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Archive for March, 2010

10 Questions to Ask When Deciding to Purchase a Condominium

Yesterday we talked about the 5 questions you needed to ask before writing a contract on a condominium.  Today we are going to back up a bit and look at 10 questions to ask when deciding to purchase a condominium.

This terrific set of questions was put together by Richard Vetstein, a Massachusetts real estate lawyer with extensive experience.  Richard makes the point that “. . .  you are buying into the entire project as much as you are the unit, and your decision will impact your daily living and your ability to re-sell.”

Here from Richard are the 10 questions buyers should ask when deciding to purchase a condominium unit:

  1. What is the monthly condominium fee and what does it pay for? The monthly condominium fee can range quite dramatically from condominium to condominium. The fee is a by-product of the number of units, the annual expenses to maintain the common area, whether the condo is professionally managed or self-managed, the age and condition of the project, and other variables such as litigation. For budgeting and financing you need to know the monthly fee and exactly what you are getting for it.
  2. What are the condominium rules & regulations? Condominium rules can prohibit pets, your ability to rent out the unit, and perform renovations. Make sure you carefully review the rules and regulations before buying.  Needless to say, the buyer’s attorney should review and approval all condominium documents, including the master deed, declaration of trust/by-laws, covenants, unit deed and floor plans to ensure compliance with state condominium laws as well as Fannie Mae and FHA guidelines, as necessary.
  3. How much money is in the capital reserve account and how much is funded annually? The capital reserve fund is like an insurance policy for the inevitable capital repairs every building requires. As a general rule, the fund should contain at least 10% of the annual revenue budget, and in the case of older projects, even more. If the capital reserve account is poorly funded, there is a higher risk of a special assessment.  Get a copy of the last 2 years budget, the current reserve account funding level and any capital reserve study.
  4. Are there any contemplated or pending special assessments? Special assessments are one time fees for capital improvements payable by every unit owner. Some special assessments can run in the thousands. You need to be aware if you are buying a special assessment along with your unit.  It’s a good idea to ask for the last 2 years of condominium meeting minutes to check what’s been going on with the condominium.
  5. Is there a professional management company or is the association self-managed? A professional management company, while an added cost, can add great value to a condominium with well run governance and management of common areas.
  6. Is the condominium involved in any pending legal actions? Legal disputes between owners, with developers or with the association can signal trouble and a poorly run organization. Legal action equals attorneys’ fees which are payable out of the condominium budget and could result in a special assessment.  In most states, you can run a search of the condominium association in the court database to check if they’ve been involved in recent lawsuits.
  7. How many units are owner occupied? A large percentage of renters can create unwanted noise and neighbor issues. It can also raise re-sale and financing  issues with the new Fannie Mae and FHA condominium regulations which limit owner-occupancy rates.
  8. What is the condominium fee delinquency rate? Again, a signal of financial trouble, and Fannie Mae and FHA want to see the rate at 15% or less.
  9. Do unit owners have exclusive easements or right to use certain common areas such as porches, decks, storage spaces and parking spaces? Condominiums differ as to how they structure the “ownership” of certain amenities such as roof decks, porches, storage spaces and parking spaces. Sometimes, they are truly “deeded” with the unit, so the unit owner has sole responsibility for maintenance and repairs. Sometimes, they are common areas in which the unit owner has the exclusive right to use, but the maintenance and repair is left with the association.  Review the Master Deed and Unit Deed on this one.
  10. What Does The Master Insurance Policy Cover? The condominium should have up to $1M or more in coverage under their master condominium policy. For buyer’s own protection, they should always buy an individual HO-6 policy covering the interior and contents of the unit, because the master policy and condo by-laws may not cover all damage to their personal possessions and interior damage in case of a roof leak, water pipe burst or other problem arising from a common area element. Ask for a copy of the master insurance policy and don’t forget to check the fine print of the by-laws.  Sometimes, there’s language that would hurt a unit owner in case of a common area casualty.  Condominiums over 20 units should also have fidelity insurance to protect against embezzlement.

In the Commonwealth of Virginia, condominium documents (which answer all these questions) must be provided to the buyer prior to closing but may also be requested just as a point of reference.

Michael

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5 Questions to Ask Before Writing a Contract on a Condominum

Our mortgage broker tells us that with the recent changes in how condominium loans are approved, there are 5 questions you should ask before writing an offer on a condominium.

The information for the 5 questions can be obtained from the management office of any condominium complex fairly quickly.  A good lender will be able to provide strategic feedback once the information has been provided. 

