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

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.

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 discussion follows.

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Elizabeth Razzi: Hello, everyone! Glad to be back with you again. I'd love to hear how you're finding the market right now. Anybody having trouble getting loans? Also, if anyone out there is upside down -- that is, owing more on the home than its current value -- but still able to pay the monthly note, I'd love to talk with you. Please send an email to razzie@washpost.com if you'd like to talk about the situation. So, let's get started.

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Maryann Haggerty: Thanks for joining us today.

The government released another round of grim housing statistics today -- construction starts are way down, and permit applications (an indicator of future construction) are down even more.

But let's talk about what you're seeing, and we'll try to answer what we can.

Maryann Haggerty: ...And Elizabeth points out to me that it would have been even scarier if home starts had NOT gone down!

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Washington, D.C.: For the past few years I've been diligently saving for a downpayment on a condo. My initial plan was to save 10 percent, $30,000, a goal I'm about to reach. However, now I'm wondering if I'm even going to get a mortgage with only 10 percent. I have good credit, a stable government job, and a decent income (though no where near six figures). Do you think I should even bother starting the condo search next spring/summer as originally planned, or put it off a few more years until I can save up 20 percent?

Elizabeth Razzi: You sound like a perfect candidate for an FHA-insured mortgage, which requires just 3.5 percent down (though you certainly are free to put down a greater amount). Twenty percent down is a huge hurdle for a first-time buyer. That has always been the case, way before the housing boom and all the credit shenanigans of recent years. And that's why FHA has offered low-down mortgages for decades. You can learn more at www.fha.gov. And you get FHA mortgages through most lenders.

Maryann Haggerty: Our recent reporting has been finding that with 10 percent down and private mortgage insurance (PMI) you can also get a non-FHA loan at competitive rates.

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Bethesda, Md.: The lot that buttresses my backyard has recently begun construction on a new house. They've laid the foundation and it seems that the house will fill most of the lot leaving very little space around the perimeter for yard. What are the regulations re how close a home can be to the property line? Thank you.

Elizabeth Razzi: I don't know specifically what rules are in Montgomery County, but you can find out from the Dept. of Permitting Services. The neighbor had to file for a permit before laying the foundation, so presumably this complies. Was there a notice a while back that your neighbor was requesting a variance? Keep in mind, though, that spaces can be deceiving. You're seeing a structure where there used to be none, so it probably looks huge. And the maximum allowed build-out area could be much greater than the neighbors' home footprints.

Maryann Haggerty: Check the rules and permits, but I'd be surprised if it went beyond the rules. I assume Montco officials are checking those things very very carefully these days, after the kerfuffle a couple years ago about widespread density and zoning violations up-county.

Anything that fills a once-empty lot will feel intrusive at first. You actually get used to it with time.

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Calvert County: What adds more value to a house, a screened in porch or a den? I want to close in my screened in porch but will it be more valueable as year around space or outdoor space?

Elizabeth Razzi: Why not go for the three- or four-season room approach? The more usable and attractive it is, the greater the value. Big French doors, sliders, skylights -- all could be used to bring in the most air and light, yet make it liveable in cold weather. Good insulation & a hard-wired space heater or heat pump could help. You also could look into some of those sunroom companies and see what they offer.

Maryann Haggerty: Hmmm... I think I would vote for the den, actually. That makes it suitable for a home office, which of course is increasingly popular. Sure, you want it sunny -- but you also want aplace where it's safe to run computers, etc., all year round. I have no studies to back this up. Just saying...

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Dale City, Va.: Morning, ladies. I live in a brand-new development that's about half-finished. Due to the current state of affairs, construction has been stalled for months. My question is, is the builder obligated to finish the plans that I was shown before I bought the place? Could a new builder come in and totally change things? Thanks.

Elizabeth Razzi: And good afternoon to you, Dale City. You hit on a big issue that's going to be with us for a while. No, builders are not obligated to finish those developments. The rec center that's supposed to be built? Tot lots? Basketball courts? If they're not done already, they may never be built. Or maybe they'll come in 10 years. If a new builder comes in, he can change things, but it will be subject to the county's approval.

