Welcome to Real Estate Live, an online discussion of the Washington area housing market with Post Real Estate editor Maryann Haggerty.

Maryann has been with The Post for 18 years and has served as real estate editor for the last five years. She's been a business and real estate editor and reporter for about 25 years. In all that time, she still hasn't figured out where you can find a lovely but inexpensive house in a charming neighborhood.

Haggerty is joined by Washington Post columnist Elizabeth Razzi. Razzi is the Local Address columnist for The Post's Sunday Real Estate section in Business. She's written about real estate and other personal finance topics for magazines and newspapers since the days of double-digit interest rates. She is also the author of two consumer-advice books, The Fearless Home Buyer (2006) and The Fearless Home Seller (2007).

Today, they'll discuss the local housing market -- from condos and investment properties to contracts and mortgages.

For more on local real estate, visit washingtonpost.com's Real Estate section.

The transcript follows.

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Elizabeth Razzi: Hello, everyone! It's been a while -- too long a while, actually. Technical problems kept us down a while, so we'll be making up for lost time today!

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Maryann Haggerty: Hi. Thanks for joining us. Let's go!

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York, Pa.: My girlfriend and I are planning to purchase a house early next year. She recently (last year) declared bankruptcy. Will this cause any problems getting a mortgage in both our names? My income alone would be enough, but with both incomes, we could really get the house we want.

Maryann Haggerty: That bankruptcy really messes up her credit. So, yes, you likely will have a problem with a joint loan application -- higher rates if you can get anything at all.

Elizabeth Razzi: A couple of things scream "rent" to me. "Girlfriend" instead of "wife." I mean, if you think marriage is a commitment, wait until you need to sell a house you own jointly. The bankruptcy -- and the way it will cause you to buy a house that's not what you really want -- make me question the hurry to buy. Why not rent a while longer, and shore up those finances?

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Upper Marlboro, Md.: I am a real estate agent, licensed in Maryland and D.C.

In 2005 I bought an old house on a 1 acre lot. I had the house razed, subdivided the lot, built one house were I currently live and now have built a second home next door. The problem I have is I am having trouble selling my current home and I have 3 other rental properties and high credit card debt so it is hard for me to qualify for a new affordable loan. I currently have a construction loan but I want a beter rate with another company. What should I do?

Maryann Haggerty: When you're leveraged as far as you are, getting more credit costs more money. It only makes sense -- would YOU lend you more money at nice cheap rates?

So, you'll either have to pay down some of that debt to improve your creditworthiness, or make your peace with high loan rates.

Elizabeth Razzi: Maybe you need to sell the most desirable properties, which could be those already-rented investment properties, and use the proceeds to pay off the credit card debt. You're over-extended, and you need to pull back. Sorry...

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Vienna, Va.: Thanks for doing these! My questions involves light fixtures, curtains and curtain rods. I understand the law regarding rental property and how anything affixed to the property becomes the property of the landlord but what is law regarding a homeowner and their fixtures. If a homeowner shows their house with nice light fixtures, curtains, and curtain rods, can they swap out these fixtures for inferior ones after I've put a contract on the house. I feel like that is a case of bait and switch but then again, I know that if the house has furniture in it when I see it, I'm not getting the furniture. What about a cabinet that is hung like a picture on the wall? Where is the line and what can I expect to stay? Thanks!

Elizabeth Razzi: It works the same way for for-sale properties. If it's bolted to the walls or floors, it's supposed to go along with the house. But this causes trouble all the time. Best way to handle it is to specify in the purchase contract EVERYTHING you expect to convey with the house. Drapery rods, indoor shutters, appliances, air conditioners, even stand-out plants in the yard.

Maryann Haggerty: And don't forget appliances. That washer and dryer probably aren't fixtures. (But many people will prefer to leave them anyway.)

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Prince George's County: We are not looking to sell or buy but wanted to do some repair and renovation, e.g., hardwood floors, new windows and paint. What words of wisdom do you have when selecting a contractor? Thank you.

Maryann Haggerty: Start by asking around among neighbors, friends, etc., for references.

It really does help to get three bids, but I admit: That is often a hassle, especially if you have other things to do in your life.

