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About Washington DC Real Estate By The McConkey Real Estate Team

Mortgage Rules To Boost DC Condo Sales

June 20, 2016 by McConkey Team | 0 comments

We were treated to GREAT NEWS in May. In a speech to the National Association of Realtors, Housing and Urban Development Secretary Julián Castro said the Federal Housing Administration (FHA) has completed its promised reforms of condominium mortgage rules and they are only awaiting presidential approval to be implemented.

DC condo sales are strong, with almost 400 units sold last month. That number is at a near record high sold, and up 6% over last year; Nevertheless, greater FHA mortgage availability would have a dramatic impact on the market.

The details have not yet been announced but the changes are expected to greatly expand FHA financing of condominiums. FHA condo loans fell from a high of 90,000 units per year before the 2008 housing crash to just 23,000 units last year. The FHA pull back after the crash had a negative effect on the market, and a reversal would greatly help the owners of condos in DC.

FHA mortgage rules affect DC owners in two ways, 1) building approval, and 2) individual loans. Because of the existing rules, many of the DC condominium “buildings” themselves are not eligible for FHA approval which excludes all owners and potential buyers from seeking FHA financing despite their personal financial ability and credit worthiness. A change in the rules is expected to reduce the regulation and red tape that discourages many communities, often managed by part-time volunteers, from even applying.

Second, FHA individual loans allow more potential buyers because less upfront cash is needed and less income is required than most other programs. Morever, FHA allows for “reverse mortgages” so more seniors are better able to refinance and afford to keep their units.

An increase in FHA condominium financing will benefit everyone who owns a condo whether or not they have a FHA loan because the building approval and individual loans will increase potential buyers, and thus increase prices.

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Montgomery County Real Estate Taxes Increase Dramatically

May 22, 2016 by McConkey Team | 0 comments

Despite vigorous lobbying efforts by many community groups including Realtors through the Greater Capital Area Association Of Realtors (GCAAR), the County Council approved a drastic increase in the Montgomery County real estate taxes, both property taxes and recordation fees. This will hurt homeowners, by raising the cost of owning a home in Montgomery County, will make it more difficult for homebuyers, particularly first-time homebuyers trying to save the large closing costs (including property taxes and recordation fees) needed to purchase a home, and will make worse the struggle of many seniors fighting to stay in their homes on a fixed income.

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Montgomery County Enacts New Taxes on Homeownership

By the Maryland Policy Institute

ROCKVILLE, MD (May 20, 2016) —The Montgomery County Council unanimously adopted $325 million in new taxes on homeownership this week as part of its deliberations on the Fiscal Year 2017 budget. The Council adopted an increase in the home sales recordation tax on Wednesday and an 8.7 percent increase in the property tax on Thursday. The council is expected to adopt the full budget next week.

“County politicians just delivered homebuyers a 1-2 punch,” said Christopher B. Summers, president of the Institute. “Montgomery County already has the State’s highest per capita income tax burden, so making homeownership more expensive only adds to the list of reasons a family should avoid planting roots here. Homebuyers should be viewed as a source of pride, not a source of new tax revenue. The new taxes will also hurt county realtors, who depend on a healthy home buying market for economic security.”

Tax Increase Summary:
•Property Tax Increase: The Council enacted an 8.7 percent increase in property taxes, pushing the County’s tax rate higher than all surrounding jurisdictions. The average property owner in Montgomery County will now pay $326 more in property taxes every year. County Executive Ike Leggett has stated he expects the increase to raise approximately $140 million from homeowners.

•Recordation Tax Increase: The Council also approved a $180 million increase in the recordation tax on home sales. Under the new tax structure, a house sold for $600,000 would cost about $1,000 more in recordation taxes.

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DC Offers License Amnesty Through February

January 26, 2016 by McConkey Team | 0 comments

If you own a rental property in the District you are supposed to obtain a DC business license. Whether it is a single family home, an apartment building, a condominium, or just a basement apartment, you are required to have a license, though many landlords do not.

To help landlords, and other businesses without the proper licenses, the City is offering a “Business License Amnesty Program” through the month of February. Through the 29th of February 2016, all businesses within the District of Columbia operating without a current license can obtain a new license under the amnesty program without fines and penalties.

