You've read about it in the Washington Post, you watched it on CNN, and the stock market has been reacting to it -- mortgage foreclosures are at an all time high. But, how is it affecting the local D.C. and Northern Virginia market? Many of my clients and potential clients have been asking me about finding a good deal by locating a foreclosure. However, the reality is that while foreclosures are up nationwide to an average of 28 foreclosures per 10,000 households, the D.C. area is not hit that hard, and foreclosures are actually few and far between. The D.C. metro area averaged only 8 foreclosures per 10,000 households in the 3rd quarter of 2006! Today's Washington Post article examines only subprime loans and shows that in the 4th quarter of 2006, out of the whole country, D.C. ranked 42nd in subprime foreclosures and Virginia ranked 47th. While hard-hit areas like Ohio and Michigan are respectively experiencing 11% and 9.5 subprime foreclosures, Virginia only had 1.8% in the 4th quarter of 2006. So, while yes, there are more foreclosures that in the past, they are most heavily concentrated in other areas of the country. Can you find a foreclosure deal in Northern Virginia or D.C.? Maybe. But not very likely. And if you did, would it be the house you want to live in as your primary residence. When a bank starts the foreclosure process, it usually means the owners are 5-6 months behind in their payments. If they haven't been paying their mortgage, do you think they've been paying for the upkeep of their home? A foreclosure may be a good deal for an investor doing rehab work, but in Virginia and D.C., if you can even find many foreclosures, they typically will not be appropriate for most buyers. |
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