Katie Wethman’s Real Estate News – March 2019

March 2019

SPRING IS HERE!

March started with a bang and is still going strong! We’ve been seeing lots of activity in the market this month with many buyers out looking for homes, sellers receiving multiple offers, and lots of pre-market homes coming available as we cruise into the spring real estate market.
Most of our buyers are competing against multiple offers, and escalation clauses are common. We’ve been able to win a few bidding wars WITHOUT waiving contingencies, but it takes the right lender and a good offer strategy. “Coming soon” and off-market sales are becoming more frequent sales opportunities as well, so it’s critical to be working with an agent who is connected. Contact us for more info!
We’re excited for a strong year and we’re excited to help more with their Real Estate needs. Our goal is to reach 100 transactions this year, so if you know anyone thinking of buying or selling, please think of us!
WETHMAN GROUP CLIENT EVENTS: Today is the last day to enter our Wethman Group March Madness Brackets (using this link)! Prizes for top 3 clients to enter (clients only please.) You can also join us for fun, food, and some prop bets with prizes at our Final Four Basketball party on Saturday, April 6th (contact us, or check out the Wethman Group Perks Facebook page, to RSVP). And finally, Save the Date for our Spring Picnic at the Winery on May 11th (weather dependent). We hope to see you throughout the Spring season!
BUYERS: NOW is the time to get your pre-approval finalized and start talking strategy with us so that you’re ready to move quickly when THE ONE pops up. Call us, or get started at our FREE home buyer class in Arlington on Wednesday, April 3 (register here).
AMAZON UPDATE: This past week, Arlington County approved Amazon’s HQ2 Performance Agreement, which provides incentives back to the community based on Amazon’s performance with their new headquarters in National Landing. This incentive, which is tied to Amazon’s direct performance will not only bring 25,000 new jobs, but also infrastructure and support the area through Technology/Educational improvements, Transit updates and Affordable Housing Improvements.
Transit updates tied to the incentive package include:
  • New entrance to the Crystal City Metro station
  • South entrance off Potomac Avenue to the new Potomac Yard Metro station
  • Improvements to U.S. Route 1 in Arlington County
  • Pedestrian bridge from Crystal City to Reagan National Airport
  • Transit way expansion supporting Pentagon City, Crystal City and Potomac Yard in both Alexandria and Arlington
Housing updates include: Arlington and Alexandria will be investing around $150M through 2029 to support affordable and workforce housing in Alexandria, Crystal City, Pentagon City and Columbia Pike areas. This investment will help create anywhere from 2000-2500 units in the area.
Follow us on Instagram & our National Landing Facebook page for more details & updates!
SELLERS: Have you been considering selling your home? There is lack of inventory right now, and buyers are actively looking for a property in your neighborhood! While there is limited inventory, buyers are looking for certain items and will pay more for renovated homes with specific updates. Contact us today for a FREE Home Valuation, and to learn what buyers are looking for your home! Special incentives for those who book an appointment with us before the end of the month!
INTEREST RATES: Rates have recently dropped this past week to the lowest in a year! Now that the Fed has backed down from their hints of rising rates throughout 2019, we should see steady state for awhile.
30-Year Fixed 4.25%
30-Year Fixed VA 4.125%
15-Year Fixed 3.625%
Hear from Katie how we were able to help a client get a DC condo under contract before the open house!
Wethman Group - Getting the Seller to Cancel the Open House!
LISTING SPECIAL!
Thinking about selling your home in 2019, or know someone who is?
Meet with us by the end of March and mention this newsletter to receive commission incentives, a FREE HOME VALUATION and a FREE HOME CLEANING (up to $350) when you list with us.
OUR LISTINGS
HOME CARE CORNER
Spring Maintenance time is around the corner! its a great time to check your gutters, roof and windows for repairs. Check out our Maintenance Checklist for other items to inspect. Routine maintenance throughout the year helps avoid large expensive repairs or replacements down the road!
CLIENT PERKS: LOANER PROGRAM ITEM OF THE MONTH POWER WASHER!
Need to clean off the exterior of your home, patio or driveway? Use our Power Washer for FREE!
Have something you’d like to see us add to our collection of client items available to borrow? Just email us!
We’re happy to help with all your residential and commercial real estate needs throughout the DC metro area. Remember to Like us on Facebook for market updates and real estate tips!
We have a nationwide network of quality agents–let us know if you or someone you know needs a referral to another city.
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Katie Wethman’s Real Estate News – February 2019

February 2019

The Spring Market Has Arrived!

