No Change Proposed to Current Rate But Your Tax Bill Will Probably Increase
Those of you who live in Fairfax County should be receiving your real estate tax assessment shortly.
For a large number of you (92%!), the assessment went up (2.8% saw a decrease and 5.2% were unchanged). On average, residential real estate assessments are up 9.57%.
Note: the Board of Supervisors has not yet adopted the 2022 tax rate and will do so later this spring. On February 22nd the FY 2023 Budget was presented to the Board and included no change to the current Real Estate Tax Rate tax rate ($1.14 per $100 of assessed value). However, an equalization rate of 9.57% (the market-driven change in property value) would mean the average tax bill would increase by approximately $666 based on the proposal.
Assessments increased in most areas of the county due to record low interest rates, low housing inventory and high demand. (Other factors include sales in the neighborhood, average days on market, sales volume, improvements, new construction, and size, age and condition of the property.)
Here’s the breakdown of average home property assessment by property type (averages are not necessarily indicative of individual properties or neighborhoods):
Single family detached homes – $807,450, up 10.86%
Townhouse /duplex properties – $501,743, up 8.70%
Condominiums – $320,940, up 3.98%
Now. Truth be told – the assessments in Fairfax County are oftentimes LOWER than actual “market value” (meaning what a “willing Seller” and “willing Buyer” agree a property is worth by ratifying a contract to sell/buy that property.)
If you are thinking of buying a home in Fairfax County, don’t be deceived into thinking you will be able to buy a home for about what the County has assessed as the value of the property. We are often asked how a Seller could justify an asking price above the Fairfax County tax assessment.
Assessed value is just ONE factor to look at when buying or selling. A better place to start is with a FREE INSTANT online estimate. Then schedule an appointment with The Belt Team for a custom estimate.
If you think your assessment is wrong, Fairfax County does have an appeal process. You can file an online appeal prior to April 1st. More info here.
Also note that Seniors and People with Disabilities may be eligible for the county’s tax relief program. More info here.
If you have questions about your assessed value, the market value of your home or are thinking of buying or selling a home, give The Belt Team a call (703) 242-3975. We are happy to help you make the right move!
A recent survey revealed that many consumers believe there’s a housing bubble beginning to form. That feeling is understandable, as year-over-year home price appreciation is still in the double digits. However, this market is very different than it was during the housing crash 15 years ago. Here are four key reasons why today is nothing like the last time.
1. Houses Are Not Unaffordable Like They Were During the Housing Boom
The affordability formula has three components: the price of the home, wages earned by the purchaser, and the mortgage rate available at the time. Conventional lending standards say a purchaser should not spend more than 28% of their gross income on their mortgage payment.
Fifteen years ago, prices were high, wages were low, and mortgage rates were over 6%. Today, prices are still high. Wages, however, have increased, and the mortgage rate, even after the recent spike, is still well below 6%. That means the average purchaser today pays less of their monthly income toward their mortgage payment than they did back then.
In the latest Affordability Report by ATTOM Data, Chief Product Officer Todd Teta addresses that exact point:
“The average wage earner can still afford the typical home across the U.S., but the financial comfort zone continues shrinking as home prices keep soaring and mortgage rates tick upward.”
Affordability isn’t as strong as it was last year, but it’s much better than it was during the boom. Here’s a chart showing that difference:
If costs were so prohibitive, how did so many homes sell during the housing boom?
2. Mortgage Standards Were Much More Relaxed During the Boom
During the housing bubble, it was much easier to get a mortgage than it is today. As an example, let’s review the number of mortgages granted to purchasers with credit scores under 620. According to credit.org, a credit score between 550-619 is considered poor. In defining those with a score below 620, they explain:
“Credit agencies consider consumers with credit delinquencies, account rejections, and little credit history as subprime borrowers due to their high credit risk.”
Buyers can still qualify for a mortgage with a credit score that low, but they’re considered riskier borrowers. Here’s a graph showing the mortgage volume issued to purchasers with a credit score less than 620 during the housing boom, and the subsequent volume in the 14 years since.
Mortgage standards are nothing like they were the last time. Purchasers that acquired a mortgage over the last decade are much more qualified. Let’s take a look at what that means going forward.
3. The Foreclosure Situation Is Nothing Like It Was During the Crash
The most obvious difference is the number of homeowners that were facing foreclosure after the housing bubble burst. The Federal Reserve issues a report showing the number of consumers with a new foreclosure notice. Here are the numbers during the crash compared to today:
There’s no doubt the 2020 and 2021 numbers are impacted by the forbearance program, which was created to help homeowners facing uncertainty during the pandemic. However, there are fewer than 800,000 homeowners left in the program today, and most of those will be able to work out a repayment plan with their banks.
Rick Sharga, Executive Vice President of RealtyTrac, explains:
“The fact that foreclosure starts declined despite hundreds of thousands of borrowers exiting the CARES Act mortgage forbearance program over the last few months is very encouraging. It suggests that the ‘forbearance equals foreclosure’ narrative was incorrect.”
Why are there so few foreclosures now? Today, homeowners are equity rich, not tapped out.
