Ask the Realtor

December 1, 2010

 

-Dear Darrell:

I picked up a copy of The Georgetowner last weekend, and once again began to think about moving to the city from our home in the suburbs. I love the energy of the city and think I would love living in D.C., but we have a one-year-old and another child on the way. I worry that living here will be difficult for the children, and that the cost of owning real estate in D.C. is way more than where we now live. This isn’t exactly a “real estate” question, but I would appreciate your thoughts.

— Melissa H, Gaithersburg, MD

Dear Melissa:

Great question, and a very difficult one, because the choice of where to live is based on so many case-by-case variables. In principle, I believe very strongly that children can thrive in the city environment, and in some ways the city model is more like small-town living than suburban life is. In Georgetown, for instance, there is a town center, and one can walk to the post office, the library, parks, schools, tennis courts, restaurants, and the town “stream” (i.e. the Potomac). Kids still play on various sports teams and belong to youth clubs — two which come to mind immediately are the Jelleff Boys & Girls Club and the Guy Mason Park rec center complex. Imagine living on R Street, rolling out of bed, and taking the kids across the street to Rose Park to run in the fields, play on the playground, hit a tennis ball or hike down to Rock Creek Park to throw rocks in the stream. The about-to-open renovated Georgetown library is two blocks away. There are French, Turkish, Korean, and Egyptian restaurants — not to mention Ledo’s Pizza — a stone’s throw away, and countless other restaurants within a few blocks. It’s an easy stroll to a showplace Safeway, and there is the easy access to the museums, monuments, galleries and music venues of downtown D.C.

Then there are the properties themselves: one-level, two-level, three-level row houses, condos and co-ops, many with decks, patios or back yards. With a little work, I believe you can find a property which would suit your family.

In general, the prices are likely to be higher than suburban property, but the tradeoff is the community, more time off the roads, less money on commuting costs, less stress, and easy access to the incredible variety of life in the city. I’ve described Georgetown above, but same applies to numerous other communities all over D.C.

Obviously I can’t tell you that your children would be content in the District, but my guess is that if you are content here, they will be also. Children learn from their environment, and they will certainly learn things peculiar to city life, things which I believe will enrich their lives in a very special way. And, of course, yours too!

Darrell Parsons is the managing broker of the Georgetown Long and Foster office and abides by Equal Housing Opportunity regulations. Have a real estate question? E-mail him at darrell@lnf.com. He blogs at georgetownrealestatenews.blogspot.com.

Ask the Realtor


Dear Darrell,

Is there any advantage in my trying to buy a property before the end of the year, rather than waiting for early Spring of next year?

Bill E

Dear Bill,

From a tax standpoint, there might very well be an advantage for you to buy and close before the end of the year. But each person’s financial situation is unique to that person and is something you should discuss with your accountant or financial advisor.

From a real estate standpoint, there are a couple of useful things to keep in mind:

– If you look at a newly built property, it’s very possible that the builder will be offering end of the year incentives.

– Certain owners may be facing tax consequences of one kind or another, which would be ameliorated by selling before the end of the year. These sellers might be more flexible than usual.

– Prices and interest rates are low—interest rates, historically low. No one knows how these two will change between now and spring of 2011.

Many economists predict that we will see a slow, steady improvement in the economy over the next year or two. If this does happen, it is likely that prices and interest rates will rise. So, the question is: do you want to bet that the economy will be better or worse come spring? Prices already seem to have stabilized in DC. We’ve been fortunate in that regard. Whatever your decision, I encourage you to be in touch with a local Realtor who has a view into our local market. Most of what one hears in the news is based on the national market. To make informed decisions, you need to know what is happening locally.

Darrell Parsons is the Managing Broker of the Georgetown Long & Foster Office. Darrell@LNF.com or 202.944.8400. He blogs at: www.GeorgetownRealEstateNews.blogspot.com

Ask the Realtor

October 6, 2010

Dear Darrell:
I hear the city shuts down in August and there is no point in trying to sell my house then. I don’t want to miss a possible buyer, but I also don’t want the hassle of open houses, etc. if no one is going to be looking. What’s the best time of year to sell?
— Lloyd L., Woodley Park

