The Great Falls, Virginia market has tended to have fairly severe price swings over the past four housing downturns. While price swings happen in most markets, because of its uniqueness, Great Falls goes up higher and down lower than many others. I believe this is because of the desirability of the Great Falls lifestyle. When the economy is doing well, those who can afford the higher prices (the higher maintenance costs) will pay the premium to live here. Unfortunately, there are those who overextend themselves to get that dream home. These individuals end up getting into trouble when their incomes drop with a slower economy. They then either lose their homes through foreclosure or are forced to sell it at a sizable loss. This then drags down the prices of other homes which also are on the market.

While common sense, you want to be sure to buy low/sell high if you want your investment pay off. Having said this, there is no better time than the first quarter 2009 to buy low. This is particularly true for homes in Great Falls. My advice is almost always based on my personal experience or how I counsel my own sons. Nancy and I purchased our home in 1999 during the last downturn for $505,000. After a $300,000 renovation, this home was recently appraised at $1.3 million in this down market. There are currently some truly incredible opportunities.

Example one: A home that sold for $1.3 million only three years ago was recently foreclosed on and is being offered for $808,000. I am fairly certain that the bank will accept somewhere between $700,000 – $750,000. I had hoped for my son to be able to purchase this home, but it is priced just a little too high for him.

Example two: This home sold for $1.126 million only two years ago (after the market had come down) The home had about $150,000 put into upgrades and is now for sale at $1.1 million. It has five bedrooms and three full baths on the upper level. Since this one is my listing, I can’t comment on what I believe it will sell at. I do feel its the best bargain in the $900,000 – $1.2 million range. So do other realtors since it is averaging more than five showings per week.

Example three: A home that sold for $1.995 million in 2005, had about $200,000 in upgrades, is now on the market for $1.499 million. I had shown this home several times when it was priced at $1.8 million and am totally surprised it didn’t sell long ago. The home is currently vacant and will likely sell for a good bit less.

Homes one and three are definitely examples of buy high/sell low.  Contact me when you would like to make an investment of a lifetime.