Hackers are the New Silent Party in Real Estate

Also Published on The Huffington Post

~~~~~

When you buy a home, there are three main parties who bring you through the process from contract to closing. One is obviously your agent. The second is your loan officer. They help you get the mortgage so you can buy the home. The third is the Title Company.

Well shoot, who’s that?

Most buyers are active in their search to hire an agent and loan officer. But hardly anyone ever knows who the Title Company is or how they play into the process. (Title Company, Settlement Agent and Escrow Agent are used interchangeably but they all refer to the same company.) They are responsible for running title to the property, ensuring that the property transferred legally and correctly from person to person and preparing the closing documents and deed to transfer ownership. They also collect and disburse money to/from the appropriate parties.

In the process all this money coming and going, hackers very slyly figured out how divert some of that cash into their accounts.

 

Hacker.jpg
Photo by NeONBRAND on Unsplash

For decades, when buyers paid the deposit at the time of contract, it had been customary to write a check. Since checkbooks are about as popular now as princess phones, many buyers wire their funds instead. This is where hackers figured out a pretty perfect crime.

You’re the buyer. You receive an email from someone at the title company, introducing themselves as another point of contact, with wire instructions for your deposit. You wire the money to that account. And no one at the title company ever receives it. You actually wired it to a bogus account.

How is this happening that the hacker knows exactly when to email you during the appropriate point in your transaction?

We’re an industry that has moved online. It is a common daily occurrence for an employee at a title company to receive an email that says: “Attached you will find a contract for our new transaction.” Title Company Employee clicks the link, downloads the contract and the ball is set in motion for a new transaction. Except now not every single one of those emails is a legitimate contract.

Some of those emails with attachments now contain malware links. It can be an attachment. It can be a link within the email. It can be an unsubscribe link. Whatever it is, once downloaded, that software allows the hacker to infiltrate the user’s computer at the title company and see everything on which they are currently working. Then they can spoof emails to people actively engaged in a transaction asking them to wire funds to the account info in the email.

The buyers never realize this is not a legitimate employee and they wire their money.

And then it’s gone.

Local title companies report receiving multiple requests a day to download or click suspicious links. It has become almost impossible to discern which is legitimate and which is a hacker. The emails are in perfect English, there is no clue that would raise a red flag. The recipient would have no reason to believe they are about to send their money to a place where it will never be recovered.

How can we prevent this?

Old School, baby. We’re going old school. We have to do two things we thought we may not have to do anymore.

1) Pick up the phone and have a conversation with someone. Call the Title Company and confirm the wire instructions. Do not use the phone number in the email. Google them yourself (at least I didn’t tell you to look it up in the Yellow Pages) and call the number you find for them.

2) Write a check and hand carry it to the Title Company or mail it to them.

As we take steps forward with technology there is always a pitfall to dodge. Until this is figured out, or until the hacker(s) are caught, (don’t laugh! The Nigerian Prince was caught last week!) we need to go back to the tried and true methods.

Now, go find your checkbook. It’s probably under your fax machine.