Maryann Haggerty: Nope, no obligation beyond what's in your contract. (And often there's language that gives the developer an out.) In some circumstances, local governments can make future developers follow up on various amenities the original developer proffered in return for zoning flexibility. And other "amenities" are in fact legal requirements -- i.e., that water feature that in reality is a drainage pond. But stuff meant for marketing?

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Elizabeth Razzi: You folks being shy today... or is everyone out snapping up investment properties in Prince William County? We'd all love to hear your reports from the field.

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Fairfax: What is the current atmosphere for home refinances? I have been watching the rates and they appear to be falling slightly so I am considering this option. I have lots of equity in my house so I'm not trying to do anything except lower my monthly payments. Are banks even lending due to the crisis? it would seem to me that they would need to retain (maintain) their business base.

Maryann Haggerty: This week, I helped a friend review documents for a 6% fixed rate no-upfront-cost refi that she signed on yesterday or today. She has great credit and plenty of equity -- and this refi gets her out of an ARM set to balloon in a couple years. (She had that loan in the first place because of a divorce settlement.) So yes, refis are available. But rates are real bouncy these days as markets try to figure out what's going on. So if you get a good rate, lock it. If you don't, maybe you want to wait a bit.

Elizabeth Razzi: Interest rates just blipped up -- a lot -- this week. Who knows what will happen next week. Why not call up the bank that has your mortgage now, tell them you'd like to refinance when the rate is right. A sharp loan officer will get your application ready and talk with you about the right time to make it official.

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Alexandria, Va.: I'm hoping you can help me with this question -- my husband and I are hoping to become first-time homeowners. We've started looking at various communities we're interested in, plan on meeting with a few agents, etc. My question as I'm confused to no end is where do I get a mortgage? I ask because for example, we bank at HSBC and Wachovia -- are these considered "safe and sound" banks to get pre-approval from? Also, should we be getting charged for pre-approvals? I was told no, but no if it's hundreds of dollars worth. My husband's credit union will charge us $75, is this fair? Worth it? Thanks.

Elizabeth Razzi: Ahh...relax on this one. The "safe and sound" question really applies to deposits. And those are safe, sound and government-insured anyway. Wachovia is being purchased by Citigroup...but that doesn't really concern you either. Their business goes on, and if you take a mortgage out with them, that mortgage simply becomes the property of the new bank. You'd barely be affected, if at all. You can expect to pay for a credit report for a pre-approval. That's about $15-$25, but there could be higher fees. Usually it's credited to you at closing. You really don't need more than one pre-approval, anyway. Credit unions very often offer the best deal.Relax. Call the banks you do business with. And the credit union. Compare their rates and fees. And then get pre-approval from the one that gives you the best price and service.

Maryann Haggerty: If your needs are complex, throw a mortgage broker into that mix, too, if you want.

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Washington, DC: A question for you about tax deductions for closing costs: I know most expenses aren't generally deductible, but is the DC recordation tax something I can write off on my return? It does qualify as a state/local tax, correct...?

Elizabeth Razzi: You'd think so, but sorry, it's not deductible. Generally transfer taxes like that are considered more like administrative fees than taxes. It's like the way you don't get a deduction for paying your auto tags.

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Rural, Va: I wanted to note something I did not expect to encounter when we purchased a small home in southwest, very rural Virginia. And that is motorcycles.

This was our retirement dream home. It looks quiet and peaceful. But starting at 10 o'clock at night, a motorcycle group drives past to gather at a house down the street. They leave that house around 1:00 a.m. Then some of them come back around 2:30. Around 3:30 or so, the rest of them come back. And at 5 a.m. they all leave.

This ritual happens every single night.

So sleep is impossible. We've tried running fans to create a background noise that is consistent, and even replaced the windows in the front in order to help sound insulate.

Nothing works. The whole house works shakes when they drive by.

After this experience, I feel it should not be asking too much for a potential buyer to ask the owner if they can spend the night on the property... just to see what things are like at night in the neighborhood. Would such a request be unreasonable in your opinion?

Maryann Haggerty: I think one of the cable TV channels recently tested a show based on just that premise -- spend a night in the house before you buy it. I don't know which network or whether it's actually on the air.

In the real world, I doubt a seller who wasn't desperate would agree to any such thing. But it is a good thing to ask the nosey neighbors (and the cops) if there's anything you should know.

