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• Homes for sale: 646 (up from 586 in March, and very close to the 662 one year ago)
• Homes sold: 108 (double the 54 of snowy February and up from 93 in March and up from 79 same time last year.)
• Average sold price: $420,963 (up from $380,889 last month and up from $382,406 same time last year.)
• Average days on market: 55 (down from 79 last month and way down from 93 one year ago.)

As we have been saying over the past year, prices in Leesburg have been rising steadily since December 2008 and are still trending up. For the first time in years, we are seeing a trade up market by those homeowners who did not over finance their property during the boom. With low rates, low prices and rising confidence, healthy housing consumers have decided to come back into the market.

We do not expect the expiration of the housing tax credit to have much effect on the housing market now that the recession is ending.

Market data and  commentary provided by David Hess, Executive Vice President and Managing Broker.

Search for homes in Leesburg, and all of the DC Metro: www.averyhess.com

The great debate among economists and TV commentators is what kind of recovery it will be. Typically recoveries look like a “V” when Gross Domestic Product (GDP) is tracked. Because of the high unemployment rate, many are saying we will not have a “V” recovery, but more of a slow and gradual rise. But don’t be fooled. Indicators for employment can be the last thing to pick up. It is considered a lagging indicator because employers do not start hiring until they are secure that they have growing demand for their product and a growing cash flow to pay for additional employees.

Let’s look at the evidence: Consumer spending is growing. This has a multiplier effect throughout the economy as each sale creates sales throughout the supply chain. Business investment is rising, at a whopping 18% annual rate. So the people who currently have jobs, just like the business owner, start to feel more secure and start to take more risk (buying things).

New unemployment claims are falling which reinforces what I have written above. So we are having a recovery, how about a recovery in real estate? Let’s go back to the 93-94% of the people in the DC Metro area that have jobs (the unemployment rate here is under 7%). If they do not own a house, they are prospects to be in the market to buy a house under today’s favorable conditions, low prices and low interest rates. If they own a house that was bought before 2005 or they made a large down payment when they bought, they are candidates to sell their house and buy a larger one. The people who are not in the market to buy are those who bought from 2005 through 2007. But normally people who have only owned their home for only three to five years are not selling anyway. The average is about seven years.

Steve Murray of Real Trends has consistently reported that about 5% of the population moves each year. During the boom that number swelled way above the 5% norm. So as the economic recovery continues, it will spillover into the Real Estate market here in the DC Metro area. Already those who had the courage to buy since December 2008, when prices bottomed, have been rewarded with increased equity both from mortgage principle pay down as well as some price appreciation.

So are we having a Real Estate recovery? The evidence says we have already started or are about to start. So buckle up your seat belt and get ready for the ride!

Commentary provided by David Hess, Executive Vice President.

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Below you’ll find a report of the previous month’s housing market in Bristow, Virginia:

• Homes for sale: 148 (largely unchanged from last month, way under the 206 of one year ago)
• Closed sales: 36 (largely unchanged over the past two months, up 20% from a year ago)
• Average sold price: $338,808 (up from $299,055 one year ago, and $16,000 from just last month)
• Average days on market: 42 (has climbed from 21 days in January 2010 due to snow storms, but still way under the 94 days of one year ago)

Bristow’s prices bottomed out around December 2008 and have moved up steadily since that time. At under $350,00 and selling in an average of 42 days, Bristow homes remain underpriced in this marketplace. Bristow remains an affordable and in-demand place to live. With interest rates remaining around 5%, consumer confidence rising, and inventory at such a low level, high buying activity is creating an upward drift in prices.

Keeping in mind the that normal market balance is six months worth of housing inventory, Bristow has a less than balanced supply with only 148 houses for sale while selling 36-40 units per month. If this continues we can expect prices to continue rising in the near term.

Since homes in Bristow in the past year are typically less ten years old, it’s a good place to buy a home and not have to worry about a lot of repairs, as long as the previous owner did their regular maintenance. If you’re unsure about a home, think about getting a home inspection to fully understand the systems of the house you’re buying. Also ask for a warranty so you can be protected from costly, unexpected repairs.

Market data and commentary provided by David Hess, Executive Vice President and Managing Broker.

Search for homes in Bristow, and all of the DC Metro: www.averyhess.com

Here are the market statistics for Silver Spring, Maryland:

• Homes for sale: 1,085 (about the same as last month, but down from 1,456 one year ago)
• Closed sales: 121 (down from 144 in January, but up from 86 a year ago)
• Average sold price: $334,529 (up from $317,926 last month, and up from 330,453 one year ago)
• Average days on market: 88 (down from 132 last month and down from 145 one year ago)

Areas with Silver Spring addresses comprise most of the eastern side of Montgomery County, Maryland. Silver Spring is served by four Metro stations: Glenmont, Wheaton, Forest Glen and Silver Spring.

Housing stock in Silver Spring is every size, style, age and lot size imaginable due to the large expanse that Silver Spring covers. From one bedroom starter condos to multi-million dollar mansions, there is something for everyone.

