January-February 2007 are an excellent time to purchase in the inner suburban areas of northern Virginia, for most prospective buyers.

There are many properties to choose from in every price and type category. The “inventory”—meaning the number and type of properties on the market-- is increasing sharply after declines over the holidays.

Interest rates have increased but are still near historic lows.

Many buyers apparently have felt in recent months that with obvious signs that the inventory has increased and prices have decreased, it is best to wait to see how far the adjustment goes.

Kit is telling buyers that we are probably close to the bottom for properties under $750,000. What follows later this year is not price appreciation, but stability. (Call about the special case of the $1,000,000 houses.)

On the other hand, interest rates are a puzzle: it is not at all clear that rates will stay stable. Rates may increase. Talk to your lender about this.

A rate increase could create a problem for you, based on your own situation.

The reasoning for saying we are near the end of the adjustment?

This local economy is one of the strongest in the nation—it continues to create jobs in large numbers.

In summary, those who want to buy should start looking.

Those who are buying second homes for vacation or rental, or buying for investment, might want to wait a bit. Markets at the beaches are weak and getting weaker. And for rental properties in this area, most rents are not yet at levels that will give you breakeven or positive cash flow. For these special case situations, be sure to call Kit for advance guidance.