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October 24, 2008

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Christopher DiManna

How extensive have the layoffs been at Van Metre this year? Are they down to just core HQ staff now? It is impressive that they are even still operating with the huge fall Loudon real estate went through these past 2 years.

Danilo Bogdanovic

Christopher - Not sure exactly how many they've laid off, but they're still building and surviving.

Sam Goldstein

I heard that they are operating with just a trimmed down hq staff most of which are not taking salaries and they are trying to wait out this recession. They seem to be one of the few home builders still operating in this area.

Danilo Bogdanovic

That sounds noble, but you really think they're working for free? How are they (the staff) going to pay their personal bills and feed their families if they're not getting paid?

Melanie Swiftman

I am sure that the HQ folks are all millionaires many times over from the real estate boom from the past ten years. They can probably survive a long time without salaries.

Danny O'Reilly

If you are a good negotiator you can probably knock 30-40% off homes that Van Metre is selling. Like all new home builders, they are struggling to survive so are pretty desperate.

Samuel Goldstein

American new home sales in October fell to their lowest level in 17 years, according to data released by the U.S. government Wednesday. The Census Bureau noted that, for the January-to-October period, new homes sales were down 40 per cent compared to the same 10 months in 2007.
Seems like the buyer is in a strong negotiating position with Van Metre.

Frank Sutterman

Wow that is scary. When is bottom?

Michael Jaworski

Is Van Metre still in business? Does anyone know?

Danilo Bogdanovic

Frank - If I knew, I probably wouldn't be writing this blog and would be sitting on my own island somewhere making my own Corona commercial.

In all seriousness, the market's much better now than it was just a year ago and it's showing continued signs of stabilization. Perhaps we're not quite at the bottom yet, but we're definitely close.

Michael - Yes, Van Metre is still in business. They're selling a decent amount of homes (all things considered) around the area, especially in their Stone Ridge community off Route 50.

They're actually getting ready to release a new section of 50 single-family home sites in the near future (that doesn't include their town homes).

Danny O'Dwyer

That's great to hear because I was wondering what the effect of having a record number of foreclosed homes on the market was having.

Danny O'Dwyer

On second thought, what is "a decent amount (all things considered)"?

One or two? And how deep are the discounts?

Danilo Bogdanovic

Danny - The number of homes they sell varies by month, but it's at least a few per series per month. When they run specials, it's even more.

As far as "how deep" the discounts are, they're 15 to 20 percent as I memtioned in the post.

Jack Townsend

Hard to imagine anyone in their right mind building new homes right now given the massive glut of unsold homes in that area.

Danilo Bogdanovic

Jack - With all due respect, I'm not sure what you're talking about nor where you're getting that idea from. There is no glut of unsold homes in Loudoun. In fact, there are very few homes to choose from and the pickin's are only getting slimmer. The current inventory levels are where they were during the boom market between 2003 and 2005.

Here are the stats - http://www.loudounscene.com/my_weblog/2009/03/whats-up-with-buyers-having-no-homes-to-choose-from.html

and

http://www.loudounscene.com/my_weblog/2009/02/loudoun-is-a-sellers-market-are-you-crazy.html

Jack Townsend

From an Associated Press article

By Alan Zibel
Associated Press
Thursday, February 26, 2009

WASHINGTON - Sales of existing homes sank unexpectedly last month to the lowest level in nearly 12 years as potential buyers worried about their jobs and awaited details of President Barack Obama's plans to stabilize the housing market.

But the banking industry's teetering fortunes and mounting job losses could stall any recovery. Falling prices and low mortgage rates don't make much of a difference for people who are out of work - or fearful of losing their jobs.

Danilo Bogdanovic

That article pertains to the U.S. as a whole, not Loudoun County nor Northern VA. That article used data from a real estate group that does national statistics and local markets were never analyzed individually. My post, statistics and this blog deal with Loudoun County and Northern Virginia.

And Van Metre is a local builder - not a national one. Their market is Northern VA and the DC metro area only. With market conditions the way the are, they are selling homes and people are buying them.

As for the accuracy of mass media's reporting, articles were still being published in late fall of 2005 about how there was no end in sight for appreciating home values - several months AFTER the Northern VA market had already peaked (August 2005) and started to plunge. Mass media can be about as accurate with their stories as Topper Shutt's 10-day forecast.

Jack Townsend

I sure hope you are right. You are the only positive voice I have heard in over 3 years regarding real estate in Loudon County.