~~~~~~

What's Trending in Home Design for 2018

Also published on the Huffington Post.

~~~~~

See ya later white kitchens, don’t let the door hit ya on the way out!

Various sources are calling the 2018 trends in home design and the white kitchen is allegedly falling out of favor. What are all the contractors in DC going to do? Dollars to donuts, I’m sure there are several million white cabinets sitting on various palettes, waiting to be delivered to one of the many homes being built or flipped in DC. There’s always a trickle-down effect with these things. Take, for example, how we actually got to this white cabinet phase in the first place.

HGTV first became mainstream around the early 2000’s, thereby coining that gem of a phrase: “house porn.” At that time, there was a specific lineup of kitchen choices. Remember black appliances and Uba Tuba granite that had to be sealed every year? Me too. I did love those wood cabinets though. Dark wood, light wood, made no difference to me. I shared an office with the woman who sold the options and upgrades at D.R. Horton and I could have listened to her discussing cabinetry and flooring choices for days.

Black appliances didn’t have so long a run, but wood cabinets ran the gamut from light to dark with neither being declared a winner. The truth was, the specific color choice of the wood was about personal preference. Where the trend came into play was with the style of the doors, which changed over the decade-plus. We saw raised-panel, partial overlay doors early in the trend and full overlay with more of a shaker or minimalist style.

Then one day, some brave soul knew it was time and they pulled the trigger on a white kitchen. There were definitely non-believers (me.) I was convinced I fell asleep and woke up in one of my mother’s Florida house hunting nightmares where she was looking for a clean white Florida kitchen. I was ready to get dinner by 5:00 to catch the early bird.

 

DSC_2570.JPG

I finally came around. Look, I admit it. It’s just like that time I worked at a certain lingerie store at the mall 25 years ago. I kept rehanging the same floral robes over and over for months. By the time there was just one left I was thinking, “Hmm, that robe with the pink roses all over it is pretty.” (It wasn’t.) Same thing applies here. Show enough homes with the white kitchen and suddenly you’re doing white in your own kitchen remodel. (I did) and walking out of houses that don’t have the white kitchen. (It was a very catchy trend.)

Enough of that.

Honorable mention for another thing going by the wayside is the “bar cart.” Bar cart? The only person I have known to have a bar cart was Don Draper.

So what’s trending in home design?

Well, by process of elimination…if white cabinets are out, what we have left is either wood or colorful cabinets. And yes, those are the things being shown in kitchen design now. It seems people will be taking a paintbrush to their cabinets and going all sorts of deep. Very bold colors are making the rounds – navy, greens, deep reds. And the light wood look is back.

 

jason-briscoe-332507.jpg

Another incoming trend worthy of a giant gasp is what’s happening in flooring. Hardwood floors are still safe, but there are other flooring choices garnering some attention. Zillow calls it “statement” flooring; HGTV went straight to “terrazzo.” (If you have totally turned off of HGTV the television channel, let me assure you that HGTV Magazine and the HGTV Website are pretty awesome.)

You can also see at that link above that HGTV shows a colorful kitchen in sage, as well as mentioning “statement ceilings.” I’m a fan but within reason. If anyone tries to pass off a popcorn ceiling as trendy, they will be in a lot of pain when I’m done with them.

[Important note: No contractor with half a brain cell will ever agree to remove the popcorn ceiling because of the intensive labor involved. They all just offer to put drywall up in place which is a stupid but “lesser of two evils” option in their eyes. After striking out with every contractor in town, I couldn’t take it anymore and decided to do it myself. Just because I didn’t hire someone doesn’t mean I didn’t pay dearly. It cost 3 days and a broken back to get that popcorn ceiling down. They should be outlawed. I can’t even look at them without vomiting.]

HGTV curated their list from the Pinterest 100, which tracks trends in “saves.” HGTV also mention trends in oversized art, mixed metals and plants, as well as the “Spa Bathroom.”

Weren’t spa bathrooms always on trend?

Well, have at it peeps, there’s some cool looking house stuff coming down the pike!

Five Secrets to Identifying Sloppy House Flips

Also published on the Huffington Post

~~~~~

We’ve all been there - walking around that gorgeous house that’s finally for sale. Months of construction, preceded by years of abandonment, preceded by decades of neglectful owners and it’s been spruced up and is ready for a new owner. As you exchange the winks and nods with your partner, or friend, or mom – whomever you brought with you for validation, you know this is the one on which you want to submit an offer.

Just as you’re about to fall asleep that night, as visions of Home Goods dance in your head, that little nagging voice asks if you’re sure. You don’t want to buy a money pit. Everything seems shiny and new, but how do you know that it’s been done right? How do you know that behind the walls there isn’t a tangled mess of improperly run electrical wire, waiting to ignite? How do you know that the toilet lines are draining into dedicated waste lines instead of tapped into the plumbing line?

Home Inspectors are amazing, awesome and necessary partners in the process of homebuying, but they don’t have x-ray vision. They can only see what they can access, and depending on what’s visible and what’s been covered behind drywall, you may not get the whole picture.

Screen Shot 2017-12-21 at 4.28.19 PM.png

This doesn’t mean you can’t get a true sense of how good a renovation this is, but you have to look and listen harder.

