Real Estate Live

Welcome to Real Estate Live, an online discussion of the Washington area housing market, featuring Post staff writer Daniela Deane.

In her Live Online discussions with the audience, Deane discusses the specifics of the market, from condos and investment properties to contracts and mortgages.

Deane has covered real estate for The Washington Post since 1999 and has worked as a reporter for more than 20 years.

The transcript follows. Editor's Note: Washingtonpost.com moderators retain editorial control over Live Online discussions and choose the most relevant questions for guests and hosts; guests and hosts can decline to answer questions.

Editor's Note: Washingtonpost.com moderators retain editorial control over Live Online discussions and choose the most relevant questions for guests and hosts; guests and hosts can decline to answer questions.

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Daniela Deane: Hello everybody! Is it a nice day in D.C. or what??? Here's my main advice for today: Get out there and enjoy this day! Just get up and leave that cubicle now (well maybe when this is over) and take a walk around the block!...). I've got a request for today. I'm working on a fall market story, trying to answer those pesky questions you guys ask me all the time: Is the market slowing? Has my time come? Is it too late to buy? ...So I'm shamelessly asking for your help. I'd like to steer today's discussion to the market so that I can get some feedback on this from my best sources (you) and I'd like any real buyers or sellers out there today to please email me at deaned@washpost.com this afternoon with their phone numbers at work so I can call you to chat after the chat. I promise that next chat, we'll go more general (hopefully we'll have exhausted the market topic completely by then.). Thank you so much with your help. I'm waiting for you!

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Washington, D.C.: : What do you think about Columbia Heights? I keep hearing that it's up and coming, but I'm just not sure. We live in U street area right now, but can't afford to buy in that region, and we're seeing nice, extremely affordable (relative to to other spots in D.C.) rowhouses in decent shape not to far from here, ie Fairmont, Girard St etc. Is that Target ever going in? If not, is something "develop-y" going in that will help the neighborhood? I'm not looking for dupont appreciation rates or anything, but is this neighborhood a good investment?

washingtonpost.com: Drama Before Curtain Call at Theater (Post, Oct. 4, 2004)

Daniela Deane: We've included a link to Dana Hedgpeth's very good Monday business story this week on the Tivoli Theater site in Columbia Heights. Her story has a lot of information about what's happening there. It looks like a lot. It's certainly somewhere to consider.

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Anytown, USA: Fractional share condos/vacation homes...There was an excellent article a few weeks ago in the Post about the ups and downs of buying a partial share of a home (vacation home/condo). I can't find it online. Could you direct me to it please? or give me other links to research?

Thank you!

washingtonpost.com: In Tight Vacation Home Markets, Some Find Fun With Fractions (Post, Sept. 25, 2004)

Daniela Deane: Here's that story....We publish a lot of informative stuff, don't we? (That's not a plug, I swear...it's just the truth really).

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Oak Hill, Virginia: Where can I find the past transcripts of your program?

washingtonpost.com: Real Estate Live (Show Transcripts)

Daniela Deane: You can read me until you're blue in the face...(actually stop before you're blue in the face, will you?)

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Annapolis, Md.: Is the "million+" market getting soft and if so what are the causes?

Daniela Deane: Yes, I think the million-dollar market has slowed down and it's the 700,000 market and above in some areas that's slowed down. I think some buyers are looking at an $800,000 house that hasn't been updated in any way, and thinking, you know what, I'm going to pass on that for now.

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Daniela Deane: Sorry, I pushed the button on that one before I was ready....I think buyer resistance to prices is part of the reason. I've heard a lot of possible reasons for this slight slowdown we're having (i really don't want to over-state it). seasonality, election and war uncertainty, and prices....What do you think?

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Alexandria, Va.: Do you think it's true that inside the Beltway (e.g. Arlington/Alexandria), people expect tricked-out kitchens and bathrooms if they're going to pay $500k+?

Daniela Deane: I just talked to a woman who had been looking for a single family house in Alexandria for the past month before deciding to buy a townhouse. She said at least a third of the single-family houses she saw seemed over-priced -- not updated at all and still asking top-dollar. She said she found the single family market much harder to navigate than the condo or townhouse market, where it's much easier and clearer to compare prices and units. She said she felt there was a greater risk of over-paying in the single-family market....And it really bothered her that some sellers were asking 550K for houses that hadn't seen any upgrades at all. That's why she ended up picking a townhouse.