It is only then that you should consider writing a contract.  In fact, many of the ‘fallout’ situations we are seeing with condo loans could be avoided if these 5 questions were answered first.

If you have any trouble getting the answers to these questions, that should be a sign in itself that all is not well.

5 Questions to Ask Before Writing a Contract on a Condominium:

  1. What percent of the total number of units are owner occupied?
  2. Does one entity own more than 10% of the total number of units?
  3. What is the condo fee delinquency percentage?
  4. What percent of the units are commercial?
  5. Has the association been in control by the unit owners for more than 12 months?

Want more information about why these questions are so important?  Give me a call at 703.927.4554 and we’ll work on it together.

Michael

 

 


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The Great Del Ray Easter Egg Hunt – 2010

Ok, so there are some folks who think that you have to go the White House to hunt Easter eggs, but those in the know opt for the Great Del Ray Easter Egg Hunt (GDREEH) right here in Alexandria.

Started just last year by Eric Nelson at Artfully Chocolate with 300 eggs, the GDREEH took a huge leap forward this year with a block full of sponsors, charity partners and over 2,000 eggs. 

Eric was joined this year by Barkley Square, Erickson & Ripper Gallery, Executive Lock (Hardware Store), the Purple Goose, Thai Peppers and Evening Star. 

Charity partners, the American Red Cross and the Animal Welfare League of Alexandria, collected contributions while having a chance to talk about their work in the community.

And the grand prize for all this hard work?  A 26 inch chocolate bunny from Artfully Chocolate.

What?  You couldn’t make today’s Great Del Ray Easter Egg Hunt

Never fear, next Saturday, a little further south on Mt. Vernon Avenue, our favorite Eclectic Nature will hold their Sixth Annual Egglectic Nature Easter Eggstravaganza

Check it out!

Michael

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U.S. Route One Gets ‘Historic’ Designation in Virginia

U.S. Route 1, once a major north-south corridor, will soon get a ‘historic’ designation for the portions that pass through 19 cities and counties in Virginia. The legislation was passed in the most recent General Assembly session in Richmond.

 

The legislation will take effect July 1 and while it will not cost the state government any money, localities will be required to pay for new signage at a cost of $400 per sign. 

This however will not change the official name of the road in Virginia where it is formally known as the Jefferson Davis Highway in honor of the president of the Confederacy.

U. S. Route 1 runs nearly 2,400 miles, from Fort Kent in Maine to Key West in Florida, roughly paralleling Interstate 95. Before the introduction of the interstate highway system, it was a major north-south route down the Eastern seaboard. 

 

For much of Alexandria it is still a major north-south route with four lanes, traffic lights and rush-hour congestion.

It is also a key component of development plans for Potomac Yard and just recently the City of Alexandria was awarded some $9 million in grants for enhanced transit services on the highway.

Ummmmm, how long do you think it will take GPS systems to get up to speed on ‘historic’ Route 1?

Michael

Thanks to Wayne Hulehan, an invaluable source of information in the Del Ray/Rosemont/Beverly Hills area, for this tidbit.

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Signs of Spring

And it only gets better.

Michael

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Top 10 Kitchen Trends for 2010

Like all industries, the kitchen and bath folks like to announce and pronounce trends to make us all sit up and take notice. 

This latest offering of the top ten kitchen trends for 2010 is from the National Kitchen and Bath Association’s poll of design professionals.

One of the big trends is to hide as much as possible.  We’re not talking a “coffee garage” tucked into a corner.  Nope, this is serious hiding – under the counter refrigerator drawers, dishwashing drawers, drawers for appliances – all so these necessities will not interfere with the design esthetic.  

In all fairness, dishwashing drawers do allow for running smaller loads thus saving water and electricity – just not sure how long it would take to recoup the initial investment.

Some of the other trends:

Color: Shades of white and off-whites are the most common kitchen colors, followed by brown, beige, and bone hues.

Cabinetry: The most popular wood for kitchen cabinetry remains cherry, then maple. On the decline, painted cabinetry and light natural finishes and distressed finishes.

Design style: Traditional is still the most popular kitchen design with contemporary a close second.  (What would come in between?)

Flooring: Ceramic and porcelain tile and natural stone remain the most popular kitchen flooring but hardwood is making it’s presence felt.

Countertops: Granite is still the most popular option, but quartz is inching up.

What, no prediction on the future of stainless steel appliances?

Michael

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The MV Big Flea is Coming Your Way on April 24

The MV Big Flea – Alexandria’s biggest charity flea market – is coming your way on Saturday, April 24.  The MV Big Flea is the brainchild of the Mt. Vernon Community School PTA and supports school activities year round.