Despite limited inventory and frigid weather in the area, we’re helped 5 clients with their settlements in January 2019, and already a few in February too! We’re excited for a strong start to the year and we’re excited to help more with their Real Estate needs. Our goal is to reach 100 transactions this year, so if you know anyone thinking of buying or selling, please think of us!
As we typically see in January and February, multiple offers are commonplace because sellers are waiting for “Spring,” but buyers are out ready to write offers! We expect appropriately priced properties to move quickly throughout the rest of February and into March when inventory finally starts to slowly inch up. BUYERS: NOW is the time to get your pre-approval lined up and start exploring the market so you can hit the ground running when the inventory starts popping up — call us, and register for our free webinar via the link below.
We received a lot of questions about the previous government shutdown and its impact on the market, and Amazon’s decision to pull out of New York as its second HQ2 location. Fortunately, we did not see much of an impact with our clients and our current listings as a result of the shutdown–none of our settlements were delayed, and buyers were still excited to continue their home searches. We did see a slight increase in buyer activity in the Fall after the news was announced, but activity has returned to normal in anticipation of local hires and discussions of Metro and transit improvements as part of the Amazon deal. Amazon has confirmed that they are moving forward with the Arlington portion of their HQ2 build-out, and they are currently looking to “organically” grow the 25,000 jobs that were planned in NYC, rather than name a new location. Time will tell if our area ends up with more than our originally planned 25,000, but it makes sense that if things go well over the next few years, that we might see more job creation here than originally planned since Crystal City has the commercial space capacity, and our region can handle such a big influx of jobs. We’re not surprised that Amazon wouldn’t want to announce that in advance though, given the activist reaction in NYC.
Follow us on Instagram & our National Landing Facebook page for more details & updates!

Seller’s Corner

Have you been considering selling your home? There is a lack of inventory right now, and buyers are actively looking for a property in your neighborhood. While there is limited inventory, buyers are looking for certain items and will pay more for renovated homes with specific updates. Contact us today for a FREE Home Valuation, and to learn what buyers are looking for your home! Special incentives for those who book an appointment with us before the end of the month!

Taxes & Tax Law Changes

All of our clients that bought or sold a home in 2018 should have received a copy of their Closing Statement via email. If you are unable to find yours, please let us know! Don’t forget that new tax brackets and tax rates were passed late last year, and there are a host of changes, especially for homeowners. Consult your tax adviser for details.

Interest Rates

Rates have recently dropped this past week to the lowest in a year! Now that the Fed has backed down from their hints of rising rates throughout 2019, we should see steady state for awhile.
30-Year Fixed 4.37%
30-Year Fixed VA 4.125%
15-Year Fixed 3.625%

FREE Home Buyer Webinar

Are you interested in buying, but don’t have 10-20% for a down payment? We have options and advice to help you! There are programs available to buyers that require less than 5% down, you can finance PMI payments and help you achieve owning your own place. There are also lenders and programs for as little as 0-3%, and down payment assistance options that we can discuss too!
We’re hosting a free Home Buyer webinar on Wednesday, Feb 27 which will include an Amazon update, tax law update, and other factors to consider when buying a home. Click here to register.

Upcoming Events

Finally, keep an eye out for invitations to some of our client appreciation events!  We’re planning a Final Four Basketball party, and will also be hosting a Free Car Wash Day at a local car wash TBD, and our Spring Picnic at a Winery in May (weather dependent). We hope to see you throughout the Spring season!

LISTING SPECIAL!

Thinking about selling your home in 2019, or know someone who is? Meet with us by the end of February and you’ll receive Commission incentives, a FREE HOME VALUATION and a FREE HOME CLEANING (up to $350) when you list with us. Contact Katie to schedule your appointment!


HOME CARE CORNER
Winter is in full swing! With the snow we’ve been receiving make sure your gutters are clear prior to storms and melted snow/rain is able to drain away from your home. Also, take a quick visual inspection of your roof (and peek up into your attic if you have one) to help catch any early leaks and avoid larger repair costs. Here’s a tip if you see a water stain in your attic–take a sharpie or pencil and outline the spot…then check it again after another rain or snow to see if it has spread outside the outline to tell if it’s an active leak or an older stain.
LOANER PROGRAM ITEM OF THE MONTH: CHAFING DISHES
Hosting a party on a cold winter’s night? Or perhaps a Sunday brunch? Borrow one or more of our chafing dishes (both sterno and electric available) or warming trays to help make serving your guests a breeze! Large  coffee urn also together
Have something you’d like to see us add to our collection of client items available to borrow? Just email us!
We’re happy to help with all your residential and commercial real estate needs throughout the DC metro area. Remember to Like us on Facebook for market updates and real estate tips!
We have a nationwide network of quality agents–let us know if you or someone you know needs a referral to another city.
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Katie Wethman’s Real Estate News – January 2019

January 2019

Happy new year from the Wethman Group!

