Myth: When choosing a lender, shop around for the lowest interest rate
Reality: When exploring lenders and mortgage options there are many factors to consider besides the interest rate including:
- A lender can’t offer you an interest rate until you have a property lined up to purchase and they have reviewed your financial qualifications. Those low rates that you see advertised are available to specific borrowers for specific loans, not everyone who uses that lender.
- Different lenders do not all offer the same products. Shopping for a mortgage is not like shopping for a car.
- Many lenders have reputations, some good, some not so good. In a competitive offer situation, submitting a lender letter from a mortgage provider who doesn’t have a good reputation is not going to help get your offer accepted. In fact, it will likely have the opposite effect.
Why do sellers care?
- A seller who accepts an offer from a buyer whose financing is declined can lose a significant amount of money in terms of carrying costs and a potentially lower sales price if the market has changed.
- Yes, real estate agents are partial towards advising sellers to accept offers from buyers who are working with reputable (usually local) mortgage providers. They don’t receive any financial incentives for recommending a specific lender, and don’t want to be in a situation where a deal falls through because of a bad lender.
What’s the risk?
- If you decide to work with a lender, and they don’t have your loan ready by the settlement date, you as the buyer may be in default of the contract. There is no penalty to the lender. The seller can pursue damages for this default.
The lender you choose has a substantial impact on your home purchase. This decision can impact whether or not your offer is accepted on a home and whether you are able to complete the transaction (or if you will face financial penalties as a result of default).
Yes, a lower interest rate will save you money, but only if you’re first able to complete your home purchase. It’s important to consider more than just the interest rate when exploring your financing options and make an informed decision that will set you up for success.
Wondering what questions you should ask prospective lenders? Check out our list here.
Tired of hearing about homes selling in less than a week and multiple offer scenarios? Me too. So let’s explore the other end of the spectrum today and take a look at a few homes that have defied the odds and continue to remain actively listed, after a year (or more).
Homes that last on the market for a long time and have a high number of days on market can tend to be overlooked by buyers who remain focused on the newest listings, but they can also present great opportunities (and have way better negotiation prospects than new listings).
2620 Moreland Place NW — Chevy Chase DC — $800,000
- $800,000 for a 3 bed/3 bath detached home in Chevy Chase DC is well below the market average
- Originally listed in March 2016 for $925,000, and reduced as low as $710,000 in June 2017 but is back up to $800,000 — it’s possible that the seller would consider a lower price once again
- Listing remarks specify that the home is subject to an existing lease, but the photos show a vacant home (added 8/2/17)
2619 University Place NW — Columbia Heights — $899,900
- Over 3,000 square feet including a finished basement and only 4 blocks to metro
- Insider tip — the home has a few additional rooms that are not legal bedrooms, but is much larger than the 3 bed/3 bath size suggests
- Originally listed in August 2016 for $950,000 and reduced to $899,900 in February 2017
- Outdoor space is limited but this would make a great investment property — no yard maintenance for tenants to keep up with! Prospects for adding an upper level deck are good
350 G St SW #N104 — Southwest/Waterfront — $479,000
- Originally listed in August 2016, this 1 bed/1 bath 892 sq ft condo has held a consistent list price of $479,000 for the last 428 days
- Located in the Potomac Place condominium community, this unit is in one of the newer buildings that was built in 2004 and the condo fee of $422.42 includes great building amenities (outdoor pool, multiple fitness rooms, business center, concierge)
- A few short blocks from The Wharf and all of the amazing things planned for this development
These new construction condos have yet to hit the market. Once they do, they won’t be around for long. Finding new construction in DC can be harder than finding a seat on the metro during rush hour, and many of the best units are reserved or sold before they are listed. So if you’re looking for that brand new, “never been lived in” vibe, check out this exclusive list of exciting upcoming projects throughout DC.
The Highline – 30 Florida Ave NW | 8 units
2 bed/1 bath units – upper $400k’s
Peninsula 88 – 110 units
From $500k’s – $1.5m
Sales begin in 2018
Buchanan Park – 1321 E St SE | 41 condominiums, 32 townhomes
1, 2 and 3 bed units | 3-4 bed townhomes | $400k’s – $1m
Accepting registration, completion est. 2018
Stone Hill – 1345 K St SE | 36 units
1 beds – high $300,000 | 2 beds – $600k | Penthouses – $1m+
Sales begin Fall 2017
The Flats of Ivy City – 1865 Corcoran St NE | 10 units
Sales begin September 2017
The Bower – 4th and Tingey Streets SE | 138 units
Delivery Fall 2018, Sales begin soon
Meridian Park West – 1455 W St NW |
1 beds – mid $400’s | 2 beds – mid $800’s
For more information on these projects, check out our full post here.