Speaking of cops: Based on those hours, perhaps you want to talk to them about your neighbors. I have nothing against motorcyclists -- especially if they let me ride occasionally -- but those hours indicate the possibility of amateur chemical labs.

Elizabeth Razzi: It would be a great idea to try out a house overnight before buying it. But I'd hate to have to do it as a seller. Could you imagine the pressure? But this reminds me of the days when I was a young mother home with a baby that had finally fallen asleep...just in time for some guy very pleased with his rumbling cycle to zip through the neighborhood. Crazed and sleepless as I was back in those days, I stopped him in the street. Asked him to please give me and my sleeping baby a break. He didn't react pleasantly. But... as I walked away, his cycle stalled. Ha! I would not, however, recommend you flag the gang down. Good luck.

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Arlington, Va.: How do you expect the election to affect the D.C. area's housing market? What do you expect to happen with interest rates over the next 12 months?

Maryann Haggerty: A: Elections tend not to have all that much direct effect on the housing market -- at most, you might see a few thousand political appointees (and most of them already live here) in a metro area of 5 million people.

B: I can't imagine how anyone could possibly predict interest rates in the current economic enviroment, even if they were the kind of people who tried predicting these things. Which I'm not.

Elizabeth Razzi: Seriously, we have stock markets that swing by 800 points over the course of a day, and somebody is going to try to predict interest rates? Everything in the financial picture is unusual now -- and that makes everything, including home prices and demand, even more unpredictable than usual.

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Alexandria, Va.: Hey there! I saw on the TODAY Show this week that sale prices on homes in DC are down some 22 percent. Does this mean I can get an offer accepted at 22 percent below the asking price on my home of choice?

Maryann Haggerty: Well, if the asking price is the same as it was at the very highest point, that might be logical. (That's what that 22% is.)

But if the asking price is in line with the current market, then I doubt you'll have much luck in most places.

Elizabeth Razzi: No, that would be silly. They're talking about trends. If you see a home that you want at a fair price, start negotiating. The nicer -- and more distinct -- the home and neighborhood, the worse your chances of driving the price lower.

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Washington, DC: You started by asking what we are seeing... personally, I am still seeing a lot a homes that are overpriced by 20 percent (down say 10-15 from start, but still overpriced).

Elizabeth Razzi: How do you arrive at that 20 percent estimate?

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Washington, DC: What is with all the construction in Washington (the city) these days? There are big construction cranes everywhere, and new buildings are going up all over the city. Will this building boom stop now that the global economy is tanking?

Maryann Haggerty: Building a commercial building takes a LONG time. If you're seeing a crane now, that building has been planned for years. At least its early-stage financing was lined up before the market went weird.

The question: Will that money continue to flow?

Elizabeth Razzi: Credit is the lifeblood of that business. The global economy isn't the issue nearly as much an issue as the availability of credit. The longer credit markets are frozen in place, the worse the prospects.

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Fairfax, Va.: My cousin and her husband just tried the For Sale By Owner route for a month, had lots of foot traffic, but gave up and hired a realtor. They did not, however, buy an MLS listing. My sister and I are considering trying to sell next summer and with the terrible housing market, would like to try to minimize our losses. Have you seen or heard of how well it works to buy an MLS listing, whether it is more successful than the normal FSBO route, or whether you ultimately do better by using a Realtor?

Elizabeth Razzi: Well, this is confusing. Your cousin hired a real estate agent but didn't get an MLS listing? Doesn't make sense, I'm afraid. There are some real estate services out there that offer a la carte services at a discounted fee. But usually the thing everyone wants is the MLS listing. MLS is very valuable--it gets you on the computer screens of most serious buyers. If you try to go FSBO without it, you need to have an aggressive marketing plan and some cash for advertising. And... given the confusion I see here, I think you folks would be best off paying a pro.

Maryann Haggerty: Yeah, I'm a little confused...

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Rockville, Md.: Hi and thank you for answering questions. How have houses been performing that are within walking distance to a Metro station in the outer suburbs (like Rockville) as opposed to houses not in walking distance? Thanks.

Maryann Haggerty: I haven't seen any recent analysis, but my sense is that the long-time pattern of stronger markets close to Metro has continued.

Elizabeth Razzi: The studies that I've seen directly linking transportation to values used very old Census data. But if you look at the local strength/weakness patterns, the places that seem to be weakest are far removed from transit. They also are places where there was lots of farmland available for large-scale development.