The Department of Consumer and Regulatory Affairs (DCRA) Director Melinda Bolling stated that “We understand that, sometimes, not being current with licensing requirements has more to do with economic hardship than indifference to the law. This Amnesty Program offers businesses who may have suffered a financial setback a fresh start for the new year…”

For DC landlords we would say the main problem is a lack of knowledge. Landlords are frequently unaware of the need for a business license. Many landlords don’t think of their rental unit as a separate business enterprise requiring a separate business license, and such licenses were not always required, so many landlords have never thought to get a business license.

No one like more fees and expenses but if you want to get right with city hall landlords this is your chance. Most business licenses can be obtained online at http://dcra.dc.gov/ or you can apply in person at the DCRA at 1100 4th Street SW, WDC 20024, with extended hours through February.

“With licensing and corporate registration, compliance is our priority. The Amnesty Program provides an opportunity for businesses across the District to come into full compliance with business license and corporation laws without financial penalty,” said Bolling.

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2015 DC Real Estate Sales And Housing Statistics

January 22, 2016 by McConkey Team | 0 comments

2015 DC Real Estate Sales Annual sales reach the highest level since 2006; Prices gain only 1 percent for second straight year, but remain 24 percent higher than 2009’s bottom levels.

    OVERVIEW
  • 2015’s median sales price ended up at $410,000, marking only a 1.1 percent gain from 2014. Despite flat growth, prices are only 1.2 percent down from 2007’s peak levels.
  • Sales in 2015 were very strong, with year-over-year gains seen in every single month. Ultimately, the 50,528 cumulative sales marked a 9.4 percent increase over 2014.
  • Seller activity picked up consistently through the year and the 73,733 cumulative listings added over the course of 2015 were 8.5 percent more than the number added in 2014.
  • After rising to a peak year-over-year increase of 34.6 percent in August 2014, inventory growth has steadily declined in 2015, ending the year at 8,644 listings, which is only 4.6 percent higher than at the end of 2014. Inventory growth will likely be negative in 2016.
  • Half the homes sold in 2015 were on the market 22 days or less, a two-day increase compared to 2014, but remaining well below both the 5 and 10-year averages.
  • The average percent of original list price received at sale has remained relatively steady over the last several years, dropping only slightly in 2015 to 97.3 percent.
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  • The regional median price of $410,000 in 2015 was 1.1 percent higher than last year. While the gain was relatively low, it marked the sixth straight year of gains since the 2009 bottom.
  • Regional pricing levels are now 23.7 percent above the $331,500 bottom of the market in 2009, and only 1.2 percent off the $415,000 peak in 2007.
  • Despite being the only area where price levels dipped slightly, Falls Church remained the most expensive location with a 2015 median sales price of $690,000.
  • Prince George’s County has seen the highest year-over-year appreciation of 6.3 percent, although it remains the most affordable area in the region with a 2015 median price of $235,000.

The following analysis of the Washington, D.C. Metro Area housing market has been prepared by Elliot Eisenberg, Ph.D. of RealEstate Business Intelligence (RBI) and is based on year-end 2015 MRIS housing data.

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New DC Tenant Bill Of Rights Law Takes Effect

June 28, 2015 by McConkey Team | 0 comments

dc-tenant-bill-of-rightsA new law was passed by the DC Council and signed into law by Mayor Gray to protect DC tenants by requiring landlords to furnish “prospective tenants” with a summary of laws pertaining to the rental of housing in the District. The document called the “DC Tenant Bill of Rights” is prepared by the Office of the Tenant Advocate and outlines current law in an attempt to aid tenants to better understand the process.

Under the law, landlords have to provide the document (on the reverse side) to prospective tenants starting July 3, 2015. Who “prospective tenants” are is unclear, at least anyone who places an application, and be sure to have them sign the acknowledgment for your records. The penalty for the landlord’s failure to provide the form is that the landlord is not allowed to legally raise the rent on the tenant, EVER, as long as the tenant lives in the property, beware.

