Looking Back at 2008

If you had to sum up 2008 in a few words "ugly" would be right up there for sellers as well as for real estate professionals. If you're a buyer or potential buyer I think the word would be "opportunity".

The big change in 2008 was pricing. Prices have dropped dramatically year over year. The range is 35% in Culpeper to 40% in Fauquier and Prince William. Most of the drop in prices has come from foreclosures sales. In fact, much of the sales activity in general has been foreclosure sales. And what wasn't a foreclosure was, more than likely, a short sale.

Inventory continued to drop over the year in every jurisdiction. Inventory dropped because many homeowners gave up on selling. It also dropped because banks got better at pricing foreclosures and they started to sell.

Sellers remained frustrated and in pain. They struggled to compete with drastic price reductions by banks. And, it didn't matter that most owner occupied homes are in much better condition than most foreclosures. Price, price and price were the top three criteria buyers seemed to be looking for. And newspapers everywhere felt the pain of less real estate advertising.

It's a year most of us, whether we're in real estate or not, won't be sorry to see the end of! Here's to a better 2009! More on that tomorrow.

Buyers began looking, but cautiously. Investors (the pros, not the amateur flippers) were out in force. Buyers wanted bargains, and they got them. It was a market made up primarily of first time buyers or those who were able to rent out their home in order to move up. Financing was trickier, but still available. And, the process was a lot slower and more painful as almost every transaction involved painful negotiations with banks.

Real estate agents left the business in some cases. But more often we saw them finding ways to supplement their income. You're now more likely to see your real estate agent at the checkout counter at Home Depot than in the local paper in a real estate ad.