You will be involved in the process from the time you place the offer to closing. There are many stops along the way where you communicate with the seller via your agents. Pay attention here and really evaluate how the other side behaves.

1) Is their lockbox clearly marked, easy to find with nice new keys inside? Or is a rusted mess with keys from the 1960’s that barely work? Bad sign if they couldn’t even change out for new locks or invest in a legitimate lockbox instead of one of the basic combination boxes.

2) Are they involved during the marketing process and demonstrate overall pride of ownership? The best of the best will even be at their own open houses so they can respond to potential buyer’s questions or requests.

3) During the negotiation of your offer, are they generally easy to work with, forthcoming with information and willing and happy to answer questions? Or do they give you flip answers for things? I recently asked a seller’s agent where the light switch was for a closet light that was always on. When he replied, “magic,” I didn’t laugh. Turns out they never put in a light switch. Can it be fixed? Sure. But it’s an indication of corner-cutting.

4) Is the backsplash crooked? This makes me laugh because I have used this for years as the example to clients who are apprehensive about purchasing “flips.” During our initial consultation I always said, “Is a crooked backsplash an issue? No, but it indicates a lack of attention to detail.” All these years of this generic example and last month it finally happened – there was the sloppy backsplash in a flip my client loved! It would have been so easy to fix, but they didn’t. This indicates more corner cutting.

Unfinished Backsplash; Outlet should be GFI as this is next to the sink.

Unfinished Backsplash; Outlet should be GFI as this is next to the sink.

5) Is the house clean and staged? I realize this sounds a bit elitist here but in Washington DC’s Real Estate Market the stakes are high. If there are leaves swirling around on the floors, a thick layer of dust on the counters and you have to jump over abandoned construction equipment, this seller/flipper is not in control of their asset. What else have they turned a blind eye to or left to chance?

The more houses I see the faster I get at the game of “Find this house’s crooked backsplash.” You will also notice your skills sharpening if you pay attention and if your Real Estate Agent points these things out to you as your tour homes.

Hire a thorough Home Inspector known for detail and don’t be afraid to bring in additional consultants (structural, mold) to evaluate the home and the condition of the renovation.

Four Things to Do Now if You Plan to Buy a House This Spring

Also published on the Huffington Post.

~~~~~

You are so close to that roasted turkey you can practically smell it. Cranberry sauce, mashed potatoes, gravy, you are looking so forward to this. Planning to enter the turkey-induced coma for the next several weeks, stopping at some holiday shindigs along the way, and landing at New Years sounds pretty good.

Not so fast.

Do you want to buy a house after the new year? Lots of people do. Those people will be your competition when it comes time. If you do a tiny bit of prep work now, you can alleviate your future crush of stress and get ahead of the competition so that when the houses are listed, you can respond quickly.

1) Find a Real Estate Agent

This one is the easy one, but it also takes a bit of time if you want to do it right. You’re going to be making what might be the biggest purchase of your life. You should ensure that your team has no weak links. There are plenty of agents out there but you don’t want to be stuck with one you have to replace mid-game. Ask friends and colleagues for recommendations, check online reviews, and make a short list. Then you should schedule times to chat, pre-holiday, when many agents are winding down for the year and gearing up for next year. You want to look for many things in an agent. Responsiveness, industry knowledge, strong negotiating skills - all of that is a given. But there’s also an element to this relationship that’s a non-tangible, as in, do you “click.”

2) Call a Lender

This is the scary one for a lot of people. But it’s so necessary. Most people wait until they see a house they love online before they make the agent and lender calls. But it’s often too late. How? Because remember all those other buyers who did their prep-work already? They’re ready to write an offer while you’re still lacing up your kicks to go to the open house. If you have the agent interviews mentioned in Step 1, ask them for their recommendations as they usually have contacts who close without a lot of hassle. You aren’t committing to anyone – just starting a conversation. Get their list of required documents that you will have to provide so that you can start looking for those now. And get a sense of what you need to do between now and purchase time. There may be a mistake on your credit report, it happens to all of us. It’s important to know now so you have time to fight it out with the credit agencies and get it cleaned up in time for spring.

3) Clean out Your House

I love throwing things out. I’m not sure why I had to read that tidying book to embrace how much I love throwing things out but it’s one of my favorite things. Don’t be shy in telling people now what your after-holiday plans are to buy a house and to not inundate you with fake wreaths or give your kids with more stuffed animals they don’t need. Just say no.

4) Call Mama

Or Dad. Or your Great Uncle Earl. And drop the hint that you’ll be buying a house. If they plan on giving you any gift money, now’s the time to pony up. Parental gifts are subject to less rules than receiving money from other relatives so it’s not as imperative to actually get the money in your account, but just know the amount that may be coming your way so you can figure it into your search. Typically, money from people other than Mom and Dad has to “season,” meaning, it has to be in your account for a specified time period. Otherwise, the lender will have to “source” the deposit, which means Great Uncle Earl has to provide proof that the money left his account and you have to show where it was deposited to yours. Poor Earl will spend an entire day at the bank and asking them for copies of his withdrawals, then to the post office to snail-mail them to you and they may not arrive in time for closing. Trust me on this. Unless it’s Mom or Dad, get the money from whoever is providing it, now.

I know, that last one is tough. If there’s anything I know it’s the complication wrapped up in families with money. But it will be more difficult to track later on, so have the tough conversation now.

Multiple Offers 2.0 - Part Deux

Also published on the Huffington Post

