Pat Kennedy - Your Washington, DC Real Estate Connection

Today's bike ride was supposed to take us across the Wilson Bridge on the bike path.  About a third of the way across, the skies opened up, and three miles later I arrived home totally soaked.  I'm becoming to be amazed at the bike paths around the Washington Metro area.

There is an old saying that when you're buying a house in Washington, DC there are two kinds of houses.  The first are the ones that have termites.  The second are the houses that will get them.

As a new agent, I used to freak out whenever I listed or sold a house in the first group.  But today when I have a listing, I always hope that termites are not going to be an issue.  And when I'm representing the buyers, I look at it a little differently.  Even if it's not a huge issue, I'd rather that it be the seller's problem before settlement than my buyers' problem if they're found a couple of years later.

When I'm the buyer's agent, I make sure that the inspection is done about two weeks prior to settlement.  Our boiler-plate contracts state that (unless the house is being sold "as is"), there needs to be an inspection for wood eating bugs.  If the licensed pest control company finds them, it's the sellers' responsibility to kill the little guys - not literally, they'll have to hire a licensed professional hit man to do it for them.  If there is evidence that they've been in the house, but there is no evidence that the house was treated, it usually needs to be treated.  And if there is structural damage, the sellers need to fix it before settlement.

While I've sold lots of houses with these little varmits in residence, it's unusual to see homes that have serious structural damage due to termites.  In most cases, the owners discovery the bugs before things get out of hand.

Most licensed inspectors offer a one year warranty, meaning that if they show up during the first year you own your home, that company will kill them for free.  This makes them look pretty carefully before they will issue a certificate saying the house is termite-free.

After that, you can extend the warranty indefinitely - which in this part of the country is a very prudent thing to do.

I saw this last weekend in a West Virginia town where they are collecting a bunch of old railroad cars and engines.  I loved the colors and the wild flowers growing around it.  It was a beautiful and wild place, and when I get time to write about it, I'll have some more photos of this amazing place.

Buying Your First Washington, DC Home:  Getting To Settlement – Part 7 of a Series

First, you and your sellers reach an agreement on price and terms.  Then you begin to remove the contingencies (home inspection, condominium documents, appraisal and financing).   Then there is the termite inspection and, if necessary, the killing of the bugs.  And finally there is a title search to ensure the sellers have clear title to the property.

And finally, once all of this is done, you are on your way down the long and winding road to  the settlement table.  This is where you give the sellers all your money and the sellers sign the papers deeding the house or condo to you.

Here is Washington, the buyers and sellers, along with both agents, usually show up at a title company for this ritual.  It’s usually a fun, festive occasion, culminating with the sellers turning over their keys and a round of hugs and best wishes.

 If the sellers are out of town, the title company will send them the paperwork with instructions on getting it all signed and notarized.  If they are in the middle of a sloppy divorce, they might come at separate times to spare you the drama of whatever they might be doing to make each other, their agent and the title attorney, well, nuts.

Your job is to show up with money.  Not cash money, but with certified funds for the  approximate amount of the check you’ll be writing to cover your down payment and closing costs.  If you are buying a house, you’ll need evidence that you have a valid homeowner’s insurance policy.   With condo purchases, you don’t need evidence of a homeowner’s policy, and it is still a wise idea to have a condo owner’s policy.

Then, if all goes the way it is supposed to, you’ll get the keys to your new place, meet the movers, and start planning your housewarming party. 

Oh!  And maybe you can also figure out how to spend that $8,000 housewarming present you’ll get from the IRS if you qualify for the first time buyer’s tax credit!

Other posts in this series:

Senator Kennedy 

This morning, we woke up to the news that Senator Edward Kennedy died last night after his battle against cancer. 

Back in the 1970’s, when I was working for Ralph Nader, I had the opportunity to meet Senator Kennedy.

When the Judiciary Committee (he was the Chairman at that time) held it’s historic hearings on airline regulation, I somehow wound up being the lead off witness.  They had me tell the story of how the airlines’ relationships with their passengers were skewed by government regulations that protected the airlines if they bumped a passenger on an important trip, lost a suitcase, or whimsically cancelled a flight for any reason at all – not just bad weather or bad mechanics.

