I was at lunch the other day with some real estate agents and lenders from around the Northern Virginia area. Unfortunately, I was the only Re/Max agent in the restaurant but I can hold my own ground with these middle aged women. Anyhow, we all got started on the topic of the current market situation. Somehow by the grace of God we all agreed that finally, it’s a buyer’s market out there. Surprisingly, no one had anything to say when the topic was brought up. Usually some smart ass will go on a rant about all his/her experiences while the rest of us realize this is our chance to ignore them and dive into our food.

So why do we think it’s a buyer’s market? For the past few years the quickly increasing prices kept many first-time home buyers out of the housing market. However, now those rising prices have started a downward spiral. With the interest rates hovering at relatively low levels, it only makes sense to become a homeowner.

Now don’t go out and try to buy a home if you don’t have a secure job and good credit. The lenders are going to be stricter with income and credit requirements. Take it from my friend at Bank of America. He said that they’re not pushing everyone away, it’s just that they have to start being realistic with who they give the loans to.

You want stats? Here they come. The U.S. median home price was $201,000 in January which is down 4.6% from last January in 2007. The home-price index for the fourth quarter was down 8.9% from a year earlier which was the biggest drop in 20 years. There is a 10-month supply of existing homes right now.

An approach that you might want to take when buying right now is K.I.S.S. This means keep it smart and simple. To sum it up, you’re investing into something big so buy cheaper. Do your research before starting your home search. You can also call me at 888-998-9455 and I’ll explain the home buying process to you and the steps you need to take fully understand everything.

Here’s an insider tip: you have all heard it before, but now more than ever, LOCATION is crucial. You want to make sure that you’re in a good school district if you want to start a family or if you want to sell your home in the future. Also compare your estimated monthly costs for the mortgage, taxes and other expenses with the cost of renting a similar place nearby. If you can rent virtually the same house for a much lower cost, the seller is asking too much.

So if you have been waiting for the right time to buy it’s right in front of your face. Do your research, contact a HomeZill agent, and we’ll take care of you.

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President Bush and Congress have agreed to raise the conforming loan limit until the end of the year as part of the $160 billion Economic Stimulus Package. The increase in loan limits could also tighten lending standards for borrowers by increasing down payment amounts or credit history screening. The details will be interesting to see once they are released. Fannie and Freddie will now be able to guarantee loans of up to 125 percent of the median home price of each region. According to the Stanford Group of the National Association of Realtors, the estimated conforming loan limit for the Washington DC real estate region will increase from $417,000 to $547,500. For the official amount, the Department of Housing and Urban Development (HUD) will have 30 days in which to publish the median price of each region after President Bush signs the stimulus package.

The new conforming loan amounts will help struggling home owners refinance their jumbo loans into a safer, conventional mortgage with more favorable interest rates. This will also make housing much more affordable in higher-cost areas like Northern Virginia and the DC Metro area, and give first time home buyers looking for a 2 bedroom condo in North Arlington or townhouse in Fairfax VA a little more cash flow!

Estimated conforming loan limit increases by region:

Source- National Association of Realtors, Stanford Group

***Update - since this article was written, the Conforming loan limit in the Washington DC region has increased more than expected to $729,750!… read more

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If you’re purchasing a home for the first time, you will run into this thing called Title Insurance. It’s not the same as the rental insurance you neglected to get in college because you knew all your neighbors. No, this is about 10 million times more important. Title insurance is protection against loss arising from problems connected to the title to your property. Before you purchased your home, it may have gone through several ownership changes, and the land on which it stands went through many more. There may be a kink in the chain at any point that could become a problem. Some of these kinks could be a forged signature in transferring the title, unpaid taxes, or liens on the title. By having Title Insurance, you are insured for any claims or legal fees if these kinks were to arise.

The title company conducts an in-depth search to detect, prevent, and eliminate risks and losses caused by title problems. This is done by searching public records to develop and document the chain of title by identifying all outstanding claims. To sum it up in a nutshell, if you have a mortgage, you need title insurance. The price may seem high but if any problems were to come up, you’ll have no worries.

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As most of you know from the recent real estate news, new home builders are having a hard time selling homes in the DC Metro area. Therefore, more homes and condos in Northern Virginia and Washington DC are available to purchase than one would expect. Is this a good time to buy? It depends on your situation. If you plan on buying a home because of the recent interest rate cuts, make sure you plan to living there for at least 3 - 5 years. This way you can weather the times if there is any downturn in the market.

If you plan on buying a new home, then turning around to flip it for a profit in the next year or two - I would say that now is NOT the time for you to buy. The best deals from what I’ve seen lately in Northern Virginia and DC are new construction homes and foreclosures. I have typically seen the largest price drops in these types of homes recently. Not to say you can’t find a great deal on a resale home, but sellers who have bought within the last 3 years (and did 100% financing) are many times “upside down” and don’t have much room for negotiations.

