Numbers released from our Multiple Listing Service for last month; show a pretty promising start to 2012.  While the number of closed sales are down slightly (-1.28%); the average sold price is up 10.24% from January 2011.

Along with the prices increases; the average days on the market are also dropping; down 6.1% to 77 days; and the average sold price – to – original list price ratio is 93.97% (up 2.33%); meaning sellers are getting almost 94% of their original list price; as a sales price.

Now there are of course areas of Washington DC; where the micro-real estate market is much better or worse than the average; but these tend to be the neighborhoods that have for a long time been “hot” or “not”.

Dupont Circle (zip code 20036); saw an average price jump 56.34% from last year and homes sell for 98.56% of list price.  While parts of NE DC near Brentwood and Brookland (zip code 20018) saw average prices drop 8.45% and homes selling for 84.78% of list price.

Location, location, location are still the first 3 rules of Real Estate.

Currently; the number of homes for sale in Washington DC is down over 25% from the same time last year.  As we get closer to the spring market when more and more buyers come out; we very well may see higher prices as buyers start to fight over the small amount of inventory.

As home prices rise in the Washington DC real estate market; appraisals don’t always catch up as quickly; and can cause a huge snag in the middle of the real estate transaction.

Buyers in DC are seeing a much lower inventory of homes for sale; and basic supply-demand economics have prices creeping up.  Once that buyer gets a contract to purchase a home, their lender will order an appraisal.  The appraiser must support this sales price with other recent sales of like-properties.

The problem always when prices increase is that there is nothing to support a higher value.  During the crazy “boom” years when prices seemed to go up everyday; appraisers seemed to let anything go — now they are being much more careful to not make the same mistake twice.

Sellers need to understand that while prices are increasing in some areas; the comparable sales must be closely watched and must support your list price.

As we coach our own clients; it is important to remember that prices are fluid.  The exact “price” is a moving target.  As those homes competing with yours come on new to the market; as homes under contract go to settlement and as buyer’s moods change; as does the ultimate sales price of the home.

So sellers need to remember to set an “Inital Market Position” or initial price; but that this moving target often changes and must be supported by recent sales.

Below are some detailed Market Data for the 20036 zip code in Washington DC: which includes Dupont Circle.

To search more areas of Washington DC : Follow This Link

When buying a home you’re bound to encounter some things that you don’t know anything about. They are things that outside of the home buying process you won’t ever run into. And since the average homebuyer only goes through this process a few times in his or her lifetime, it’s understandable that these things would be unfamiliar. A couple of items that seem to be perplexing are title insurance and the property survey, specifically how easements are represented.

When purchasing a home with a mortgage you need to get title insurance and a survey. This is required for all financed home purchases. An attorney or title company typically orders property surveys. Though the buyer has to pay for this service they usually don’t need to be directly involved in the process.

What is Title Insurance?

Title insurance is just another line item expense when purchasing your house, paid for one time at closing. Essentially, it is protection for you and your mortgage company that the person selling you the house has full and clear title to the property and was able to legally pass it to you. The title insurance company investigates the ownership of the property and then insures their work. If the seller didn’t rightfully own the home, and someone else does, the mortgage company and the homebuyer are financially protected. Fortunately, issues of title defects are relatively rare, meaning that title insurance isn’t too expensive and really not something to worry about.

What is a Property Survey?

A property survey is a carefully measured drawing that shows the land that is for sale and all structures on the property. It shows how large all the structures are and how far they are from each other and the borders of the property. Most importantly, it shows setbacks and easement lines.

Wait, what? It seems like the property lines and structures should be most important, but they are not. The setbacks and easement restrictions are actually the most critical elements of the survey because those are usually where the biggest problems are found.

What is a Setback?

A setback is the required distance between the house you wish to buy and other property features. For example, a city or county ordinance (or even a homeowners association) may require that homes be set back 20 feet from the road. So even though you own your front yard, you cannot extend your house any closer than 20 feet from the road.

Other setbacks indicate how closely you can build to your property boundaries or to your neighbors’ homes. If you live in an area with natural features like streams or lakes, certain special setbacks may also dictate how close you can build to these structures.

What is an Easement?

Easements refer to property with common usage rights. For example, you may own the land that a sidewalk is on, but anyone can walk on this part of your property.