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Downtown, D.C.: I just closed on my first home this week! So very excited! Any pieces of advice of things I'm going to need to do that I might not know about?

Elizabeth Razzi: Hey, congratulations! Be sure to see if you qualify for the federal tax credit (up to $5,000) available to first-time homebuyers in the District. That's officially back in operation retroactive to the beginning of the year. I'll have more details are at the end of this Sunday's column.

Maryann Haggerty: First, relax. STOP LOOKING AT HOME-SALE LISTINGS. That will only drive you crazy.

Next, look at your inspection report. Are there things mentioned there that need attention? A loose brick? Maybe missing flashing? (I hate flashing. It looks so small and inconsequential, but ignore it for a winter or two, and you have big problems.)

Finally: If you have a patch of outdoor space, plant bulbs. Plant lots of bulbs, in the next weekend or three. They'll make you feel great come February and March.

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Washington, DC: As for developers and amenities...

They might be forced to take care of them if the ammenities were covered by a bond. In my community the developer walked away and the county is now using the bond money to finish things up -- even some things the majority of the community doesn't want -- simply because it was a bond requirement. We can remove it but they have to install it.

Elizabeth Razzi: Good point. County zoning officials can help residents figure out if anything is covered that way. I would expect that to cover things that matter to the county, like green space and water-retention, more than pure neighborhood amenities such as club houses or pools. Any ideas on that?

Maryann Haggerty: In a really big planned-unit development that required lots of local political involvement, it's quite possibel these obligations are bonded.

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Washington, DC: What's the general sense of prices and listings downtown and in the near and outer burbs?

Maryann Haggerty: Hmmm... pretty broad question. The market is still varying a lot from area to area within the region.

Elizabeth Razzi: I'm waiting to see what happens with the housing numbers for October. The economy has behaved in a way I've never experienced. People aren't shopping, eating out or buying cars. It takes a brave soul to buy a home when the economy is as crazy as it has been this month.

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HGTV show: The show is "Sleep on It" on the HGTV cable network. That's the network with all the home improvement, real estate, DIY, and decorating shows. Interesting idea...but many sellers aren't interested in it. Great if it works.

My actual suggestion is to call the local police when the rides are occuring. Report a public disturbance and give the address. If you report this regularly, then maybe after a few visits, the bikers will either quiet down or move somewhere else.

Maryann Haggerty: Thanks. (There are several real estate and DIY-focused networks, at least on my TV.)

Yep, call the cops! (After, of course, at least asking one or two other neighbors whether they know what's going on...)

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Arlington, Va.: Hi, I live in a small condo. I have been exploring possibilities of remodeling my kitchen (very small) and have been given estimates of 10K-17K not including replacement of appliances. This is extremely unaffordable for me. What would you estimate the lowest cost would be to make improvements in my kitchens? Basically, adding some counter space and some closets? Thank you for having these chats. These are so good for people with limited capabilities, like us.

Maryann Haggerty: The cost depends on what you want to do. Does adding counter space and storage mean changing the configuration? That can be expensive. But if instead there's a dead space that you can add an antique-y or Ikea-y base cabinet to, then top with recycled counter stone or off-the-shelf Formica, it's a lot less.

Similarly, moving plumbing lines to adjust a sink location costs $$$. Adding a new deeper sink from Home Depot, not so much.

Frankly, $10k-$17K sounds pretty reasonable for a complete small kitchen re-do, but you can get more bids. Sometimes that helps. And also think about what if anything you can do yourself. (Lay a new vinyl floor, yes. Hang cabinets, maybe no.)

Look at your layout. Look at your needs. Be realistic -- then visit places like Ikea, a home recycling warehouse and anyplace else that may sell what you need.

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Clifton, Va.: BTW the cost of a credit bureau report at all three Transunion, Experian and Equifax is less than $5 and if they were charging $5 they are making almost a 100 percent profit.

The five largest CU in the U.S. are technically in default. That includes Navy Federal and Pentagon Federal.

Navy Federal offers their own settlement company and you get title insurance at cost, no junk fees and they will come to you. Yep, even in a strip bar!