In the run-up to the housing bubble, some homeowners were using their homes as personal ATM machines. Many immediately withdrew their equity once it built up. When home values began to fall, some homeowners found themselves in a negative equity situation where the amount they owed on their mortgage was greater than the value of their home. Some of those households decided to walk away from their homes, and that led to a rash of distressed property listings (foreclosures and short sales), which sold at huge discounts, thus lowering the value of other homes in the area.
Homeowners, however, have learned their lessons. Prices have risen nicely over the last few years, leading to over 40% of homes in the country having more than 50% equity. But owners have not been tapping into it like the last time, as evidenced by the fact that national tappable equity has increased to a record $9.9 trillion. With the average home equity now standing at $300,000, what happened last time won’t happen today.
“Not only have equity gains helped homeowners more seamlessly transition out of forbearance and avoid a distressed sale, but they’ve also enabled many to continue building their wealth.”
There will be nowhere near the same number of foreclosures as we saw during the crash. So, what does that mean for the housing market?
4. We Don’t Have a Surplus of Homes on the Market – We Have a Shortage
The supply of inventory needed to sustain a normal real estate market is approximately six months. Anything more than that is an overabundance and will causes prices to depreciate. Anything less than that is a shortage and will lead to continued price appreciation. As the next graph shows, there were too many homes for sale from 2007 to 2010 (many of which were short sales and foreclosures), and that caused prices to tumble. Today, there’s a shortage of inventory, which is causing the acceleration in home values to continue.
Inventory is nothing like the last time. Prices are rising because there’s a healthy demand for homeownership at the same time there’s a shortage of homes for sale.
If you’re worried that we’re making the same mistakes that led to the housing crash, the graphs above show data and insights to help alleviate your concerns. Still have questions?? Reach out to The Belt Team to discuss your real estate questions and specific situation. Let our 55 years of experience benefit you! 703-242-3975 | Info@TheBeltTeam.com
Besure to follow our blog, as well as our pages on Facebook & Instagram and our YouTube channel, to get our updates on the real estate market, community happenings and much more!
Ulta Beauty is coming this Spring! 👏👏👏 Located at 8350 Leesburg Pike/Pike 7 Plaza (across Rte 7 from The Boro), Ulta Beauty will be in the location of the old Performance Bike shop. It is based in Illinois and is one of the nation’s largest beauty retailers with over 25,000 products featuring more than 600 brands and we are excited that it will be here in Tysons soon!
Ulta Beauty is just one many companies recognizing the incredible growth and opportunity here in Tysons. They call it “America’s Next Great City” for a reason! Tyson’s is a 4 square mile area that is experiencing unprecedented growth and development. The master plan is for Tysons to be THE place to live, work & play.
To think that it was once rural farmland…us natives remember when Tysons 1 Mall was built, and the many corporations that have moved their headquarters here over the years (including Capital One and Hilton). With the expansion of the Silver Line Metro adding 4 stops in Tysons, access has become easier for everyone to come and enjoy all of the shopping, restaurants and events that make it a major Hot Spot!
More to come on America’s Next Great City🇺🇸
Please sign up to follow our blog, as well as like/follow us on Facebook, Instagram & YouTube to be the first to see our real estate updates, community happenings & more!
The January numbers are in and they reveal what you are seeing (or not seeing) in the market…a dearth of new For Sale listing signs. New listings in January were down significantly compared to 2021 and prices continued upwards.
We are experiencing one of the most challenging markets for buyers to find a home in history. Many sellers do not want to put their home on the market before they know they have found their next home, but can’t buy without selling first. Quite a dilemma. But…there are solutions!
Please reach out to talk if you find yourself in this situation and learn how to have success in this challenging market. It is VERY important to work with an experienced agent that will provide you with the data you need to make good decisions to help you be successful in this type of market.
(703) 242-3975 | Info@TheBeltTeam.com | or fill out our Contact Us form
Then be sure to take a look at all the January 2022 housing market stats for Northern Virginia and some of our hyper local markets at the bottom of the page.
Northern Virginia January 2022 home sales:
• 2,346 homes went under contract in the region. This is down 19% from the same time period in 2021.
• 49% of the homes that went to settlement in January 2022, sold in 10 days or less from when they hit the market.
• Average sold price was $648,444 (up 9.4% from the same time period in 2021).
• 2,437 homes came on the market. That’s down 23% from January 2021.
• Homes that sold (closed) averaged 28 days on market,7 days slower than January of 2021.
• There is currently a 0.3 month supply of homes (remember, in a balanced market – the demand from buyers equals the supply from sellers – there is a 5-6 months supply) in the Northern Virginia – and 1,245 homes for sale (townhouse, condo and single-family).
OVERALL: Northern Virginia remained an aggressive Seller’s Market. Lots more of the same from 2021…very LOW inventory in our market, buyer demand high and home prices rising.
To see what the conditions are like in your community, click on the link to your desired city below!
It’s tough out there in the real estate market for buyers! They are dealing with an unprecedented seller’s market (very low inventory = lots of competition), rising home prices and possibly rising interest rates. Here are a few tips from our CEO, Terry Belt, on how buyers can be successful in this market (watch video below).
