Live on the Red Line - Real Estate

Congress Passes Tax Credit Extension/Expansion for Home Purchases

2009-11-06T14:35:32-05:00

Download Government_affairs_tax_credit_ext_chart_110409

This is a comparison chart that can be a helpful resource as you look to take advantage of the credit in the months ahead.

Washington Examiner article about buying a home in Alexandria

2009-10-29T13:51:23-04:00

http://www.washingtonexaminer.com/economy/real-estate/Expanding-the-search-in-Alexandria-pays-off.html

Financial Benefits of Home Ownership

2009-09-28T14:40:29-04:00

There are a number of personal and emotional reasons to buy a home. But there are also some strong financial reasons to make the investment. In addition to exceptional home affordability and near historic interest rates, here are some important financial benefits of owning a home:

Increased Net Worth: Few things have a greater impact on net worth than owning a home. In a comparison of renters versus homeowners, the Federal Reserve Board of Consumer Finance found that the average net worth of renters was just $4,000 compared to homeowners at $184,400.

A Big Tax Deduction: One of the largest tax deductions available is the amount of interest paid on a mortgage. In fact, a $150,000 home at a 5.50% interest rate can add up to approximately $8,000 in first year's interest. This amounts to a significant savings - effectively reducing the amount of a homeowner's monthly loan payment.

Long-Term Appreciation: Over the last few years, home prices have corrected and become more affordable. While that's good news for potential buyers, it has overshadowed the long-term appreciation of a home's value. The reality is, despite market ups and downs, real estate historically appreciates around 6% per year. Even if you calculate a modest appreciation of 3%, a home purchased today for $150,000 should grow in value to $364,000 over 30 years.

$8,000 Tax Credit: Don't forget, the government is offering an $8,000 tax credit for first-time homebuyers - or for folks that haven't owned a home during the past three years. However, the program is scheduled to end soon. In fact, the Internal Revenue Service recently reminded potential buyers that they must complete their first-time home purchases before December 1, 2009 to qualify for the special credit, which means the last day to close on a home and qualify for the credit is November 30, 2009.

If you're considering purchasing or selling a home, this is an ideal time. Call or email me today to discuss your specific situation and how you can benefit from today's market.

Federal Housing Tax Credit Timeline is running out!

2009-09-15T15:40:48-04:00

The timeline to use the $8000 Tax Credit is summarized below. Escrow companies are going to be extremely busy the last half of November and with Thanksgiving week taking two days away. Don't miss out!

To qualify for the Home Buyer Tax Credit of $8000, you must buy your home prior to Dec 1, 2009

The tax credit is for first time home buyers, defined as people who haven’t owned a home in the last three years prior to the day you close on your home purchase or people who have never owned a home.

Here is the current timeline working backwards from the last possible closing day for a frame of reference.

November 30th - Deadline - The transaction must be closed by this date to qualify for the credit.

November 19th - Critical “Closing” date - The is the safe date to close by. The next week is Thanksgiving holiday week with county offices closed Wed-Fri. Closing on or before Thursday, 11/19 will avoid the hassles of trying to close during the peak vacation time along with all the other buyers trying to close at the same time.

October 5th - Critical “Contract” date - It is important to have a contract in place by this date if you plan on claiming the Federal Housing Tax Credit. Most first time home buyers are using FHA financing, which realistically takes about 45 days to process.

September 15th - Ideal “Contract” date - Sometimes your first offer isn’t accepted or the inspection can uncover unacceptable conditions, so ideally you should leave some time in case the first contract doesn’t work out. I have had three clients miss out on competitive offers in the last 2 and a half months!

August 1st - Ideal time to start looking - The Federal Housing Tax Credit is putting up to $8,000! in your pocket, that is the easy part, but it usually takes up to 3 weeks to find a home and become Pre Approved for financing - - no time like the present to get started.

Information deemed reliable but not guaranteed.

Will the deadline for the Federal Tax Credit be extended? Maybe, however it could be extended with a lower dollar amount or with the payback requirement re-instated. What is certain is that if you buy a home that closes before December 1st, 2009 and you qualify, you will get $8000.