Why Setbacks and Easement Restrictions Matter

What happens if the survey reveals that part of the house (the actual structure) up for sale sits within a setback or an easement? It’s a problem! In some instances it means that part of the house will need to be torn down before it can lawfully be sold. Otherwise title cannot be passed to a new owner because someone is attempting to sell property that was not built legally.

Surprisingly, this situation is not so uncommon. It may not affect the main domicile on a property, but garden sheds or pool equipment are occasionally located in an area where they don’t have a legal right to be. In these cases your lawyer has some work to do. Hopefully, you’ll discover that the structures are grandfathered because they were erected before certain setbacks were enacted. But definitely investigate these matters fully, as doing future improvements on the property may necessitate that they be corrected in the process.

Spend Some Time With Your Property Survey

For some, the survey process is one of those “check the box” items during home buying. Most get it done and move on. But it’s important to look over everything carefully and ask questions. Surveyors are happy to discuss the survey with you, and errors on surveys can occur. Spending 15 minutes looking this over will save you the headache of having it redone down the road when you want to build or make a change on your property.

While the rest of  the country struggles with home prices still looking for a bottom; Washington DC is staying strong.  DC posted the third-best gain in prices in the last three months, up 2.1 percent.

Compared with a year ago, the median price in Washington is up 1.9 percent.

The number of da

ys a home takes to sell is also dropping; although it’s all about price and location.  The average days on the market for DC back in December was 76; however in the popular Dupont Circle area (zip code 20036); the average was 40 days.

The key for sellers is to be happy that prices are going up; but they still MUST properly price their homes.  Buyers are still looking for deal and are very cautious about how much they are paying.

The first month my bill jumped $40 – I blamed it on the better-half ordering too many On-Demand or pay per view movies.  See like many people; I didn’t actually LOOK at the bill.  It was on auto-pay; so I was just “annoyed”.

The 2nd month I saw it was up $50.  Now I WAS annoyed.  When the better-half swore there was only 1 $5 movie ordered; I actually LOOKED at the bill.

Well it seemed that my cable/internet “bundled package” had expired.  My bill was now $48 more per month.  Same service.  No extra channels or extra internet speed. It was just more expensive.  UGH.

Well as I have learend from many service providers; you don’t get a discount if you don’t ask.  So I called my cable company.

After about 2 minutes of phone queues reaching a human.  Then another 12-15 minutes being transferred and on hold; and VOILA – my bill went from $188 to $129.   HUH?  Same service; same channels; same everything.  I had a new “package”.  I didn’t even have to raise my voice or get angry.  I said I was disappointed and “didn’t understand” how it went up so very much.  All very true.

Now I will have to go through the same exercise in a year; as this is a “special for a year”. So for less than 20 minutes of my time I will save $708.  Hmm; Good investment if you ask me.

Cable bill too expensive.  Call and ask for a discount!

So is the goal to make money or get people to slow down?

With DC speed cameras raking in so much cash; perhaps the goal has changed.  The old speed cameras; could be seen a mile away.  People would see them (mounted on poles with the lights) and remember to slow down.  Now; DC has installed these new silver boxes; which are about the size of an outside mailbox.   These cameras are here to make money.

The average ticket? $150.  OUCH.  I may never complain about a $25 parking ticket again!  In fact the tickets range from $75 to $250.

The DC government was making $10 million dollars a year; and now have expanded the program.  Why not?  It’s a cash cow for the city.

Here are the new locations:
• 1900 block of Foxhall Road NW, north and south bound directions, 25 mph,
• 2800 block of Calvert Street NW, east bound, 25 mph.
• 2300 block of Connecticut Avenue NW, south bound, 25 mph.
• 100 block of Florida Avenue NW, east and west bound, 25 mph.
• 4200 block of South Capitol SW, south bound, 25 mph.
• 2300 block of Porter Street NW, east and west bound, 30 mph.
• Canal Road NW .3 miles south of Arizona Avenue NW, north and south bound directions, 35 mph.
• DC-295 NE at Benning Road overpass, north bound, 45 mph.
• DC-295 SW .7 miles south of Exit 1, north and south bound, 50 mph.

I guess what makes things difficult in DC; is that many of these roads are not small residential streets or big school zones.  No – many of these locations are larger main commuter routes.  The problem is the speed limits are too low!