I was a young kid testifying for the first time and scared out of my mind.  To make things even scarier, I got a call from his staff the night before telling me that I couldn’t read my prepared statement, but that they wanted me to submit it for the record and “Just talk to the Senator.” 

 Oh, and they said not to worry.

 Gulp!

 The next morning I showed up with the rest of the staff of the Aviation Consumer Action Project, and when we went up to the witness table, Senator Kennedy really did make it easy for me.  Later, when I read the actual transcript of my testimony, I realized that the Senator asked me questions that anticipated what I would have said next if I’d been reading my statement, and by that time, it was such a part of me that it was just like a conversation you’d have with someone over a drink and dinner.  And I loved him for making me sound like a smart person.

The half hour or so that I spent at the witness table was one of the major peak experiences of my life. 

 Then, a few months later, ACAP sponsored a seminar on airline regulation, and Senator Kennedy was our keynote speaker.  My mom was there helping out with the logistics, and when someone pointed her out to the Senator, he went up to her, gave her a big hug, and then told her what important work I was doing.  It was totally gratuitous nice.    And my mother has never forgotten it.

 And neither will I.

Buying Your First Home In Washington, DC: Buyers' Remorse - Part 6 Of A Series 

Your agent called you with the great news that the sellers accepted your offer.  You were ecstatic.

Then the home inspector went over Dream Place with a fine toothed comb and declared it to be structurally fine.

You got word that the appraiser even thinks it's worth a bunch more money than you're paying for it.

Then you wake up with a knot in your stomach, sweating, and you begin to repeat a mantra something like:

What In God's  name was I thinking!  I've made a huge mistake!  I have to get out of this deal if it means moving to France!

Well, actually moving to France is never a horrible thing, but it's a little drastic if you're doing it just to run away from a real estate deal.

Almost anyone who buys a house or a condo is afflicted with Buyers Remorse at some point between signing the contract and going to the settlement table.  And virtually everyone gets over it - especially when it's their first place.  And there are two things I can almost bet my real estate license on:

• You'll get over it.
• When you do get over it, you will be so amazingly glad that you didn't bolt from the deal.

When I was a new agent, I got an offer accepted in a two-way multiple contract presentation.  Two days later, just before it was time to remove a major contingency, the buyer called me to say, "GET ME OUT!"

So I did.

Twenty minutes after I brought her signed release to the listing agent, the back up buyer was thrilled to be getting the place.  And, you guessed it, ten minutes after that, my buyer called me sobbing.

She'd made a huge mistake.  Could she undo the release? And I think she was more than a little annoyed with me for doing what she told me to do without thinking that she might have a temporary condition.

Oh, well!

So now when I get that panicky call, especially if we're talking about a first-time buyer, and if the wish to get out of the contact doesn't come from a serious issue - either with the building, the title work, or some other major and legitimate concern - I hold off as long as I can to give them time to figure out whether it's real or simple Buyer's Remorse. 

And I give them a little packet filled with Buyer's Remorse Pills - either M&M's or Skittle's. 

Oh, and Gray Goose Works, too!

Next:  Part 7 - The Settlement Ritual!

This is a road trip weekend through West Virginia.  And I met this lady yesterday.  She came up to the fence and posed for me, lifting up her front leg and flashing me a huge smile!  When I said goodby and got back into the car, she gave me a huge "MOOOOOO".

So, Andrea, this one's for you!

Washington's Calvert Woodley: It's Not Just For Wine And Gray Goose!

On Connecticut Avenue just above the VanNess Metro stop, Calvert Woodley Fine Wine & Spirits is a Northwest Washington, DC favorite place, not just for fine wine and spirits, but also for it's amazing deli section.

Yesterday, I beat the 5:00 pm Friday rush, showing up a couple of hours early.  I didn't have to wait in the usual long line to purchase my rosemary ham, chevre, stuffed grape leaves or Greek yogurt.  

Between Wednesday and Saturday, their loss leaders are cheese and pate, ham and coffee.   And if you wonder what one of their sale cheese taste like, they'll give you a nice sample to try before you buy.  

They import their bagels, flown in every morning from New York City.  And their Nova is a preview of heaven.