Are you ready to buy? Make sure you work with a very experienced agent who can help you navigate these tricky waters! If you are in the Northern Virginia area…give us a call and let our 55 years of experience work for you! 703-242-3975. Or shoot us an email at Info@TheBeltTeam
Besure to follow our blog, as well as our pages on Facebook & Instagram and our YouTube channel, to get our updates on the real estate market, community happenings and much more!
Welcome to 2229 Benedictine Ct…an updated split colonial situated on a lovely .38 acre corner lot in the Wincanton neighborhood of Vienna. 2,495 square feet of living space with 4BR/2.5BA on 4 finished levels. Updates/improvements include hardwood floors, carpet, roof & gutters, windows throughout, kitchen, interior painting, hot water heater, clothes dryer and rear fence. Outdoor living & entertaining space features a deck overlooking the yard and trees. 2-car attached garage, unbeatable location for commuters & amenities, great schools and so much more!
Call Terry Belt at 703-242-3975 for more details or to schedule a showing!
Mortgage rates have increased significantly since the beginning of the year. Each Thursday, Freddie Mac releases its Primary Mortgage Market Survey. According to the latest survey, the average 30-year fixed-rate mortgage has risen from 3.22% at the start of the year to 3.55% as of last week. This is important to note because any increase in mortgage rates changes what a purchaser can afford. To give you an idea of how rising mortgage rates impact your purchasing power, see the table below:
How Can You Know Where Mortgage Rates Are Headed?
While it’s always difficult to know exactly where mortgage rates will go, a great indicator of where they may head is by looking at the 50-year history of the 10-year treasury yield, and then following its path. Understanding the mechanics of the treasury yield isn’t as important as knowing that there’s a correlation between how it moves and how mortgage rates follow. Here’s a graph showing that relationship over the last 50 years:
This correlation has continued into the new year. The treasury yield has started to climb, and that’s driven rates up. As of last Thursday, the treasury yield was 1.81%. That’s 1.74% below the mortgage rate reported the same day (3.55%) and is very close to the average spread we see between the two numbers (average spread is 1.7).
Where Will the Treasury Yield Head in the Future?
With this information in mind, a 10-year treasury-yield forecast would be a good indicator of where mortgage rates may be headed. The Wall Street Journal just surveyed a panel of over 75 academic, business, and financial economists asking them to forecast the treasury yield over the next few years. The consensus was that experts project the treasury yield will climb to 2.84% by the end of 2024. Based on the 50-year history of following this yield, that would likely put mortgage rates at about 4.5% in three years.
While the correlation between the 30-year fixed mortgage rate and the 10-year treasury yield is clear in the data shown above for the past 50 years, it shouldn’t be used as an exact indicator. They’re both hard to forecast, especially in this unprecedented economic time driven by a global pandemic. Yet understanding the relationship can help you get an idea of where rates may be going. It appears, based on the information we have now, that mortgage rates will continue to rise over the next few years. If that’s the case, your best bet may be to purchase a home sooner rather than later, if you’re able.
Forecasting mortgage rates is very difficult. As Mark Fleming, Chief Economist at First American, once said:
“You know, the fallacy of economic forecasting is don’t ever try and forecast interest rates and or, more specifically, if you’re a real estate economist mortgage rates, because you will always invariably be wrong.”
However, if you’re either a first-time homebuyer or a current homeowner thinking of moving into a home that better fits your changing needs, understanding what’s happening with the 10-year treasury yield and mortgage rates can help you make an informed decision on the timing of your purchase.
And reach out to The Belt Team to help in your home search and let our 54+ years of experience work for you!
One minute you are jumping rope feeling like a kid again and the next you are hobbling around in a boot for 4-6 weeks. 😩. Injuries happen, it’s a part of life especially for athletes and us (middle aged😉) people just trying to stay active!
So, when an injury happens, what’s our body’s natural response to trauma? Inflammation! And what do we do next…
R– Rest I – Ice C – Compression E – Elevation (and we reach for the ibuprofen)
R*I*C*E & 💊💊💊 are super effective but don’t forget that Mother Nature is also an incredible source of healing. SO many foods are loaded with anti-inflammatory properties that reduce inflammation and get you back to your life, your workouts and make you feel AMAZING!
So whether you are injured or just looking for ways to incorporate anti-inflammatories into your diet, we’ve provided a list below to serve as a good reference for you…
Foods that pack a big anti-inflammatory punch are:
Olive oil 🫒
Green Tea 🍵
Dark Chocolate 🍫
*Added Bonus: glowing skin, amazing energy & better sleep!
Being sidelined is hard and it can be all out mental warfare. I know many of you reading this can relate! Hope this information is helpful on your road to recovery and happy healing! ❤️🩹
Sarina Belt – Former NASM Certified Personal Trainer | Schwinn Certified Spin Instructor | Former AFFA Certified Group Fitness Instructor
Please sign up to follow our blog, as well as like/follow us on Facebook, Instagram & YouTube to be the first to see our wellness posts, our real estate updates, community happenings & more!