January started once again with a bang as serious buyers came out from the holidays with resolutions to buy, and started their home searches well before the “spring season.” We typically see an increase in buyer showings and offers right out of the gate in January, and this year is no exception. Inventory shortages remain and buyer motivation is strong in our area, despite the shutdown.

Amazon Update

Katie was featured on NBC4, sharing her take on the Amazon announcement and what that means for renters, buyers & sellers in the DMV. Check our her interview HERE!
Follow us on Instagram & our National Landing Facebook page for more details & updates!

What does the government shutdown mean for sellers/buyers?

So far, in our area, we aren’t seeing a *significant impact* on the market; but it’s early in the year, and our buyer demand has been strong enough to absorb any slack caused by buyers dropping out of the market.
According to a National Association of Realtors survey of over 2,200 members taken in January, over 75% of members saw no impact to their clients’ contracts or closings. A smaller amount, only 11% of members, noted that they saw an impact to their current clients, and an additional 11% reported an impact on their potential clients.
Interestingly, clients that decided to delay their home purchase made their decision based on the current economic uncertainty, even though many were not furloughed federal employees.
FHA/VA loans are also not seeing as much impact during the shutdown, as HUD had a contingency plan in place. There could be marginal delays in processing due to under staffed offices, but most are operating.

2019 Market Predictions

Interest Rates: Rates are widely expected to continue their general upward trend. The FED increased interest rates three times in 2018, but have been on a recent (temporary?) decline. While interest rates may slow down real estate markets in other areas, the DC Metro area won’t feel the impact as much given its diverse buyer demographic and transition of government, military and contractors every few years. There might be a slight slow down in home sales, but that is likely due to lake of inventory available to current home buyers.
Inventory: In the DC Metro Area, inventory will remain low, especially for townhouses and lower priced single family homes, and especially close in (NW DC, Arlington, Alexandria, Falls Church). This inventory crises has been in place for some time, and is not due only to the Amazon hype. In fact, we are not expecting Amazon to bring a significant impact to the area this year, as many of the jobs are being hired from the local talent pool, and will be phased in over 10+ years. See our previous Amazon analysis and predictions. Nonetheless, we expect our existing inventory shortage to continue to worsen, especially in price points from $450k-$1.2M.

Tax Law Changes

As we enter tax filing season, don’t forget that new tax brackets and tax rates were passed late last year, and there are a host of changes, especially for homeowners. The standard deduction amounts have nearly doubled, making itemizing less beneficial, and the personal exemption amount has dropped to $0. State and local tax (SALT) deductions are now limited to $10,000 which is a real hit in our area. Mortgage interest on the first $750,000 of debt is still tax deductible, but HELOC interest is only deductible to the extent it was used to improve a primary residence, and Private mortgage insurance (PMI) is no longer deductible. Consult your tax adviser for details.

Interest Rates

Rates have remained mostly steady the past month:
30-Year Fixed 4.37%
30-Year Fixed VA 4.37%
15-Year Fixed 3.87%

FREE Home Buyer Webinar

We’re hosting a Home Buyer webinar on Feb 27 which will include an Amazon update, tax law update, and other factors to consider when buying a home.Click here to register.

LISTING SPECIAL!

Thinking about selling your home in 2019, or know someone who is? Meet with us by the end of February and you’ll receive Commission incentives, a FREE HOME VALUATION and a FREE HOME CLEANING (up to $350) when you list with us. Contact Katie to schedule your appointment!

LISTINGS

Check out our newest homes for sale!

HOME CARE CORNER

Winter is in full swing! Make sure to grab an extra bag of salt, an ice scraper and sturdy shovel to help when snow arrives! If you are out of town, make sure to leave your heat above 55 to prevent freezing pipes!

