Ask Eli

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: I’m hoping to purchase a home this year and wondering what types of inspections I’ll be able to do on the home before buying it and about how much they will cost.

Answer: Most sales contracts include an Inspection Period (usually 3-14 days after an offer is accepted) for buyers to conduct various inspections of their choice on the property. Depending on how the contract is structured, buyers may have the right to negotiate for repairs or credits based on the findings and/or the right to terminate the contract.

Standard/Common Inspections

General Inspection: This is the most common inspection for buyers to conduct with costs ranging from about $300-$1,000 depending on the size, age and type of the home. A General Inspector is hired by the buyer and works for the buyer, not for the seller or the buyer’s agent.

A general inspection is classified as a “visual inspection” of the surface, structural and mechanical components of a home like appliances, flooring, electrical, plumbing, foundation and other elements which includes running all mechanical components they can access. Your inspector cannot open up walls or floors and, in many cases, cannot climb on roofs.

A good inspector will be able to identify many of the home’s flaws through the general inspection as well as identify any signs that further specialty inspections are needed (see below). Some inspectors carry high-end thermal readers to find evidence of moisture, poor insulation, or faults in the ductwork.

After the inspection, you’ll receive a detailed report with photos, descriptions and recommendations of everything the inspection covered. An extra benefit of an inspection is that you’ll learn a lot about how your home works and property maintenance.

Radon Testing: Radon is toxic gas from the ground that is known to cause cancer with prolonged exposure above certain levels (EPA website). Most homes in Northern Virginia have an average to above average risk of elevated radon levels and it is impossible to know without testing. Radon levels can vary widely from one house to another on the same block.

I always recommend buyers test for radon if they have basement/below ground living areas (radon generally doesn’t impact above-ground levels). The test is relatively inexpensive ($150-$200) and most general inspectors can administer the radon test as well, which requires a small box to sit in the basement for 2-3 days.

In the event of elevated radon levels, radon remediation systems are highly effective and usually cost about $1,000.

Wood-Destroying Insect (WDI) Inspection: Around here this is primarily an inspection for termites or carpenter bees. With a cost of $50 or less it makes sense for buyers to order this for a purchase of a townhouse or single-family detached home (generally not necessary for a condo).

Of note, the Northern Virginia Sales Contract requires sellers to cover the cost of any treatment or repairs related to WDI. This can usually be ordered with the general inspection or separately with a pest company.

Specialty Inspections

In some cases, it makes sense to bring in specialists for additional inspections. This may be on the recommendation of your General Inspector or for a number of other reasons.

Ultimately, this comes down to a cost-benefit analysis by you and your agent because you can easily spend thousands of dollars on specialty inspections. The following is not an exhaustive list of specialty inspections, but those that tend to be the most common. Cost estimates do vary.

1. HVAC Inspection ($150+)
2. Chimney Inspection (free-$200): A structural flaw in a chimney or a failing liner can be very expensive or unsafe if you plan to use the fireplace. A chimney inspection will include a scope of the interior of the chimney.
3. Roof Inspection (free-$200)
4. Mold Testing ($150+): Ranges from air sampling to testing of a specific area with known mold.
5. Lead Testing (varies): If you suspect lead-based paint or want to test for lead in the water. This is worth further discussion around lead and lead paint with your agent.
6. Structural Inspection ($250-$1,000+): Settling and settlement cracks are normal, but signs of continuous or abnormal settlement warrant a visit from a structural engineer. A good General Inspector will be able to tell you whether or not further structural evaluation is recommended.
7. Water/Sewer/Gas Line Inspection ($500+): The main lines connecting your water, sewer and gas from the public lines to your home are expensive failure points, with replacement usually costing $5k-$10k in addition to repairing any landscaping, driveway, etc torn up in the process. Tree roots are a common cause of damage. These inspections involve scoping of the entire line and get pretty expensive. An alternative to paying for these inspections is purchasing relatively cheap insurance through Dominion Energy’s insurance partner HomeServe.
8. Electrical Inspection ($200-$500): If there are concerns over the quality of the electrical system/installation, you can hire an electrician for further evaluation.
9. Plumbing Inspection ($200+): If there are concerns over the quality of the plumbing lines, you can hire a plumber for further evaluation and, for an additional cost, scope the plumbing lines.
10. Pool Inspection (varies)

