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GDoN Revisited by Hipchickindc – 1228 Florida Ave, NE

by Prince Of Petworth April 19, 2013 at 11:00 am 49 Comments


Hipchickindc is a licensed real estate broker. She is the founder of 10 Square Team and is affiliated with Keller Williams Capital Properties. 10 Square Team is a popville.com advertiser. Unless specifically noted, neither she nor the company that she is affiliated with represented any of the parties or were directly involved in the transaction reported below. Unless otherwise noted, the source of information is Metropolitan Regional Information Systems (MRIS), which is the local multiple listing system. Information is deemed reliable but not guaranteed.

Featured Property: 1228 Florida Ave NE
Legal Subdivision: Trinidad
Advertised Subdivision per Listing: Trinidad
Bedrooms: 6 Baths: 4.5
Original List Price: $926,500
List Price at Contract: $898,400.
List Date: 1/31/2013
Days on Market: 18
Settled Sales Price: $926,000
Seller Subsidy: $27,780.
Settlement Date: 04/04/2013
Bank Owned?: No Short Sale? No
Original GDoN post is: here.
The listing can be seen: here. To see pics, click on the camera icon after opening the link.

When a Good Deal or Not (GDoN) post garners 110 comments, there’s got to be some controversy. In this case, it’s a nearly $900,000. net sale for a particularly large fully renovated house in the NE DC neighborhood of Trinidad, on busy Florida Ave, no less.

To date, the next highest sale in the Trinidad neighborhood was a January sale down the street at 1222 Florida Ave NE for $590,000. The property is within less than half a mile to neighborhoods that are regularly seeing high end prices (notably south of H St NE and closer to Lincoln Park, although prices are also rising at the lower part of Eckington to the west).

In May 2012, some apparently savvy investors paid $286,000. in cash for the property.

The listing agent was Matt Tekmen of Fairfax Realty, Inc. Dyanne Branand of Coldwell Banker Residential Brokerage represented the purchaser.

  • I’m surprised it appraised…and I can’t make sense of the buyer paying almost the full original list price of $926K when they had dropped the list down to $898K.

    • beyond shocked! No way I’d pay that much for Florida avenue and Trinidad…

    • Anonymous

      seller subsidy of 27,780.

      926,000 – 27,780 = 898,2000.

      I don’t know, maybe they agreed on the seller subsidy to create the illusion that the home is worth $926k?

    • Anonymous

      Sorry 926,000 – 27,780 = 898,220.

    • Nicoli

      I’m also impressed it appraised at that price. It’s a particularly big/open row house and the renovation looks really good, but still it’s on a busy street in Trinidad.

  • Anonymous

    I hope they get enjoyment out of the spacious house and aren’t forced to sell before 8-10 years. If they’re in it for the long haul, who is to question the sales price.

    $27k in closing costs? Are closing costs that high for $926k transaction? I was under the impression that seller credit can’t be more than closing costs……

    • seller credit can be whatever you make it

      • Anonymous

        First anon here.

        Can you explain?

        Can you get approved for a loan in this situation (seller credit is higher than your closing costs)? Would you pay a higher interest rate? When I closed I was told by my agent, mortgage provider, and settlement company that I was precluded from getting more closing costs than settlement costs. Maybe they just wouldn’t have approved my mortgage and I would have to go elsewhere to get a loan……

    • Seems reasonable to me could be even more if there were origination fees/points. Transfer taxes are probably 1/2 of it alone. Our place was less than this and we paid about that in closing costs.

    • Anonymous

      Actually I think 26k may be rather low. Seller closing costs are often in the neighborhood of 4-7% or more.

      • think we were talking about buyer closing costs.

        • Anonymous

          Buyer closing costs are insane in DC; ours were close to $50k. And of course you have to come up with a 20% downpayment on top of that. Thankfully closing’s not nearly as expensive when you refinance (as long as it’s your primary residence).