Market data and  commentary provided by David Hess, Executive Vice President and Managing Broker.

Search for homes in Silver Spring, and all of the DC Metro: www.averyhess.com

The following statistics reflect the real estate market in Centreville, Virginia:

• Homes for sale: 312 ( up from 288 last month, down from 402 at same time last year)
• Closed sales: 58 (down from 90 in December)
• Average sold price: $293,369 (down from $304,655 in December, but up from $272,000 in January 2009)
• Average days on market: 41 (up from 36 in December)

Comparing each month to the previous month’s results has been like driving on a country road: small ups and downs, but the trend is unmistakable, prices are going up again. All the great fears and media reports about how the shadow inventory of foreclosures was going to cause a depression have so far been a bunch of hype. The real winners have been the buyers who have braved the media reports and jumped in and bought a house. With or without a tax credit, these folks are already looking very smart for taking action.

Prices in Centreville are rising and there is a trend toward declining inventory from which to select. As this trend continues, home prices should continue to rise as a result.

Market data, commentary and statistics provided by David Hess, Executive Vice President and Managing Broker.

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…commercial real estate loans should not be marked down because the collateral value has declined.  It depends on the income from the property, not the collateral value.

Why he didn’t come out and say this in 2008 will always be a mystery. If he had said it then, the world and particularly the US might have avoided this financial crisis.

In November 2007, FASB (Financial Accounting Standards Board) reinstated mark-to-market accounting for the first time since 1938. This rule uses the last price of a similar asset sale to value assets. This caused the market for asset-backed securities to dry up. The prices of bonds and mortgages that were still current in their payments fell by 1/3 to 1/2. In a roundabout way, this had the effect of wiping out regulatory capital, causing bankruptcies and creating a vicious downward spiral in the economy.

Last April, FASB told banks they could use asset cash flow to value bonds and mortgages. This fixed the immediate problems in the system, and the economy and financial markets have been on a tear since.

However, now we read that bank regulators are enforcing their own version of mark-to-market accounting by using the appraisal process. Regulators are forcing banks to write down loan values and increase loan-loss reserves by using appraiser-driven valuations. Appraisers? Aren’t they the same people that over-valued properties five years ago?

To the bank regulators, it does not matter if the loan is still being paid on time. Additionally, it does not matter to them if the lower valuation of the collateral will make the bank require that the borrower put up additional cash. The result is decreased bank lending that is hurting small business and making it more difficult to reduce unemployment, which is not necessary. Most banks are well capitalized today, better in fact than they were in the 1980s when banking losses were very high. In the 1980s we did not have mark-to-market rules, so if a loan was being paid on time, the bank did not have to set aside much in the way of reserves for it.

We need bank regulators to get on the same page with the Chairman of the Federal Reserve.

Post written by David Hess, Executive Vice President and Managing Broker

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• Homes for sale: 497 (down from 543 two months ago, and 625 one year ago)
• Closed sales: 54 (down from 112 in November when the first round of tax credits expired, and down from 117 in December when everyone was trying to close before the year end.)
• Average sold price: $363,410 (down $373,530 from two months ago, but up from $277,169 one year ago)
• Average days on market: 60 (stable over past two months and half the time it took one year ago)

Prices in Leesburg are up 29% from one year ago and bouncing around and still trending up. It is estimated that approximately 40% of the sales in Leesburg are either bank owned or short sales, where the bank has agreed to take a payoff that is less than the outstanding mortgage loan.

Downtown Leesburg is a Historic District of quaint old town where the architecture has been preserved. It is a vibrant business hub that includes shops, restaurants, art galleries, the Loudoun County Courthouse, and numerous small offices.  In addition, there are are multiple hospitals that service Leesburg. Part of the attraction to living in Leesburg is the easy access to employment areas that are within a reasonable drive, including the Route 7 biotech corridor, Tysons Corner, and Route 28.

Market data and  commentary provided by David Hess, Executive Vice President and Managing Broker.

Search for homes in Leesburg, and all of the DC Metro: www.averyhess.com

The following represents the real estate market in Sterling, Virginia:

• Homes for sale: 383 ( up from 374 last month)
• Closed sales: 71 (down from 121 last month)
• Median sold price: $274,000 (up 18% from one year ago)
• Average days on market: 36 ( down from 39 days last month)

Almost every month the median sales price in Sterling has been going up. In fact, it’s now 18% higher than one year ago. Plus, the time it takes to sell a house in Sterling is down to 36 days, improving on last month’s 39 days. Available inventory is now down 32% from a year ago, reducing the housing selection for potential buyers.

Investors and first-time buyers had previously been competing to buy the same houses on the market, which drove up house prices. Changes in policy on the sale of Fannie Mae and Freddie Mac foreclosures that will give owner occupant buyers first preference. This should result in making it easier for owner occupants to purchase without having to pay more than the original asking price.

Market data and commentary provided by David Hess, Executive Vice President and Managing Broker.

Search for homes in Sterling, and all of the DC Metro: www.averyhess.com