Elizabeth Razzi: Okay, Clifton, TMI there on the service you get from your credit union. And, yes, I know credit reports cost less than they charge. And a tea bag costs 25 cents but I pay so much more at the corner shop.

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Falls Church, Va.: I'm reviewing the HUD forms prior to settlement on a home loan -- settlement is next week -- YAY! Is it customary that both the buyer and seller pay a $295 "administrative fee" to their respective brokerage companies? Beyond the normal commission? This screams "junk fee" to me, but maybe this is standard practice now?

Maryann Haggerty: No, it's not customary, but at least one local brokerage has tried to levy such fees. Check anything written agreement you have with you agent. If you didn't sign something, you aren't obligated to pay it. Point that out to your agent. If she gets wishy-washy and says, well, my broker says we hav to charge it... tell her to show you where you agreed to pay it. If you didn't, don't. But you should know: The agents hate these fees, too. So don;t take your annoyance out on her. Just tell her to tell her boss that you won't pay...

Elizabeth Razzi: Another bad idea the real estate brokerage bizness has adopted from the used-car business. If you fight it, the money will probably come out of your agent's commission. But if they didn't warn you about this up front... I sure would fight it. Times are tight -- for everybody. You and me included.

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Martinsburg, WV: We're upside down on our house -- bought it 3 years ago -- but we're not having trouble paying our mortgage (knock on wood). Since we're not planning to sell anytime soon, we're not really worried. Wish we had extra cash right now though -- there are some great buys in our neighborhood and we'd love to invest for the future. New home building did stall but has started back up again, and road construction and new businesses are still coming in, so we're not too worried. Are we missing something?

Elizabeth Razzi: Hey, you can't ask for better than "not really worried" these days. I'd love to follow up with you on this if you don't mind. Would you please send an email to me at razzie@washpost.com (btw...we don't see your identifying info at all on this chat.)

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For "Rural VA": Not to be a nosy flatlander, but very little good happens with motorcylists coming and going in the middle of the night. If they know which house is being visited, they can check out the land records and see who the owner is. If it's a rental, the owner might not even know what's going on. And the county sheriff might be interested too... at that hour, a sobriety checkpoint every now and then could do wonders.

Maryann Haggerty: Yup.

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SF, CA: Is the market in DC at its lowest level? I'll be looking to purchase mid-09... still a good time? I'm worried about getting loans. I won't have much, if any, to put down (but two high stable incomes to afford a mortgage). Thanks.

Maryann Haggerty: We have no idea. Calling market bottoms is pretty much impossible (as is calling market tops).

At least if you're coming from San Francisco, the sticker shock will be less than for most other folks.

Elizabeth Razzi: You'll need to have something to put down. At least 3.5 percent for FHA. You have between now and mid 2009 to save up some cash. Good luck!

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Prince William County: I purchased a townhouse in 2006, just as the market was coming down. At the time, I chose a 5/1 ARM, bought down points on my mortgage, and put a substantial amount down. I still have equity within the house from my downpayment, despite the drop in home prices. My plan was to refinance before my mortgage adjusts. Now, I am concerned that I will be unable to refinance my house as originally planned. Is there any reason why I would be unable to do so?

Maryann Haggerty: It depends how much your house appraises at. Plummeting house prices aorund you could have wiped out your equity by now.

BUT: Your loan does not adjust until 2011. That's a long while from now. Worry about it when the time comes.

Elizabeth Razzi: Especially since you paid to buy down the rate, you should benefit from that low rate for a while. If by any chance you're making interest-only payments, get started paying principal, too. And look over your loan documents. What's the worst case scenario when that ARM adjusts? If it's not so bad, then take your time. A 1-year ARM is not intrinsically evil. Just make sure there are reasonable caps on the interest rate you can be charged.

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Overpriced?: Actually, it's hard to determine when you are overpriced and when you are not. The price is what the market will bear. You have to list a house and get showings and if it still doesn't sell after showings, then you may be overpriced.

I had to put in a bunch of home improvement and renovation work on my old home and still ended up lowering the price. Fortunately for me, I owned the house long enough that the price drop still left me way ahead of what I had purchased the house for, but it was still galling to earn so much less than many of my neighbors who had sold in the year or two before me. That's the market.

Maryann Haggerty: Thanks for the observation.

Elizabeth Razzi: Very true. Thanks for sharing.