LOANER PROGRAM ITEM OF THE MONTH: MOVING TRUCK

Use our truck locally (free of charge) if you are a past or current client! Remember you can use our truck for non-profit related activities too! We were glad to lend our truck recently for a ‘Help the Homeless’ coat drive!
We’re happy to help with all your residential and commercial real estate needs throughout the DC metro area. Remember to Like us on Facebook for market updates and real estate tips!
We have a nationwide network of quality agents–let us know if you or someone you know needs a referral to another city.
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Katie Wethman’s Real Estate News – Dec 2018

December 2018

 

Market Update

As expected, the announcement from Amazon caused a a bounce in sales, particularly in 22202 “National Landing.” Typically activity and sales in November is slower, as we ease into the holiday season. This past month, 22 properties in the National Landing area went under contract compared to 3 homes in 2017. This is a substantial increase, driven by buyers trying to purchase so that are not priced out of the area once Amazon arrives. But don’t panic…see our own analysis in November’s Amazon Update and take a look at the George Mason University Conference on HQ2 Imapct Video Here. Despite the hype, have identified some cash flow positive investment opportunities, so contact us if you’re looking to invest!
Other areas outside of “National Landing” saw a increase in activity and sales in November, but not as dramatic of a change. Read more details here.
The country’s real estate market is predicted to enter a downtown in the coming 2-3 years, and Amazon may help buoy this area in an otherwise turbulent economic time. Follow our ongoing analysis and updates on ourInstagram and our National Landing Real Estate page. 
In other market news, home sale appraisal rules are changing. Some FNMA and Freddie Mac rules are already in place that eliminate the need for appraisals on certain home types with a sufficient down payment, and the administration has proposed eliminating appraisals on any home valued at under $400,000; instead it would be subject to a ‘evaluation’ by non-appraisers with limited regulation. This is a mixed bag for home buyers and sellers, as many home buyers see the appraisal as a safety net against overpaying for a property. Given that appraisals typically take 1-3 weeks, the elimination of this requirement would likely speed up settlements, and this change will save borrowers about $400-500 in fees. Check out more details here.
New Loan Limits & Interest Rates
The Federal Housing Finance Agency (FHFA) recently announced its new loan limits for 2019. The new (regular) conforming loan amount impacts nearly every part of the US, and was raised to $484,350 in 2019! A 6.8% increase compared to $453,500 in 2018. In higher cost cities, which includes the DC Metro area, the new limit is $726,525.
Current Interest rates (Source: Freddie Mac)
30 Year Fixed: 4.63%
5/1 Arm: 4.04%

Thinking of Selling? Our team is looking to get a jump on the Spring market and is currently setting up consultation appointments for January and February with sellers. We’re offering special financial and staging incentives for sellers who meet and sign with us before the end of February for a Spring 2019 listing—if you or someone you know is thinking of selling next year, please contact us to book an appointment!
As always, if we can ever help with your real estate needs, please don’t hesitate to reach out. Wishing you all very merry holidays and a happy new year!


HOME CARE CORNER
Winter is officially here! If you haven’t turned off your hose bibs, now is the time!
Click here for details: Hose Bib Shutoff Instructions.


CLIENT APPRECIATION EVENTS
THANK YOU to all of our clients that attended Pie Day and Breakfast with Santa! We loved seeing you! thank you for supporting our business all year long with your referrals of friends and family.
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The Wethman Group’s Real Estate News – November 2018

November 2018

 

We’re taking a break from our usual newsletter format to provide an analysis of the Amazon HQ2 announcement. The Washington area and more specifically the newly christened “National Landing” area of Crystal City (comprised of parts of Pentagon City, Potomac Yards, and parts of Alexandria) will be the home of 25,000 new jobs, providing a boost to the local economy and tech ecosystem.
What We Know
  • Amazon has committed to 25,000 jobs over a 10 year period. They chose this area in part because of the extensive talent pool already here (emphasis added). Jobs are expected to be mostly in accounting and tech with incomes of about $150k. Of course, a ‘new’ business with such a significant presence is also expected to create jobs in supporting industries like retail, construction, and service businesses nearby (with lower incomes.)
  • Amazon has made a commitment to STEM education investments, including a new Virginia Tech campus focused on Computer Science as part of National Landing, and investments at George Mason. The idea here is that Amazon is hoping to hire some homegrown (and local) talent years down the road.
  • Incentive payments to Amazon are dependent on the actual number of jobs created.
  • Arlington and Alexandria have committed to investing $570 million in transportation improvements, and Virginia has committed to an additional $195 million. Planned investments are additional entrance(s) to the upcoming Potomac Yard metro station, improvements to Rt 1, pedestrian bridges. Additional funding is available if Amazon creates more than 25,000 jobs.
Much has been said about this number of employees creating havoc in our already strained real estate market. We’re advising our clients to take a wait-and-see approach on the real estate market impacts. Our area is more than capable of absorbing these jobs, but market impacts will be uneven both economically and geographically.

