While bargain hunters have been avidly focused on foreclosures and, to a lesser extent, short sales; another segment of the market also offers some spectacular bargains.

Builders who have inventory already built want to get rid of that inventory quickly. In this area, builders haven't been building spec homes for some time now. These homes are generally homes where a contract fell through. Occasionally, you'll see a model home for sale where the builder has finished building in that subdivision.

These homes can be tremendous deals. Builders don't want and usually, can't afford to sit on inventory. It ties up cash they need to pay off loans and move forward with other projects. And, so they're typically priced attractively to start and an even better deal can be negotiated.

Unlike typical new construction, these homes may have the basement already finished. And you're likely to see a fair number of upgrades already included. And, if you don't like exactly what you see, don't be afraid to ask for what you want. While they're not going to gut the house and redo it to suit your taste, there is probably room for some changes.

True, there aren't as many of these bargains as there are foreclosures. But you also don't have as many of the problems as arise with a typical foreclosure. The odds of you settling on time and being in your new home when you expect to are exponentially higher with new construction. You're likely to receive an answer to your offer much more quickly. And there's much less likelihood of last minute deed problems.

There are still builders with inventory in most local counties, including Fauquier, Culpeper, Prince William and Loudon.

If I was a buyer in the market to buy, I'd be looking for some of these gems.

How will 2009 play out? I can only speculate. In truth, this feels like one of the toughest years to predict. But I am undaunted! I'm going out on that limb to make some predictions.

I need to preface my predictions with a word about the overall real estate situation. There are two possibilities in 2009. The government could intervene in a meaningful way in the real estate markets. (Other than the Fed action earlier this month to say they’ll buy mortgage backed securities, federal intervention up until this point has definitely been NOT meaningful!) If they do that, the forecast, while not rosy, is for a market that’s beginning to stabilize. The other alternative is that the federal government does nothing about the real estate markets, the overall economy continues deeper into decline and there’s no end in sight. That produces a markedly more pessimistic forecast.

I'm going to take a moment today to acknowledge that this is my 400th blog post here! I've enjoyed every minute of it and have learned more than I would have thought possible!

It's been fun hearing from you. All of you are the reason this blog exists. The purpose remains the same now as it was at post number one. This is here to give you, the consumer, more access to information on real estate in general and on the Fauquier (Warrenton), Culpeper, Prince William, Rappahannock and Warren county real estate market.

The occasion of the 400th post is prompting some reflection and analysis and watch for some adjustments going forward that will hopefully make this blog even more relevant.

And, because I wanted today's post to have an upbeat feel, here's an article on what I believe is ultimately a very positive sign for the real estate market overall. Work outs for troubled mortgages have not been happening in anywhere near he numbers they need to. This points to better systems and processes to make that happen.

And, one more milestone occurs later this week. Next weekend I'll turn 50!

YeeHaw!

There's lots to talk about today.

Saturday, in Warrenton, is the third annual Alternative Energy Expo. It runs from 9:30 a.m. to 4:30 p.m. at the Fauquier County Fairgrounds. Admission is $5. If you've been thinking about making your home and/or your life more "green" this is a great place to get ideas, talk to people who can help and get inspired! It's bigger and better than ever this year!

Most of you should have received in your mailboxes this week a circular called "Northern Piedmont - Buy Fresh - Buy Local". The Piedmont Environmental Council sent this to residents of Culpeper, Fauquier, Orange, Madison and Rappahannock counties. In it you'll find a guide to buying almost everything you eat locally from produce to meat, from farmers markets to CSAs to buying right on the farm. Great publication!

The WSJ has run a couple of very interesting real estate articles this week. First up was an article called "As Dues Dry Up, The Neighbors Pay" about how as no one is paying the HOA dues on vacant/foreclosed houses, other homeowners are having to swallow large increases in dues. It's another things buyers need to take a careful look at prior to buying.

The other article in WSJ was "Will Upgrading Your Home Help You Sell It?" and the results are clearly mixed. In a declining market I'd always argue that while you want your house to shine, you should never put in expensive upgrades. This article has some interesting details.

The April numbers are finalized.  I did a sneak preview for you about ten days ago, before the numbers were official. And, the picture hasn't changed much.