Washington DC vs. Federal Tax Credits

2009-09-02T06:00:00-04:00

This article has a great graph on the differences between the two:

http://dcmud.blogspot.com/2009/08/dc-v-federal-tax-credits.html

FHA Program Offers Purchase, Renovation Aid

2009-08-31T16:15:00-04:00

The Federal Housing Administration is encouraging use of its little-known 203(k) loan program.

The 203(k) lets an owner-occupant borrow money for both the purchase and renovation in one loan, and put down only 3.5 percent.

The program requires the use of credentialed contractors and can include cosmetic improvements as well as major renovations like replacing plumbing or electrical. Completing the application process requires patience, says Nancy Hammock, an associate with RE/MAX Properties in Western Springs, Ill.

But in this lending environment, more homebuyers are finding 203(k)s worth the hassle. In fiscal 2008, the government insured about 6,700 of the 203(k) loans. This year, more than 11,000 loans have already been insured, according to the Office of the Comptroller of the Currency.

Source: Chicago Tribune, Mary Ellen Podmolik (08/14/2009)

Buying a Home: Buyers Rush to Beat Tax Credit Deadline

2009-08-28T12:30:00-04:00

Real estate professionals report that first-time home buyers are flooding the sale market, pressed to finalize a deal before the federal government's $8,000 tax credit offer expires on Nov. 30.

Because mortgage approvals, residential inspections, and other steps in the buying process typically take about two months, buyers hoping to take advantage of the incentive will need to have a contract by the end of September.

The new flurry of activity now as house-hunters try to meet the deadline is triggering bidding wars and energizing the property market, which historically is slow at the end of summer. As a result, more homes are getting their full asking price.

Source: Chicago Tribune, Kathleen Lynn (08/14/09)

Real Estate: Strong Gain in Existing-Home Sales

2009-08-26T15:46:43-04:00

For the first time in five years, existing-home sales have increased for four months in a row, according to the National Association of REALTORS®.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 7.2 percent to a seasonally adjusted annual rate of 5.24 million units in July from a level of 4.89 million in June. Sales are 5.0 percent above the 4.99 million-unit pace in July 2008. The last time sales rose for four consecutive months was in June 2004, and the last time sales were higher than a year earlier was November 2005.

Largest Gain in a Decade

Lawrence Yun, NAR chief economist, said he is encouraged. “The housing market has decisively turned for the better. A combination of first-time buyers taking advantage of the housing stimulus tax credit and greatly improved affordability conditions are contributing to higher sales,” he said.

The monthly sales gain was the largest on record for the total existing-home sales series dating back to 1999.

“Because price-to-income ratios have fallen below historical trends, there are more all-cash offers. In some recovering markets like San Diego, Las Vegas, Phoenix, and Orlando, the demand for foreclosed and lower-priced homes has spiked, and a lack of inventory is becoming a common complaint,” Yun said.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 5.22 percent in July from 5.42 percent in June. The rate was 6.43 percent in July 2008.

"First-Time Buyer Tax Credit is Working"

An NAR practitioner survey showed first-time buyers purchased 30 percent of homes in July, and that distressed homes accounted for 31 percent of transactions. NAR President Charles McMillan said the first-time buyer tax credit is working. “In addition to first-time buyers, we’re also seeing increased activity by repeat buyers. While many entry-level buyers are focused on the discounted prices of distressed homes, they’re also freeing some existing owners to sell and make a move,” he said.

“Realtors are the best resource for consumers in these changing market conditions because the transaction process has become more complex. Since it’s now taking longer to complete a home sale, first-time buyers who want to take advantage of the $8,000 tax credit should try to make contract offers by the end of September,” McMillan said. “Otherwise, they may miss the November 30 closing deadline.”

Inventory Up, Prices Down

Total housing inventory at the end of July rose 7.3 percent to 4.09 million existing homes available for sale, which represents a 9.4-month supply at the current sales pace, which was unchanged from June because of the strong sales gain. Raw inventory totals are 10.6 percent lower than a year ago when the number of unsold homes was at a record.

The national median existing-home price for all housing types was $178,400 in July, which is 15.1 percent lower than July 2008. Distressed properties continue to weigh down the median price because they typically sell for 15 to 20 percent less than traditional homes.