~~~~~

Let’s dive in because I know you’re chomping at the bit to figure out how to handle this property frenzy. You feel totally out of control playing a game where rules change all the time. A new property hits the market with no offer deadline. You quickly submit a great offer at the encouragement of the listing agent and get some mumbo jumbo which amounts to worse than a rejection. They want to hold until other offers come in. Now you have to wait through the weekend for the seller to have their open house, collect more offers and use those offers against you. What do you do, besides chew the insides of your cheeks off?

IMG_0930.JPG

Let’s review the options.

1) You think “Oh, okay, well I want this house so I’ll wait.”

2) You think, “I should have offered more, I’ll do that now.” And you re-submit hoping for an acceptance.

3) You think, “Eh, whatever. I’ll withdraw my offer and maybe resubmit in a few days.”

Option #1 isn’t a good strategy. In fact, it sucks. Being nice, flexible and patient will get you absolutely nowhere. Think about it - the listing agent has your offer in hand and holds the open house. People ask “Do you have any offers?” And the listing agent says “Yes, we’ve received an offer.” Now what happens?

Well, remember that old boyfriend you dumped who used to clip his toenails in bed with you and let the nails fly everywhere and not clean them up? Yes, him. You find out he’s got a new girlfriend and suddenly you want him back because he’s the one that got away and just seeing him with Suzie makes you realize that you love him so much? Yeah. That. Except this time, it’s YOUR offer that incites someone else to desire a property they were formerly indifferent about. Nothing makes someone want something more than when someone else also wants it.

Option #2 is also the sucks. Think about it. Even if you go high from the start or you bid against yourself to go higher when the first offer is rejected, at some point there’s a cross over into “too much money.” The seller sees how much you want to pay and they don’t read that number as the representation of your desperation plus the extreme lack of inventory. No, they read that number as “My stupid listing agent made me list my house too low, and it must be worth 18 million dollars so now I’m holding out for that. Step aside small potatoes, I’m holding the equivalent of goldmine here!”

What can you do about this? When you submit an offer to an agent who has no memorialized deadline and the seller does not accept, WITHDRAW YOUR OFFER. Do not allow yourself to be used as a pawn to drive the price up at your own expense. So you see, #3 was the right answer. It’s always the right answer.

What if you just can’t withdraw your offer? What if you want to take a chance and hope you have a reasonable seller who may just accept an offer on Day 1 and cancel the open houses, what should you do to improve your chances?

1) Write an offer higher than list price. I know, I know, I hate escalations and offering more than the seller agreed to accept. But since you’re submitting early and you’re the only offer, there is no escalation that would kick in even if you included one. Add some money to that offer and be prepared to waive your contingencies. Sorry. If this is something you can’t or won’t do, then do not go running out to look at properties on Day 1. You’re going to make yourself insane. Just don’t do it.