Question: What do I need to know about searching online for homes? Is there a specific site you’d recommend?
There’s no debating the fact that the internet has transformed the real estate industry and in particular, how buyers search for houses. I’ll admit that since entering the industry post-internet in 2009, I’m honestly not even sure how buyers searched for houses other than looking at for sale signs in yards (sounds efficient, right?). Today there are literally thousands of websites that a consumer can search — but this is DC — we all want to know about new listings first and have access to the most homes for sale. This leads me to a common question that I am frequently asked — where is the best place to search online for homes?
I’ll do my best to spare you the super technical details, but to start with, a little background information is useful. First, we have an MLS or multiple listing service. MLS’s are private databases that are created, maintained and paid for by real estate professionals to help their clients buy and sell property (NAR). The MLS is where real estate professionals enter listings, search for properties and conduct market research.
It can seem like every day there is a new announcement about a development or project update, and it can be hard to keep track of it all. In this series I will be highlighting larger development projects (or clusters of projects) taking place in neighborhoods around the city and the impacts of these projects on the neighborhood housing market.
This week, the focus is on Fort Totten. While some of the development projects have been in the works for the better part of the last decade, 2017 is going to be a big year there with many of the buildings delivering and new businesses and retail opening. From army fort, to Metro station to urban walkable neighborhood, the landscape of Fort Totten has transformed over the last century and will continue to change as it becomes a major economic hub in NE DC.
- Fort Totten Square: Phase 1 construction was completed in 2015, and includes 345 residential units and 130,000 square feet of retail including the anchor tenant Walmart. Other recent retail announcements include Counter Culture Coffee, Petco Unleashed, and Five Guys, who are all expected to open in the next several months.
- Arts Place: Mixed use, 502 apartments (The Modern at Art Place) and 105,000 square feet of retail. Developed by the Cafritz Foundation. The project will also include a children’s museum which is scheduled to open in 2019.
- Fort Totten Metro: Mixed use, 345 unit building with 10,000 square feet of retail by Donatelli Development
- Metropolitan Branch Trail Expansion – DDOT announced an RFP to continue the trail which will connect Brookland to the Fort Totten Metro Station
In addition to the numerous new apartment offerings at the metro station, two of the residential neighborhoods in the surrounding area include:
Ahh September, some days you feel like summer and others you make us long for the sun. Congress is back in session, kids are back in school, and we’ve officially entered the fall real estate market. While we don’t have a crystal ball to predict exactly how things will go this fall, we can look at the seasonal trends of the past few years and anticipate similar conditions this year.
Here’s what we expect:
- Renting? September isn’t quite as crazy as August when the DC rental market hits its peak. There is some carry over demand this month from people who haven’t quite secured their long term rental option, and demand will remain high through September. If you are thinking about moving and can wait until October, I think you will find less competition, more availability and potentially more negotiable rental rates.
- Buying? After a bit of a lag in late August, we should see a strong influx of new listings this weekend and throughout the rest of the month now that the holiday weekend is over. Some markets are more seasonal than others (ie. single family homes, suburbs, etc) but throughout the DC area we should see an increase in new listings from the August lull. If you are looking to move before the end of the year, September will be the month where you will have the greatest number of options to choose from, new listings will decline through the rest of the year and we won’t see new listing volume levels this high until next spring. That doesn’t mean you should rush, but if you find the right place, you may not to wait on it either.
- Selling? One of the reasons for the strong influx of listings in September is that the end of the year is quickly approaching and sellers who want to have everything wrapped up before the holidays should think about listing now. The period of time between Thanksgiving and New Years historically tends to be one of the slower, lower demand times of year, and having your home on the market then can require more patience and perseverance than other times of the year. That being said, if you know your home is going to be a “home run” and you plan to price it in line with the market value, there really is no bad time to list since. Buyer demand continues to exceed supply and there are ready, willing, and able buyers who will continue their search through the depths of winter (when their real estate agents will pull out their snow boots for another season of fun).