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Alexandria, VA: I will go to the FHA site you suggested but can you tell me, never having had a mortgage before, is this something all lenders offer? Or do lenders offer different types of mortgages, each with their own caveats?

Elizabeth Razzi: You can only get an FHA mortgage through a participating lender that is approved to do business with FHA. The good news is most of the mainstream lenders are approved. Lenders usually have a menu of mortgages. It's a smaller menu than it used to be, now that all the scary no-doc, balloon, interest-only garbage has been discontinued. You can do a lot of reading about mortgages at the FHA site. And you'll grow much more comfortable as you learn more. Start with your bank, and ask them what they have to offer, just on an informational basis. They can explain the different loans to you before you actually apply.

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re: I just closed on my first home this week! : CONGRATS! My biggest homebuying regret? Moving in the day of closing ( I couldn't WAIT!) rather than waiting and getting the floors redone first. While the home is empty and unoccupied is the only convenient time to do them. Don't be like me with floors that need to be redone and a house full of furniture! Do it BEFORE You move in!

Elizabeth Razzi: Oh, you're right on the floors! The messiest job in the world.

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re: kitchen redo: GO TO IKEA!!! They have low and mid end stuff, they have everything in stock and the people are so helpful. We redid a kitchen in our rental (condo) for about $2000 for stuff (cabinets/sink/faucet) -- probably was about that to install it, actually, but you could get higher end stuff and still not be at 10k. Just sayin.

Maryann Haggerty: $2K is pretty low, even for Ikea. Again, it depends what you do.

Elizabeth Razzi: I like IKEA. And let's remember some condo kitchens are snack-size!

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re: SF to DC: DC -- I get you with predicting the market. I think we can do 3.5 percent (hopefully). And you have no idea about the sticker shock when going to SF (from DC)... yikes. Thanks!

Elizabeth Razzi: Good luck!

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Somewhere, MD: My parents have a great home they want to sell -- great condition, all brick, on a lovely tree-lined street, gardens and fruit trees, inside the beltway about two miles from the nearest metro, walk to everything or take the bus at the corner stop -- and the are willing to take any offer above $200K. However, it is located in a part of PG County that no one seems to be interested in living in. I realize that people have their concerns and prejudices about the location -- so many of which are exaggerated -- and I am wondering, what can citizens like me do to draw positive attention to communities that haven't gotten a fair shake? No one has ever heard of our area. But it is recognized as one of the first racially desegrated suburbs in America and has much to offer. For people wondering where the affordable, close-in, "charming" housing is, it's right here. This has been an issue in my parents' area for years, not just now. Any advice would be greatly appreciated.

Maryann Haggerty: First, be careful what you wish for. There are plenty of other suburbs around here that wish they had never been "discovered."

In the case of your parents: Perhaps their agent needs to try very local, focused marketing, to the people who work for large employers near the neighborhood. (And if it's one of the ones I'm thinking of, there are large employers.)

Long-term, local economic development efforts can prove effective (see Arlington). So, of course, could a successful campaign to get the neighborhood featured on one of the million or so "10 Best Places To..." lists. But that's a bit more complex...

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Washington, DC: Bond and what's covered: In my community (in Fairfax) it covers everything from the sidewalks, to the exact number of trees that must be planted (even though there isn't enough room for all of them -- they still got planted), to the clubhouse to the pool... everything. But its a townhouse/condo community so that could be why there are more bond issues than in a single family home community.

Maryann Haggerty: Yep, that's exactly the kind of community that in Virginia requires a bunch of pre-development negotiation with the county.

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Arlington, VA: Thank you so much for the response. I now know that I am not being taken for a ride with the estimates I receive. Once again these chats are so useful.

Elizabeth Razzi: Thanks for the kind words. We enjoy the chats quite a bit, too.

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Arlington, VA: Hello ladies,

Thanks for all your advice and wisdom. My question is regarding refinancing, specifically the appraisal. I have a small garden-style condo and I would like to refinance soon if possible (my ARM will adjust next summer; even if the payment goes up I should be able to continue to pay it, but I'd prefer to avoid that if possible). The previous owners of the condo had rented it out to various tenants for years, and as a result they did absolutely no upgrades to it. I've been saving my money in order to make some improvements but haven't moved forward with anything yet except for replacing windows and getting new appliances. I did start to do a little painting and wallpaper removal, but realized I would get a much better result if I hired professionals to do all the work instead, and as a result my home doesn't look all that great right now. Do you know if things like partially-painted kitchen cabinets and outdated flooring and counters will affect the appraisal value for a refinance? If I wait until after doing upgrades, I will have to wait a pretty long time. Thanks.