2) Deadline. Deadline. Deadline. And stick to it. Put a short window of time in which they need to respond or the offer is withdrawn, and stick to it. Time is not on your side here, don’t afford the seller the opportunity to “shop your offer.” This strategy obviously isn’t for the faint of heart or the emotional though. You have to be prepared to walk away otherwise your integrity is compromised. But at least you will know you didn’t cave in on all your principals. There will be another house, I promise.

 

Multiple Offers, 2.0

Also published on the Huffington Post

Forgive me Huffington Post for I have sinned. It’s been a really long time since my last confession. It’s an indication of just how busy things have been in DC, in Real Estate, and in life.

Nothing has equalized yet, party people. The insanity presented to buyers in the Spring 2017 DC Real Estate Market has continued right into summer, unabated.

It is time to revisit the Multiple Offer, 2.0. This topic is going to be split into a couple parts. We’ll spend the first installment revisiting the lay of the land and getting up to speed on where we are now and how we got here.

Prior to this year, the approach and handling of multiple offers by both buyers and sellers seemed to follow the same essential process: Property listed for sale on Thursday or Friday with the offer deadline in the listing notes. There was the obligatory Sunday open house and offers were due on Tuesday or Wednesday. Wash. Rinse. Repeat. This seemed to work well for the past several years. Everyone had the same information, knew what to do and by when they needed to do it.

Last Fall (2016) there was a definite slowdown in the market. It was a bit surprising, but in a city with all eyes on the Election and subsequent craziness, the collective yawn was the best we could do. Properties on the market sometimes still included notes stating that offers were due on a certain date, which was well into the past. It was hard to know if a 41-day negotiation standoff was in process or if the property was still fully available.

I always call the agent when I see things like this because I’m nice like that and if you have a snot hanging out your nose I’m going to tell you. (I just lied. I don’t always call. Sometimes I don’t have time or the energy to help other people do their job too.) Funny enough, each time I made this call, I received the same answer from all these different agents, every single time:

“Oh, my assistant must have forgotten to change that.”

That poor, potentially non-existent assistant. To be fair, last fall, many of us were off our game. The cooling off came swiftly and no one really expected it.

That's Clark the assistant. Never once blamed for anything.

That's Clark the assistant. Never once blamed for anything.

Of course, no one expected either that when spring arrived, the bulls would charge out of the gate. Despite the strength of the market in 2017, there are a lot of listing agents who are still hesitant to commit to an offer deadline the day the property is listed. See: Still feeling the chill of last fall.

Despite the market strength right now, this hesitancy to decide an offer deadline on listing day is because some properties out there are defying the odds - and not in a good way. There are properties listed right now that everyone cooed over. And they have yet to elicit an offer. I know – you want to know how I can say the market is so strong in 2017 but there are also properties sitting on the market. The answer is simple. Some sellers got too greedy

(I’m sorry, but if your neighbor Bob sold his house 4 months ago for $500,000 and your house is the exact same floorplan with a slightly nicer yard but in worse condition inside, where exactly do you get off thinking that you are entitled to $625,000 because you’re including a faux-stainless steel microwave and a garden gnome? We’re real estate agents, not magicians. And buyers? They’re savvy, not morons.)

Today, maybe one in ten listings will have an offer deadline noted on the day the property is listed. The other nine are waiting through the weekend to hold the infamous open house to gauge interest before setting a deadline. No matter how strong the market, there are new rules to the game. And we (well, you) have to figure out how to play.

My personal feeling on a property listed with no deadline is that it’s fair game. If my client wants to write an offer an hour after it’s been listed, I’m going to write it and submit it. Why should they wait until after the Sunday open house for a deadline? I always contact the listing agent who always encourages me to write up the offer. It’s always the same thing: “We don’t have any offers in hand right now but if your client presents something that is too good to pass up, my client will look at it.”

Of course, they will look at it. It’s likely one of the biggest investments they will ever own, why wouldn’t they look at it? Their whole purpose in listing their house is to look at offers.