You really do want to make sure the contractor has a license. Again, it can be a hassle, but worth it to protect yourself. And you want to make sure your agreement allows you to pay at least some of the money after the work is complete, to ensure it actulaly is completed.

You know what happens when you ignore these commonsense rules? You end up hiring the semi-homeless dude who knocks on your door and offers to paint the shutters, etc. Somehow, it costs you a lot more than you thought. He never cleans up properly after himself, so you're pulling paintbrushes, etc., out of the ivy for weeks. And your neighbor -- who has even a softer heart than you do -- ends up with HALF of her shutters painted and half not.

Elizabeth Razzi: Unfortunately, some good contractors won't give you a bid if they know you're collecting them, so keep that tidbit to yourself. Also check on their liability insurance. Ask for a company and policy number -- and phone the insurance company to verify it. Takes only a few minutes, and a good contractor will expect you to do such due diligence. Pick up the phone and talk to his references. Always ask the magic question, "Would you hire this guy again." Then be quiet, and wait for the answer. If the person hesitates, take it as a big negative. People don't like to admit their mistakes, so hesitation is a big deal.

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Washington, D.C.: Our coop apartment has been on the market for two months. it is located between two Metro stations in a close in location. The unit itself is in great shape. But it is coop and we not allow the owners to rent. Air conditioning is by window units and laundry is in the absement. We have had one low ball offer and we tried to negotiate but they started so low that it wsnt worth it. Do you think we'd have better luck taking our place off the market and putting it back on in the fall or the late winter?

Also, does a change in administration have any effect on the local real estate market? Will a change bring in more buyers? What effect will a change in administration have on interest rates? Thanks!

Elizabeth Razzi: The last part's easy. Don't wait for a change in administrations to help unload that co-op. The turnover just doesn't affect the market that much. As you seem to realize, your coop doesn't look like that tempting a deal. Window units? Basement laundry? That's a tough sell, especially given all the competition out there. Perhaps that lowball offer wasn't so off the mark?

Maryann Haggerty: If you don't really need to sell, this may not be the time for you to do so. There are a lot of very desirable condo and co-op units on the market now, so your competition is tough.

And I'll underline this: Changes in federal administrations have an almost negligible effect on the local real estate market. In a metropolitan area of millions of people, the numbers are negligible. And even in those neighborhoods that might see a direct demand, it's not like there are all that many REALLY new people. Many of the people who take most jobs are already here...

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PG County, Md.: How does the assessed value work? My assessed value was $365K, my peak market value was $410K. I never believed it would sell for that much even at the peak. I know i won't see an adjustment and corresponding property tax relief, but just curious how tax assessments work.

Maryann Haggerty: Assessors evaluate homes en masse, sort of on a curve. So the assessment on any single house can be off. That's one reason there's an appeals process. (But no one appeals an assessment that's too low.)

In Maryland, assessments run on a three-year cycle. They generally lagged the marekt going up. They are likely to lag going down, too.

But assessments DO drop -- or at least they have in many places.

One thing to keep in mind -- in PG, there's a strict cap on tax increases, so there may not be a lot of change in your tax bill even if your assessment softens.

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Great Falls: I was amused to see the National Association of Realtors's response to the settlement with the DOJ. They characteristically put an upbeat spin on it and called it a "win-win" situation. Um, if it's win-win to cease and desist what you were doing that got you sued, simply because you're not admitting guilt and not paying a fine, I think you could have accomplished that three years (and perhaps a million dollars in attorneys fees) ago. Why do the media even bother to quote the NAR? Their statements contain the most spin of anyone since Baghdad Bob.

Elizabeth Razzi: Well, of course you have to quote NAR when you're talking about a lawsuit that involved NAR. And you've got to expect a full-speed spin cycle from them (or any organization in their position) too. It's like expecting thunder after lightning. In my opinion, the real result of the DOJ suit came from the suit itself. It caused NAR to change its policies about Web sites and discounters, and put the whole organization, including the state associations,on a short leash.

Maryann Haggerty: You can decide whether to believe the NAR or not. That's your job as an intelligent reader. My job is to make sure they get a fair chance to comment.

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Alexandria, Va.: Choosing a contractor? Don't forget to check their record in the BBB.

