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This week’s Q&A column is written by Sallie Seiy of McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article and relevant Alexandria market news, contact Sallie at 703-798-4666 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: I’m just starting to think about buying a house. Are open houses a good place to start? What are the best practices to attend an open house?

Answer: First off, congratulations on the early stages of home buying!

Attending open houses at the beginning stages of your search can really help you narrow (or expand) what and where you are looking to purchase. They allow you to tour new neighborhoods you’re considering, define your likes, dislikes and things that are non-negotiable, gauge market activity, and define a clear picture of home value.

Once you attend a couple of opens, you’ll be a pro. Here are a few tips to get you started on the right foot:

Do a little research first

Decide what neighborhoods you’re most interested in and find homes that match your ideal price point. Although it can be fun to see all types of homes ranging in all types of prices, it doesn’t assist you in the long term. You want to use this time to set your expectations for what’s in your budget and what you like and don’t like before you truly enter the market. By attending open houses in your preferred areas, you can gauge other buyer interest and overall value for that type of home/area. It’ll help down the line knowing if you’re in a competitive area and price point.

No scheduling necessary, but keep an eye on the time!

Open houses are usually Saturdays and Sundays from 12-4 p.m. with common time slots being 12-2 p.m., 1-3 p.m. and 2-4 p.m. If you have too many on your list in varying neighborhoods, you may miss some. In the early days of in-person open houses during the pandemic, there were lines out the door and people had to wait to enter homes. Now, it’s up to the seller and listing agent on how they manage open house traffic, so be prepared to potentially wait. The average time to tour through an open house is about 15 minutes.

Wear shoes that you can easily take on and off

Sellers typically ask those attending an open house or a private showing to remove their shoes or wear the provided shoe covers (also known as booties). It’s a common courtesy to the seller!

Follow the Golden Rule

Treat the home as you’d want your home to be treated. Limit touch and keep your hands to yourself with personal items. You can always ask the agent present to assist you with opening closed closet doors or kitchen drawers.

Sign in!

As a courtesy to the seller and the agent present, please remember to sign in as you enter the home. With the resurgence of QR codes, most agents will have a touch-free way for you to quickly sign in with your smartphone.

Ask questions!

The listing agent or their associate present will greet you at the door and provide you with fast facts about the open. Don’t be afraid to ask specific questions or inquire about the basic facts again. It’s why they are there!

If you are looking to start your home search, please give me a call!

As a fifth generation Realtor and the granddaughter of an architect and builder, Sallie has deep roots in real estate. She is passionate for the charm, history, and architecture of Alexandria and its surrounding communities. If you would like more information on selling or buying in today’s complex market, contact Sallie today at 703-798-4666 or visit her website SallieSeiy.com.

If you would like a question answered in our weekly column or to set up an appointment with one of our Associates, please email: [email protected] or call 703.549.9292.

McEnearney Associates Realtors®, 109 S. Pitt Street, Alexandria, VA 22314. www.McEnearney.com Equal Housing Opportunity. #WeAreAlexandria

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This week’s Q&A column is written by Karisue Wyson, Director of Recruiting & Agent Support at McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article, contact Karisue at 703-615-0876 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: How do I get my real estate license and what happens next?

Answer: The Great Resignation is upon us, and you may be thinking about launching a career in real estate. Good for you! Real estate offers those with an entrepreneurial spirit a path to an income that is limited only by the time, energy and focus that you put into your work.

But beyond dreams of selling luxury homes and being the master of your own workday, what does it really take to get started as a Realtor? Here are answers to some of the most frequently asked questions.

How do I get my license and how long will it take?

The first step in the licensing process is completing 60 hours of the “Principles and Practices of Real Estate for Salesperson” coursework. This can be done online or in-person (limited locations and times) and can take less than two weeks if done in-person, similar or longer for online (depending on how quickly you finish the self-paced work). Popular sites for online classes are TheCEShop and Moseley (which is Virginia focused) but you can find a full list of exam prep companies at the Virginia Department of Professional and Occupational Regulation (DPOR).