My client gives me their terms and I write that bad boy up and send to the listing agent. And this is where things get interesting, because no matter what the offer says, the listing agents always say the same thing: “The seller decided to wait through the open house to give everyone a fair chance to see the property.” One agent told me he already had the ads set to run in the paper. The what?

Anyway, what happened? This isn’t the playground. We don’t all have to have a turn. But, okay, you pick yourself up, dust off and try to regroup. What happens now and what could you have done differently if you really want the house?

Meet me around the corner for part 2.

 

Be Aggressive! B-E-Aggressive!

A little something I published on the Huffington Post today.

This one is a total 180 from the tone of what I have written in the past. Having lived through a runup of prices, a horrible downturn and the subsequent runup we are currently experiencing, I lean to the conservative side of real estate. They were very dark days I experienced, working for a builder when the phones just stopped ringing. I’m always scared that we’ll end up there again.

In my last article, I said it was a bloodbath out there. It truly is. The market has reached a level of such insanity that buyers have to get creative to get their house. Don’t get me wrong, even I’m perturbed by what is happening now with prices going through the roof and the escalations necessary to secure a home. But I’m not the one looking for a house. You are. And my job is to help you buy your house. So, it’s time for some tough love.

People, we need to get focused!

Bask in the gorgeousness of Logan Circle.

Bask in the gorgeousness of Logan Circle.

Here’s the advice I have for buyers in making sense of their Spring, 2017 search:

1) Pick One: Location or Condition

Unless you want to totally blow your budget, you probably have to choose between location and property condition. Real Estate is still about location. It is less about finding the perfect house as it is in finding the perfect location, because locations don’t change. While many sellers and their listing agents have cranked up their game and list a home for sale only when it’s immaculate, other sellers don’t have to try as hard. Some locations are so prime that those sellers can list a house that results in a collective sigh upon crossing the threshold. It needs help, work, TLC, handyman’s special - whatever you want to call it.

Look beyond the inside of the house and focus on the things that won’t change like location. Not considering a house because it doesn’t have the countertop you want is silly. Picking apart the interior features is a waste of time. If you want this location, I can guarantee someone else does. There are a lot of people who will live with linoleum counters to get into the right neighborhood, right school district, etc. You need to stop with the First World Problems.

2) Don’t Fixate on Price

Just ignore the price. There will be the rare occasion that a home is priced slightly low. Don’t fall into the trap of thinking that you can get the house for that price. Other buyers are just as sharp and the house will end up in an escalation situation. Wipe the list price from your mind and offer what you think the house is worth – to you – based on what you have seen already and how much this house checks the boxes for you. I constantly witness buyers trying to talk themselves into higher priced houses that aren’t a fit. Then they find the perfect house that’s priced $50,000 lower and knowing they have to escalate to get the house, they won’t go up more than a tiny bit. But they would have paid more for something they like less? I don’t get that at all.

3) Do You Want a House or a Hobby?

For some I believe it is fun to look at houses. If the market is too tough for you to contend with and you aren’t ready to play ball with the big kids, then it’s fine. Sit this out. There is no reason to keep making yourself (and me) crazy looking at houses every weekend when you have been outbid 5 times and you’re getting frustrated. It’s time to think critically. Is this the time for you to be in the market? You’re fighting against lots of all-cash buyers and fully approved buyers. You have to be aggressive. And for the love of all that is holy to you, please don’t look at 50 houses, write offers on 10 and then claim you aren’t in a hurry. That’s a waste of everyone’s time.

4) Please Don’t Talk About Tennessee.

Or any other place where you are from. And please don’t fly your parents in from another place to do it either. Other markets do not work at all like DC. Don’t apply logic from where you live to this market. This market defies logic. Are we Silicon Valley? No, thank goodness. But the government provides a stable employment base so we’re not like other cities at all.

5) Think of the Money!

Please don’t ignore your lender until you need them. Just go get yourself approved so you have nothing to worry about when the loan process begins.

This DC Real Estate Market isn’t for everyone. Many buyers don’t have the stomach for it. But the ones who do are under contract and locked in at an interest rate that is probably as low as it will be for the next few years.

