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WINTER 2015

IN THIS ISSUE:• MyAnacostia

• FREEMONEYforYourDownPayment

• HowDoIFinanceMyNewHome

• HowtoSTAGEYOURHOME

• andmore

WASHINGTON DC

HOME MARKET ®A N A C O S T I A

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WASHINGTON DC

HOME MARKET ®A N A C O S T I A

Publisher’s Notes ......................................................................................4

My Anacostia ...........................................................................................6

FREE MONEY for Your Down Payment ...............................................10

How Do I Finance My New Home ........................................................14

Staging Your Home ................................................................................17

The Listing List ......................................................................................21

Solar Comes of Age ................................................................................22

What’s My Home Worth ........................................................................23

Contents

Community Services Press, LLC10500 Rockville Pike, Suite 807Rockville, MD 20852

www.washingtondchomemarket.com

Publisher: Michael Vezo

Executive Editor: J. McCrary

Design: Flynn Creative

Copyright © January 2015 Community Services Press

All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage or retrieval system, without permission in writing from the publisher.

Printed in the United States of America

ISBN 13: 978-1-938620-07-2

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M i c h a e l V e z o

Publisher’s Notes

Welcome to the premier edition of Washington DC Home Market.

Utilizing the region’s premier online home listing service, MRIS (Multiple Regional Listing Service), and with support from our advertisers, Wash-ington DC Home Market gives home owners, home buyers, renters, inves-tors, and others some insight into the complicated world of selling and buying a home.

On the facing page is an image of the heart of the publication, the Washington DC Home Market web page. You can get to the page by typing www.WDCHM.com into your browser. or by using a smart phone or a tablet to scan the code, then clicking on “full site” at the bottom of the screen.

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I lived in Anacostia for part of my childhood, and many family members still live there, so I’ve always thought of it as my home away from home. Now that I’m in real estate, I can appreciate so much more about Anacostia. It’s a great location, no matter where you want to go. It’s just across the river from downtown and the capitol area, and it’s an easy ride to Virginia or Maryland from anywhere in the neighborhood. The housing is the most affordable in the DC area. This is the moment of opportunity because the prices, compared to other parts of the city are still affordable.

So much is going on--development in the neighborhoods, new govern-ment programs that are helping people get into their own houses, the sudden acknowledgement that Anacostia has the best city views in the whole metro area, and most definitely the planned new 11th Street Bridge Park. This park will be a really innovative pedestrian bridge, a greenbelt-type park that will link the two sides of the river. Built on

the ruins of an old freeway bridge, it will include a boat launch, a plaza for markets, performances and festivals, a café, and a water feature.

Anacostia has always fascinated me, and so I did some research into its history.

First mapped by Captain John Smith in 1612 as an important fur-trading post, Anacostia has been a busy, diverse neighborhood for over 400 years. The name evolved from Nacotchtank, meaning “trading village,” and it referred to both the marshy settlement and the Native American Algonquin tribe on the east branch of the Potomac River. By the late 1600s, the village was decimated by the invasion of European settlers’ viruses and alcohol, and the remnants of the tribe moved to Anacostine Island, now known as Theodore Roosevelt Island.

Now the name Anacostia refers to several neighborhoods in southeast DC, all of them shaped by federal construction. Uniontown was first developed as affordable housing for Navy Yard workers in the 1850s. A

decade later during the Civil War, a ring of forts was built to protect the Navy Yard. Though all the forts were soon torn down, the land under Fort Stanton and Fort Greble eventually became parks, now managed by the National Parks Service.

Other military construction included Anacostia Naval Station and Bolling Air Force Base, both built during World War I. The Anacostia Freeway (I-295 and DC 295) was constructed in the 1950s and 1960s, blocking the neighborhood from access to the waterfront and helping to change its demographics.

President Lincoln freed the slaves in Washington, DC nine months before the Emancipation Proclamation, which began an influx of African-Americans during the Civil War. Several developments welcoming freed slaves were built in Anacostia after the war ended. The first and best-known, Barry Farms, was founded in 1867 by General Oliver Howard, also the Commissioner of the Freed-man’s Bureau, when he sold land to newly-freed slaves in what became the first freedman’s community in the area. Part of the purchase money was diverted to build Howard University, which he founded as an educational institution for neighborhood residents of all races.