After you complete the coursework, you will take an introductory exam that, once passed, allows you to sit for the national and state licensing exams. Scheduling an exam can take a few weeks and while you are completing your studies you should also be interviewing brokerages and learning about the different business models for working in real estate. When you pass your exams, you will then need to affiliate with a brokerage and submit your licensing paperwork before your license becomes active and you can begin practicing real estate. (Currently it is taking about a month to process licensing paperwork.) But wait! You’re not done yet with classwork…

All active new salesperson licensees must complete a DPOR Board-approved 30-hour post-license education (PLE) curriculum within one year from the last day of the month in which the license was issued to remain on active status. If you do not affiliate with a brokerage or have not completed your PLE within one year, your license will be placed on inactive status, and you may need to begin the license application process again. That’s why it’s important to have your timeline mapped out before you begin your coursework.

The timeline to make your move to real estate is up to you, but once you make the leap to get started, be aware that a clock does start ticking.

How much does it cost to start a real estate business?

New agents are often surprised to learn that there are significant costs to getting licensed, even before you sign your first client. In addition to the licensing costs, new agents join several associations — such as local, state, and national Realtor groups, and the local Multiple Listing Service (MLS) — and purchase equipment such as lockboxes, post signs, sign riders, business cards, etc (these costs will multiply if you decide to work in additional jurisdictions like D.C., MD or other regions outside of the Metro-D.C. area).

Many brokerages will offer a new agent package that includes an initial amount of these items at no cost, but you should set aside funds to supplement or replace them as they are used up.

Depending on how you structure your business, you may also incur legal or incorporation fees (although some agents wait to determine how they will structure their business — sole proprietor, limited liability corporation (LLC), S-corp, or other entity… but that’s a discussion for another column).

Start-up costs for real estate can vary but estimating about $2,000 should cover your coursework, licensing fees and association costs, with another $500-$1,000 for costs associated with launching your personal business and branding (if not covered by your new brokerage).

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This week’s Q&A column is sponsored and written by Brian Bonnet, Senior Loan Officer (NMLS ID# 224811) of Atlantic Coast Mortgage, LLC (NMLS ID# 643114). To learn more about current mortgage rates and the home loan process, contact Brian at 703-766-6702 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: What’s the status of the mortgage industry this fall?

Answer: As we roll into fall 2021, the US mortgage industry will see some changes, some more attractive to consumers and some not as much.

Recent positive changes include a reduction in the spread between rates for owner occupied properties and those for second homes and investment properties. Several months ago, regulatory changes caused significant increases in the rates for non-owner occupied properties.

For a period, the rate spread between primary residence properties and non-owner occupied could be as high as 1.75% in rate. That spread is now back down to roughly .500% to .750% making investment purchases and second home purchases more tenable.

At the start of the pandemic, Fannie Mae, Freddie Mac and most of the secondary market imposed various additional restrictive underwriting guidelines. The purpose of the tighter underwriting guidelines was to protect lenders from potential increased risk associated with pandemic related economic downturns. At this point most of the more restrictive guidelines have been lifted and underwriting guidelines generally reflect pre-pandemic standards.

Mortgage program options have continued to rebound as well. Some programs were suspended early in the pandemic, again to allay risk. Many lenders suspended their non-conforming or jumbo programs. At Atlantic Coast Mortgage we suspended our construction loan and bridge loan programs at the beginning of the pandemic.

The good news is we have brought those two programs back. Additionally, we added programs such as special loans for doctors and lawyers. Most lenders in the secondary mortgage market have brought back their jumbo loan programs. The loan program offerings for consumers today generally mirror those offered prior to the pandemic.

The last bit of good news is conforming loan limits are going to increase significantly at the start of the new year. There are no official numbers currently, but we expect the standard conforming loan limit to increase from $548,250 to at least $625,000. At Atlantic Coast we have already begun making conforming loans up to that loan amount.

In the Washington Metro area, we enjoy the benefit of the 2nd tier conforming loan limit which is currently $822,375. That number will also likely increase to somewhere close to $900,000. Conforming loans have less restrictive underwriting standards including lower down payment requirements which make it easier to purchase property in the ever increasingly expensive Washington area.