This year the MV Big Flea has even caught the eye of Antiques Roadshow’s own Leslie and Leigh Keno.  The Keno brothers were quick to note that last year the MV Big Flea sold a rare Audubon print.

Thinking maybe you can’t wait until April 24?  Well then, hurry on over to the MV Big Flea Store at 1219 First Street, just behind the MacDonald’s on Rt. 1 North (close to the Monroe Street Bridge).  The store is open every Saturday until April 16 from 2-4pm  to take in donations and for early sales.

It’s a great time to preview the merchandise, all of which is carefully ‘curated’.  This is NOT the place for ‘junque.’

Things you need to know about the day of sale:

It’s a great cause, it is truly a community event, you can snag some great bargains and it’s the perfect way to start off your Saturday in Del Ray.  Oh, don’t forget the Farmer’s Market.

Want to know more about living in this great neighborhood?  Give me a call at 703.927.4554 and let’s talk houses.

Michael

 

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2010 Cherry Blossom Festival Brings More Than One Million Visitors to Washington, DC

A 1912 “friendship” gift of 3000 cherry trees from the mayor of Tokyo, Yukio Ozaki, set the stage for what is now the annual National Cherry Blossom Festival

 

 Starting March 27, and running through April 11, the 2010 festival will draw well over 1,000,000 visitors to the greater Washington, DC area, including Alexandria.  After a winter that saw over 55 inches of snow in the region, the return of the iconic cherry blossom is a welcome site.

A full, two week schedule of activities will feature everything from sake tasting to kite flying to a parade to the largest Japanese Street Festival in the United States. 

First Lady Helen Heren Taft planted the first two cherry trees on March 27, 1912.  That same year the United States sent flowering dogwoods to Japan as a gift and did so again in 1965.  During the duration of World War II the Japanese trees were referred to as “Oriental” trees and the festival was suspended between 1942 and 1946. 

Read the rest of this entry »

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Mortgage Rate Stability May Hinge on End of US Treasury Purchases of Mortgage Backed Securities

Our go to mortgage guy, Rob Clark, offers that mortgage rate stability may hinge on the end of a US Treasury program that purchased mortgage backed securities.



Rob goes on to say “According to some analysts, mortgage rates  “wandered about aimlessly” last week.  It is becoming apparent that the current economic recovery will be a very slow and muted affair, at least for the time being.

With manufacturing issues appearing to cool, consumers remaining on the sidelines, and, in last week’s Producer Price Index (PPI) and Consumer Price Index (CPU), inflationary pressures seeming to be nearly nonexistent, the Fed will likely be able to maintain its low rates for some time. The Fed’s policy statement last week said as much, with the Fed leaving rates unchanged again.

This week could be another week of the same for rates, but there are some unknowns coming. While many have pointed out that the Fed continues to have many tools available to influence rates, its campaign of buying mortgage-backed securities will come to an end on March 31st.

While there appears to be some significant stability to rates right now, markets can turn quickly. Hopefully it will not happen, but even a false rumor could lead to a spike in mortgage rates in the coming weeks.”

For Rob’s full report, click here.

Michael

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Alexandria Real Estate Market Report for Del Ray, Rosemont and Temple Park

The February 2010 Alexandria Real Estate Market Report for Del Ray, Rosemont and Temple Park – those neighborhoods in zip code 2301 – show a marked improvement over the same period in 2009.

Although the number of sales is down 33%, from 9 in 2009 to 6 in 2010, the average sold price is up 18% for the same time period.  The days on market (DOM) made an even stronger showing, dropping from 84 in 2009 to 28 in 2010.  All this despite the weeks of snow that brought the market to a virtual stand still here in Alexandria.

It will be interesting to see what happens with the March numbers.  Open houses were rampant this weekend with buyers and sellers ready to make a move.  As always price is key. 

The numbers below represent sales of single family dwellings, condominiums are not included.

February (22301 zip)
2009
2010
Av. List Price
$540,367
$637,083
Av. Sold Price
$619,589
$630,750



Low List Price
$299,900
$435,000
Low Sold Price
$285,000
$406,000



High List Price
$825,000
$885,000
High Sold Price
$792,000
$886,000



# of Home Sales
9
6
Av. Days on Market
84
28

Want to know more about available properties in the Del Ray, Rosemont and Temple Park neighborhoods?  Give me a call at 703.927.4554 and let’s talk.

Michael

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