In every county, the pattern is the same. Inventory has risen again, as has the number of new listings. After a dismal month in terms of sales in March, April looks better, both in terms of new contracts written and sales closed. But the number of houses sold is not keeping pace with the new listings coming on the market.

Fauquier, Culpeper are each showing about 16 months of inventory. Warren is looking worse at 24 months. Prince William is in the best shape at only 9 months. Rappahannock, being a special place, has about 3 years worth of inventory. But, again, the numbers generally don't give a very realistic picture of Rappahannock.

The more interesting comparison, of course, is year over year. Since real estate is very seasonal, that's always true. In general, inventory is higher than it was a year ago and sales are slower. There are some exceptions, but it's too soon to say if those are a blip or a true change in market conditions.

No bottom in sight would be my reading of current conditions. There is nothing to suggest we've turned a corner. (Although I remain hopeful that I'm wrong!)

Saturday's Washington Post carried a story about foreclosure activity that primarily looked at Prince William county. As the story makes clear, things are pretty bad in Prince William County. The number quoted in the article is that 5.5% of the homes in the county are in some phase of foreclosure.

I took a look at RealtyTrac, a web site that specializes in providing foreclosure listings. It shows 3204 homes in Prince William County in foreclosure out of 5573 homes currently listed for sale. It says an additional 881 homes are in pre-foreclosure. And 1932 homes are up for auction. Some of those auctioned homes are likely to be foreclosures, although certainly not all of them.

To give you a feel for the rest of the area, Culpeper County has 137 properties in foreclosure, 20 pre-foreclosure and 97 up for auction. That's out of 819 listings.

Fauquier County has 111 foreclosures, 2 pre-foreclosures and 93 properties up for auction out of 730 listings.

Rappahannock County has 4 foreclosures, 0 pre-foreclosures and 6 properties to be auctioned.

Warren County has 0 foreclosures according to RealtyTrac, although I seriously doubt their data on this county. There are 4 in pre-foreclosure and 73 listings to be auctioned.

I've got February's market numbers. I'll give you the scoop on Culpeper, Fauquier, Rappahannock, Prince William and Warren Counties. If anyone is interested in information on any other counties, contact me and I'll be happy to provide.

In general, what we're seeing across the board is a jump in inventory. This being March, that's not a surprise at all. The increase in inventory will continue for the next several months.

In three out of the five counties the number of closed sales was flat. Rappahannock had one sale in both January and February. Warren had 22 each month. And Fauquier actually fell from 33 in January to 32 in February. As I said, flat.

Prince William showed a huge increase in the number of contracts written, from 498 in January to 698 in February. This may have something to do with the steeper price drops we've seen in that market. They may have finally broken the stalemate between buyers looking for a deal and sellers determined to hang on to every dime of equity they can, even if it means not selling!

Warren showed a nice increase in contracts, up by about 25% from last month. Rappahannock went from 0 last month to 1 this month.  Culpeper was up just slightly from 47 written last month to 51 written this month. Fauquier actually fell from 53 to 44.

Most of the counties are sitting at around 2 years worth of inventory on the market right now. Prince William is an exception with only about 16 months of inventory. The numbers for Rappahannock are pretty meaningless, but if you're interested the math shows a 70 month supply!

Across the board prices are still falling. And, I expect that to continue throughout 2008. This will vary a lot by neighborhood. In some neighborhoods, you may see some stabilization. In some neighborhoods, there's still a lot of adjustment needed. I'd be shocked if anyone found a single neighborhood where prices increase over the next year.

That's the scoop for February! If anyone needs me to dig deeper into any of these numbers I'm happy to help. Just send me an e-mail.

The January numbers are out and there's more good news to report. This is starting to feel and look like more than an anomaly. (Knock on wood!) But there are still danger signs as well. Let's talk about all of it.

Culpeper county continues to see inventories decline. Actually across the board we're seeing declines, but perhaps most significantly in Culpeper. This is the lowest we've seen inventory in a year. And, while closed sales were down in January, the number of contracts written more than doubled. A good sign going forward. Given how busy I am with both buyers and sellers the past couple of weeks, I believe we'll see an increase in contracts again in January.

Here's the bad news; new listing jumped back up. New listings in December were 91. New listings last month were 161. Year over year, we're holding steady. In January of '07 we saw 165 new listings. Expect that number to increase again in February. Again, my personal experience with new listings coming up would seem to confirm that.