And, of course, it's hard to leave the place without picking up a bottle of something wonderful.  They have a superb collection of wine from all over the world.  And they also have an amazingly knowledgeable staff.  

On weekends, they often have wine tastings.  Now, I have some unusual wine snob friends.  When we get together, the idea is to bring a bottle of good wine that cost under $20.  And when in doubt, I've never gotten bad advice.

And beer.  They have it all, from Bud Light to the most sophisticated micro breweries, and again, they can steer you right toward what you want.

Finally, their Gray Goose prices are the lowest in town.  They even beat out the Commissary prices at Ft. Belvoir!

They are located at 4339 Connecticut Ave NW, and most important, they have free parking in the adjacent lot (although there is often a bit of a line to get a space.

Calvert Woodley gets a 10 WOW rating from me!  

Buying Your First Home In Washington, DC: The Art Of The Deal - Part 5 Of A Series

When you find "The One", your Realtor's® job is to make it happen.  This is where a great buyer brokers earn their keep.

The first step is to prepare the paperwork for your offer.  In the Washington area, your agent will work with you to put the offer together using boilerplate forms provided by our local board of Realtors®.  And as you go through to fill in the blanks, it's time to kill a tree!  Our forms run from about 35 pages on up.  

This document will govern the price and terms of your home purchase.  And how negotiable the seller might be will depend on a bunch of factors:

• Are you the only offer on the table?  If your not, a lot of your negotiating power goes down the drain.  And even in this market, the good houses that are well-priced are sometimes attracting multiple offers.  This is one reason for acting quickly once you find your Dream House, because the longer you wait, the greater the chances are that other buyers will be in there bidding against you. 
• How long has it been on the market?  It's usually easier to get sellers to lower their prices if it's been on for a while.  It's usually hard to get the owners of a brand new listing to take a huge price cut, even though they may have to lower their price even lower than your low ball offer in a few months.
• How does the price compare to recent sales of similar homes in the neighborhood?  And I mean recent - not last year or the year before.  Last month, maybe.  Your agent can prepare a market analysis for you to give you an idea of how it stacks up against the comparables.  If the numbers make the list price look high, even if it is a new listing, it's probably worth trying to make an offer with a price supported by the comps.
• What do you know about the sellers' motivation to sell?  Is it a transfer?  Is the house empty?  Is it a happy move or a sad one?  All of these factors can have an impact on how the sellers will respond to an offer.
• What did they pay for it, and will they have to bring money to the table if it's worth less than their mortgage balance?  There are a lot of sellers clinging to the hope that they can get just enough to pay off the mortgage, without regard to the home's actual value.  This type of seller might just have to sit on their place for a while before they see the light.

Then there are the terms that can make a contract attractive, even it the price isn't ideal:

Do You Really Need A Home Inspection For Your Washington, DC Condo?

Yes!  Absolutely!

When you buy a condo, it seems a lot simpler than buying a house.  But in many ways, it isn't.

Both are a complicated set of systems and appliances in a structure that is better if it is sound. 

With a house, getting an inspection is a no-brainer.  And you know what?  It's a no-brainer with a condo, too.  Sure, the condo association is the one to maintain the structure and the common elements, but you are a part of that condo association.  You need to know what you're getting into.

The inspector can look over the unit itself, checking the appliances, the heating and air conditioning unit, the wiring and plumbing, and tell you all kinds of stuff you need to know about the building itself. 

He'll look at the masonry and the roof.  If there is a boiler room in the basement, he'll check that out. 

Your contract to buy your new place will include an opportunity receive and review the building's "resale package", with information about the budget, among other things.  If the inspector finds, say a roof that will need replacement in the near future, that may not be a bad thing if there is money in the reserve funds to fix it?  If the boiler is dying of old age, can the pay for the replacement without passing the hat in the form of a big special assessment?

The home inspection is a very important introduction to your new place.  You'll not only learn whether or not the appliances all work, but what to do when one won't start because a breaker switch is flipped.  If the toilet starts running and looks like it's going to overflow, where is the water cut off valve that will avoid a flood in  your downstairs neighbor's apartment?

Buying a condo, especially if it's your first place, is a major life milestone.  And your home inspector is an important part of the team to help you make it happen.