I usually recommend starting with the standard inspections and adding additional inspections as needed. If you want to include a bunch of specialty inspections in addition to the standard inspections, you’ll want to make sure your contract provides enough time in the Inspection Period to complete all of them and set that expectation with the seller up-front, especially if the home is occupied.

Keep in mind that even with a full Inspection Contingency in place, with the right to negotiate for repairs and credits, there’s no guarantee that after paying thousands of dollars for inspections that the seller will agree to repair, replace, or credit everything you ask them to.

If you’d like a question answered in my weekly column, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.

Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: I am interested in making an offer on a home, but the asking price is nearly $80,000 higher than the county’s tax value. Will I be overpaying if I offer over the tax assessment? Can I use the tax assessment to negotiate a lower purchase price?

Answer: This is one of the most common questions I’m asked by clients early in the buying process. The fact is that the majority of homes are assessed below market value (sold price) and you should not rely on the county’s assessment to determine how much you’re willing to pay for a home.

Negotiate Away, But Don’t Expect Them To Listen

As for using it in negotiations, you should find any angle you can to negotiate a better deal for yourself so if pointing out the tax assessment helps you get a better deal, by all means go for it! However, don’t be surprised when the seller or the seller’s agent quickly dismiss it, especially if they’ve seen the data presented in this column (sorry).

2018 Tax Assessment vs 2018 Sold Prices

Let’s take a look at how Arlington county’s 2018 Tax Assessment Values compared to the actual purchase price of homes that sold in 2018. The table below is based on 689 of the ~3,000 total sales in Arlington from 2018.

For some reason, the MLS doesn’t have updated 2018 tax assessments for most of the transactions hence a limited data set, but 689 data points are plenty.

In 2018, homes in Arlington sold an average of 7.6% higher than their assessed value. By comparison, Zillow claims that their Zestimates have just a 3.3% margin of error in Arlington. Just 17.1% of homes sold for less than their 2018 tax assessment and only 8.3% sold for 5% or less than the assessed value.

Appealing Your Tax Assessment

If you’re an Arlington homeowner, you should be happy to hear that you’re most likely paying taxes (.996% rate) on a value that represents less than what your home is worth.

For those of you who are not happy with the assessed value of your home, every year you have an opportunity to appeal your assessment, but the burden of proof is on you, not the county, and it’s not easy even if you have solid data. Arlington provides an informative website on the appeal process.

Quick hits on that process:

• Your first appeal with the Dept. of Real Estate Assessments must be filed by March 1 of that year.
• Step 1: Call 703-228-3920 for information on how your assessment was determined.
• Step 2: File your appeal online here (First Level).
• Step 3: An assessor will visit your home and you can provide relevant info to make your case.
• Step 4: If you’re not satisfied with the decision or have not received written notice by April 1, file your second appeal with the Board of Equalization online here (Second Level) by April 15.
• Step 5: If you’re not satisfied with the decision, your final option for appeal is with the Circuit Court, which will likely require you to hire an attorney.

If you’d like a question answered in my weekly column, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.

Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: I’m a bit overwhelmed by the number of real estate agents claiming to be “Arlington experts.” How many real estate agents worked in Arlington last year?

Answer: The residential real estate profession has one of the lowest barriers to entry of any industry. While there are a lot of great agents out there, dedicated to their profession and delivering real value to their clients, it’s easy for just about anybody with a couple of months to study and a couple thousand dollars to represent you in a real estate transaction.

That’s why it’s important to ask your agent if they’re full-time or part-time, how they conduct business and about their professional background.