In Fauquier we saw many of the same trends, but dialed down. Inventory decreased very slightly, from 703 to 699. Inventory still remains above where we were a year ago. As in Culpeper, sales were down, contracts were up. New listings jumped significantly. By the way, this is not unusual. Especially in a tough market, it makes a lot of sense to beat your competition to market. And the spring will likely see a flood of new inventory.

In Prince William all the above trends hold with no significant differences.

Warren County is clearly still struggling. Inventory is down only slightly. New listings increased almost threefold and while new contracts increased, it was not by much. 

Rappahannock County seems to be looking a little more anemic right now. But the volumes are so tiny in Rappahannock that you'd be in sane to try and determine trends from such scanty data. There were no new contracts written and only one sale last month. Inventory decreased very slightly and the number of new listings doubled from the month before.  It'll be interesting to see how the spring market unfolds here.

So, let's see what the increased activity I'm seeing now does to these numbers next month!

The real estate market was front page on the Washington Post again yesterday. And, there are a couple of interesting lines that say a lot about our local market here.

2007 is behind us and the December numbers are now available. And there's plenty of good news. In every county I looked at, inventory continued to decline. Culpeper moved down to 783 homes for sale. It was at 796 last month. And, at its high hit 823.

Culpeper is representative of the surrounding counties. Rappahannock, Prince William, Fauquier, even Warren, all saw reductions in inventory. I'd like to say it's a trend, but given the circumstances it's still too early to say that. November and December in an average year will see a reduction in inventory as people take their homes off the market during the holidays. If January and February numbers continue to show a decrease I'll officially declare a trend!

We also saw fewer new listings across the board. Again, good news if it continues. With spring coming this is one I think we can safely say is not a trend. That's especially true if we look at year over year numbers. A comparison between December '06 and December '07 shows a sizeable increase in the number of new listings.

The number of new contracts and solds was down across almost every county with the exception of Prince William. That may have something to do with the fact that Prince William is showing some of the most aggressive price cutting.

I also compared the new contracts and solds to a year ago. In Culpeper we're significantly lower, in Fauquier close to breaking even. And, while Prince William is up month over month, it's down year over year.

All in all, December was a mixed bag. As with most statistics, we'll have a better idea what they mean a year from now!

For some odd reason there seems to be a class of real estate pundits out there who believe that a potential recession is a good thing for the real estate market.

It's an odd line of thought. But I understand their logic. The belief is that if the economy continues to look like it's headed for recession the Fed will have no choice but to lower interest rates. Lower interest rates will get all those buyers who are currently sitting on the sidelines to jump in and buy a home. And, voila! the market improves.

There are some serious logical flaws in this argument. First of all, even with some data suggesting the possibility of recession, the Fed's in a tough spot. While they'd no doubt like to lower interest rates to bolster the economy, there are also plenty of worries about inflation. Oil hit $100/barrel this week. Rising oil prices impact the prices of almost everything in our economy. It's hard to see how continued high oil prices aren't inflationary. And, food prices are rising fairly rapidly. While this is not included in most official measurements of inflation, it is certainly something that will be watched by the Fed. So, maybe they cut interest rates. Maybe they hold steady. There's not enough data to provide an answer right now. And, the truth is you never know for sure until the Fed meets.

Secondly, as I've mentioned here before, a lowering of rates by the Fed is no guarantee of lower mortgage rates. Again, inflationary worries often have more of an impact on those rates.

Next, recessions are not good for real estate! People insecure about their financial prospects do not go buy new homes! If you're worried about losing your job you don't look to move up. You look to hold on to what you've got. Time to batten down the hatches!

And, lastly, there is no quick turn around for real estate. And, that's certainly true here locally. There are not enough buyers waiting on the sidelines to completely turn around this market in the short term. It took time for us to dig the hole we're in. It will take time to fill it back up! I'm hopeful we'll see a bottom in 2008. Anyone expecting much more than that has got some serious rose colored glasses!

Technology is a constantly changing thing. And it certainly continues to impact how real estate is bought and sold.

Because technology is so important to how I run my business, I'm continually evaluating what's effective and what isn't and how I can best provide information to the public.