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Washington, D.C.: We are buying a 70s split-level in Vienna this spring. It is the house my husband grew up in -- his mother is downsizing and selling to us for a great price. We are planning to remodel it as the design is rather dated. We want to add another floor with two bedrooms, redo the existing kitchen and three baths.

Where do I begin? Do we have architects come in and plan out the space? Will they manage the contractors? Does anyone have a recommendation for a good local firm? Has anyone here remodeled a split-level? We also want to overhaul the outside so it doesn't look like a 70s split-level. It is a little overwhelming, but we are very excited. Any advice? How much is this going to cost?

Daniela Deane: You ask a lot of good questions....and I can't get into all the answers here...Check out my story on pop-up renovations (I'll ask my producer to give you a link to it) where I featured three houses that were popped-up. Pop-up renovations are increasingly popular. Get some recommendations from friends for contractors they've used...and hopefully liked. Some people loved their renovators; others are no longer speaking to them. I don't give out personal recommendations. Get quotes from 3 different ones. Renovating is a wonderful thing to do to your house...but can also drive you completely round the bend, as my husband would say!

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Arlington, Va.: Is it true that FSBO works best when you have a "brand-name" condo or co-op? Such as Arlington Village or Fairlington? Thanks.

Daniela Deane: One of the difficulties of selling FSBO (for-sale-by-owner) is pricing the property correctly. It's easier with a condo development for precisely the reason I mentioned in the previous question -- comparables are easier and clearer in a condo development with similar units. So pricing isn't as hard. One of the problems with FSBO-selling is getting exposure. Agents can list properties on the multiple listing service and individuals can't...BUT, you can pay a flat fee to have your property listed on the listing service. Keep in mind one present reality: Most buyers are working with agents at the moment and so the probability of having to pay the 3 percent fee to the buyer's agent (even when going FSBO) is high. You can still save the 3 percent listing agent fee though. Pick up a book or check out the many web sites devoted to FSBO selling now.

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Falls Church, Va.: I think that there may indeed be more variation in prices for similar single family houses. But there is also variation that can be attributed to the lot size and quality. An outdated house on a lot that accommodates many choices of upgrading and expansion is worth more.

Daniela Deane: Yes, that's definitely true...What she was saying was that as a buyer, you looked at a house from the outside that had just sold for x and then another one nearby that had sold for x plus 10. And you couldn't really figure out why. That made her uncomfortable: There are many variables that go into a price.

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Silver Spring, Md. (Downtown): Just wanted to let you know that market is hopping in Downtown Silver Spring. Thanks to the new developments, houses are still selling like hot cakes....on the market for only a few days and selling for the most part well over list (like 30-40k). Silver Spring is becoming the new Bethesda. Same atmosphere, better and bigger houses for your money!

Daniela Deane: Yes, I think you're right, although one agent just told me that houses in Silver Spring that are priced at 700,000 and up -- like maybe a spec house from a builder -- were sitting on the market longer. I think it's a price issue. Do you?

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Bethesda, Md.: I think part of the softness of the more expensive stuff is due to sellers not really knowing what the 'right' price should be-- and deciding that there's no harm in going high. And that's not just greed-- after all, prices went up awfully fast for a number of years.

Daniela Deane: Yes, I think it's very hard to price a property now....But I also think some sellers are indeed being greedy.I also think some buyers just don't have the money to pay 700,000 for a house and then another 250K to make it nice.

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Alexandria, Va.: Buyers' agents are less likely to show a FSBO property, as they may get haggled on their commission and they can't build relationships with other agents that way.

Daniela Deane: Yes, that's one of the challenges for a FSBO..(there are many, unfortunately). Let's face it: The entire real estate transaction is basically skewed toward doing it the same old way forever.....

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Bethesda, Md.: Re: Market slowdown. Well, there's a tear-down in our residential neighborhood adjacent to the CBD on the market for $800,000. I'm willing to bet it goes for over $700 within two weeks.

Daniela Deane: So less than asking?

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Washington, D.C.: Just getting into the market for my first home. I'm looking at condos in S.W. Washington. There are brand new ones and older ones. Is either a better option? Also, my agent told me Nov. and Dec. is a good time to be looking/closing as prices can be as much as 50K less than at other times of the year. True?

Daniela Deane: I think this is a good time to be looking...better than it has been in a long while. There does seem to be a bit of a slowdown with a bit more inventory out there and fewer buyers. Prices are high, but if something's been on the market for awhile, that's your cue for an under-the-asking-price offer. A lot of fall and holiday period sellers are serious (they want to sell). If they didn't, they wouldn't mess with it during the holiday period.