Dear Lloyd:
As with most things, it depends. It is questions like yours that make me long for a different personality, one which was certain of everything. So I could just say, “Don’t put your house on the market in August. The city is dead then.” But being who I am, I don’t see this as an either/or question. Yes, the market is traditionally slower in August, and people are traditionally away on vacation, and it is traditionally hot and humid.
However, when is the last time anyone found the current world traditional or predictable? It isn’t! And neither is the real estate market. There are plenty of potential buyers who don’t go away in August, maybe because they are saving their money, or are gearing up for the fall, or any one of a myriad of reasons.
The old real estate adage, “it only takes one buyer,” is never better applied than in this situation. No one knows when that one buyer will come along. There is one thing for certain, however: if your house is not for sale in August, no one will make an offer on it in August.
What it boils down to is how you feel about the process of having your house on the market. If it really stresses you out, and you aren’t in any rush, then you can afford to wait. But if you really want to sell, I encourage you to meet with your realtor and come up with a plan which will allow you to have your house on the market without stress. For instance, you don’t have to have open houses. If your house is being marketed through the usual channels, your realtor will get to the potential buyers. And when a buyer wants to see your house, all you have to do is get things straightened up.
My advice is to put it on the market now and begin looking for your buyer!

Darrell Parsons is the managing broker of the Georgetown Long and Foster office and abides by Equal Housing Opportunity regulations. Have a real estate question? E-mail him at darrell@lnf.com. He blogs at georgetownrealestatenews.blogspot.com.

Ask the Realtor


Dear Darrell,
I am working with a Realtor to buy a house. He keeps asking me for more and more of my financial information. I like working with him and think he is a good agent, but am a little put off by having to give my financial particulars. I also don’t want to be rude by telling him this is private and that I don’t want to share it. Is it common for agents to request this sort of thing?

Amanda R.

Dear Amanda,

Without knowing exactly what the Realtor is asking you for, it’s a bit hard to answer your question. But assuming the Realtor is asking questions related to the resources you have available for purchasing a property, these are legitimate questions. Part of the work of a good Realtor is to educate his client. There are a couple of ways to go about this when discussing financial information. One is for the agent to ask the questions (as is happening in this case). Another is for the agent to encourage you to talk with a mortgage broker who can tell you about a wide variety of loan programs which might be suitable for you. Either way, it is important for you to understand the costs of buying a home—the immediate costs and the long term costs. As evidenced by the huge number of people who have gotten into trouble because they were overextended financially, it is critical that you be certain that you have both the cash (down payment and closing costs, etc.), and the income to support the monthly mortgage cost. If you are uncomfortable giving this information to your agent, you can certainly give it directly to a mortgage broker, and that person can counsel you on financial matters. If you don’t know a mortgage broker I suggest you talk with friends or ask your agent for a recommendation or two. One other very important aspect of this process is that in light of the recent systemic financial problems, lenders are being far more cautious. This makes the process longer, and requires a fair amount more documentation and review. Your agent no doubt knows this and is probably trying to help you get your ducks in a row early on, so that when you find the property you want, you will be prepared to make an offer and move forward.

Ask the Realtor

September 8, 2010

Dear Darrell,

I know you are probably predisposed toward someone buying rather than renting, but it seems to me that buying now is not a good idea since it looks like house prices are still dropping — at least that’s what I seem to be hearing and reading. Why do realtors keep telling me it’s a good time to buy? — Steve A.

Dear Steve,

I’m not necessarily predisposed to sales as opposed to rentals, but there are actually at least a couple of good reasons to buy now. I know there is the general idea that one shouldn’t buy before the market hits bottom. That’s good advice, but the only way to know when the bottom is reached is when one is looking back at the bottom. So it is a guess, and it involves other factors, the most important of which is mortgage interest rates. Even if one were to guess right about the bottom of the market, the interest rates at that time probably would have risen, and the advantage of buying at a lower price would be wiped out by higher cost of the mortgage. I say this with trepidation, but I see signs here and there that things are beginning to stabilize. Also, what you are reading is typically national news rather than local news. In fact, D.C. has fared better than most areas, and the bottom here will be different than the bottom elsewhere.

In the case of realtors who are suggesting it’s a good time to buy, I would quiz them about why they believe that to be a good idea. I’d ask them to go over the numbers with you so you can actually see whether it makes sense for you at this time or not. Also, renting is great in some ways, but it isn’t perfect either. If you decided to buy, keep these three things in mind: location; don’t overpay; buy what you can afford.

Darrell Parsons is the managing broker of the Georgetown Long and Foster office and abides by Equal Housing Opportunity regulations. Have a real estate question? E-mail him at darrell@lnf.com. He blogs at georgetownrealestatenews.blogspot.com.