Given that, I've made the decision to discontinue my traditional web site and focus purely on this blog. I'm getting better feedback on the usefulness of the information here than on my original web site. And it's become impossible from a time perspective to keep that continually updated and to post high quality blogs on a regular basis.

So, watch for changes here! I'll be adding some categories and moving a lot of the information from my web site here. I'll be adding a category for listings and displaying that information here. If there are some hiccups in switching everything over, I apologize for those now!

Meanwhile, I'm hopeful that these changes will allow me to continually improve what I can offer you here. As always your suggestions are warmly welcomed and eagerly solicited!

I know sellers are waiting anxiously for how February numbers look.  And while it's too early to have all the data, here are two quick items to make you feel a little better!

Overall inventory fell this month from 1903 to 1793. These numbers cover Fauquier, Culpeper, Madison, Orange and Rappahannock counties. I can't tell you yet how much of this is attributable to new contracts and how much is attributable to the wintery weather that plagued us for much of the month.

There's also good news on the interest rate front with rates falling again this week for the second week in a row! That's good news for buyers and sellers!

Stay tuned to this space for more data as it becomes available!

It's time for another update on what the local market conditions look like from a statistical standpoint. The numbers I'm providing here are January, 2007 numbers unless I specify otherwise. These statstics are taken from the local Mulitple Listing Service (MLS).

We'll start with what I see as the most discouraging numbers: the total number of newly ratified contract in the Greater Piedmont Region (Fauquier, Culpeper, Rappahannock, Orange & Madison counties) in January of 2007 is 150. The total number of new listings entering the market was 485. Clearly inventory is headed back up again and that's bad for sellers. Buyers, life continues to look pretty rosy from your perspective!

Average days on market was 82 in January of 2006 and is now up to 148.

Average sales price as a percentage of list price was 94.59% in January of 2006. That number is now down to 90.58%.

Here's an interesting one for you! Average list price is up 2.66% year over year, but average sales price is down 1.69% for that same period.

Total active listings is 1903 as compared to 1334 last year at this time. This gets even more striking when you consider that just a month ago, December 2006, there were a total of 1260 active listings. I can confirm that I'm getting calls to take new listings almost daily.

What does this all mean? If you thought the spring would bring a hot sellers market, not a chance! For all those who are saying we've hit bottom, I doubt it! While there have indeed been more buyers out looking around they're not opening up the checkbook and you shouldn't count on them to.

If your home is not in top condition and priced very aggressively you are probably doomed to fail. If you don't have to sell right now, don't!

If you're a buyer, the news just keeps getting better!  Enjoy!

I haven't yet written about the proposed Dominion Power lines that were slated to run across northern Fauquier County. And, now they've changed the plan.

Apparently tired of the local opposition, the bad press and the lawsuits, they've decided to move the route south, where it will no go through southern Fauquier, Culpeper and Rappahannock Counties.

I've been skeptical from the beginning about this line. First of all, regardless of the route of this line, I think the plan should be to bury it. I have a hard time buying the cries of poverty by Dominion. And apparently while they weren't willing to spend millions more to bury the line, they were willing to spend millions more on a longer route. The new route would cost an additional $60 million because it's a much more indirect route.

I also haven't heard Dominion doing all that much to encourage conservation to reduce the need for future lines. If the only strategy is just to continue to build more lines as the population grows and demand increases we can look forward to a truly ugly landscape!

This move to a more southerly, more indirect route seems designed to move the fight to a group Dominion believes will be less well organized and less well funded. That's never a good enough reason and in this case I believe it may also be a serious miscalculation.

As always, local activism and organization will have a huge impact in how this turns out. If you're interested in more details on the latest announcement you can see articles on today's announcement in both the Fauquier Times Democrat and the Culpeper Star Exponent or on RappVoice. You can also look at the Piedmont Environmental Council's website for a more detailed report on the history of this project.

Where do you stand on this issue?

Warrenton's mayor, George Fitch, has issued a call for Warrenton to become more energy self-sufficient; to, as the local newspaper put it, "go green".

First of all, I applaud Mayor Fitch for taking this step. A focus by the town on renewable energy resources is a welcome one. Every locality should be looking at ways to reduce our energy consumption and our dependence on sources of energy that are bad for our planet and increasingly bad for our country.

The mayor's focus seems to be on buildng a small scale biorefinery capable of producing ethanol from locally available materials such as corn. The idea of small local refineries that are joint public and private partnerships is, in my mind, a good one. It could be good for the local economy, local farmers and, to some extent, for energy efficiency.

