Ever heard of TRID?

...or maybe you've heard about the Consumer Protection Financial Bureau's (CFPB) "Know Before You Owe" campaign.  I wrote about mortgage docs being simplified a few months ago, and as expected, things have changed. The rulemaking is a good thing overall, but as with all regulatory changes, there may be a few kinks to work out during the implementation period.  

History

Back in the day borrowers had no idea how much cash they would have to bring to settlement? Folks were really walking into the room to sign their final loan docs, and not knowing whether they'd receive a $1500 check or have to write a $10,000 check...pretty ridiculous. Then we had the financial crisis, thus the passage of Wall Street Reform in 2010, which created this new government consumer watchdog called the CFPB. The CFPB is implementing the "Know Before You Owe"  or TILA-RESPA Integrated Disclosures Rule (TRID), which will soon give borrowers three days to review their final loan docs before going to settlement.  This will take away the uncertainty of the past. The CFPB also revamped the forms you'll receive, so loan information will be simple and easy to understand. 

Unfortunately, this change kind of caught the lending industry by surprise, and the logistical changes for many lenders will take some time to perfect. The good news is that the CFPB is now allowing a grace period for lenders to work out the kinks, particularly since they had originally planned to fine lenders for violations (even minor clerical errors) from day one of implementation.

What does this mean to me?

Some lenders have been preparing for these changes for years, and some lenders are just now implementing the changes. Therefore, if you're going to purchase or sell a home after October 3, 2015, your settlement dates may bump from 30 days to 45 days. Therefore, working with a lender who is prepared for TRID can make the difference between getting your dream home or losing it because the seller needs to be out of the place in 30 days. Be sure to work with the right lender, and an agent who can help you ask the right questions during the lending process.   

View fullsize

Georgetown

Ever wonder how much one of those charming Georgetown rowhomes are worth?  We've all seen the neighborhood's pristine blocks encompassed with history and character. After listing a 2-bedroom, 1-bathroom rowhome in Georgetown a few months back, I thought I'd take a look at What's it cost to live in Georgetown?

Below is a summary of the market analysis of sold rowhomes and single-family homes to date (condos and co-ops were excluded) 

View fullsize

1333 28th St., NW
Washington, DC 20007

The Breakdown

Criteria

• Homes in Georgetown (condos and co-ops excluded) 
• Sold between January 1, 2015 and July 2015

The Numbers

• 63 total homes have been sold since January 2015, ranging from $550k to $5.7 million
• The average home sold for about $1.8 million
• The median home sold for about 1.625 million

View fullsize

Stachowski's at 28th and P St.

What's it cost?

• 2 Bed / 1+ Bath - $550k to $2.195 million, with the average going for about $985k
• 3 Bed / 2+ Bath - $900k to $3 million, with the average going for about $1.5 million
• 4 Bed / 2+ Bath - $950k to $3.25 million, with the average going for about $2 million
• 5+ Bed / 3+ Bath - $1.25 million to $5.7 million, with the average going for about $3.2 million

Georgetown Average Home Sales

What does this mean to me?

Buyers: If you're thinking about purchasing a home in Georgetown, the average pad sold for about $1.8 million.  They also sat on the market 90 days on average, but the median home sold in 11 days, so many of the homes are being swept up quickly. As you're thinking about purchasing your next home, begin working with an agent early in the process, not just when you find the home you want on the internet. Being proactive in a competitive real estate market is critical to getting your next home.

Sellers:  In 2015, only 63 homes sold in Georgetown, and like many areas throughout the District, demand is high and supply is low. However, it's impossible to determine if and when this trend will end. If you're thinking about selling your home, take a few moments to answer a few questions about your place to receive a personalized analysis of your home.

Open House Saturday & Sunday - Rockville Cape Cod

View fullsize

304 Reading Avenue
Rockville, MD 20850 

Open House Saturday & Sunday from 1-3pm

This charming Cape Cod seems modest, but a significant addition nearly doubled the size of the original house! Thanks to that clever renovation, the home offers all the space modern living demands, and yet is appropriately scaled for the neighborhood. 

Open House Saturday (6/11) and Sunday (6/12) from 1-3 pm at 304 Reading Avenue, Rockville, MD 20850. Additional info can be found here and here.

View fullsize

Sun-filled living room w/ wood-burning fireplace

As you enter the home through its sun-filled living room, you're greeted by a charming wood-burning fireplace. The first floor boasts oak hard wood floors and a freshly painted interior throughout.

Venture down a hallway and you'll find a modern, open floor plan. A center island kitchen features gas cooking, natural wood cabinets and pendant lighting. The eating area conveniently doubles as both a kitchen table and informal dining area. 

Huge screened porch is an outside room!

An over-sized screened porch off the kitchen and family room is a gem! With ample space for grand entertaining, it can serve as both an outdoor dining room and family room. With two ceiling fans, carpeting and bead-board ceiling you'll want to spend all your time outside during the warmer months, safely screened away from the bugs.

Upper level is your fourth bedroom

Three bedrooms on the main floor feature oak hardwood floors, ample closets and lovely views. Rounding out the first floor are two bathrooms; one of which features a soaking tub, the other a separate shower and marble flooring. Upstairs the fourth bedroom touts newly installed carpeting and features ample space for a play area or office.