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Arlington, Va.: I would say the market is slowing down for well priced homes in the EFC area but those that are over priced houses are the ones suffering.

Example house was put on the market FSBO at an over inflated price of 625K and languished on the market for at least two (still not sure if sold). Same layout of house priced about 65K less sold in one weekend.

I would agree the state the frenzy for the 800K house is soft but anything close in, well-priced and under 600K is still pretty hot.

Daniela Deane: Yes, I agree completely....It's a price issue...People still want to buy when they see some semblance of value there...

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Arlington, Va.: On average people buying single-family homes seem to prefer all bedrooms on the upper (2nd) floor. I think this pricing premium is going to change. As the baby boomer generation ages, do you think a main-level bedroom will be more desirable, so older people can enjoy the house without going up and down stairs?

Daniela Deane: Yes, yes, yes....So many builders are doing main-level masters now. And everyone is predicting that ramblers (yey! that's what I've got) will become more popular as baby boomers age...For families, I think the second floor bedroom configuration is still popular. I personally love having my bedroom on the main floor of my house. This summer, I was visiting a friend in London, who lives in a fabulous 4-story big old rowhouse...It was beautiful, it was stately, etc. etc., but after staying with her literally just one day and walking up 3 flights to look for my glasses twice, I thought there is no way I could live here....And she told me it drives her nuts too.

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Fairfax, Va.: Hello Daniela..

I just bought an end unit townhome in Fairfax County, base price was $560, roughly around 2500 sq. ft.. Did I over pay? I can make the monthly payments ok and I know I am not suppose to dwell on prices from last year but just the fact that i paid over half a mil for a townhome is keeping me awake at night.

sleepless in Fairfax..

Daniela Deane: I really can't say since I don't know the development, etc...Like we've been saying, though, you should be able to check comparable prices in a townhouse development pretty easily...What you're feeling -- buyer's remorse -- isn't that unusual. I wrote a story about remorse recently...It's actually a natural human response that usually gets better after awhile ... You know what: You gotta let it go. There's nothing to do. ENJOY your place!!! I'm sure that if you hold it for a reasonable amount of itme (5-7 years), you'll be fine.

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Washington, D.C.: Hi Daniela -- I bought a cute, but small, one bedroom on Capitol Hill in February for (barely) less than $250K. A friend is now looking for a one bedroom in the same neighborhood at the same price. So far, she hasn't found anything that is as nice (or as large) for less than $285K -- and they are being snapped up! She's holding out hope for the condos on Kentucky (by the safeway) but I think the price will go up by the time they are finished...

Daniela Deane: So you don't have buyer's remorse, huh?!!

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Silver Spring, Md.: Do you know of any good resources for someone just beginning to explore the possibility of buying? I don't think I'm ready for an agent, but would like to get a feel for what I might qualify for, what interest rates I should expect, and other aspects of buying a home for the first time.

Daniela Deane: Pick up a book at the book store or library on first-time buying. There are many. Start going to some open houses on the weekend to get a feel for the areas you're looking at. And talk to a mortgage broker before you do anything to find out what you can afford and to get pre-approved for a mortgage. Then you'll know what price range to limit yourself to.

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Silver Spring, Md. (Downtown): Yes, you're right, I think the issue is price. 700k and up aren't moving because that's just Bethesda all over again. But there are a ton of houses near the new development that are anywhere from 350-500k that are flying off the market.

Daniela Deane: Yes, thank you for sharing.

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Bethesda, Md.: Do you think it has to be a main-level bedroom? We have a master bedroom and a small bedroom on the 2nd floor, and a sizable bedroom on the main floor. Full baths on both floors. As we're inside the Beltway and on Metro, we think people will be willing to live with our layout just fine when we sell 5 or 10 years down the road.

Daniela Deane: That sounds like a nice lay-out to me. You have a bedroom on the main level and a bathroom. I think that's what older people are looking for.

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Bethesda, Md.: 15 or so years ago there was a flurry of stories suggesting that boomers would be rushing to buy vacation homes. Has this happened?

Daniela Deane: Yes. The second home market has done extremely well over the past few years and is predicted to keep doing well. Prices at the Delaware shore near here, for example, have simply exploded.

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Bethesda, Md.: In Bethesda I've noticed less condos in downtown available and usually they're priced high. In the past few years condos would usually be offered at a somewhat reasonable price and getting jacked up with bidding. Now they just go on the market high and sellers wait 'til someone bites.