Single-Family Homes and Condos

Single-family home sales increased 6.5 percent to a seasonally adjusted annual rate of 4.61 million in July from a pace of 4.33 million in June, and are 5.0 percent higher than the 4.39 million-unit level in July 2008. The median existing single-family home price was $178,300 in July, which is 14.6 percent below a year ago.

Existing condominium and co-op sales jumped 12.5 percent to a seasonally adjusted annual rate of 630,000 units in July from 560,000 in June, and are 5.9 percent above the 595,000-unit level a year ago. The median existing condo price was $178,800 in July, down 18.9 percent from July 2008.

By Region:

The Northeast surged 13.4 percent to an annual pace of 930,000 in July, and are 3.3 percent higher than July 2008. The median price in the Northeast was $236,700, down 15.0 percent from a year ago.
Existing-home sales in the Midwest jumped 10.9 percent in July to a level of 1.22 million and are 8.0 percent above a year ago. The median price in the Midwest was $157,200, which is 5.9 percent less than July 2008.
In the South, existing-home sales rose 7.1 percent to an annual pace of 1.95 million in July and are 5.4 percent higher than July 2008. The median price in the South was $164,500, down 7.1 percent from a year ago.
Existing-home sales in the West slipped 1.7 percent to an annual rate of 1.13 million in July, but are 1.8 percent above a year ago. The median price in the West was $202,300, which is 28.0 percent below July 2008.

Source: NAR

Federal Reserve: Recession Ending, Rates Left Alone

2009-08-17T09:40:43-04:00

The Federal Reserve ended its policy-making meeting Wednesday with the declaration that the recession is ending and it would move toward more normal policies.

The Fed said, “Economic activity is leveling out.” It added that it expected inflation would remain “subdued for some time.”

The Fed said it will keep the short-term key interest rate near zero, but it will end its program to buy $300 billion worth of Treasury bonds by the end of October. Buying bonds was one of the Fed’s efforts to drive down the cost of home mortgages.

“In a way, it’s more of a thumbs-up than if they had said they were continuing the Treasury-buying,” said Edward McKelvey, an economist at Goldman Sachs. “They’re saying that things are going according to plan, and that the policy is O.K.”

Source: The New York Times, Edmund L. Andrews (08/12/2009)

REMINDER: Home Buyer Tax Credit Expires December 1,2009

2009-08-13T12:33:12-04:00

If you are going to take advantage of this tax credit, you will need to close on your purchase by 12/1/2009. Please remember that finding a home, getting the contract ratified, and obtaining loan approval will take about 45-60 days. In order to meet the deadline, you should start looking before the end of September.

For more info: http://www.federalhousingtaxcredit.com/2009/index.html

Newly renov Retail/Office Suite; parking & metro (Silver Spring, MD)

2009-07-17T06:30:00-04:00

Do not miss this amazing opportunity for space available to your new start-up business, or adding to your existing business in a new location in the great downtown Silver Spring area. Low cost and accessible to the hustle and bustle of downtown Silver Spring. The Suite is ready for occupancy. Come and see the beautifully renovated suite in this boutique office building.

Building is pristine and newly renovated. One suite space is available. Includes reserved parking spaces (4) in parking lot located behind the building. Approx. 1000 sq. ft, the suite is perfect for office spaces or misc. retail (classrooms, yoga classes, child care center, etc...) .

The newly renovated space includes pre-wiring for telephone and computer networking in each room (including Verizon FIOS). New Kitchen and cabinets installed in the break room . Fantastic location in downtown Silver Spring, with Red line Metro accessibility (Silver Spring). Available for short sublease or long-term. Office furniture available, too.

Contact me for more information or to schedule a site visit.

Pictures at:
http://www.flickr.com/photos/22982988@N08/sets/72157603734729472/

What You Should Know About Rent Control in the District of Columbia

2009-07-08T10:41:00-04:00

If you are a renter, or a landlord, you should take note of the information in this PDF that was released by DHCD (Dept of Housing and Community Development):

Download DCRA_Rent_Control_Pamphlet