Now for the less than pleasant news. Interest rates are increasing. We knew it would happen and it is generally a sign of an improving economy. Interest rates have been in the two percentiles for most of the past year. The Federal Reserve’s response to the pandemic economy were the reason for the historically low rates and now the Fed is faced with the need to address the reality of significant inflation. Generally, the Fed’s response to inflation is to increase the Fed funds rate which also has the impact of driving up all other interest rates as well.

Mortgage interest rates have inched into the low three percentiles for most transactions, and we expect they will continue to rise in the coming months. An increase in rates has an impact on a consumer’s ability to qualify for loans. At some point that will translate to pressure against the rising cost of housing. The lack of housing supply has been the primary driver of the cost and it will continue to be so, but a rise in rates will have some tempering affect.

If you would like more information to help plan your next move, please contact Brian Bonnet at [email protected] or call 703.766.6702.

If you would like a question answered in our weekly column or to set up an appointment with one of our Associates, please email: [email protected] or call 703.549.9292.

McEnearney Associates Realtors®, 109 S. Pitt Street, Alexandria, VA 22314. www.McEnearney.com Equal Housing Opportunity. #WeAreAlexandria

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This week’s Q&A column is sponsored and written by Kim Peele and Hope Peele of The Peele Group and McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article and relevant Alexandria market news, contact The Peele Group at 703-244-5852 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: When I fall in love with a house, should I discuss it with my agent while in the home?

Answer: With today’s amazing technology, it’s increasingly likely a home may have a security system or other recording device in use. Homeowners regularly use cameras and sound recording devices for many reasons. Sometimes it’s a security concern, while other times it’s just to see who’s at the front door. Some use cameras and listening devices to check on their children while the babysitter is there or to make sure their puppy is not misbehaving. Whatever the reason, when you’re buying or selling a home, home recording devices should be considered.

One of the first things we tell our buyers when starting to look at homes is to wait until you’re outside to tell us that you love the home. And we certainly don’t want discussions about value and pricing inside the home.

We don’t want to give the seller any inside information on your thought process, especially if you decide to make an offer. We certainly don’t want our buyers to lose any of the negotiation leverage we hope to bring to the table, especially in this competitive market. Have you heard the expression poker face? Don’t show your cards to the other party, either with your face or verbally, when touring a home, whether it’s a private tour with your agent or when you are attending an open house.

So, what are your rights and responsibilities as it pertains to real estate? As a seller in Virginia, the listing agreement asks a question that you must answer honestly, disclosing whether you have a recording system in your home. If you do have a recording system for audio, your agent is required to disclose this to all buyers and their agents.

We know of a situation where the sellers checked the box for “no” audio, forgot about this and decided to check in on their puppy cam, which had been set up and not looked at in a couple of years. Their home had gone under contract with multiple offers, and there were no contingencies or further negotiations that would be affected. However, on a buyer visit to measure for window treatments, they heard the realtor and buyers criticizing their decor. They were offended and told their realtor about this and said that if they were not already committed, they would never have chosen this buyer. They were reminded by the realtor that they were in the wrong for listening, and they were instructed to turn off the camera for any future visits. In Virginia, it’s illegal to record a conversation without consent.

We also know of an instance where a seller signed into their recording system to hear the comments of buyers during their open house. They overheard comments about their home being overpriced, and they were furious. Their realtor had to remind them that they should not have had a recording device in the home without disclosure and that it needed to be disabled immediately — or post warning signs so realtors and buyers were aware.

According to a recent LendingTree survey, 30% of home sellers admitted to using hidden recording devices during open house visits. The study also showed that 44% of buyers would back out of a contract if they learned that the sellers had been recording them.

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This week’s Q&A column is sponsored and written by Ann Duff of McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article and relevant Alexandria market news, contact Ann at 703.965.8700 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: Where in the World Wide Web can I settle on my new home?

Answer: It started in March 2020 — my first “drive-by” settlement in a parking lot with sellers getting a clipboard, papers and a clean pen through their car window. I was in another car watching with my phone on speaker. The buyers copied the process 15 minutes later — same parking lot, same paperwork plus loan documents. It worked. One-time event, right?

Au contraire — as in so many areas, the real estate world has permanently changed due to the pandemic and safety worries. Here are some distinct differences in today’s world.

