It is a thought that has been rattling around in my head for awhile. How many years into the future will homeonwers and Realtors ® be dealing with short sales in Northern Virginia?
We hear officials (lenders, economists, etc) speak as if they think the short sale phenomena will run its course in the near future. Yet when you look at the number of homes sold in the last 5 years and calculate the number of homeowners who cashed out their home equity for the finer things in life, do you really think that short sales will go away anytime soon?
Even in Northern Virginia some neighborhoods have seen price drops in the double digits and appreciation is going to be slow and hopefully steady in the years ahead. It will take far longer to recover the negative between the mortgage and market value than some homeowners have to wait it out.
What happens in 2 years, 3 years or even 5 years down the road when a job transfer, divorce or retirement requires them to sell their home? A percentage of homeowners who are waiting it out today won’t have that option in the future. Certainly it won’t be the mind boggling numbers that lenders are trying to deal with today but no one should close down their short sale departments at the end of 2009 or 2010 and think they will never see another short sale again.
Anyone remember the Northern Virginia real estate market in the 1990’s?