Daniela Deane: Some sellers aren't comfortable with that price-it-low, wait-for-the-bidding-war strategy...They just want to price it high right off the bat!

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Falls Church, Va.: The ones who are really going to be burned, outside of the over-pricers, are those who don't have tricked out houses and are outside the Beltway. They're not building any more roads, people.

Daniela Deane: I guess....West Virginia is now part of our commuter zone....One builder told me the other day that he regarded Leesburg as "close-in." All I know is that when I entered Oakton High School as a member of their first graduating class (boy does that date me!), that was considered beyond the boons, man....especially for an Arlington gal like me. And I think we can safely agree that Hunter Mill Rd. is no longer the boons...

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Anonymous: Do you think the current house prices are going to lock out the elderly, single and low income population. I make a decent salery and basically feel that I either have to go ultra house poor or live in an unsafe area.

Daniela Deane: It's harder and harder for folks to be able to afford anything, which is the sad underside to this great real estate market...Buy what you can afford (probably smaller than you thought you'd be buying) and start building some equity is my advice.

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Washington, D.C.: Comment for poster deciding old vs. new is SW D.C. Go new! We bought an old rowhouse in Capitol Hill nearly a year ago and have had nearly $30 K in "must do" unanticipate repairs/upgrades. With no equity in the house that stings! Also, we have three stories with I thought was cool 10 months ago and now I can say it drives me crazy! I stopped using the third story so I would have 1000 less sf to look for my keys!

Daniela Deane: That 3-story thing can grate at times....

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Laurel, Md.: My husband and I bought our single family home in the Russett Community in Laurel in November 2002 for $319,900. A similar home a couple of streets over is listed at $499,900. The only real difference is they have an updated kitchen. I'm feeling pretty happy!

Daniela Deane: No buyer's remorse here, huh Laurel!

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Fairfax, Va.: Hello!

I have noticed tons of listings on MRIS for townhomes in planned communities (like Lorton Station, Faircrest, Lorton Valley). Some are being built, some are "flips" and some are just vacant. I mean tons! 2/3 are listed by the builders. Is this a sign that the market is cooling?

Daniela Deane: I would think so, yes. That's one of the signs we look for: number of listings, along with days on market....The problem for my story next week is that there are no statistics yet...Please tell me there are some recent sellers and buyers out there who want to talk to me???? I don't think my editor wants me to hear that I can't write my story!! (she really hates that.)

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Fredericksburg, Va.: I am considering a condo in the west end of D.C. Is that an area that may expect to appreciate in value?

Daniela Deane: West End, as in near the Ritz-Carlton West-End, right? If you believe anything of what local economists have said is going to happen in this area, then, yes, you can safely assume the West End will appreciate...If you don't, well then that's a different matter.

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Springfield, Va.: Hi Daniela: I will be selling my two floor condo/townhouse shortly. It's an older home in a nice community. The home really isn't upgraded except for the stove and dishwasher. It's freshly painted and has hardwood floors upstairs. Do I price under market? This confuses me! Thanks for the input.

Daniela Deane: Are you going to have an agent?? If so, this the kind of input agents get paid their commission for. It shouldn't be that hard to price a condo/townhouse since there must be similar units that have sold recently, no? Then you gotta figure if they were updated or not..If you're using an agent, get an agent that knows that development and has sold there before.

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Re: Downtown Silver Spring: I live in downtown SS too, and I agree with the former poster that the market is pretty hot. What I find bizarre, though, are the mammoth properties being built by developers on very unattractive lots (e.g. at the intersection of two busy roads, or squeezed in between some much smaller and less-upscale housing stock). There are three such properties in my neighborhood, and none of them have budged. Particularly the one that's on the market for $1million+. What are these developers thinking?

Daniela Deane: They're thinking that people want to live in a downtown area and will pay a premium for that privilege. Newsweek just had a story last week on how retirees are moving to urban areas and paying big bucks for nice big condos there. That's what they're thinking. We'll see if they're right.

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Daniela Deane: Folks! I gotta get back to the drawing board with my story...I'm gonna be so depressed if I don't have some emails from you guys with phone numbers wanting to talk to me about the market...COME ON!!!!! Thanks for joining me today in any case. And please come back again in two weeks, the 21st, same time, same place...And pick your bottoms off those office chairs right now and go outside for a 10-minute walk! That's an order!

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