In the olden days of pre-2020, the highest tech was a “mail-away” scenario where papers were sent to sellers to print and go to a bank to find a notary wherever they were.

Now, the notary will come to you (called a mobile closing or remote notarization). The title company will designate a company and have a trained human come in person to your dining room table to tackle the papers and authenticate the actual signing before scanning and shipping everything to the closing company. For my clients, with the keen cooperation between the lenders and the title company, my far-flung sellers have opened their doors to these live notaries and completed their work in places from Vancouver to Colorado Springs to Naples, Italy.

A remote company can also handle long-distance virtual seller signings, and this is called eNotary. Just this year, I have had legal electronic signings occur with a seller recuperating in a Paris hospital and others unpacking at their new home in Austin, Texas. No face-to-face human interaction — just phone connections and internet presentation of the documents.

Buyers can now occasionally join in on the long-distance, remote-signing fun. International settlements were recently tricky due to time zones and FHA/FreddieMac/VA loan requirements that everything be signed on exactly the same date, which meant staring at the door waiting for FedEx or DHL to appear before 5 p.m. Now, buyers can standby for that very long-distance call, ask their questions and make an appointment with the approved eNotary.

“Hybrid settlements” have increased exponentially. According to one title company, every month more and more diverse closing styles are taking the place of sitting around the table at the lawyer’s office or settlement company conference room. I miss the camaraderie and ceremony of the group meeting of the sellers and buyers, but times have changed… Some in-person, some electronic, some in-office, the variable scenarios do add up to the official transfer of property, just without the warmth, good cheer, key transfer and stories about the neighborhood cat everyone feeds or the wonderful UPS fellow who goes the extra mile.

So why not just have local someone else show up to sign, you ask? There are strict rules these days on granting a Power of Attorney (POA) to sign on your behalf. No one with a financial interest in the transaction can be given this responsibility, so you need to find a relative, trusted friend or hire another attorney not involved in this specific closing. And, that person needs to actually show up ready to perform the tasks. “Wet signatures” with real ink are still required on Deeds of Trust, though one-by-one some jurisdictions are allowing carefully controlled electronic signatures. Even so, worry remains about the potential for foul play or hacking.

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This week’s Q&A column is sponsored and written by Peter Crouch of McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article and relevant Alexandria market news, contact Peter at 703-244-4024 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: How can I buy a house before selling my current one?

Answer: After skipping a year, the real estate market is playing out its usual late summer to fall softness. It’s hard to call it a slowdown since sales in many areas remain brisk. Last year, however, during the COVID-19 rush to buy social distancing via one’s home, we did not have this traditional softness. So, what does that mean for people who are considering selling a home?

We have all heard about “low inventory,” meaning fewer than average homes on the market. Sellers have been reluctant to put their homes up for sale, wondering how they will manage the timing and contingencies as they become potential buyers. As a buyer, the market has demanded they have no contingency on the sale of a prior house — how do they buy without having first sold? They are also bombarded with TV commercials and mail solicitations about selling their home directly to one of the “flippers” who buys homes quickly in any condition. So, the dual issues for sellers have been the prospect of becoming a buyer, plus the issue of what to do if their home is not perfectly market-ready.

These two issues have recently been addressed. First, in order to become a cash-ready buyer, sellers can now sell their home to an intermediary, free up their cash and stay in their house for up to 12 months while they shop for a new home. This is essentially fast and easy “bridge financing.”

There is now also a platform to seek bids from the “flippers” so you know what they are really offering — and can weigh that against selling with full market exposure. As experienced real estate brokers, we have always assisted sellers with the preparation of their homes. We have a stable of great contractors who can spruce up a house for market. Many of them will hold financing until settlement. We have always believed, and still do, that some prep and full market exposure is the best option for our seller clients. For houses that need major work, however — and where sellers are really considering the flippers — having a platform to check multiple flippers against full market exposure truly gives sellers all the options.

These two seller options are part of the McEnearney Advantage program. In addition to our traditional top-flight service, we can now add both modern bridge financing and a platform to evaluate online or flipper offers.

So, if the idea of selling your home has been too daunting, let us give you all the options. Having all the options means you are both a fully-informed seller and an unpressured buyer. Best of both worlds.