Frederick Douglass, who moved to Anacostia in 1877, was the most

famous former slave in the country. Known as the father of the civil rights movement, Mr. Douglas advised pres-idents, worked for human rights for all Americans of any color and sex, and was called by Abraham Lincoln “the most meritorious man of the nineteenth century.” His home on Cedar Hill is now a national historic site and museum. There are plans to link it to the 11th Street Bridge Park.

St. Elizabeths was a government hospital for the mentally ill, established in 1855 in Anacostia. During the Civil War, it treated injured soldiers as well, and was the first to ever treat African-American soldiers. St. Elizabeths added a farm to grow crops for its growing number of patients, and started building on the land, which became known as the East Campus, in 1902. The hospital continued expanding as the patient population grew to its peak of over 7,000 patients in the 1940s, with the last buildings being added in 1963. The East Campus was given to the DC government in 1987, while the West Campus is still owned and managed by the Federal government.

d e b o r a h t h o m a s

My AnacostiaPast, Present and Future

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Currently, the East Campus is being transformed into an Innovation Hub, with its land and buildings planned to be shared by both academic institu-tions and technology firms. The new jobs and economic opportunities are meant to diversify and enrich the local economy.

Gateway DC is an exciting new venue on the St. Elizabeths East campus. A park and pavilion for casual dining, it includes a farmers market and has space for community and cultural events, including pop-up retailers and arts displays.

The Anacostia Community Museum is under the umbrella of the Smithsonian Institution, and it

serves as the Institution’s center for African-American history and culture. Located in Fort Stanton Park, it’s free to all (including free parking), and offers a variety of events, exhibits and educational programs for all ages.

The location of the Community Museum is particularly appropriate. The neighborhoods of Anacostia have been culturally rich and diverse for

decades. In the early 20th century, the Great Migration of African Ameri-cans began to flow from the southern states and Anacostia boomed. Demo-graphics continued to change when the D.C schools became the first school district in the United States to be fully integrated in 1950. By 1957, Washington became the country’s first city with an African-American majority, and it remained that way for fifty-four years.

The Anacostia Arts Center opened in 2013, sponsored by Arch Devel-opment Corp, which has supported small-scale neighborhood develop-ment, business support, arts and culture in Anacostia since 1991. The Arts Center includes a black box theater, galleries, boutiques, fitness and wellness classes, a café, and rehearsal spaces. Events this winter include All Are Welcome: Row House & Storefront Church Exhibition, a 20-year collection of architectural photographs of the area by Michael K. Wilkinson.

CHASE Action Agenda (covering Congress Heights, Anacostia and Saint Elizabeths) was created to ensure that the changes and growth coming to these areas builds on the existing assets, protects historic districts, and involves better transportation.

One of the most beloved arts instal-lations in Anacostia, the Chair was once the world’s largest chair and it is

known as the neighborhood landmark. Santa Claus still visits and sits in it every Christmas. A 19-1/2-foot-high replica of a Duncan Phyfe chair, the 1959 original was mahogany, made by Bassett Furniture, and donated to Curtis Brothers, a furniture showroom in Anacostia. In 1960, a woman moved into a 10-by-10-foot cubicle that was placed on the seat of the chair, and she lived there for 42 days.

After 40 years, the chair’s wooden legs began to rot, and it was replaced in 2006 with an aluminum replica. The new chair’s plaque reads:

THIS COMMUNITY LANDMARK REPRESENTS THE

CURTIS COMPANIES LONG-STANDING ALLEGIANCE TO THE NEIGHBORHOOD AND

STEADFAST COMMITMENT TO UNITY, PROSPERITY, AND GOOD WILL TO ALL WASHINGTONIANS

AND FRIENDS OF ANACOSTIA.

Consider Anacostia when you are looking to make your next move. It is a welcoming, booming area, full of charm and history, and the best bargain in town.

Deborah Thomas is a licensed realtor and works in the Capitol Hill offices of Long & Foster Realtors.

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FREE Money for Your Down Payment

M I C H A E L V E Z O

Frequently Asked Questions

1. Q: How do I know if I am ready to purchase a home?

A: Purchasing a home is a big step. You will need a team of knowledge-able individuals to help you through the process of selecting your home, determining which mortgage loan best suits you, obtaining a mortgage loan, etc. A good place to start is a HUD approved housing counseling agency to learn more about the home buying process. Or, if you are ready to start shopping for a home, you will need to select a participating lender and a realtor.