Maryann Haggerty: That's so easy on their Web site, www.bbb.org

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Alexandria, Va.: Fixtures that convey?

When I sold my previous residence, the bidder asked for the under-cabinet radio in the kitchen. Lose a $500K sale for a $125 radio? No chance, I accepted the offer.

So, if the previous poster wants her drapes and fixtures, just be prepared if someone else wants them too.

Elizabeth Razzi: I'm amazed sometimes at what people will ask for. That leads to the tried-and-true advice for sellers: If you don't want it to convey, don't let sellers even see it.

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Washington, D.C.: Let me dispel a common myth here: There are no great numbers of "fence sitters" just waiting to time the market to jump in. There are, however, a number of wanna-be first time home buyers that -- due to no fault of their own other than to join the workforce within the last five years saddled with big fat Sallie Mae college loans -- who are effectively priced out of the market. And please don't feed us any bunk about "DC always being expensive." It was never this expensive compared with local salaries. I am a GS-12. My father was a GS-12 and my mom was a stay at home mom while my dad could afford a four bedroom SFH in Rockville in a good school district while my mom took care of three kids. DC has NEVER been this expensive -- especially in the last five years. Even if I combine my salary with my wife's (works in the school system), we can only afford a one-bedroom condo and that would be stretching it. And yes, I do brown bag my lunch and my eight-year-old Saturn is paid for. The first time buyer programs around here are laughable ($3,000 to live near Baltimore). Prices need to come way down in line with fundamentals that have been in place for more than 100 years, and you, I, and everyone here on this board knows it!

Maryann Haggerty: I'll throw this out there, although experience tells me plenty of folks will disagree with you. For a lot of reasons

Elizabeth Razzi: Well, DC has never been this expensive (well, at least never as expensive as two years ago.) And I've never been this old. Getting angry at the market -- or at the changing economy -- isn't going to make anything better.

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Rockville, Md.: Hi. My wife and I are young newlyweds and, as such, our friends also tend to be young newlyweds. In the last year or so, we've watched one couple move to Colorado, one to Baltimore, one to Charlotte, and one to Richmond. All are making considerably less money than in the D.C. area, but all are living much better lifestyles (e.g., single income households with a stay-at-home parent, large back yards, money to spend going out, etc.) I know this is purely anecdotal on my part. Are you finding numbers that indicate that younger generations are being pushed out of this area due to higher costs of living?

Elizabeth Razzi: Have you been eavesdropping on the conversations my friends and I have had for the past 20 years? This, alas, is just the way it is around here -- and in other expensive places like NY City and San Francisco. Here's the antidote to your malaise: Spend this weekend visiting the free Smithsonian museums. Take in Shakespeare at the Carter Baron Ampitheatre, (The Post distributes free same-day tickets, btw) or free performances at the Millennium Stage at the Kennedy Center. Bike along the Potomac. That stuff has value, too.

Maryann Haggerty: And part of it might be your definition of "a better lifestyle." Not everyone wants to be a stay-at-home parent, for instance. For those people, being close to jobs for both people in the couple is more important.

Last weekend, I was in Montpelier, Vt., a city I love. Up there, I could buy a rambling (if energy-inefficent) house for what my little townhouse here cost me 15 years ago. But if I got a job in a used bookstore, the pay would barely keep me in used books, let alone artisanal cheese. Maybe someday...

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Arlington, Va.: After the bank's RE agent dutifully chased us away from our rental home that went into foreclosure, the property was put back on the market. I couldn't care less about this apt. anymore, but I'm just having a hard time understanding the listing price of this foreclosed 3/2/1 Arlington Courthouse condo - $879,900! It was sold to my scammer landlord (who 100 percent financed and never paid a dime on mortgage or condo fees) in '06 for $700K, and now the bank is trying to rip a 180K profit on it?! In this market? As a potential buyer, I just don't get it. Do you?

Maryann Haggerty: Well, odds are they're not going to get that $879K, if you're right.

Elizabeth Razzi: I wonder if some lenders wouldn't rather carry it on their books than to sell a foreclosure at the market price -- and then realize that loss on their balance sheets. Anyone with ideas on that?