Pete Crouch is a Seniors Real Estate Specialist, which means he is well-versed in all aspects of moving as we age. His own downsize gave him tremendous insights into what is involved, from emotional matters to real estate considerations. Pete is a Board Member of At Home in Alexandria (AHA), our local Senior Village, and was the 2018 National Recipient of the “Outstanding Service Award” by the National Association of Realtors for his work with Senior Moves. Text 703-244-4024 or email [email protected] for a copy of his Downsize Alexandria! Booklet about living more simply in Greater Alexandria.

If you would like a question answered in our weekly column or to set up an appointment with one of our Associates, please email: [email protected] or call 703-549-9292.

McEnearney Associates Realtors®, 109 S. Pitt Street, Alexandria, VA 22314. www.McEnearney.com Equal Housing Opportunity. #WeAreAlexandria

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This week’s Q&A column is written by David Howell, Executive Vice President and Chief Information Officer, of McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article and relevant market news, contact David at 703-738-9513 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: Is the number of home sale contracts in Alexandria City closer to normal levels this year than in 2020?

Answer: In August we wrote about our mid-year Market Report, which takes a look at closed sales in Alexandria City for the first half of 2021 compared to the same months of 2020. As expected, there were substantial improvements this year compared to the peak months of shutdowns and isolation due to COVID. But 2020 was definitely not a normal year as far as traditional spring and summer markets are concerned, so this week we decided to go a little further back and compare contract activity for this year with both 2020 and 2019, which was a more “normal” year for Alexandria real estate.

For the past three years, overall contract activity for the first eight months of each year breaks down as follows:

  • 2019 had 1,824 contracts
  • 2020 had 1,873 contracts
  • 2021 had 2,256 contracts

As the first two charts below show, those strong numbers for 2021 bear out for each price category and property type (condo, attached and detached homes). The third chart looks at contracts by month and demonstrates that this year mirrors 2019 with more activity during the spring months and a bit quieter in July and August. COVID was a major disrupter to that typical spring and summer cycle last year. (Source: BrightMLS. Data deemed reliable but not guaranteed.)

In August we included the following thoughts about what’s ahead for the second half of the year. We look forward to a strong fall market!

  • We expect buying activity to continue to improve — modestly — through the rest of the year.
  • While the abundance of condo inventory will gradually be absorbed, there will continue to be relative bargains available to the purchasers of smaller units.
  • Continuing a trend from the last couple of months, there will be marginally more new listings coming on the market than homes going under contract. That will gradually begin to ease the very tight supply of attached and detached homes.
  • Based on our own projections and the BrightMLS forward-looking Home Demand Index, almost every area of the city will be in the “high demand” category, signaling a healthy second half of the year.
  • The area with the highest demand will likely be the West End.
  • By price range, we will likely see detached homes priced between $700,000 and $1,250,000 continue to be exceptionally strong. For attached homes, the hottest price range will be $500,000 to $1,000,000. In both cases, these will be what we consider “extreme” seller’s markets.
  • For condos, the hottest part of the market will be for units priced between $500,000 and $800,000, but that price range will not be as strong as the market for attached and detached homes.

If you would like a question answered in our weekly column or to set up an appointment with one of our associates, please email [email protected] or call 703-549-9292.

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This week’s Q&A column is sponsored and written by Lisa Groover of McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article and relevant Alexandria market news, contact Lisa at 703-919-4426 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: What updates should I consider if I’m thinking about selling my home in a year?

Answer: This is a frequently asked question and one I am happy to address here. It is also a service I provide to my friends, neighbors and potential clients on a regular basis.

Start at the street, remembering that you only have one chance to make a first impression.

Does your home have curb appeal? Based upon the condition of the outside, would a buyer be motivated to check out the inside? Or do you need to think about painting, enhanced landscaping, new front door hardware or gutters? Is the driveway or sidewalk cracked? Does the fence need to be repaired or power-washed and stained? How old is your roof? (All buyers ask this question!)

Take a look at the photos of recent sales in your neighborhood to identify what the sellers did to get ready for market. Then walk through your house room by room to make a list of what types of repairs and/or upgrades would best showcase the features of your own home.