My concern is that ethanol made from corn, which seems to be the cornerstone of the plan is not all that efficient a fuel. Some studies show that more fossil-fuel energy is expended in the production of corn-based ethanol than we would ever save by burning it.

But it's early yet and the idea is just getting off the ground. There's time for fact-finding and, eventually, modification of the original proposal. The Warrenton Town Council has provided $5000 for a feasibility study and I look forward to hearing the results.

I hope that no one is waiting for this to solve our energy dependence problems though! This is another instance where "waiting for the world" is definitely not the way to go! Each of us can be looking at ways to reduce our own carbon footprint. Whether your motives are cost savings, saving the planet or making our country energy independent, there are plenty of good reasons to look for ways to reduce our energy consumption.

One of the things I love about real estate is that I'm working to fulfill a basic human need - shelter. It's something I feel good about! About the only more basic human need I can think of is food. And I've recently had a chance to get more involved with an organization that's working on that.

Fauquier County Food Distribution Coalition is an organization working to feed their hungry neighbors. It is truly amazing what they do using almost entirely volunteer labor and donated food and monies.

In the month of December, 2006 they served almost 200 families. I'm guessing there are an awful lot of people in the county who didn't even know there were 200 hungry families here. And they're sure they're not even reaching everyone who needs their services.

The food is distributed once a month on the third Saturday. Volunteers not only provide almost all the food, but also man the operation. They set up tables, sort food, fill boxes and help the families with getting the food to their cars. Considering it's only once a month it's not all that much food. Most of us wouldn't want to try and live on it! But you'll see people waiting for hours for this.

I believe we are our brother's keeper and let's face it, most of us have so much more than we need in terms of material goods. If you can spare time or money or food, there's a way for you to help feed your neighbors. And I'll bet it's hard to think of something that feels better than that!

You can find out more at their web site: http://www.fauquierfood.org

Or contact them directly at info@fauquierfood.org

There's lots of talk out there about what's happening in the housing market.  But let's look at some hard numbers for some of the local jurisdictions.

As you can see, Fauquier County has been hit substantially harder than surrounding areas. I don't have Culpeper numbers right now, but I would speculate that they are worse than Culpeper. John McClain, senior fellow at the center for Regional Analysis, George Mason University says we've taken the brunt of this because of the large percentage of new construction on the market here. When existing homes are competing against that much new construction and the upgrades being offered for free often add up to $50K or more, existing homes lose!

The good news is that some of that inventory is starting to be absorbed. With numbers this low, I believe we will not see substantial continued decreases in prices, at least in the outlying counties.  But don't hold your breath for a quick rebound either! There are still a lot of empty new homes out there!

The October numbers are out for our local multiple listing service and they are a mixed bag. The number I'm following most closely right now is inventory. Overall in the region, that number is falling month over month. However, year over year, we're still way above what we had a year ago. And, the worst news from my perspective, is that the number of new listings coming on the market exceeded those going under contract by about 3 to 1. In Fauquier County we've got approximately 16 months of inventory currently. In Culpeper County we've got about 22 months.  That's if things continue to go under contract at the same rate and if nothing else comes on the market.  Both of those are unreasonable assumptions.

The only reason these numbers aren't worse is that a lot of sellers have taken their homes off the market.  That's good news. With the current level of inventory we need a change in one or more of these three elements:

1. Sellers pull listings off the market (preferably for more than one year).

2. Buyers start coming out in droves to buy up current inventory.

3. Prices and/or interest rates plunge in order to pull more buyers into the market.

It is hard to see any of these things happening in enough volume in the short term to turn this market around significantly. My prediction at this point in time is that the market will remain very soft throughout 2007.

I'm not an economist and there's certainly a good chance that I'm completely wrong. And, there can always be unforesee events that completely change the picture. But right now I haven't got even a hint of good news for you sellers.

For all you buyers, enjoy being in the driver's seat! But remember that some day you'll be the seller and what goes around comes around! Try not to leave the seller laying wounded on the floor!

I'd love to hear what you're experiencing in this market, whether you're a buyer or a seller. Let's hear from you!

For more information on buying or selling, please visit my web site at http://www.JulieEmery.com