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Arlington, Va.: What's the definition of 'first-time home buyer'? We bought and sold our 'first' home a few years ago, are we 'first-time home buyer' again now as we are renters? What are the perks of being a 'first-time home buyer' in terms of getting a loan?

Thanks!

Elizabeth Razzi: Good question! Government programs define "first time" as not having owned in two or three years, depending on the program. Check the details of any programs designed to help first-time buyers. You just might qualify for a program that offers help with closing costs or interest rates.

Maryann Haggerty: And to take advantage of the special DC first-time homebuyer tax credit, that is first time IN THE CITY in two years or whatever -- ie, people who own in the suburbs and move downtown are first-timers as far as the tax man is concerned. I suspect there may be similar definitions in some other programs

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Discouraged-ville: I'm hoping you can give me some words of encouragement -- I'm looking to buy a 2-br condo in Silver Spring walkable to the metro, and I am having so much trouble finding something in my price range. No one is selling! Any advice, or should I just resign myself to renting for the foreseeable future?

Elizabeth Razzi: Dear Discouraged: You don't say what your price range is, but any nice two-bedroom walkable to Metro station is going to cost. Before you give up, you might want to broaden your target area to other metro stations, and to neighborhoods with good bus service. Maybe "bike distance to Metro" will work out.

Maryann Haggerty: While you keep looking, keep pinching your pennies. A bigger down payment will increase your buying power.

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D.C.: I'm a pay-cash-for-everything type who's never had a loan or a credit card. My credit is not bad; it's non-existent. No credit score at all. Is getting a credit card and paying one bill a month on it for a while going to be enough to create a score that will allow for a decent mortgage, or should I just accept that by the time I've built up enough credit history, I'll have saved enough to pay 100 percent in cash for a house?

Elizabeth Razzi: If you save enough to pay 100 percent cash for a house, you are either expecting some mighty inheritances or you don't plan to own until you're pretty long in the tooth. It's very useful, and very sound financial practice, in my opinion, to have one or two carefully managed credit-card accounts. You might be comfortable with an American Express, which requires 100 percent payment every month. Credit cards by themselves won't derail your finances. Carrying balances from month to month will. It won't take that long to build a good credit history.

Maryann Haggerty: It doesn't take long

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Potomac, Md.: My best friend lives in an exclusive neighborhood in the Northeast. After months on the market, her neighbors told her they are considering selling their house to some sort of "Internet multimillionaire". Will this person live in the house? Uh, no. Instead, this person plans to rent the house to some custodian, his day care worker wife, and their seven children (combined). My friend is beside herself, as you can imagine! It would be like if Jose, Maria and their baby Jesus plopped themselves down in a barn on River Road!!! The HOA says there's nothing they can do. What are her options to derail the sale of the house? Lawsuit? Political intervention (her husband donates heavily)? Calling INS? I'd love to provide her some thoughts and resources to help her forestall this imminent travesty.

Maryann Haggerty: Are you serious?

Good for that millionaire for realizing that the people who work for him deserve to have a decent life, too.

Elizabeth Razzi: Wow. Old-school bigotry is not dead. All I can say is my late mother (one of seven children) would tell you to behave as if Joseph, Mary and Jesus (oops, Jose, Maria and baby Jesus) were moving into this "exclusive neighbhood."

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Clifton, Va.: Re: DC GS12 w/school system wife,

So in next year or so you should be making about $70K and if your wife is a teacher with some experience she should be making maybe $60k or more. Move out PWC or Loudon

w/a combined income of $130k you could pick up something very nice for $370K and closer in Fairfax Cty a nice 3bedroom TH in a great neighborhood. And your car insurance will drop and your homeowners insurance will be cheaper.

Maryann Haggerty: Some specific ideas

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McLean, Va.: Look, if you want to afford a four-bedroom SFH on a federal salary, then you need to bring something to the plate. Get a 2nd job. Join the Reserves or the National Guard. Drop your kids to two meals a day. You don't deserve a nice house because you're "doing good." You deserve one because you can afford it. Period.

Maryann Haggerty: And other ways to buy...

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Silver Spring, Md.: There is a house in my neighborhood (Woodside Forest/Park) with a realtor sign in the yard and a "coming soon" add-on. The house does not appear to be listed yet. Is that legal/ethical?