Because you have time before you are seriously thinking about selling, you can spread the updates and budget over a period of time. So many people wait until they are about to sell their house to make changes, and then wish they had been able to enjoy them earlier.

Consider the condition and age of your floors, walls, light fixtures, countertops, cabinets, bathrooms, and appliances and systems like the A/C, furnace, and hot water heater. Once you have your list, determine the priorities based upon your budget, keeping in mind that there are ways to update without a full remodel.

Unless you are planning to sell your house “as-is,” meaning you are not going to make any repairs or replace any of the mechanicals, buyers may pass on a purchase that will require a new HVAC system or roof or a home that has previous water damage. Fix those things upfront rather than waiting until a home inspection creates an opportunity for your buyers to void the contract.

Keep in mind that fresh paint is the least expensive way to make a big impact. I have a lime green kitchen, hot pink bathroom, and orange accent walls in addition to my collection of colorful contemporary art. I love the look, but I know that the colors will be distracting to buyers when the time comes. Although I have no intention of selling, I just had all of my hardwoods refinished, added new light fixtures and ordered some new furniture. I am also painting the walls white and moving my artwork around for a fresh new look to a home that I have lived in for almost 24 years.

Keep in mind that your goal when selling your home is to provide the potential buyers the opportunity to picture their own furniture and accessories in the space — not to worry about what they need to fix or replace. Take a step back, keep an open mind and consider bringing in a professional to make some suggestions.

Whether you are thinking of buying or selling — or just need suggestions for updating your home — I am happy to provide ideas or recommend contractors for your specific projects. I am a resource for the duration of homeownership, not just the buying or selling process. Feel free to reach out anytime!

Lisa Groover is a licensed real estate agent with McEnearney Associates, Inc. in Old Town Alexandria, VA. As an active member of the community since 1989, Lisa specializes in Alexandria and is thrilled to have the opportunity to work closely with her friends, neighbors, former clients and their referrals.

In addition to enjoying the Old Town lifestyle and the art-related events and activities, she is a member of a number of volunteer organizations. Having had eight Golden Retrievers, she is dedicated to helping other dog owners through the challenges of renting, buying and selling their home.

If you would like a question answered in our weekly column or to set up an appointment with one of our Associates, please email: [email protected] or call 703-549-9292.

McEnearney Associates Realtors®, 109 S. Pitt Street, Alexandria, VA 22314. www.McEnearney.com Equal Housing Opportunity. #WeAreAlexandria 

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This week’s Q&A column is sponsored and written by Kim Peele and Hope Peele of The Peele Group and McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article and relevant Alexandria market news, contact The Peele Group at 703-244-5852 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: How much is my home worth?

Answer: Whether you just bought your home or you have owned it for years, it’s always fun to keep up with the current value and to see how your investment has appreciated.

As interesting as it is to see the recent sales and speculate your home’s worth, it’s important to note that many homeowners get a false idea of value by looking at online sites and other assessments. While those sources offer estimates of home value, most of them are not accurate and are just very rough approximate values. This is fine if you are not planning to sell anytime soon. However, it is super important to know the correct value range when it’s time to put your home on the market.

Your most important resource for a true value assessment of your home will be an experienced professional Realtor.

First, let’s talk about where homeowners tend to find information on home values. Everyone gets a city or county tax bill, which includes an assessment of value. The tax assessed value can be much lower or much higher than what your home would actually sell for on the open market. In most cases, an assessor has never seen the inside of your property. They use a software program based on sales data and a rough comparison of property features. Their goal is to provide a tax bill for town revenues, and they are not purporting to be an accurate source of value.

Another popular, yet misleading, source of home data is online valuation sites. Zillow is the main one that homeowners cite when discussing value. However, as with most of the online sources, Zillow gets its information from a combination of county websites, user input and recent sales. They publish their margin for error on their website, and in many cases, the error range can be significant. For instance, in Arlington County, Zillow lists the median error rate as 2.5%, so their valuation of a $1 million home is likely to be off by $25,000 or more. In other areas, the error rate is even higher. To view the Zillow margins for error in Virginia, check out Virginia Data Coverage and Zestimate Accuracy.