Your real estate agent’s job is to get you a house, not hold your hand while you pick apart the half-assed renovation of some HGTV junkie wannabe who overpriced the piece of real estate in which you are standing.

 

April Showers Bring May Insanity to DC Real Estate

Me + Huff Post = a spankin good time. Enjoy.

Here we are, party people. Smack in the middle of the DC Real Estate Soiree, known to locals as the infamous “Spring Market.” It is anything but fun for most of the partygoers.

Last Fall, there was a noted lull in activity. Properties were sitting on the market a bit longer than usual, and there were price reductions. Gasp. DC Real Estate hadn’t seen price reductions on listings for years! Was it a sign of things to come? Election, new administration, changes in government afoot, it seemed like it might slowly be winding down.

But someone burst open the door and the life of the party came back and it’s back with a vengeance.

In some typical water cooler chat, other agents have been sharing the familiar stories of buyers escalating $100,000 over asking price and still not getting their offer accepted.

Folks, it’s a bloodbath out there.

 

Screen Shot 2017-12-05 at 1.10.43 PM.png

A couple weeks ago, my clients bid on a 1 bedroom condo in Logan Circle. They put an escalation in but were not the winning bidders. There were close to a dozen offers but 2 frontrunners duked it out in the $50,000 over-asking price range and the rest were barely out of the gate. My clients were in 3rd place. How did they feel about this? I didn’t let them even have a moment to ponder that because I learned that the two frontrunners aside, many of the other offers came in at about the same price and terms as theirs.

When I was reviewing the situation with them and explaining that they hadn’t won the bid, I told them they should feel great about what they offered. They said “But we didn’t get it.” But, I told them that when their bid is similar to everyone else’s, they probably nailed the value because everyone else came to the same conclusions. Just because two outliers bid the property way up doesn’t mean it was a good move. It may feel like it to those buyers right now but time will tell. My super-smarty-pants land developer husband always says, “There’s no winner in a bidding war. If I’m the winner in a bidding war then I paid too much.”

The price of a property matters most at two points in time – when you buy and when you sell. Like most others, I don’t see a crash of any type here in the District, but I believe we could go for several years with flat appreciation in some neighborhoods.

It’s easy for me to say these things though. I’m not emotional about property. For me, it’s business. If I didn’t get a house I would move on to the next one. But as a novice homebuyer many years ago, I recall having to take a long nap (Ok I went to bed early that night) after a crazy bid process where I didn’t win the place I wanted. It all turned out for the best though, because I ended up with a home I still own and still adore to this day. But it’s hard to paint a picture of the future for buyers when the present seems so discouraging.

In the last week since that bidding war I just described, I have had 2 more clients get outbid.

Parts of this process feel uncomfortable to me. I am pretty financially conservative and the freewheeling spending style isn’t my style at all. I always shop the clearance racks. I always get my Easter Candy after Easter when it’s half price. Just because it’s wrapped in pastel foil doesn’t mean that chocolate is any less delicious today than it was yesterday.

I told several buyers this week alone that bidding wars are never fun and they are never fair. You will pay more for the property than the seller would have accepted. But, this is the market and there’s not much anyone can do to “fix” it. It will fix itself. Or not. But now is not the time to show up on the scene expecting a deal or to offer less than list price because the price is “inflated.” It’s only “inflated” if no one wants to pay the list price, otherwise if someone offers it, then that’s the new market value. Sorry. It sucks. But it’s the “Come to Jesus” I’ve had to have more times in the last few months than I would like.

People who have been waiting it out for a couple years have watched prices rise out of their reach. It’s frustrating, discouraging and nerve-wracking. People who have been waiting it out from Fall, 2016 when there were price reductions and stagnant inventory and a potential election that may have killed the economy with the outcome now see properties escalating to crazy highs. They feel like the bus left in December and they missed it. But last December, those same people felt that they could wait and prices would come down even further. If this is proof of anything, it’s that no one can predict what will happen next in DC Real Estate.

One thing that won’t change in DC anytime soon is inventory. There just are not enough houses to go around for people who live here. That should tell us all something.

Bid wisely, my friends.