“Just needs a little TLC”
This ubiquitous phrase is a frequently trending topic in the world of MLS remarks. Is TLC the newest and greatest home feature? Probably not, but every once in awhile you may also find a “diamond in the rough,” “excellent bones” or “character” as well — the trifecta of DC fixer uppers!
Although these homes haven’t reached unicorn status, if you have a little extra TLC to give, here are 5 homes that could use it!
This 5 bedroom, 3 bathroom home features a “breathtaking view,” along with a large lot and long private driveway. With enough textured ceiling to try all of the Pinterest hacks you can find, the only thing missing — “a little TLC and your personal touch.”
Located in Brentwood, this home presents a chance to live in “Little Rome.” Slightly mysterious with its limited internal photos, we’ll trust the remarks that, along with its convenient location, and loads of character this one “just needs TLC.”
This “lovely 4 sided brick rambler” has features that include vintage kitchen cabinets (that may be coming back into style at some point), a party-ready basement, rec room with a built-in bar, hardwood floors, and 2 fireplaces! As an added bonus, this one also comes with “lots of love to give.” As you may have guessed it “just needs some TLC and vision.”
Woodridge (not to be confused with its VA counterpart WoodBRIDGE) is a neighborhood that doesn’t get much attention as a DC destination. The unassuming residential vibe of the neighborhood is one of the features that attracts residents to the quiet tree lined streets and numerous parks.
Location: Northeast DC, along the Maryland border of Eastern Ave, west of Brookland with Rhode Island Ave running through the middle.
Why it’s great:
- Single family homes, with yards, and alleys = the best of both urban/suburban living
- 5 miles from downtown!
- Barnard Hill Park: one of the lesser known Fort Circle parks, while it lacks a website you can’t miss the large grassy expanse.
- DC Brau: DC’s first craft brewery which recently celebrated it’s 5 year anniversary
- Community centric, spirit of neighbors helping neighbors. Check out Good Food Markets from Oasis Community Partners, helping to minimize inequalities in access to food.
- Home to one of the few DC Rita’s water ice locations
Renovating a home is not for everyone, it is expensive, time consuming, frustrating, but one of the best adventures of your life. If you’re up for this challenge, the journey can be well worth it.
The key is in finding a home that offers the right scope of project for your budget and time constraints and will be a finished product that meets your needs. Aside from the obvious financial benefits of instant equity, renovating a home is also the best way to get exactly what you want.
Finding the right home for you is the first step and there are a wide range of options. But don’t stress, I have that covered! Below, I’ve identified 4 homes that I think offer great potential and are renovation ready!
10 years from now, it’s going to believe that this price ever existed in this neighborhood. The days of non-condo homes selling under $400,000 this close to downtown are very limited. If guaranteed appreciation and a neighborhood full of fun new bars and restaurants isn’t enough, here are a few more features:
- 2 levels and 1,184 sq ft (per tax record)
- Upstairs: 3 bedrooms/2 bathrooms, but could easily be reconfigured as 2 bedrooms/2 bathrooms
- “Average” condition, may meet conventional financing guidelines (which means you can get a traditional mortgage)
- Recent $10,000 price reduction
With open floorplans, shiny new appliances, and modern conveniences like central air, it’s no surprise that renovated homes are a hot commodity in the DC real estate market.
The District had the highest number of home flips in the first quarter of 2017, with no signs of slowing down anytime soon. Unfortunately, some of these homes have expensive hidden issues, where developers or contractors (whether intentionally or unintentionally) cut corners or masked over costly problems that buyers may not detect before purchasing.
Below are my top 10 tips for how to determine if a home is a flip or flop:
1. Check for permits — The DCRA Property Inspections Verification System website is your friend.
2. Check for inspections — inspections are part 2 of the permitting process, certifying that the permitted work was done correctly. The DCRA website (above) may not include 3rd party inspections, ask the seller to provide written documentation.
3. Have a home inspection done — use an inspector who is experienced, and familiar with inspecting renovated homes, ask their opinion of the quality of renovation.
4. Check all major systems — a home that is advertised as “fully renovated” should have all a new HVAC system, roof, and the electric panel should be upgraded to modern capacity.
5. Run all of the water in the house — do the shower floors have the correct slope to drain? Are the drains slow or backing up? Is there water coming out of any drain?