Elizabeth Razzi: I see those signs all the time. I don't see why they would be illegal or unethical. It's not as if the agent is trying to keep the listing secret for a while, so he can bump up the odds of an in-house sale. Any agents out there have insight on this?

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Bethesda, Md.: For all you guys selling houses right now. Check on your agent every once and awhile! There is a beautiful house that my husband and I would would love to see but the agent has yet to call us back. We have been calling each week for the past 6 weeks. We have used his name, my name and my maiden name to see if it would make any difference. Apparently not. She has yet to call us back. Meanwhile though the price of the house has dropped $40K and still sits vacant. It's not a short sale or foreclosure as far as I can tell. Is calling once a week too much, am I doing something wrong or is she really just that inept?

Maryann Haggerty: We answer a similar question in the Sunday Business section.

But I have a question for you: Why are you still calling that agent? Why haven't you either A) had your agent do it or B) dropped a note directly to the owner? I'm curious.

Elizabeth Razzi: You must really love that one house... and be a very patient person.

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Washington, D.C.:"Luxury" is a throw away word anymore. Seems that every new development is either "luxury condos" or "luxury town homes." It's gotten so bad, I just ignore that word anymore. Can't these development marketing people come up with a different gimmick? I got a good idea: actually lower the prices to what people can afford with the median salary on a 30-year fixed and remove the word "luxury." You may even start to sell some of these things after that.

Elizabeth Razzi: So true.

Maryann Haggerty: I recall a PR person who was pitching me a story about a "new, luxury condo" that had laundry rooms in the basement.

If you have to do laundry in the basement, it is NOT luxury.

Our producer is getting a link to a story we ran this spring about what-is-luxury.

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washingtonpost.com: The Crux Of Deluxe

Maryann Haggerty: Here's that link about luxe...

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Washington, D.C.: Question about the Apartments/Rentals section of the Post. Are the Q&A columns gone for good? The last few weeks it's just been the one featured building and pages and pages of ads.

Maryann Haggerty: The apartment rental Q&A is gone for the time being, I am afraid, a victim of ever-tightening newsroom budgets. I wish that was not the case.

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"DC has never been this expensive": I think your response was on target. But basically, why should we expect DC to remain the same? Hundreds of factors have changed in the 25 years since your parents bought their house. Look at the influx of immigrants. Look at the thousands (hundreds of thousands?) of new government jobs, with limited real estate within a reasonable radius. Look at the national trend of overeducated young people to swarm to a handful of cities, causing the real estate values in those cities to increase dramatically.

Or try it another way. The average price of buying just an APARTMENT in Manhattan is over $ 1MM. Does it do any good for a New Yorker to complain about what he could have bought 25 years ago? No, it's irrelevant.

Elizabeth Razzi: Thanks for the response.

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Arlington, Va.: I rent my condo from a couple, and I will say I have standards. I was complaining the other day because the windows aren't energy-efficient; the landlord should really step up on that. The man looked at me and said, "Don't look a gift horse in the mouth. You're renting this unit at $250 below the going market rate. You can have your energy-efficient windows, but you'll also pay market-rate." Can you imagine?

Elizabeth Razzi: New windows are a big investment. And if you are paying for your own heat and cooling cost, the financial incentive for the landlord just isn't there. Now, it would be lovely from a save-the-planet-from-melting standpoint if everyone dug deep into their pockets to pay for such upgrades. But in reality, that kind of expense could be enough to make your landlord lose money each month. Maybe you will have an easier time meeting your standards if you buy your own apartment somewhere.

Maryann Haggerty: New windows costs a MINIMUM of $1,000 each. If the only problem is energy efficiency, I can't imagine a landlord replacing them. Caulking and weatherstripping, yes. Replacing, no. They don't affect habitability.

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For the "Struggling" GS-12 and his School-Employee Wife: Dude, you and your wife have guaranteed jobs with guaranteed annual raises. Suck it up, lower your mansion expectations a little, and be glad you still get two checks every two weeks.

Elizabeth Razzi: just passing this one along....

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Charles Town, W.V.: What interest rate is FHA charging for a couple with a good credit rating (over 725) for 20 year fixed, around 65,000, financing one third of appraised value?