2. Q: Can I afford to purchase a home?

A: For an estimate of what your monthly mortgage payment might be with one of our DC Open Doors mortgage loans, go to our mortgage

calculator and enter in your specifics. Your next step should be to contact one of our participating lenders who can determine what mortgage loan products you might qualify for.

3. Q: How much of a down payment will I need to purchase a home?

A: Your required minimum down payment will depend upon your home purchase price and your mortgage loan product. Some mortgage loan products require a minimum of a 3.00% down payment, while others require 3.50% and some even require 5.00%. Our participating lenders will help you determine how much of a down payment you will need. DC Open Doors offers down payment assistance loans for qualifying borrowers who use our mortgage products. You may also be eligible for

down payment assistance from the Department of Housing and Commu-nity Development’s Home Purchase Assistance Program.

4. Q: Do I need homebuyer educa-tion to obtain a DC Open Doors mortgage loan?

A: DCHFA encourages home-buyer education and it is required for some of our mortgage loan products. Homebuyer education must meet the National Industry Standards for Homeownership Education and Counseling in order for it to be accept-able for a DC Open Doors mortgage loan. Please contact a HUD approved housing counseling agency for more information on homebuyer education.

5. Q: Does the process for obtaining a DC Open Doors mort-gage product take longer than a “normal” mortgage loan?

A: No, it does not. Purchasing a home with a DC Open Doors mort-gage product should not add any additional time to your home purchase process. In fact, DCHFA monitors its lenders very carefully to ensure loans are processed as quickly as efficiently as possible.

6. Q: How do I know if a partici-pating lender has qualified me for a DC Open Doors mortgage loan, including down payment assistance?

A: Borrowers approved for a DC Open Doors down payment assistance

loan (DPAL) will receive a Borrower Commitment Letter. If you are not sure if your lender has reserved a mortgage loan for you under DC Open Doors, contact your lender to verify or feel free to contact us directly at 202-777-1600.

7. Q: Can I purchase a home anywhere using DC Open Doors?

A: You can purchase a home in any neighborhood, area, or Ward of Washington, DC using DC Open Doors. However, DC Open Doors can only assist applicants on homes within the District of Columbia.

8. Q: How do I find a home to purchase?

A: A realtor will be happy to assist you in your home selection process once you have been pre-qualified by a participating lender for a DC Open Doors mortgage loan.

9. Q: Can I qualify for a DC Open Doors mortgage loan if I am not a first-time homebuyer?

A: Yes, DC Open Doors has a variety of mortgage loan products to serve both first-time and repeat home-buyers. Please reference the DC Open Doors Product Highlights for specific product requirements and parameters.

10. Q: Can a DC Open Doors mort-gage finance affordable dwelling units (ADUs) or units with restric-tive covenants or deed restrictions?

A: No. DC Open Doors can not

I will edit Q and A to fit and to remove reverences to “contact a lender”.

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finance the purchase of an affordable dwelling unit (ADU) or units with restrictive covenants or deed restric-tions. Please refer to the DC Open Doors Product Highlights for specific product requirements and parameters. If you should have a specific questions regarding your home purchase, please call a participating lender.

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M ichelle Davis, a mortgage consultant with Prosperity Home Mortgage, LLC,

has successfully matched house buyers with the right loans for more than twelve years. She works with greater DC clients who need loans of any size.

Michelle, what advice do you have for someone who plans to buy a house in the next year or so?

Since the mortgage market has tightened, having good credit is even more important than it has been in the past.

The higher your credit rating, the better interest rate you can get on your mortgage. Even though interest rates are low, a half-percent can really make a difference. For instance, on a $300,000, 30-year fixed loan, someone with great credit may get a 4% rate, which means a principal and interest payment of $1,432.25 per month. If your credit leaves something

to be desired, though, you might get a 4.5% loan, which means you’ll pay $1,520.06 per month. That’s $87.81 per month more, or about $30,000 more over the life of your loan.

It’s definitely worth it to make sure your credit is as good as it can be. That doesn’t mean you should necessarily pay off your credit cards, though. Your credit gets dinged if your cards are close to their limit, so pay them down instead. Make sure you don’t owe more than half of the credit limit on each card.