Oh well; slow down or pay…

I have had two different home buyer’s tell me this week; when they inquired about a listing I have on the market.  These people say they don’t want or need an agent.  Why?

One person said; they will get a better “deal” working directly with the listing agent.  Why do they think that?

For those who do not understand; let me explain how a Basic Real Estate transaction works.

A homeowner hires a Real Estate agent and signs a Listing Agreement Contract with them. The seller agrees to pay X% commission to the agent.  The agent will then share the commission with another agent.  Of there is no other agent involved; the listing agent gets the full X%.

A listing agent does (and must) work for the seller.  Their job is to get the best price and terms for the seller. PERIOD.

If a buyer without their own agent shows up by law; they must Disclose Material Defects in the property (if known).  Things like the basement floods or the roof leaks.  And they must treat the buyer honestly and fairly.

What they cannot do is help them get a better price or suggest they do a home inspection; etc.  They are only allowed to suggest to the buyer a contract price of the list price (or above).  They are NOT representing the Buyer.

So why would a buyer NOT want their own agent?  Cost?  No.  As you can see; sellers are paying the commission; not the BUYER.  Having your agent representing you does not cost you.

I suppose some are not convinced and never will be.  However; a buyer needs to understand that having your agent guide you through the process; show you the comparable sales data (not just the ones the listing agent will show you which supports the sellers price); advise you on what inspections you need and be you – the BUYER’s trusted advisor.

So next time you think you don’t need your agent – think again.

People are all different and we all have different opinions.  FACT

This is a free country and we have the right to free speech.  FACT

Spouting off opinions in the Social Media world alienates some people.  FACT

In business; alienating about 50% of potential clients is bad.  FACT

Religion and Politics.  Don’t talk about them.

As we appraoch yet another election season; more and more people will have opinions.  We will watch a debate, hear a speech and will want to post something on Facebook.  Perhaps we will want to blog against or for a certain candidate.

Maybe we will want to write a blog about something religious.  A belief we have; that is controversial.  Something we say or do which we know not everyone will agree with.

Now unless your business is Politics; or Religion.  I don’t think blogging; tweeting or Facebook posting about how you did or did not like that speech or this sermon is a good idea.  No; you don’t need to “hide” who you really are; but is it smart to blast your personal views to the entire planet?  I think not.

Now I agree that it is nearly impossible to not say something in your day to day tweets, blogs or Facebook posting; that won’t give your readers, friends or followers a clue as to your views.  I know I post things that people can probably figure out my views on certain things.  But I try not to blast things like “That guy is spouting rhetoric again” or “If that guy compares himself to a past president again; I am gonna scream”.

My point is: Watch what you say.  If you don’t care; then don’t be offended if you get unfriended, unfollowed or if someone decides they can’t work with or for you.

I have had many clients whom I knew I didn’t agree with their views on things. But neither of us blasted our thoughts out to each other.  Keep your thoughts to yourself and just do business together!

Now most home sellers would be thrilled with just one offer, let alone multiple ones at the same time.

This is however happening more and more in the DC market, as the inventory of great properties stays at a multi-year low.

So what are some things to consider if there are multiple offers?
-Look at all the terms. Of course price is the first thing we will look at, and while it is probably the most important, the other terms must be reviewed as well.
-Compare things like how many days they want for an inspection and appraisal. In our market a 7 day home inspection and 21 day appraisal is about the right amount of time.
-What kind of financing and how much of a downpayment is the buyer putting down? The larger the downpayment, the more likely the financing will not run into huge issues. Conventional financing with 20% down or more is the best – except of course a buyer with ALL CASH.

-Make sure they don’t have to sell a home first; before going through with the purchase. While you may accept this contingency under some circumstances, if you have a choice, take the more sure thing.

Sometimes you will receive multiple offers and the basic terms and price are the same. If you are confronted with more than one offer that have basically the same terms, you have to consider other factors…

Factors can include:
-Who is the lender? A large reputable bank or a never heard of operation?
-What about the buyer? Did they come into the Open House and act all fussy or did they come in and gloat about how wonderful everything is?
-Is the Buyer’s agent a strong professional type with a good reputation; or not.

Remember it is never OK to discriminate – but choosing a buyer who is well qualified and who seems easy to work with; along with an agent who understands the end goal is to get your home sold – is vital.

Every situation is different; so be sure to consult your agent and ask for as much information as you can.