Elizabeth Razzi: FHA doesn't set the interest rates. You can call around to any local lenders (or try some of the big national ones via the Internet) and see what they're offering on any given day for the type of loan you want.

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Anonymous: I want to sell my home. At it's peak it appraised at $410K. i have an updated kitchen with granite and new cabinets, one remodeled bath with whirlpool tub but a few minor things that could be done. What's a good threshold to limit the minor repairs (painting, ugly bathroom beyond just paint, curb appeal, etc.) before just lowering the price.

Maryann Haggerty: Cleaning, painting and curb appeal are musts.

Anything that looks just plain trashy is a must. (Broken steps, plaster holes, missing floor tiles.)

But no renovations.

Elizabeth Razzi: Spend this weekend shopping the competition. Get a good idea of what others are asking for homes like yours -- and what kind of condition those houses are in. I usually agree with what Maryann said about "no renovations." Except in this case, you've already upgraded the kitchen and one bathroom. Buyers expect a whole house to be in the same condition. Ask your agent (and ask the agent to get his colleagues' opinions) if that shabby bathroom is really hindering your sale. An upgrade (none too lavish) might be in order.

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Alexandria, Va.: I think the poster talking about the high price of a SFH is right. And wrong.

In previous decades, one parent worked and paid for the house. Now, mostly -- both parents work, which makes more money available to pay for the house -- which means 2 income families can afford a more expensive home (bigger? newer? closer-in?). But also means that if the 2 income family is bidding against the 1 income family, the 2 income family is going to win much of the time -- driving up the cost of all housing.

Maryann Haggerty: The book "The Two-Income Trap," by Elizabeth Warren, examined this issue in some depth. She points out that people are willing to pay big to be in the very best school districts, too.

Elizabeth Razzi: Warren's book is excellent. One other thing to consider. Back in the '60s, when builders built neighborhoods full of affordable detached houses, we didn't have many townhouse developments. They're more likely to be the affordable alternative today. And they can be very pleasant neighborhoods, too.

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Bankers and Foreclosure Pricing: Look, a foreclosure isn't a true loss until you dispose of the property and have zero chance of receiving any further revenue. Given the way banks are shrinking, better to put off the denoument and try for an '08 year-end bonus -- because who knows whether you'll still be there in '09?

Elizabeth Razzi: Interesting.

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Silver Spring, Md.: Do you have any thought on how having metro access will affect the value of homes -- will the increase at greater rates than non-metro accessable homes?

Also, is there any rule of thumb for figuring out if a major project is worth it? We are considering digging down 4 feet in our basement to make it a more livable space. Thanks!

Maryann Haggerty: Metro access has already run up the prices of homes big-time.

And as far as figuring on that (very expensive!) renovation: What will it add to the resale value of the house? How does that compare with the cost of the project?

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Laytonsville, Md.: Another suggestion for people with houses listed for sale, have your agent update the listing periodically with "in-season" photographs.

I am sure there is at least a subliminal turn-off to potential buyers gazing upon a house with snow on its roof, not to mention that just emphasizes "this house has been sitting on the market since winter."

Elizabeth Razzi: Honestly, I'm amazed that agents leave last season's photos up on their websites. Digital photos just don't cost that much!

Maryann Haggerty: OK, and here's another one, especially in summer: It absolutely amazes me when listings for waterfront houses don't show the view. I have to assume that all you can see is perhaps a floating garbage scow.

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Arlington, Va.: Maryann and Elizabeth:

A word of advice to the couple looking to do some minor repairs and renovations, and was seeking advice on contractors: do it yourself!

After going through several frustrating experiences with contractors, I decided to pick up my own paint brush, tape and rollers and do it myself. One project led to another, including installing my own hardwood floors, and I'm now a full-fledged do-it-yourselfer. All anyone needs to do is invest in a good toolbox, do a little research on your project, and take your time to minimize mistakes.

Elizabeth Razzi: Do-it yourself is a great idea if you really, truly CAN do it yourself. Someday I'll write about the the do-it-yourself ceiling fan the previous owner installed...which nearly decapitated me one night. Seriously, a half-baked job takes value away from your home. Know thyself....