If you’re going to receive a gift of money towards down payment or closing costs, ask for it as early as possible so all the verification can be done easily. Your grandmother in Topeka may not want someone snooping around in her accounts to verify her balance, or she prob-ably doesn’t have a fax so she can send letters of explanation at the last minute.

What if I’m self-employed? Does that make it harder to get a loan?

Being self-employed makes it a

An intervie withMichelle Davis,

Prosperity Home Mortgage— J. McCrary

How Do I Finance My New Home?Steps you can take to helpget the home you want?

whole different evaluation process when you apply for a mortgage. If you get a paycheck for a living, we use your gross income. If you’re self-employed, though, we use your bottom line—your net income—when we qualify you. How much gross income are you writing off? What’s great for income tax purposes is not great when you’re applying for a mortgage.

We need to average two years of your income. You must give us your tax returns for the last two years, both your personal and your business returns, and we scour them and verify them with the IRS. If you’ve been self-employed for less than two years, the income doesn’t count, unfortu-nately. There are some exceptions to this, but you need to have a least one full year of tax returns as a self-employed individual.

W ha t ’s t h e d i f f e r e n c e between being prequalified and preapproved?

When you’re prequalified, you’ve had a discussion with a lender over the phone and you’ve broadly covered your income, savings and debts. You’ll know what amount of money you should be able to borrow if everything checks out.

Before you make an offer on a house, though, your real estate agent will want a letter from the lender saying you’re preapproved. This means the lender has run a credit

report and has documentation about your income and assets.

What documentation will I need to have?

You need two of everything—two years of tax returns, two paystubs, two monthly or quarterly bank state-ments, and two years of W2 forms, 1099 forms or K1 forms.

Does being preapproved mean I definitely have the loan?

In most cases, yes, you will get the loan, but it doesn’t mean it’s guaran-teed. Preapproval is not the last step, just basic information. Once you have a ratified contract to purchase your new house and agree to “lock in” with the lender, that’s when the real fun begins.

First, we make sure your earnest money check clears. Most people write the earnest money check without enough money in the account to cover it, and they must liquidate assets or transfer money into the account.

What happens next?I’ve been in business twelve years,

and I know what the underwriters ask for, so I make sure we hand them everything they need to close the loan. The process is so detailed that it can be frustrating to buyers, but we would rather have you frustrated at the beginning rather than unpleas-antly surprised at the end.

We must be able to prove that your down payment isn’t coming from the

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— J . M c C r a r y

Staging Your HomeThe Pros and Cons of impressing potential buyers?

seller or the listing agent, and that it isn’t borrowed money. Our loan proces-sors comb through your bank accounts, looking for large deposits that are 50% or more of your monthly income, or any odd payments. Each transaction must have a paper trail showing where it came from. The processors also submit 4506T returns to the IRS so your tax returns can be verified.

If you have some late payments or ugly spots in your credit report, you may be asked to explain them.

Some people are what we call “money movers,” and they shift their money around among several accounts. Our processors follow these trails. When everything is verified and tracked, we turn the records over to the underwriters.

Thank you, Michelle, for explaining the process. Do you have any final words of wisdom?

Yes, I have one last bit of advice: Before you close on your new house and receive the loan, the lenders search for any new credit inquiries. This is not the time to open new credit cards or buy anything major, especially if you are borderline qualified.

For more information on home loans or to contact Michelle, visit her website at www.MichelleDavisMortgage.com or call her office at 202-895-7254. Her site has a wealth of information for prospective buyers, including a handy Rent vs Buy calculator and

an online mortgage application.

In some parts of the country, home staging has long been taken for granted as a necessary part of the home-selling process. In the D.C. area, though, it’s a relatively recent phenomenon. If you haven’t bought or sold a house since the housing market implosion in 2007, you probably haven’t realized the huge increase in prep work that the seller is expected to do today. It’s gone far past de-cluttering, cleaning and doing a little touch-up painting.

Think of what’s involved in staging a play, or how the military stages a campaign. We’re looking at logistics, strategy, and a great deal of plan-ning and effort. Almost all properties that are on the market could benefit from being staged. Not only are they more attractive, the really well-staged houses show off their unique features and potential and help them stand above the crowd. Professional staging is not just interior decorating;

it creates a traffic pattern to lead the buyer through the rooms, points out all the storage and other attributes that can be overlooked, and presents the pros and cons of the house in the best light possible (literally and figuratively). A professional stager tells you where to focus your money and energy before you put your

house on the market, and helps you get the most bang for your buck. It’s marketing, pure and simple.

