Grounds Keeper

RE/MAX associate broker Jane Quill has tracked the Northern Virginia housing market’s peaks and valleys for close to 30 years. By nature, what she brings to the table of what’s been labeled an estate crisis is something most can’t: a macro perspective.

By Forrest Glenn Spencer / Photography by Seth Freeman

Jane Quill

As the nation endures a housing market wreaked by subprime foreclosures, devalued properties, a tightening credit market and lessening home construction rates, Northern Virginia, while not Teflon-coated, has certainly weathered the subprime-mortgage crisis and subsequent housing ails better than other regions. Jane Quill is the Northern Virginia Association of Realtors’ 2008 chairman of the board of directors. She is also a full-time associate broker for RE/MAX Presidential and has represented hundreds of clients. For nearly 30 years, Quill has witnessed the cyclical changes within the region’s housing market. The recent housing crisis is one that demands our attention, but—as Quill would advise—not our panic. She insists people step back and look at the data. The outlook, she’ll tell you, is not all that bad.

Based upon the numbers we have seen so far for 2008, in comparison to the nation, how does our region perform?
From a real-estate point of view, you have to look at national trends and our market, which has remained traditionally strong. We are doing better than other areas, as a market. The numbers here are better and will always remain better. When you look at this market, it remains strong because of location. People want to be near Washington for several reasons: the government, the military. Even though we suffer from the same ills, we have suffered from the subprime crisis, we cannot call it a crisis. We are still dealing with housing weakness and a bit of credit crunch, though it’s getting better. The mortgage rates may edge up a little bit, but people do have the opportunity to lock in a fixed rate that’s very low. You have to look at the larger picture.

The news likes to report the doom and gloom, but you speak differently when looking at our economy and housing market.
People are constantly being battered by negative news. It’s like anything with a self-fulfilling prophecy: If you are constantly told it’s no good, then it’s no good … You tend to believe it simply by repetition. That is what I see happening. We’re still doing very well. We have to look at the totals.

We have to look how to make our economy perform better. Realtors, I believe, are the ones who are going to make a difference because real estate is the foundation of our economy. There’s a tremendous supply of homes. What we have here is good transportation, homes close to jobs inside and outside the Beltway, and it sort of trickles down. We have wonderful mixed-use communities that have been developed over the years, which have really been a tremendous help to our area. You have the retail, offices and people living where they work.

And what’s occurring also is developers now are looking around for infill projects. We have a good rental market in our area. There’s somewhat of a vacancy rate going on right now because people are opting more to buy instead of paying rent through their lifetimes. We have to look at the overall picture. The capital markets seem to be coming around. What I see is the cap rates are adjusting a bit because investors are going to buy property, not for the thrill of it, but for the investment. I feel very positive, in spite of the fact that it’s down realistically. We have this angry consumer, but the reality is that businesses are OK, exports are booming. I think we’re edging up, we’re turning. The 2009 market will depend upon on the confidence of the consumer.

You’ve been through other downturn markets here in the D.C. region?
This is the third down track I’ve gone through since I came here in 1979. When you’ve been around long enough, you look at things differently.

What’s the immediate game plan?
As far as housing sales, we’re trying to catch up with people who have wanted to sell, people who took their homes off the market, rented them, and now like to put them back on the market. We’re trying to absorb the foreclosures. At the same time, people are putting more and more houses on the market.

In Northern Virginia, subprimes were not widespread. It’s been a problem of foreclosure hotspots, like Manassas and Daly City.
That’s right. The subprime-loan problem is going to disappear. The upper-price homes will return to the market. We have to deal with the stigma of the declining-market surcharge by the banks. You cannot take a whole area and stigmatize it and say it’s a declining market. It’s not true. Some is true, but other parts are going up. Jumbo loans are going to be improving. We are going to have to revisit this declining-market policy. We have the [Federal Housing Administration] come into the market and become stronger. That’s going to be helpful. The economy will turn around.

Who got hit in terms of foreclosures? Can you paint a portrait?
I don’t know the statistics, but for sure it seems to have been spread throughout the market. I have a neighbor whose daughter has been living in her house for 20 years, and when the market went down, her husband—a loan officer—wasn’t doing well, things slowed down, his commission was down, and they had a foreclosure. These are people who have been in their homes for years. The other group that has been hit is the speculators.

In general, throughout the nation, California has been hit hard, certain areas of Florida; in our area, certainly Loudoun and Prince William Counties have been hit more than other areas. Then you have to look at taking the foreclosures and look at the lending policies. Any place you have low subprime mortgages, they are doing very well. That goes without saying because all real estate is very local.

Over the past 18 months, Northern Virginia home values have gone down. Is that right?
Interestingly, some homes’ values have gone up, which has been astonishing. What’s been hit hard is new-home construction, which is down. But because of the decline of average sales price, affordability of homes has gone up. We have areas where people can finally buy. That’s what’s going to help. But if you cannot afford a home, don’t buy! Be responsible.

Each year, people are coming here. These people are going to need homes. We’re going through a period where the 30-year average is 1.4 million homes per year, and we’re getting down to the million-home formation. We have to be very careful, or we will not have housing.

What I see [is] we’re shaken through a little bit with projected inflation, and I expect it to improve in 2009. We’re better off in comparison to other markets. Even if you take the foreclosure rates here, it’s like 6.9 percent, or 169 per 10,000 units. You would swear the entire nation was being foreclosed by the media. When you compare Metro areas, we’re sixth in the nation for relatively low foreclosure rates. Detroit had 500 units per 10,000. We’re not doing badly … when you look at the different counties. For example, February 2008, Fairfax County went up 173 per ten thousand, up from December 2007; in Arlington, it’s .55 percent; Alexandria, .73 percent; out in Loudoun, 276 per 10,000 units; Prince William, 552 per 10,000.

So your song for 2009 is “Don’t Worry, Be Happy”?
I am optimistic. I’m a person who wakes up every morning, and I’m optimistic. You would be surprised—being optimistic helps. This has been my best year in real estate. Realtors are working hard to turn this around. We are No. 2 for best global-investment cities, behind New York City and ahead of London. In 2006, foreign investments here were 1.6 percent. In 2007, it was 11 percent. I don’t know why we’re so hard on ourselves. We have to work together. Let’s stop talking and just get it done. I want the real-estate market to go forward, which it will. I’m happy in what I’m seeing in the marketplace.

(December 2008)

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