Jack Townsend

A 20% off sale on new homes is typically not a bullish signal....

Danilo Bogdanovic

Don't let their marketing fool you...

A purchase price of $500K with $60K in free options, a finished basement (worth $30K) thrown in and $10K in closing closts paid for by the builder is the same as $500K with 20% off.

Offering "free incentvies" is what most builders offer as part of their marketing plan. Some say they do it that way to keep the purchase price higher for comp purposes so people that have already bought in the community don't get pissed off that their home values are being "destroyed by the builder".

Offering a "20% off" discount off the original sales price is what Van Metre is doing and the marketing tactic is working very well for them.

And for the record, I'm not being bullish about the housing market. I'm just not as bearish as most folks are regarding the local housing market.

Jack Townsend

Thanks for the details. Reminds me of car salesmen. Definitely misleading if not downright dishonest.

Danilo Bogdanovic

No problem. Thank you for commenting and the great discussion!

Jack Townsend

Which Loudoun Zip Code is Van Metre building in?

I see that the massive price declines vary greatly by Zip Code:


Loudoun County Sales Price Changes
by Zip Code
Q4 2008 Q4 2007 ∆
20147 $337,548 $408,300 -17.3%
20148 $447,405 $481,850 -7.1%
20165 $343,178 $424,317 -19.1%
20164 $197,371 $307,785 -35.9%
20176 $339,230 $461,002 -26.4%
20175 $365,502 $415,864 -12.1%
20152 $452,520 $478,875 -5.5%


Danilo Bogdanovic

Van Metre is building in the Broadlands community in Ashburn - 20148.

Michael Jaworski

New Home Sales Fall to Record Low in January
Sales of new homes fell 10 percent in January to a seasonally adjusted annual rate of 309,000 from 344,000 in December.

This is the lowest level since the U.S. Census began keeping records in 1963.

The median sales prices of new homes sold in January was down 15 percent to 201,000 from 232,400 a year ago.

Jack Townsend

A Loudoun County couple out for their routine early-morning walk over the weekend might have been randomly attacked by as many as three assailants in the Lansdowne area, the county sheriff said yesterday.

William Bennett, 57, was found dead before 6 a.m. Sunday along Riverside Parkway near Rocky Creek Drive by a sheriff's deputy investigating a report of a suspicious vehicle in the area. His wife, Cynthia, 55, was found critically injured about 30 minutes later across the road, beyond a bloodied white fence in a muddy ditch, Simpson said.
http://loudounextra.washingtonpost.com/news/2009/mar/23/lansdowne-attack-appears-be-random-says-sheriff/

Danilo Bogdanovic

Michael - Yes, that's the national headline and national statistics.

But, as I said before, every market is different. The Loudoun market is different from the Fairfax County market - the NoVA market is different from the DC and MD market - and the DC metro market is different from other metropolitan markets and the US in general.

There are areas much worse off than us and some that are better (though we're better off than most).

In fact, the DC area was ranked #1 in the WORLD for best places to buy real estate http://www.forbes.com/2009/01/21/investment-obama-realestate-forbeslife-cx_mw_0121realestate.html

Jack - Sad story/situation. Heard about it right after it happened on Sunday from several friends/clients that live in Lansdowne. They couldn't get out of their neighborhood for hours because they blocked off the roads right around the crime scene.

Jack Townsend

Police Search for Suspects in Lansdowne Home Invasion - Robbery posted 03/28/09 4:26 pm

Police in Loudoun County are searching for the suspects responsible for a home invasion-style robbery at a Lansdowne apartment.
It happened around 11 p.m. Friday night in the 43900 block of Harbor Hills Terrace. Police say two residents, who were not injured during the incident, had just returned home when an armed suspect entered the residence possibly armed with a gun and forced the victims into a room of the apartment.

The other assailants then entered the home and assisted in taking a laptop, video game system and accessories. Police have released a description of one of the suspects. He is described as a black male, around 6 feet tall. At the time of the incident he was waring a black shirt, jeans and a ski mask.

Jennifer Cooley

Crime seems to be up dramatically in all of the downtrodden real estate areas. I guess understandably so.

Samuel Goldstein

Danny: Any signs of improvement in Loudon County?

Danilo Bogdanovic

Samuel - Yes, inventory is way down and buyer demand is way up. Homes priced well are seeing multiple offers and prices are stable.

Here are Loudoun April 2009 numbers and analysis http://loudounscene.com/2009/05/loudoun-county-housing-market-statistics-april-2009.html

Danilo

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