But does this investment really make your house 6% more valuable, as many stagers claim?

Perhaps even more important: Does staging make your house sell faster?

Staging absolutely can make your property seem bigger, newer, and help it stand out from the competition. In

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the new world of internet buying, a well-staged home fairly leaps off the screen at the buyer who’s browsing the listings at midnight. As someone who just bought a house—and who found it online from 2,400 miles away—I can tell you with certainty that the majority of places I saw online did not impress me. I struggled to see past the awkward, bulky furniture, dim light and jam-packed rooms to the bones of the house, but often it was too much effort for my experienced but weary eyes.

You have two seconds to impress your potential buyer and get them to stick with your web listing. A thoughtfully staged home catches the attention of the potential buyer, keeps her looking at your pictures and reading the text, and will help convert that virtual browser to someone who walks through your front door in person with the expectation of maybe buying it. If you can’t make that conversion, your house will sit on the market quite a while.

That’s the key—getting them in the door. I know I looked at hundreds of houses online—and we saw only three houses in person before we made our offer. We were anxious to see those three, and we knew which one was the One before we walked in the door.

So to answer question number two first: Yes, staging makes your house sell faster, 73% faster according to the

Real Estate Staging Association.When your house spends less time

on the market, you can make fewer concessions and aren’t as pressured to lower the price, which primarily justifies the claim that staged prop-erties sell for more money. If your house is on the market for a month with very few viewings, your agent is going to have a serious talk with you about lowering the price. It may not be 6%, but there are other factors in play. If your property is on the market for three or four months, it’s hard to expect a full-price offer.

If your buyers see your house staged and ready to move in, know it’s a new listing and believe it’s well maintained, they may ask for fewer concessions when they make the offer. So yes, staging affects the price posi-tively, even if you don’t list your house at a higher price because of it.

If you’re even thinking about selling, you need to go online and search for the houses that will be your competition. You’ll learn to identify the standouts pretty quickly, and you’ll have a much better idea how your place will compare online. That was a wake-up call for me. My next door neighbor’s house had been stag-nating on the market for four months, and my agent asked me to compare online impressions of that house and mine. After taking an online tour, I immediately agreed to repaint half the

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rooms and rented a storage facility for items I didn’t need. My house had to look better than the house next door.

That’s a good start, but it’s really impossible for us to thoroughly stage it ourselves. We all have our blind spots, especially when it comes to the house we love and have been deco-rating (and filling, and overfilling!) for years. Even if you’re a home deco-rating maven, you can benefit from an objective, professional opinion. Some real estate agents are talented in that area, and they’re willing and able to give you a detailed “to-do” list to get you on the right road. My agent was exceptionally talented, and she knew what buyers were looking for in our region. I was really confident with the changes she requested, and did almost everything she asked. Even she knew she needed professional help when it came to photographs, though. Beware the DIY agent/photographer! Why go to all that effort if the pictures don’t show off your home?

Home stagers vary in their levels of training and expertise. One stager may focus on making small prop-erties seem more spacious. Others might focus on the special chal-lenges of condos— “vanilla boxes,” as one blogger describes them. How do you make one condo appealing and memorable to the online and in-person buyer when it looks just like 500 others, all listed and available?

Not with your beer stein collection, that’s for sure!

If you decide to go with professional help, review their website carefully. Are they using photos of properties they staged, or are they using stock images or those they got from their training programs? Do you relate to the stories they tell with photo-graphs? Are they marketing the properties in discernably different and unique homes, or is it a cookie-cutter approach? What training have they had, or are they self-taught?

Some stagers will work over the phone on an hourly basis, talking you through the process and working from photographs. Some supply rental furniture or direct you to places where you can rent it while the house is on the market. There are even virtual stagers, who take your photographs of empty rooms and use digital magic to paint and furnish the rooms for internet marketing. That can boomerang, though, when the buyers do finally show up.

My story ended happily, with my house selling in nine days for 1.5% below the asking price—a clean deal and $6,000 more than my neighbor’s asking price. I am certain that every dollar and hour we spent preparing the house for sale was worth it, and if we hadn’t staged the house, it would probably still be on the market three months later.

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