Maryann Haggerty: Cosmetic stuff like that won't affect an appraisal much if at all -- though it will affect saleability.

Elizabeth Razzi: If it's really, really shabby, the appraiser might note it in the record. That could ding you a little bit. But before selling, do what you can to get it cosmetically as pretty as possible. At least get the paint looking good.

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What I'm seeing in Clarendon is...: no uniformity in asking prices. Some properties are selling at 20 to 30 percent below the peak prices of 2006, while other folks are asking (and occasionally getting) peak prices. It's amazing to see such discrepancies in list prices of comparable properties - it's like half of the sellers won't accept the reality that prices are falling, while the other half are realistic.

The few properties still selling at peak prices are mostly being purchased by folks from other areas such as New Jersey, New York, etc. (based on my anecdotal observation of the license plates of the cars of the new owners).

Elizabeth Razzi: Thanks for the report from the field!

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Overbuilt Condoland, DC: Hello, I live in a small condo reconversion building (used to be an apartment building, now is condos). The developer never finished construction on the building, never posted a warranty bond with the city, and never got a certificate of occupancy. The condo association sued the developer, won, and at least got a certificate of occupancy. But the developer defaulted on the judgment against him, and has not paid to fix the building. We're doing the best fixes we can with our merger condo dues.

My question: should I give up ever trying to sell my unit? My unit is attractive, the building's structurally sound, but the finances are a mess from our suit. Thanks.

Maryann Haggerty: What a mess! Could you in good conscience recommend that a friend buy in that building?

Can you drop me a line directly at haggertym@washpost.com to talk more about this?)

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DC: Sometimes, the simplest answers (the ones we don't want to hear) are the correct ones. Sellers: lower your prices dramatically now or chase the market down -- it's your choice.

A good measure is to find the median income of your perspective client base and then set the price between 2.5 to a max of 3 times that income. It has worked for nearly 150 years before the last five. Prices do not "need to stabilize." Rather, they need to return to fundamentals.

Loans aren't hard to get if you have a small chunk of money to put down and are realistic about what you can afford. It's just that housing prices have to come down to meet that number. Anything else is wishful thinking ...

Elizabeth Razzi: More market intelligence... Thanks.

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Dupont, D.C.: I am closing on a condo in Dupont on Nov. 14... I'm getting a little scared and nervous about the whole process, but i'm hoping everything will turn out well. I'm not having trouble with lenders... probably because I have excellent credit (over 700). It's funny how prices are dropping everywhere EXCEPT for Dupont. The condo I am purchasing received FIVE offers within two weeks... all close to or at list price! I am ready to buy now and only want to live in this area so I wasn't totally bummed about not getting a "deal," but in this market I was suprised there wasn't more room for negotiating.

Maryann Haggerty: It's all about supply and demand.

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Staying Over: It's on HGTV, but the name just escaped me. Same thing sort of happened to me when I moved to the Eastern Shore: my first quiet Saturday morning, I took the Post and a cuppa out to the porch around 7... by 7:30, you could cut the lawnmower noise with a cleaver. Why live in the country if it's louder than the city?

Maryann Haggerty: Hey, NO ONE in my city neighborhood EVER mows the lawn at 7:30 on a Saturday!

That, of course, is because nobody has a lawn.

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Elizabeth Razzi: Well, time flew today. Thanks very much for the observations! Sunday I'll be going over some nice tax credits that will be available for investments in energy conservation. See you next time!

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Maryann Haggerty: Thanks for joining in.

In tomorrow's Real Estate section, we take a look behind the scenes at the annual Capitol Hill Renovator's House Tour, which takes place tomorrow. (There's still plenty of time to buy tickets. Google Renovator's House tour for the information site.)

And it looks like fall may finally be here this weekend. Buy those spring bulbs now!!!

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Wachovia is being bought: by Wells Fargo, not Citigroup

Maryann Haggerty: You're right!

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