          • Anonymous

            $50k in closing sounds insane, unless you paid over $1M. As far as downpayments, you aren’t “required” to put down 20%. FHA loans only require 3%, but if you have decent credit, you can also get a non-FHA loan with say 5% down. You shouldn’t mislead anyone considering homeownership that they need 20% (again, unless they have terrible credit).

          • Anonymous

            20% is pretty standard down payment on a home. it actually proves the reverse: that you have GOOD credit and are responsible enough to own a home. when loans started flying out the door with ARMs and little-to-nothing down back in the mid-2000s, mortgage fraud was rampant and people lost their homes (which weren’t really theirs since they had no equity). if you can’t afford 20% down, don’t buy. you aren’t ready. home ownership is expensive. stuff breaks. stuff wears out (roofts, plumbing, electrical, etc…). it’s not for everyone.

          • Anonymous

            You don’t need to have a 20% downpayment to be ready for homeownership or be able to afford the house. It’s great if you have it and you won’t be paying monthly mortgage insurance premiums, but there are a lot of situations in which it’s a great idea for people to buy before having 20% to put down.

          • Anonymous

            We paid $775k for our home. We both had excellent credit and qualified for a much bigger loan, but 20% was the absolute minimum we were required to put down (the lenders were pushing for 25% in fact). Even with 20% down we had to do an ARM (which we were fortunately able to refinance into a conventional loan 2 years later). Yes, we could have done FHA, but the PMI would have been something like an extra $1000 a month.

            So no, I’m not misleading anyone. That is the reality of buying a home these days.

          • Anonymous

            Anon @12:54, do you think everyone’s putting down 20% just for fun? It is absolutely required for a conventional loan. Even if you do a refinance you need to have at least 20% in equity. You’re the one who’s misleading people. Unless things change homebuyers should be prepared to have that money available.

          • D

            My experience was nothing like the Anon that paid 775k. I bought in 2010 not long after the crunchiest part of the credit crunch and was able to get a loan with 10% down and closing costs that were not even remotely close to what s/he paid proportionately speaking. Hated paying PMI (refied and got rid of it) but even that too was significantly less proportionately speaking than s/he claims to have been quoted. Anon must have worked with an awful lender.

          • It’s my understanding with the higher value loans, they are more of a risk to the bank, so it makes sense that they pushed the anon purchasing at $775k with 20% down ($620k mortgage) to have a higher down payment, to reduce their own risk, make sure the loan goes through, and to possibly get a lower mortgage rate. I don’t think that was considered a jumbo at the time.

            And all are right that you don’t NEED 20% down to get a mortgage…but you’ll just pay more in mortgage insurance since it’s an FHA loan, which is pretty expensive, and you’re more likely to have a higher rate, and you have less lenders who are willing to give you a loan because it’s risky, especially at the high price points.

            If you want an example, go into the Zillow Mortgage Calculator and see what happens when you enter the different data, and see how that affects the number of lenders who are listed as willing to give a mortgage. (As an aside, I really doubt that all of those lenders listed would actually go through with some of the loans, I just think they want everyone to call them…I’ve put some unrealistic numbers in there and still had results of people I should call to get a quote).

            It’s not misleading to say that 20% is the standard amount for a loan, because that’s why 20%+ loans are called conventional loans. Plus, for this house, they wouldn’t qualify for an FHA loan, since the maximum FHA loan is $729,750–at 20% down, the loan would be higher ($740,800).

          • And to D, I can’t really say how their lender was or their title company. However, they’d need to come up with around $30k (probably a little less when factoring in the actual assessment on record at OTR) for taxes alone: deed transfer tax, deed recordation fee, and having one year of taxes in escrow. Add in more for the lender fees, and yeah, I can see it getting to $50k pretty easily.