Click for a copy of the “DC Tenant Bill Of Rights”
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District of Columbia Tenant Bill of Rights

The Tenant Bill of Rights Amendment Act of 2014, effective December 17, 2014 (D.C.Law 20-147; D.C. Official Code §§42-3531.07(8) & 42-3502.22(b)(1)) requires the DC Office of the Tenant Advocate to publish a “DC Tenant Bill of Rights” to be updated periodically and noticed in the DC Register. This document is not exhaustive and is intended to provide tenants with an overview of the basic rights of tenancy in the District. Except for rent control, all these rights apply to every tenant in the District.

1. LEASE: A written lease is not required to establish a tenancy. If there is one, the landlord must provide you with a copy of the lease and all addendums. The landlord must also provide you with copies of certain District housing regulations, including those for Landlord & Tenant relations. Certain lease clauses are prohibited, including waiver of landlord liability for failing to properly maintain the property. The landlord may not change the terms of your lease without your agreement. After the initial lease term expires, you have the right to continue your tenancy month-to-month indefinitely on the same terms, except for lawful rent increases. (14 DCMR §§ 101, 106 & 300-399)

2. SECURITY DEPOSIT: The amount of the security deposit may not exceed the amount of 1 month’s rent. The landlord must place your security deposit in an interest-bearing account. The landlord must post notices stating where the security deposit is held and the prevailing interest rate. If there is a “move-out” inspection, the landlord must notify you of the date and time. Within 45 days after you vacate the apartment, the landlord must either return your security deposit with interest, or provide you with written notice that the security deposit will be used to defray legitimate expenses (which must be itemized within 30 more days). (14 DCMR §§ 308-311)

3. DISCLOSURE OF INFORMATION: Upon receiving your application to lease an apartment, the landlord must disclose: (a) the applicable rent for the rental unit; (b) any pending petition that could affect the rent (if rent control applies); (c) any surcharges on the rent and the date they expire (if rent control applies); (d) the rent control or exempt status of the accommodation; (e) certain housing code violation reports; (f) the amount of any non-refundable application fee, security deposit, and interest rate; (g) any pending condo or coop conversion; (h) ownership and business license information; (i) either a 3-year history of “mold contamination” (as defined) in the unit and common areas, or proof of proper remediation; and (j) a copy of this DC Tenant Bill of Rights document. The landlord must make this information accessible to you throughout your tenancy. Upon a tenant’s request once per year, the landlord must also disclose the amount of, and the basis for, each rent increase for the prior 3 years. (D.C. Official Code §§42-3502.22 & .13(d))

4. RECEIPTS FOR RENTAL PAYMENTS: The landlord must provide you with a receipt for any money paid, except where the payment is made by personal check and is in full satisfaction of all amounts due. The receipt must state the purpose and the date of the payment, as well as the amount of any money that remains due. (14 DCMR § 306)

5. RENT INCREASES: “Rent control” limits the amount and the frequency of rent increases. For units that are exempt from rent control, generally only the lease terms limit rent increases. If rent control applies, the landlord may not raise the rent: (a) unless the owner and manager are properly licensed and registered; (b) unless the unit and common areas substantially comply with the housing code; (c) more frequently than once every 12 months; (d) by more than the Consumer Price Index (CPI) for an elderly tenant (age 62 or over) or tenant with a disability, regardless of income, if registered with the Rent Administrator; (e) by more than the CPI + 2% for all other tenants. A rent increase larger than (d) or (e) requires government approval of a landlord petition, which tenants may challenge. You also may challenge a rent increase implemented within the prior 3 years.

6. BUILDING CONDITIONS: The landlord must ensure that your unit and all common areas are safe and sanitary as of the first day of your tenancy. This is known as the “warranty of habitability.” The landlord must maintain your apartment and all common areas of the building in compliance with the housing code, including keeping the premises safe and secure and free of rodents and pests, keeping the structure and facilities of the building in good repair, and ensuring adequate heat, lighting, and ventilation. The tenant has the right to receive a copy of a notice of violation issued to the landlord (14 DCMR §§ 106; 301; & 400 -999)

7. LEAD PAINT HAZARD: For properties built prior to 1978, the landlord must (a) provide a prospective tenant household with a form issued by the District Department of the Environment about their rights under the DC lead laws; (b) provide a current lead-safe “clearance report” to (i) a prospective tenant household that includes a child less than 6 years of age or a pregnant woman, (ii) an in-place tenant household that gains such a person and requests the report in writing from the landlord, and (iii) any tenant household regularly visited by such a person; and (c) disclose to a tenant household what the landlord reasonably should know about the presence in the tenant’s unit of a lead-based paint hazard or of lead-based paint, which is presumed to be present unless there is documentation showing otherwise. (20 DCMR §§ 3300 et seq.)

