How Prevalent Are Short Sales in the Arlington Real Estate Market?
Arlington County is one of the must affluent, most educated, most developed counties in Northern Virginia and the Washington, D.C. metro area….so how do these gold stars affect the real estate market?
In case you need a refresher, read this post on the difference between an auction property, bank owned, and short sale. In order to meet qualifications for a short sale, you must be able to prove a hardship, ex. include job loss, divorce, medical bills, death, incarceration, insurmountable debt, etc. That’s just the tip of the iceberg.
So given these reasons, just how prevalent ARE short sales in the Arlington market? Let’s take a look at 2008, 2009, sales YTD in 2010 and current inventory:
Total Sales: 2,395
Total Closed Short Sales: 16
Accounting for 0.67% of Closed Sales
Total Sales: 2,662
Total Closed Short Sales: 106
Accounting for 3.98% of Closed Sales
Total Sales: 813
Total Closed Short Sales: 47
Accounting for 5.7% of Closed Sales
Total Active or Under Contract: 1,319
Total Active or Under Contract Short Sales: 46
Accounting for 10.31% of Current Active/Pending Inventory
Some noteworthy points:
Active/Pending inventory will not translate into closed sales at a 1:1 ratio. It just won’t. Not all short sales will get approved by the bank, and of the ones that do, not all of them will close. Buyers get tired of waiting and walk, sellers change their financial situations and on longer qualify, or frankly, the bank may just want to collect payment from the Mortgage Insurance company, which makes it more profitable for them to foreclose. Oh yeah, that happens.
You can see that short sales are NOT a huge part of our active market. Almost 82% of the short sales are in South Arlington (zip codes: 22202, 22204, and 22206), and a little more than half of them are condos.