          • Anonymous

            “Conventional” loan just means its made from a bank as opposed one which is insured by a government entity (i.e. FHA, VA). It has absolutely nothing to do with “20%+ down”; there are conventional loans from 95% LTV all the way to 80% LTV or more

            There is so much misinformation in this thread it’s scary. apparently commentors know everything about real estate but nothing about the financing usually required to procure some.

          • Anonymous

            Yeah, there’s a lot of misinformation in this thread. Homegirl is right that our closing costs had little to do with the lender. Most of our costs were the DC recordation fees (we didn’t even have an escrow) and the mandatory title insurance. She is, however, wrong about conventional fees requiring 20% down. It’s not impossible to get a conventional loan with 10% down, but it’s extremely uncommon these days and definitely not something a homebuyer should expect. The modest 2-bedroom house that my partner and I bought required a “jumbo” loan, so that did make the rules a little stricter for us. Unfortunately, property in DC is so expensive that a lot of homebuyers here will end up in that situation.

        • Anonymous

          you absolutely do not need 20% down to buy a home with a conventional loan. we bought a house 4 months ago with 5% down, with a slight bump in interest rate in lieui of PMI (still at 3.8%)

          yes, my credit was very good, but thinking you need 20% to buy a home in this market is very misleading and discouraging to prospective homebuyers in an already intimidating market. one disclaimer – our home was under $500k, if you were buying a 700-900k home, lending requirements would obviously be much stricter and may require 20% down. However, this is not a “bare minimum” requirement to buy a home

          • Reality Speaking

            You either got really, really lucky or there’s something you’re not disclosing. Prospective homebuyers should definitely be prepared to either put down 20% or deal with the hurdles and PMI associated with FHA. I don’t know anyone that’s gotten away with putting down less anytime recently. At if your credit is anything less than “Good” you need to fix that before even considering it. Lenders have gotten very strict.

          • I agree this is fishy, I have excellent credit and was unable to go higher than 80% LTV on a HELOC I just took out. Lenders are not playing the same games they used to play.

          • Anonymous

            Yeah, I made the mistake of believing everyone who said you only need to put down 10%. At closing we were scrambling to borrow money from family because they were requiring 20%. It doesn’t matter how good your credit is or how much you qualify for; they want to see that 20% or else you won’t get the loan.

          • bmac

            It sounds like a VA loan.

          • Anonymous

            (lucky anon above) FHA has its own version “PMI”. if you put anything less than 20% for conventional I believe you need to pay PMI, so if you mean if you have less than 20% to put down you have to deal with PMI, I would agree.

            Many people can have a high income and be “cash poor”. 20% down on a $500k house is 100k, which is a daunting amount to save for nearly anyone (not to mention closing costs). To say that a couple can’t secure a loan for a 500k house without 100k down or going FHA is simply not accurate, they will just have a higher monthly payment then someone who did due to PMI.

            The comments below, you must have been at a higher price point then me so the bank was more risk averse.

          • reason1

            Actually, I bought a house last year with 0% down with a BB&T CHIP loan, and no PMI, so it definitely can be done. Sure, they have income requirements, but there was nothing sketchy about it at all, and so far I love my Trinidad home! I had a good credit score and the money for maybe a 5% down payment, but it made sense to do a 0% down payment instead.

          • Anonymous

            So you agree that you were very lucky. People should not be expecting to be able to get a conventional loan with 5% down just because you were somehow able to. That’s like planning your life based on the assumption that you’ll win the lottery.

          • reason1

            Oh and BTW, the BB&T CHIP loan is a conventional loan.

          • Anonymous

            Not fishy, as others are saying. We were approved for 10% down for a substantial conventional mortgage. We have good credit and high income. It happens.

          • Coopersmama

            There are a lot of misconceptions about financing. There are several very good options for conventional loans at 0, 3, 5 and 10% down. There are also conventional loans at the lower down payments with no mortgage insurance. They typically require a slight bump in rate (.125%), but your monthly payment ends up being lower than a loan with MI, and you can deduct all the interest, but can’t deduct MI. Not all banks offer then, but there are lots of reputable ones that do.

