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Can the Market Cycle Affect You as a Home Seller?

Today I’d like to give you a quick rundown on the market cycle and explain how it can impact you as a home buyer or seller.

The first thing to understand about the market cycle is that there are four different possibilities for markets at any given time. There is the bottom of the market, an inclining market, the top of the market and a declining market.

We have to understand where we’ve been to figure out where we’re going. None of us have a crystal ball, but what we can do is look at the market’s history:

In 2009, we were at the bottom of the marketplace. From 2009-2013, we saw pretty major appreciation in home values—in fact, we regained all of the losses that we had taken previously from the crash of 2006-2009. So from 2013 to today, we’ve been pretty much at the top of the market, despite the micro-pockets in the Northern Virginia area.
The winter downshift may coincide with an economic downshift.
Why does this matter to you? If you’re thinking of selling your home in the next nine months to a year, we need to talk now. Winter is coming, and with that comes a seasonal downshift. Right now, it looks like that seasonal downshift is going to happen at the same time as an economic decline, so if you want to be able to reap the highest price on the sale of your property, contact me now and I’d be happy to talk with you about what’s happening in the marketplace and how that may impact you.

In the meantime, if you have any questions about buying or selling a home, don’t hesitate to reach out to me by phone or email. Looking forward to hearing from you!

What Buyers and Sellers Can Expect to Pay During a Real Estate Transaction

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Typically in real estate transactions, everything is negotiable. However, there are certain costs that buyers and sellers can usually expect to pay.

Usually, the seller will pay the commission to the broker they hire. The broker then pays out a commission (the amount of which the seller has agreed upon) to both the agent selling the house and the buyer’s agent. Remember, the agent works on behalf of the broker.

As a buyer, you typically have to pay for the appraisal, the termite inspection, loan fees, title processing fees, and the title search. When you select your title company, the title company will search to make sure there are no defects and the title is free and clear. That way, you won’t wind up with hostile claims or other people claiming they own the property once you buy it.

Remember, everything is negotiable.

Things like taxes are paid on both sides of the transaction. The buyer will be responsible for flood certification, prepaid interest, homeowner’s insurance, and property taxes. Sellers can always contribute to closing costs. Remember, everything is negotiable.

If you have any questions about what you can expect from your specific transaction, give me a call or send me an email. I look forward to hearing from you!

3 Different Types of Real Estate Transactions

Buying a Northern Virginia home? Get a full Home Search   
Selling your Northern Virginia home? Free Home Price Evaluation

Many times, buyers approach me and say that they want a deal. Some of these buyers think they can find a deal with a foreclosure or short sale. What is the difference between foreclosures, short sales, and traditional transactions?

First of all, foreclosures are when the bank takes back the collateral for the loan they made. The bank owns the property, which makes them real estate-owned (or REO) properties. When you put an offer on that property, you have to understand that you are negotiating with an institution. It’s not the same as negotiating with Joe Homeowner.

When you negotiate with the bank, you might find yourself saying, “Wouldn’t it make sense to do this instead?” Sure, it would make sense - but you have entered a different type of transaction when you’re negotiating with a bank.

The other thing to keep in mind when dealing with the bank is the statute of frauds, which means all negotiations need to be in writing. They may say they accept your offer but that doesn’t mean anything until you get the documents and sign the contract.

Short sales are anything but short.

When it comes to short sales, remember that they are anything but short. A short sale happens when the homeowner owes more on the home than what it is worth and they need to sell. In this case, the negotiation is with the lender. Say they owe $300,000 and the property is worth $200,000 - they have to negotiate with that lender for the difference of $100,000.

It’s summertime right now and hot as can be. I mention that because if you make an offer today on a short sale, it might be the middle of winter before you get an answer back.

Traditional sales are the easiest of the three. They do come with their own challenges, but compared to foreclosures and short sales, the buying process is simpler.

If you have more in-depth questions about these three transactions, give me a call or send me an email. I would be happy to help you!