Maryann Haggerty: I'm quite proud of the good job I did on the ceiling fan. Not so much on the crown molding in one corner of the upstairs bath.

But my husband HATES painting. I do it well, but I'm slow. So when the house needs painting, we pretty much need to hire someone, assuming we want it finished in any reasonable amount of time.

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To GS-12 and wife: I am one of those that disagree with him. The expectations have changed. Even as little as 10 years ago, people actually saved to put down-payments down. In 1995, I purchased my first SFH on my own as a single guy making about what this guy is making now (without his wife's salary). Before that, I was living in a shared 4-person rowhouse in Baltimore for $400/month rent. I drove a 10-year old car that was paid off. I curtailed my spending and saved about $20K in a year and in 2 years, I had a 20 percent down payment on a decent house. Saving the money for a downpayment was a priority for me, so I did it.

On a combined 130K, assuming 20-25 percent taxes, they are still taking home around 100K per year. There is something wrong if they cannot live on 80K per year and put aside 20K. In reality, they should be able to live on 60K and save 40K per year. At 20K per year, in 2 years they'll have 40K which is more than 10 percent to get a decent loan with PMI on a reasonable 300-400K house. That's what is considered a starter house. At 3 years and 60K you have 20 percent (no PMI) for a 300K house.

You have to make it a priority. With 130K combined income they are almost double what is considered current median income in Montgomery County (around $76K family income). Since there are quite a few people who live on that median income or less, GS-12 should be able to do that and save money for a downpayment, but these days most people feel entitled to nicer life-style than some of us did when we were saving for a first home.

Maryann Haggerty: More thoughts.

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Re. the Bethesda Agent: I'd surely contact the owner. I'm suspicious as to whether the agent is sitting on the listing, and trying to steer it to himself/herself or for some sort of kickback.

Elizabeth Razzi: perhaps...

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For Bethesda, Md.: The listing agent may not be calling you back because she only wants to deal with another realtor? She should still call you back, but perhaps she's concerned with dual agency.

Elizabeth Razzi: C'mon, can't she just discuss that over the phone?

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Re: Potomac, Md.: This commenter, if real, is typical of what gives Potomac its snotty reputation, causing despair for those of us who moved there for the fine schools and quiet atmosphere.

We're not all like this -- some of us scrimp and save so our children can attend the best schools in the country...

Elizabeth Razzi: Some of my best friends are from Potomac...

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Arlington, Va.: "DC has never been this expensive."

The relevant factor is income. If incomes rise so can home prices.

Elizabeth Razzi: Thanks for the comment.

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Banks don't want to own homes just the rights to receive the mortgage payments.: They are in the finance business not the home-owning business. They don't want the liability on their bank sheets. They probably have had several people through to appraise the house and are making a decision based on the market which likely also includes some negotiating on the buyers part.

Also, how does a renter know how much the place was bought for?

Elizabeth Razzi: Another comment...

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Springfield, Va.: Regarding the definition of 1st time homeowner for getting local government aid, many also include extenuating circumstances such as divorce. So non-1st time buyers should call the local agency to see if they are eligible.

Elizabeth Razzi: Thanks.

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Woodbridge, Va.: Hello. I am coming up on my 1 year anniversary in my new home. Is there anything in particular I should be doing/looking out for?

Elizabeth Razzi: Congratulations! I'd say it warrants inviting the neighbors over for some burgers on the grill. If it's a brand-new home, you should take one last look around the house for little repairs that are still covered under the builder's one-year warranty. If you have a one-year ARM, of course, you need to be ready for an increased payment. Keep an eye on your homeowners' insurance bill, and make sure it's going to be paid out of your escrow account promptly.

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Elizabeth Razzi: Great back-and forth, thank you! See you folks next time...

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Maryann Haggerty: This has been loads of fun.

One request: Has the slow market affected your career decisions, or those of people you know? How about how it affects hiring at your company? (Not people in the real estate biz, please. I mean people trying to sell/buy houses here.) If so, and you would be willing to speak to a reporter, can you drop me a line at haggertym@washpost.com? Much obliged.

Tomorrow's Real Estate section features a story about lowball bidding, with tips for both buyers and sellers. There's also a cool story about a house where WWII Gen. Omar Bradley once lived.

Have a great weekend.

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