          • Anonymous

            I’ve been a loan officer for 3 years. I work for one of the largest banks in the world. I want to put a stop to these statements that you need 20% down for a conventional purchase. The short answer is: you do not need to put more than 5% down on a conventional conforming purchase. If your loan amount is above $417,000 you will need to put 10% down for a conventional loan. If you do an FHA loan you can put as little as 3.5% down up to a loan amount of $729,000. Stop telling people they need to put 20% down to own a home. It’s incorrect and a very silly. If you get to the closing table and don’t understand that the lender expects you to put 20% down then you have some major issues that have nothing to do with the lender. The misinformation in the public about what it takes to get a loan is astounding.

    • Anonymous

      Closing costs would be double that, at least!

  • Thor

    as the saying goes: “There’s a sucker born every minute” (or something like that)

    • Marcus Aurelius

      Does that apply to the person(s) who bought this home or the legion of PoP posters who predicted it would never sell for anywhere near asking price?
      I can’t see paying $900K to move into that area. But then again, I doubt I would pay the going prices – about $100k more then when I bought – to move into my current neighborhood.

      • Thor

        the buyers

  • Anonymous

    as someone who is looking at the moment, and actually considering trinidad, i’m not entirely shocked. maybe buyer is planning on renting out as a group house – could go for $6,000 a month, no? $1,000 per person? I see a bunch of young hill staffers living here, and the buyer making a large monthly profit.

    • Thor

      i think the law in DC is such that no more than 4 unrelated people can live in a house.

      • Anonymous

        I’d be surprised by that, given the number of colleges and universities in DC. I can’t imagine that only groups of 4 students or fewer live off campus.

  • Anonymous

    Buyers are idiots.

    • Anonymous

      i dunno, the’yre smarter at making money than i am.

    • people were saying the same thing 10 years ago when I bought my rowhouse in ledroit park.

      • Anonymous

        The difference is you probably bought your home undervalued whereas these buyers own by far the most expensive place in the neighborhood and the remodel was shoddy at best. The home is huge, but it’s no where near worth $900k for Florida Ave/Trinidad. Idiots like this also make affordable housing in DC next to impossible in general.

  • anonymous

    A year ago houses in this area were selling for less than 400K. So 900K seems absurd for a home in Trinidad, but it only went for $10 more per sq ft than a house down the street.


  • anon 3:32

    (meant to write comments above, not below)

    90% LTV for a $775 home is quite a loan, and I’m not surprised a lender would require 20% down for that. but check with a lender and go over your financial situation before throwing in the towel if you’re looking for a home, because 5-10% conventional is doable if your home is around the “median” DC home price (mid 400s), though you will have to pay PMI or take a higher rate

  • Anonymous

    Wow. I was seriously expecting to see this lower than the asking price. Considering you can get a house the same size (though taller, not as wide) close to Union Station for this price or even less…I just don’t know what happened here. All I know is I sure would not want to own the most expensive house in the neighborhood…

  • Anonymous

    You do not need to put 20% down when purchasing a home. Anyone who tells you this isn’t telling you the whole story. Conventional conforming purchases (with a loan amount of $417,000 or less) require 5% down. Conventional conforming plus purchases (loan amounts of between $417,000 and $629,000) require 10% down. FHA loans will allow you to put as little as 3.5% down up to a loan amount of $729,000. VA loans will allow you to walk into a home without putting any money down.

    The only reason you would have to put more down that stated above is if the home is going to be a rental property, if your credit is god awful, or if the lender you’re using has guidelines that are more strict than those dictated by Fannie Mae or Freddie Mac.

    Source: I’ve been a loan originator for 3 years. 1.5 years at the 4th largest lender in the country. 1.5 years at the number 1 largest lender in the country. I also just bought a home in DC using a conventional loan putting 10% down.


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