Another frequently used source of value is the neighborhood grapevine. Your neighbor sold their home, had multiple offers and it sold for well above list price. You think that your home is better than their home, and therefore, you decide that your home value is even higher. Unfortunately, unless you are planning on listing your home within a few weeks of your neighbor’s sale, this data can be unreliable. The real estate market can change drastically in just a short period of time, and it is important to look at not only comparable sales, but also the most recent ones. And, of course, the ages of the roof, HVAC, windows and other features must be accounted for in a value calculation.

So, as you can see, county assessments, online sites and neighbors are frequently used unofficial sources of home value. It’s fine to keep tabs on the market using these sources if you just want a general idea of value, but when the time comes to get serious about selling your home, it’s time to drill down into the details to determine value.

When the time comes to sell your home, what do you do to determine a good list price?

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This week’s Q&A column is written by David Howell, Executive Vice President and Chief Information Officer, of McEnearney Associates Realtors®, the leading real estate firm in Alexandria. To learn more about this article and relevant market news, contact David at 703-738-9513 or email [email protected]. You may also submit your questions to McEnearney Associates via email for response in future columns.

Question: Are there benefits to listing my home on the MLS vs. selling it privately?

Answer: In today’s hot real estate market, some sellers may be tempted to sell their home privately, though a private sale does not include full exposure to the market through the multiple listing service (MLS), the internet, and the thousands of agents and brokerage companies who work in this region. We’ve heard a number of possible reasons for wanting to do so, including convenience, privacy and security.

At McEnearney Associates, we believe homeowners have the right to make that decision. We also believe that it is crucial to be informed, and sellers should fully understand the implications of listing privately when making their decision. The simple fact of the matter is — regardless of the listing company — sellers almost always benefit from full market exposure, and the data validate our conviction.

BrightMLS, our regional multiple listing service, recently completed a two-year study looking at almost a half-million sales and analyzing the results of “off-market” sales vs. those sold through the MLS. To help ensure objectivity, the study was guided and validated by two Ph.D. economists who have no ties to the MLS. The results are conclusive.

The study showed sale records of homes that were sold through the Multiple Listing Service and promoted to the entire BrightMLS network of 95,000 real estate professionals, concluding that these homes sold for higher prices than homes sold off the Multiple Listing Service. The median sales price for homes sold on-MLS was 16.98% higher than homes sold off-MLS. Similar results are demonstrated across BrightMLS’s three major Metropolitan Statistical Areas (MSAs) of Philadelphia, Baltimore and Washington, D.C.

As a subset of off-MLS sales, Bright analyzed “private sales,” which are defined as office exclusive listings promoted only within a brokerage office or company. Those office exclusives make up a small percentage of transactions, and nearly two-thirds (63%) ultimately end up not selling off-market and are instead promoted through the MLS. Like the findings from all off-MLS sales, homes marketed on the MLS sold for a median sales price of 16.84% more than those marketed through office exclusive arrangements. Additionally, those office-exclusive listings typically took longer to sell: Homes entered into the MLS from the start went under contract faster than properties that started as an office exclusive and were later marketed on the MLS.

It’s stunning that the results are so similar and so compelling.

Now, doesn’t this stand to reason? No individual agent or company has access to all of the buyers or even the majority of the buyers. Thus, in a time of record-low inventory, does it make economic sense to artificially restrict the number of buyers who could be interested in a property? To intentionally curb the demand side of the supply and demand equation?

Furthermore, we believe it is in the best interests of our clients to provide all qualified buyers equal access to all homes on the market, not only to protect equal housing opportunities but to ensure that they maximize the value of the investment in their property.

We’ll leave you with the following two questions:

  1. Is almost 17% a big price to pay for the perceived “convenience” of selling off-market?
  2. Who benefits most from an off-market sale — the seller or the listing company?

Read the full Bright On/Off MLS Study on our website.

If you would like a question answered in our weekly column or to set up an appointment with one of our Associates, please email: [email protected] or call 703-549-9292.

McEnearney Associates Realtors®, 109 S. Pitt Street, Alexandria, VA 22314. www.McEnearney.com Equal Housing Opportunity. #WeAreAlexandria

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