Job Absorption

This area is well positioned to absorb the expected 25,000 jobs to come over the next 10+ years. The region already annually adds 34,000 jobs on average; in 7 of the last 17 years we absorbed one FULL (50,000) Amazon’s worth of jobs! (See graph at left.) This could end up being a ‘blip’ in the greater regional area.

 

Companies whose talent is being poached may or may not backfill hiring, and those companies are scattered throughout the region. Many employees hired locally will not relocate because it just won’t make financial sense and/or the situation will be complicated by a spouse’s commute or kids in school. Consider a hypothetical tech worker making $150k and living in the Reston area. If hired by Amazon (and remember, they’re coming here for the existing talent pool), is this person likely to sell their current home and relocate to Arlington? It’s possible, but it’s more likely this person will just factor in their new commute as an opportunity cost in taking the job. That employee’s current employer will then need to hire someone, who may or may not live in Arlington. See graphic at right for expected distribution of housing for HQ2 employees.

Rising commercial rents in the area may push some existing companies out and/or discourage others from locating there; in fact, other companies that had been considering relocating to Northern Virginia may now choose not to come at all because of the upcoming fight for talent. Similarly, some companies located in the greater metro region may choose to leave because of the expected increase in competition for employees or may choose to locate further out so that their employees will be able to afford more (potentially giving them a recruiting advantage.) Bottom line: the net job increase for the area may not be 25,000, and the jobs-to-household ratio is far from a 1:1 correlation.

Traffic

It’s no surprise that traffic is expected to be worse as workers move to Crystal City and nearby businesses grow. It remains to be seen how much the transportation investments from the County, City, and State will help. Work from home trends may also spread out the hiring and ease commutes–Amazon is one of the top ‘work from home’ companies. Additionally, the high speed (15-minute commute) trains being developed between DC and Baltimore over the next 10 years–the time frame of Amazon’s growth here–could significantly alter the housing landscape of the region.
Housing Inventory – Sales and Rentals
We can certainly expect an inventory shortage for buying, but also a more significant rental shortage in the short term (first few years) of the deal. Speculators will swoop in hoping for to find a cash flow positive deal—they’re unlikely to find one currently. As always, buy and hold is a much safer strategy, and especially now.
Longer term, builders can build condos and/or convert existing apartments and office buildings to condos for quicker delivery. There isn’t much (any??) land left to build developments, so expect prices on townhouses and single-family detached homes to rise disproportionately vs, condos in the immediate vicinity. There is a strong pipeline of multi-family development already planned for the DC area (see graph). Tear-downs will swooped up by builders at breakneck speed.
Once the employees arrive, the segment most likely to see increased competition is the $400-600k range, which is the likely purchasing power of someone in the salary bracket Amazon is hiring.
Certainly, this will speed ongoing gentrification of South Arlington and affect nearby pockets of relative affordability that currently exist. With our current affordability crises, even a small increase in prices may have a disproportionate ‘push out’ effect for lower-income workers and renters, and any increase in property taxes resulting from higher valuations will also hurt longtime homeowners on fixed incomes.
Summary
  • These jobs are coming over time, and our area is easily capable of absorbing them.
  • Expect a short-term psychological bubble – sellers should take advantage of this, buyers need to not panic, and investors should proceed cautiously. Think rationally and don’t get caught up in the hype.
  • Expect dramatic rent increases as a result of the trifecta of this area being the ‘next big thing’, eventual students at the new VT campus, and new hires relocating (who will rent for a least a while before buying, if they buy at all.)
  • Housing impacts will be dispersed throughout the area and gradual. Inventory shortages will be most severe in the segments and locations we already have them: entry level townhouses and detached homes in close-in Arlington and Alexandria.
  • Appreciation in property can only be realized if you’re selling, and is a double-edged sword—expect higher property tax assessments (and remember that deductions for state and local taxes like property taxes are now capped in the new tax law.)
There ARE opportunities here, if we don’t lose sight of the fundamentals.
We’re trying to give you a realistic view of market conditions, and not just trumpet the hype. We’ve seen some excellent opportunities in parts of South Arlington and the northern end of Alexandria. Contact us to discuss your buying or selling strategy.
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