Straight Talk from a Northern Virginia Realtor

As someone who has seen the market in the Northern Virginia area go through the up and down cycles before I thought I would provide some personal insight on our real estate market for buyers who might be sitting back and waiting.

I purchased my first home in Northern Virginia in 1981.  Interest rates were a staggering 16-17%.  Fortunately I was able to assume the sellers existing VA mortgage and wrap the remaining money I needed with new VA mortgage to come up with a 12% interest rate.  I was a happy first time homeowner.  Three years later I decided that I wanted to move to Arizona but instead of selling my home I made a deal with my parents to buy a half interest in the house and maintain it is a rental property.  I used my half interest as a down payment on a new home in Arizona.

Now in the mid 80’s we hit a down market but the home that I owned in Virginia had risen in value and my parents were tired of dealing with a rental property so we decided to sell.  In 1991 I decided to return to Virginia and by then the property that I had purchased in Arizona had risen in value about $25,000.  Are you getting the drift?

So I bought another home in Virginia in 1991 at the beginning of another real estate down turn.  I bought a house in a great school district for my kids, close to a park and public transportation.  Now most buyers were sitting on the sidelines.  In fact this particular house had been on the market for a long time and the owners had already left the state and we worked out a WIN/WIN deal.

From 1991 to 1997 the real estate market in Northern Virginia was stagnant.  Buyers again were waiting to see what was going to happen.  I decided to take the plunge and bought another property in 1997 just before the market started to pick up again.  I sold the larger home and moved into the townhouse.  Small profit on the big house but more importantly during that time I had the tax write off for all the interest on my 9% loan.

I hope by now that you are getting the picture.  I didn’t have a stash of cash when I started this process.  I didn’t have any idea where the market might go.  My main objective was to have a home where I could raise my family and enjoy whatever tax benefits were available.  I felt very fortunate that I was able to make what at that time seemed like whopping profits on my homes.  Because that’s what they were to my HOME.

When I finally made the decision to become a full-time Realtor and study the idea of investing in real estate I kicked myself for not buying and holding on to more properties sooner.  If I had listened to the media and the economists who said the sky is falling I wouldn’t own three properties today and be on the lookout for more.  It is amazing to me with interest rates close to the same level they were a year ago, unemployment rates holding steady and house prices down 10-15%, depending on the area where you are looking, that buyers aren’t out in droves.  

So for the buyers who are waiting, I’d like to ask what you are waiting for?   If you want to own a home, buy while you know what the interest rates are, while the prices are lower than a year ago and the selection is greater.  As the folks at Nike say…JUST DO IT!

Freddie mac

*Chart based on 30 year fixed rate conventional loan

Your loan rate might vary based on credit, downpayment and type of loan.  If you need to talk to a direct lender give me a call.  I would be glad to give you a selection of lenders to talk to.


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