 

 

Churches & Log Cabins Are Houses Too!

Despite some annoying, face-hurting allergies, I managed to get out to take clients into houses over the weekend. Houses, many many interesting houses.

The Sanctuary, a gorgeous church conversion in Northeast, a couple blocks south of the H Street Corridor is first. These are pictures from their Piece de la Resistance, the Penthouse Unit. Gorgeous stained glass can be your living room windows.

Screen Shot 2017-12-05 at 10.49.12 AM.png
Screen Shot 2017-12-05 at 10.50.14 AM.png

And the 40 stair climb to the Bell Tower has amazing 360 degree views of DC.

Screen Shot 2017-12-05 at 10.51.19 AM.png

Church conversions are all the rage these days in DC. Not sure what that says about our culture but seems as though there is no shortage of churches being converted to condos in Washington, DC.

And then in a complete 180 degree turn from converted churches and city-living, I showed a log cabin in the suburbs. Totally unique, and totally quirky.

Screen Shot 2017-12-05 at 10.52.05 AM.png
Screen Shot 2017-12-05 at 10.52.15 AM.png
Screen Shot 2017-12-05 at 10.52.24 AM.png

It reminded me of some houses I have been in down in the south. It only had one bedroom, but there was an additional attached house - not a log cabin style, and the rest of the sleeping areas were there. Unfortunately that side of the home wasn't as unique as the log cabin side.

Truly never a dull moment. And, despite the allergies, I was very happy to be running in and out of houses again. Because sometimes being home all weekend with the Terror Twins can be a teensy bit much. Even though they're cute. Apparently I missed dress up with their Halloween Costumes. Seems Stanley wanted to eat that little piggie.

Screen Shot 2017-12-05 at 12.59.37 PM.png

Real Estate's Spring Thaw

My spring update on Huffington Post.

~~~~~

In Washington DC, there really is no such thing as a spring thaw. The entire winter was pretty mild which I am happy about, but then we got a cold blast the last couple weeks. Weather can wreak some havoc on a real estate market, because everyone’s question is always “When does the spring market get into full swing?”

This should be a pretty straight forward question to answer, but in DC, the real estate market is anything but straight forward. I always feel like there are 3 answers to the question.

1) January 2nd: Some people will want to buy or sell as soon as the holidays are over because they’ve been chomping at the bit to do so since November. And whoever they have been talking to about it has discouraged them from doing so. Never fails that someone will snag a house on December 27 that’s been listed for a month with no activity, then on Jan 2, there are half a dozen buyers who say “Oh, we saw that house but we got busy with the holidays and thought there would be more on the market...” and whatever else the reason.

2) After the Superbowl: Yes, Sundays are for football until they aren’t anymore. Then they are for open houses!

3) When the weather breaks.

Well here we are. It’s a blustery 40 degrees as we are now at Day 1 of Spring. My birthday was last week and mom always likes to say I was born on a sunny spring day. Hmmph. I’ve never seen any of those, but, March can be like that. It can be 65 and sunny or it can be 25 and snowing.

My clients who needed to get the party bus on the road have been pounding the pavement since New Year’s. I’m currently in about a week three day stretch of quiet time, which is nice in a way to have a little breather before it picks up again. But, for the buyers, I always think it’s better to be out when the weather is unpredictable, cold, rainy, snowy. Why? Because relocations, family changes, life – these things continue to happen in property owner’s lives regardless of what’s happening outside their window. It’s sometimes easier for buyers when the weather is bad to get a house.

But here comes the sun. Bring DC a perfect day with low humidity and hardly a cloud in the sky and everyone is out there again performing the Sunday dance. Gym, brunch, then pounding the open house circuit to see what the DC real estate market has to offer. The truth is that 50% of those people at open houses aren’t even “in the market,” but the sheer volume of bodies that turnout creates a perception as reality situation and things heat up really fast.

The Fed pushed rates up ¼ point last week though our local DC based lenders reported little change in mortgage rates thus far. The Fed concluded the meeting with a note that subsequent rate increases at future meetings will be very measured, dependent on many economic indicators but will likely stay low in the near term.