Many first time home buyers are unaware that the sales agents at these new home communities work FOR the builder. What does this mean? Well, it means that they are on the builder’s side and are looking out for the builder’s best interest. The reason I bring this point up is because you should always visit a new home community with representation from a real estate agent. Your agent will look out for your best interest, including pointing out design flaws, giving resale pointers, justifying comps, factoring in incentives, assisting with contingencies, making sure you are protected and negotiate on your terms. It doesn’t cost you any more to use an agent and the price of the home stays the same, so why wouldn’t you utilize the expertise of a real estate professional?

Click the link below to watch the video from Kiplinger. (heads up, there is a 10 second commercial before the actual video)

Buy a Newly Built Home Now?

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As part of the Stimulus Bill that has passed the House, and will most likely get signed into law in the next few days, conforming loan limits for the next 12 months (most likely starting in February) will be raised up to $729,750! The new limits will be based on the area’s median home price, plus 25% or 50%. Since this language is yet to pass we can only speculate, but ‘people in the know’ seem to think that it will give us a max conforming limit of $625,000 for the DC Metro area, including real estate in Northern Virginia, Washington DC and Southern Maryland. The measure would also permit the Federal Housing Administration (FHA) to indefinitely insure loans up to that same level. Currently, FHA loans may not exceed $362,250.

The Bill helps us immensely with spurring buyers back in the market, and letting home owners in trouble refinance. As you’re probably aware, the current conforming Fannie Mae and Freddie Mac limit is capped at $417,000. Anything above that amount is considered a Jumbo loan and comes with a significantly higher interest rate. Northern Virginia and DC real estate has priced many first time home buyers out of the market in recent years. Once this new limit takes hold, buyers will be able to finance more expensive homes with a lower interest rate.

“In high-cost states, many home buyers with good credit could save $3,000 - $5,000 each year by not being forced into the current jumbo mortgage market”, said NAR president Richard Gaylord. “Currently, only families in lower cost areas are able to qualify for these types of affordable loans. Such a move would stimulate home sales and help stem the rise in foreclosures, reducing the number of foreclosure by as much as 210,000, and increase economic activity by $44 billion. What’s more, this will come at NO cost to taxpayers– it’s a policy change that could really boost the economy,” Gaylord says.

Other NAR projections show that raising the loan limit will reduce the supply of homes on the market by 1 - 1.5 months, and increase home prices by 2 to 3 percent. As many as 500,000 jumbo loans will refinance into lower interest rates according to the analysis.

If mortgage interest rates stay at the level they are now (or lower), the DC Metro area will have a VERY active Spring/Summer market!

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HomeZill is like having a real estate professional at your fingertips 24 hours a day! You can make an offer online for real estate in Northern Virginia, Maryland and Washington DC. Whether it’s a town house in Fairfax Virginia, a new construction DC condo in Georgetown, or investment property in Bethesda MD, simply fill out the Express Offer to get started! And, since you are doing a good amount of the leg-work, shouldn’t you benefit? Well, with HomeZill you do! Whether you’re a first time home buyer or seasoned real estate investor, you will receive a home buyer rebate up to a 2% cash back for real estate in Northern VA, DC or MD - there’s no catch!

Search for a Home
Our online navigation tools allow you to search condominiums, town homes or single family homes in all price ranges, styles and locations in the DC Metro area. Many Realtors only show you their listings, at HomeZill.com, we show you ALL the listings in the MLS from every Realtor! HomeZill incorporates the listings, location maps and aerial imagery for you to see for yourself. Once you find homes that interest you, select and save them to your favorites so you can view them later before scheduling appointments and making an offer online.

Get in Touch
If you are interested in a home you find, contact HomeZill’s 24-hour customer service line to schedule a time to view the property at 888-998-ZILL (9455).

Let’s Buy a Home
When you have decided on a NEW construction home that you would like to purchase, simply contact a HomeZill agent to schedule an appointment with the builder. For RESALE or EXISTING homes, simply fill out our HomeZill Express Offer and a real estate professional will contact you to review your offer and answer any questions you may have. You’ll have the comfort and guidance of an experienced ReMax agent every step of the way to help you understand and explain each document you sign.

HomeZill in your Corner
Your Re/Max agent will negotiate to get you the best deal by consulting the builder or listing agent about any competing offers or special terms. We do this through our years of experience negotiating real estate transactions and the extra mile we are willing to go to get it right the first time.

Closing up Shop
One last step before you move in…closing time. Closing usually takes place at an attorney’s office or title/settlement company and typically lasts about an hour. This is where the home buyer and seller gather to sign the documents, say our thank you’s and hand over the keys.

Begin searching for homes in Northern Virginia, Maryland and Washington DC, or buy your home online by making an offer.

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