8. MOLD: Upon written notice from a tenant that mold or suspected mold exists in the unit or a common area, the landlord must inspect the premises within 7 days and remediate within 30 days.
Mold assessment and remediation must be performed in compliance with District regulations. (D.C. Official Code § 8-241)3

9. QUIET ENJOYMENT AND RETALIATION: The landlord may not unreasonably interfere with the tenant’s comfort, safety or enjoyment of a rental unit, whether for the purpose of causing the housing accommodation to become vacant or otherwise. (D.C.Official Code §42-3402.10) The landlord may not retaliate against you for exercising any right of tenancy. Retaliation includes unlawfully seeking to recover possession of your unit, to increase the rent, to decrease services or increase your obligations; and also includes violating your privacy, harassing you, or refusing to honor your lease. (D.C. Official Code § 42-3505.02)

10. DISCRIMINATION: The landlord may not engage in discriminatory acts based upon the actual or perceived: race, color, religion, national origin, sex, age, marital status, genetic information, personal appearance, sexual orientation, gender identity or expression, familial status, family responsibilities, disability, matriculation, political affiliation, source of income, status as a victim of an intra-family offense, or place of residence or business of any individual. Discriminatory acts include refusing to rent; renting on unfavorable terms, conditions, or privileges; creating a hostile living environment; and refusing to make reasonable accommodations to give a person an equal opportunity to use and enjoy the premises. (D.C. Official Code §2-1401.01et seq.)

11. RIGHT TO ORGANIZE: The landlord may not interfere with the right of tenants to organize a tenant association, convene meetings, distribute literature, post information, and provide building access to an outside tenant organizer. (D.C. Official Code §42-3505.06)

12. SALE AND CONVERSION: Tenants must be given the opportunity to purchase an accommodation before the landlord sells or demolishes the accommodation or discontinues the housing use.
The landlord may not convert the rental accommodation to a cooperative or condominium unless a majority of the tenants votes for the conversion in a tenant election certified by the District’s Conversion and Sale Administrator. (D.C. Official Code §§ 42-3404.02 & 42-3402.02)

13. RELOCATION ASSISTANCE: If you are displaced by alterations or renovations, substantial rehabilitation, demolition, or the discontinuance of the housing use, you may have the right to receive relocation assistance from your landlord. (D.C. Official Code §42-3507.01)

14. EVICTION: The landlord may evict you only for one of ten specific reasons set forth in Title V of the Rental Housing Act of 1985. For example, you may not be evicted just because your lease term expires, or because the rental property has been sold or foreclosed upon. Even if there is a valid basis to evict you, the landlord may not use “self-help” methods to do so, such as cutting off your utilities or changing the locks. Rather, the landlord must go through the judicial process. You generally must be given a written Notice to Vacate (an exception is non-payment of rent where you waive the right to notice in the lease); an opportunity to cure the lease violation, if that is the basis for the action; and an opportunity to challenge the landlord’s claims in court. Finally, any eviction must be pursuant to a court order, and must be scheduled and supervised be pursuant to a court order, and must be scheduled and supervised by the U.S. Marshal Service. (D.C. Official Code § 42-3505.01)

RESOURCES: DC Dept of Housing and Comm Development – 1800 MLK Ave, SE WDC 20020, Phone (202)442-9505, Fax (202)645-6727, Website: www.dhcd.dc.gov
DC Office of the Tenant Advocate – 2000 14th Street, NW #300 N, WDC 20009, Phone (202)719-6560, Fax (202)719-6586, Website: www.ota.dc.gov
DC Dept of Consumer and Regulatory Affairs – 1100 4th Street, SW, WDC 20024, Phone (202)442-4400, Fax (202)442-9445, Website: www.dcra.dc.gov
District Department of the Environment – 1200 1st Street, NE, WDC 20002, Phone (202)535-2600, Fax (202)535-2881, Website: www.ddoe.dc.gov

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