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IN THIS ISSUE: Market stats as of today! LuxManor video (NEW): "Water Intrusion SOLVED" Jim Roy's article: Housing Market Update (relative stability predicted) November random thought Home maintenance reminder (kept in by popular demand)

The Market Slowed in August Here are the residential sale numbers in the DMV: Coming Soon: 345 homes Active listings: 6,935 homes Under contract: 4,285 homes Sold in last 30 days: 3,383 homes

Trailing Twelve Months Market Statistics Average Days on Market: DC Metro Area

Video: Fix Water intrusion issues!

Check out my 6th video encompassing several issues on the outside of a home. Any one of them could lead to water problems. Spend a few minutes getting up to speed on the factors that can affect your home or the home of someone you care about. Become knowledgeable on water issues so a contractor can't sell you something you don't need! Also, please like and subscribe and hit the notification bell.

Click here to access all of LuxManor's videos!

Housing Market Update Jim Roy takes a fresh look at the health of DMV housing and real estate as an investment vehicle in today's world.

Will we see another 2008 foreclosure crisis? In my professional opinion, odds are very low. The main reason for this is the quality of the outstanding loans and new loans being approved today. After the foreclosure wave of the mid 2000's lenders became very conservative, perhaps too conservative, with their lending policies. The existing loans are truly high quality paper. This means they're far less likely to default. 2008 is often viewed as the year the bubble burst. This is only because that's when the foreclosures were in full swing and the pain was felt. Many Realtors felt the shift in late 2005.

Are we still in a seller's market?  Surprisingly: yes. The inventory (active listings) have recently shifted so more properties are active than are under contract. Until we see 3 month supply (3x more active than under contract), I would not deem it even a neutral market. This is not likely to change in the D.C. Metro Area anytime soon. New construction has been very slow, building materials are expensive, labor is expensive, and the job market is strong.

What about high interest rates? I had been telling my clients for years that obtaining 2%-4% interest rates is like free money. Rates lower than inflation? Lock in! I also let them know that this will not last. Recently, interest rates for homes have increased. I recall in 1998 when I first got my license: the Realtors in my office rejoicing at how low they were at that time. 8% was a bargain for borrowing money. Many of these agents remembered the ultra high rates of the early 1980's. The higher rates are a big part of the slow down we've seen in the last several months. The good news is that locking in at today's rates allows you to refinance should rates dip enough to warrant a refi. All the while you're paying down your mortgage and benefiting should home prices go up. A fixed rate also insulates you against continued increases in interest rates. "Time in the game" is better than "timing the game." It's virtually impossible to predict the "bottom" of the market.

Is there a Bubble?  While it's true that prices fluctuate to some degree, they generally hit a new peak before too long. The visual imagery of a bubble bursting can scare people into inaction and missing out on a wonderful way to build wealth and create cash flow. Inflation is a huge compensating factor for a rise in rates. Real estate is a wonderful (and maybe the best) hedge against inflation. If coupled with debt, your real estate investment (home or rental property) will make paying off that debt much easier since you're locked into a payment, but rental prices tend to drift upwards with the price of everything else. With the recent inflation we've seen, I would expect home prices to rise but at a slower pace. If there is a decline in values, I do not expect it to be very long lasting. There are no guarantees in this world but watching the stock market's ups and downs (and potentially more downs to come) can be nauseating at best. Therefore, no, my opinion is that the D.C. Metro Area is not currently in an unsustainable bubble as far as home values.

Should you invest in housing right now? Those with money to invest should strongly consider investing in buying and holding rental properties. If you're looking for cash flow, relative safety, low interest money (yes, even now), rental housing is where you want to be. Maybe you don't love the idea of finding and screening tenants. No problem, LuxManor will do so and our sister company can assist in property management. Take a look at www.dmvpm.com, the website for DMV Property Management, LLC. $100/month covers all of what most people need each month for property management. Very few investments offer a monthly payment to the investor (rent payments), relatively reliable appreciation (generally solid over any 10 year period), and the lack of wild surprises we've seen in a highly volatile stock market. Compared to selling a stock, selling a home takes longer, costs more, and requires far more paperwork. Because of this, people tend not to act too hastily and it provides stability in the market. Keeping your cash in the bank has proven to be a sure way to watch your buying power erode as everything increases in price while your cash doesn't change. My personal belief is that investing in real estate is a solid move now, especially if you have a relatively long time horizon of 7+ years. An old mentor of mine told me real estate is a marathon, not a sprint. Play the long game. Find a trustworthy advisor. Plan for your future.

Coming soon:  What are agents' responsibilities when it comes to open houses and are open houses useful? Note: I had planned to discuss open houses in this newsletter but decided to make home values and the trajectory of the market the priority.

October Thought: I before E except when you run a weird heist on a feisty foreign overweight neighbor wearing beige.

Home Maintenance Reminder Check your gutters and downspouts. Ensure they are not clogged with leaves and keep the water flowing away from your home. https://www.youtube.com/watch?v=THnCUjZ5t-Q

Contact a LuxManor Realtor with any real estate related questions for quick and reliable answers. We work with some of the best lenders and title companies in the business who can assist our clients on all real estate matters.  For more information or to speak with a licensed Realtor, contact Jim Roy at 301-254-7253 or Jim@LuxManor.com.