  The funds for renovations are fully dispersed at closing but often held in escrow (depending on the scope of work) and released as work is completed.  This managed escrow dispersal helps ensure the timeliness and quality of the chosen contractors work.  Renovation Loans are a great vehicle for borrowers to finance renovations and spread the cost out over 30 years, especially in a world in which home equity loans are increasingly difficult to obtain.

For borrowers - this is a common sense means to finance repairs/upgrades that can make your existing home look and feel like new, or put your personal touch on prospective purchases.

Renovation or rehabilitation loans are not well known but play an important role in the revitalization of neighborhoods.  These loans have maximum loan limits based upon geography but will soon increase substantially (for example the newly released loan limit for the Washington, DC, metropolitan area is $729,750, up from $362,790).  These new limits have not yet become fully accepted but they will shortly, and may only be available through the end of 2008.  Since these new limits are temporary in nature, now is the time to research this option.

You can contact Mike directly at 703.967.0709 or email him at mpfeffer@ftloan.com

An Example Of Real Estate Investing Gone Bad

During the boom market, many people and investors jumped at the opportunity to buy new construction in Loudoun County with the hopes of flipping the property(ies) in the future for a profit. After all, many thought that the boom would never end.

Well, many got burned.

One such example is the owner of three of the homes in the Villages of Waxpool subdivision in Ashburn.

They bought three properties from the builder for a total amount of $3,403,708 in 2005.

These three properties are now all on the market almost 3 years later as "short-sales" for a total amount of $2,490,664. If they get the full asking price, they will have lost $913,044. And that's if the bank/lender approves the short-sale, which doesn't happen often.

This just goes to show that you need to do your homework before making any such decisions and perhaps not go at it alone.

U.S. Foreclosures Hit Record High; Virginia Below National Level

Just in case you haven't read or seen any news within the past 24 hours... Foreclosures in America have hit an all-time high. Here are links to some of the stories:

From The Washington Post: Home Foreclosures Hit Record High

"The spike was driven by declining home prices..."

From CNNMoney: Foreclosures hit all-time high

"Declining home prices are clearly the driving factor behind foreclosures, but the reasons and magnitude of the declines differ from state to state," said Doug Duncan, MBA's Chief Economist said in a prepared statement."

From AP: Home Foreclosures Hit Record High

"Clearly it's the worst it's been," chief association economist Doug Duncan said in an interview with The Associated Press. ... "We expect some increases in the next couple of quarters,"

From Bloomberg: U.S. Mortgage Foreclosures Rise as Owners "Give Up"

"U.S. mortgage foreclosures rose to an all-time high at the end of 2007 as borrowers with adjustable-rate loans walked away from properties before their payments rose, the Mortgage Bankers Association said today.

"We're seeing people give up even before they get to the reset because they couldn't afford the home in the first place,'' said Jay Brinkmann, vice president of research and economics for the Washington-based trade group."

From InmanNews: U.S. foreclosure starts hit new records

"Our general outlook is as long as house prices are declining, we expect to see some continued increase in delinquencies and foreclosures," Duncan said. With the continued seizure of credit markets and tightened underwriting standards, "we don't expect to see the peak (in foreclosures) until mid- to late-2008."

All of the articles/quotes hit on a few key points:

1. foreclosures are at all-time highs
2. falling prices is the driving force behind foreclosures
3. the foreclosure rate is expected to continue to rise
4. people are giving up/walking away before their rate resets

Despite all of this negative news, there is some good news for us in Loudoun County and the DC metro area. In the Washington region, foreclosure rates were below the national level: In the District, 1 percent of loans were in foreclosure; in Virginia, 1.01 percent; and in Maryland, 1.22 percent.