Large rear yard with driveway

Located on a quiet side-street it's hard to believe that it's just seven blocks to the Red Line Metro Rockville Stop and a MARC Station. Best of all it's just a short walk to the much heralded Rockville Town Square, where you'll find a multiplex movie theater, numerous restaurants, an eclectic array of shops, an organic market, the 100,000 square foot flagship Montgomery County Public Library and the VisArts center (offering educational art classes, galleries, camps, event spaces, meeting rental spaces and community events). 

Open House Saturday (6/11) and Sunday (6/12) from 1-3 pm at 304 Reading Avenue, Rockville, MD 20850. Additional info can be found here and here.

Snakes in a Home...Let's Talk Disclosures

View fullsize

A Maryland couple purchased a home in Annapolis from a neighbor, but as it turns out, the home was infested with snakes...coming out of the walls, from under appliances, and even on their kids' backyard playground. Pretty scary, and definitely a deal-breaker for most buyers.

So who in their right mind would buy a snake-infested home?

Unfortunately, this can happen to anybody, particularly if you're negotiating with a seller who fails to disclose material facts about the property. Here, it's pretty obvious that the seller was aware of the little snake problem, as previous tenants had complained about the same issue...and his mother lived in the place before it was sold! While the buyers are suing the seller for $2 million (the case is ongoing as of blog posting), things would have been much easier for this couple had they never purchased the home.

So how can I protect myself as a buyer?

It's highly recommended that a home inspection be performed before purchasing a home. However, all home inspectors are not created equal, so be sure to hire an experienced inspector with a solid reputation. Your agent should be able to assist you with finding a quality home inspector, but be aware of any "referral fee" your agent might be receiving for sending the inspector a new client. It's worthwhile to hire an agent who has no affiliations to vendors/contractors, as you'll avoid any conflicts of interest. 

So what does this mean to me?

Buyers: Be sure to work with a quality home inspector, and check for references. In this case, a competent inspector might have recognized the signs of a snake-infested home, thus giving the buyer fair warning before purchasing. 

Sellers: Disclose. Disclose. Disclose. When it comes to selling your home, the last thing you want is a lawsuit headed your way from buyers who felt shafted. If you know your home has an issue that would make a buyer reconsider whether to purchase it, make it known. It'll pay off in the long-run.

What's it cost? A look at Dupont, U Street & Columbia Heights

View fullsize

I'm often asked, "How much does a X bedroom place cost in Y neighborhood? As you can imagine, there are quite a few variables that should be considered when answering that question, but a general idea of How much can I afford? is always useful. Let's take a look at what a one bedroom condo will run you in a few of DC's most popular neighborhoods: Dupont Circle, U Street and Columbia Heights.

I put together this competitive market analysis (CMA), and used a simple criteria:

• Condos located in Dupont Circle, U Street or Columbia Heights;
• One bedroom with one bathroom; and
• Sold between May 1, 2014 and May 31, 2015.

Total Number of Listings

05/01/2014 through 05/31/15

We saw more inventory in Columbia Heights, where nearly 90 one-bedroom condos sold in the past 13 months. There are fewer options in U Street and Dupont, which typically leads to greater demand, thus higher prices. 

Average List Price vs Average Sold Price

05/01/14 through 05/31/15

Don't be fooled by the small variances between List Price and Sold Price, as a small percentage or two makes a big difference to buyers and sellers.

View fullsize

Meridian Pint in Columbia Heights

In Dupont and U Street, you're looking at about $400k for your average one bedroom condo. In Columbia Heights, the same unit will cost a bit less, averaging in the low $300s.

Low Sale Price vs High Sale Price

05/01/2015 through 05/31/2015

 I refer to this chart as the "Cost of Entry Estimate", as it gives a snapshot of the lowest priced place in each neighborhood. In Dupont, U Street, and Columbia Heights, one bedroom condos were purchased for less than $300k.  However, there are many factors that could lead a home to sell for a low price, so be sure to work with an agent who can help you better understand the market.

Average and Median Days on Market

05/01/2014 through 05/31/2015

All three neighborhoods are hot right now, but Dupont Circle's leading the way with average days on the market under three weeks, and median days on the market under a week!  

What does this mean to me?

Mural on Ben Ali Way 

Buyers: If you just love these neighborhoods, then you're looking at about $400k+ for Dupont and U Street, and $330k+ for Columbia Heights. But remember, it's those little "creature-comforts" that start hiking up the price point for you...i.e. parking space, in-unit laundry, rooftop pool, more square footage, marble counters, balcony, etc. If that's what you're looking for, the high end of the market tops out around $600k.

Also, because these are condos, the data does not include condo fees, which typically range from $100-1000+ per month.  Be sure to work with an agent who can prioritize your financial goals while assisting you with your home search. More info on Condos and Cooperatives   

Sellers: It's definitely a seller's market, and properly marketed condos in these neighborhoods are receiving multiple offers. So why hesitate to sell?  

“Because while the market is great as a seller, not so much as a buyer. After I sell my place, will I be able to find a home in time? I don’t want to be homeless.”

— Reasonable Homeowner

This is a great point, and show's that you're thinking ahead of the game. However, there are many viable options to streamline the transition for sellers, particularly in such a strong sellers' market. Be sure to work with an agent who can provide you various options as you decide whether selling makes sense for you (not the agent).