The Data

In every transaction there are generally two agents — one representing the buyer and one representing the seller. Below is a breakdown of how many agents were involved in Arlington transactions in 2018:

• 1,669 different agents represented buyers and 1,452 different agents represented sellers in 3,095 transactions representing just over $2B in sales volume
• 71% of those agents represented one Arlington buyer and 65% represented one Arlington seller in 2018
• 85 agents represented 10+ transactions in Arlington in 2018 and 18 agents represented 20+ transactions in Arlington
• Buy-side agents worked for 260 different brokerages (offices) and sell-side agents worked for 284 different brokerages
• Congratulations to Keller Williams Realty for being the top brokerage by transaction and dollar volume for both buyers (378, $250M+) and sellers (428, $281M+) in 2018 and congratulations to the Keri Shull Team of Optime Realty for being the top agent/team by transaction and dollar volume for both buyers (129, $79M) and sellers (83, $57M+)

An agent’s volume in Arlington isn’t the whole story. There are many great agents on this list who do most of their work outside of Arlington and there are quite a few agents who transact simply for their own investments.

What Do You Think? 

Most studies suggest that consumers are less concerned with measures like sales volume and more focused on the strength of communication and trustworthiness of the agent they’re working with. I’d love to hear whether you, as a consumer, consider transactions or sales volume a top three factor when choosing an agent.

Interestingly enough, I often find that most people want to make sure their agent isn’t doing too much business and being spread too thin.

While some may see the low barrier to entry and high volume of agents as a negative, it also means that you have a lot of choices as a consumer and, with some effort, can make sure that you’re working with somebody who will provide the type and style of service you’re looking for.

It’s completely reasonable to interview multiple agents and the more you can express what you want from an agent, the better chances you’ll have at working with the right person.

If you’d like a question answered in my weekly column, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.

Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: I recently got a job in the D.C. Metro area and will be moving to the area next year. I am open to living in Northern Virginia, Washington D.C., or Maryland and want to know which jurisdiction offers the most favorable taxation.

Answer: Congratulations on your new job (Amazon HQ2?)! There must be a lot going on in your mind right now like whether you’re still young enough to offer your friends pizza and beer to help you move.

For years I’ve looked for a good resource to send clients in response to this question and couldn’t ever find it, so I reached out to my CPA, Klausner & Company located in Arlington, Virginia, who I highly recommend, to come up with a detailed yet simple chart to compare taxation between Virginia, Maryland and Washington D.C. across different incomes.

So with that, I will turn this week’s column over to Chris Light and the tax experts at Klausner & Company, enjoy!

First thing’s first, Virginia, Washington D.C. and Maryland all have reciprocity with each other. This means that if you live in one state and work in the other, you only have to worry about paying taxes and filing a tax return in the state that you live in.

Let’s analyze the tax outlook of three different people who have just landed new jobs as employees in the D.C. Metro area:

• Bobby’s AGI is $85,000. Bobby has a vehicle valued at $18,000 and a home valued at $450,000.
• Sarah’s AGI is $150,000. Sarah has a vehicle valued at $35,000 and a home valued at $800,000.
• Chris’s AGI is $300,000. Chris has a vehicle valued at $65,000 and a home valued at $1,200,000.

Important Notes

AGI, Adjusted Gross Income, is a term to describe a person’s income minus some specific deductions. Bobby, Sarah and Chris’ AGI are all based on salary earned by the end of 2018. AGI is used to determine taxable income, as seen in the ‘Math’ chart below. Taxable income determines which income tax brackets they fall in.

They are all taking the standard deduction. Virginia and Maryland property taxes vary by county and city/town, so the table below uses Arlington County rates for Virginia and the average Montgomery County rate for Maryland. Now let’s crunch some numbers:

For the full text of this column including summary of findings, how adjustments like renting and being married impact your tax position, and helpful reference tables please follow this link (don’t worry, I won’t ask for your email address, I just don’t have enough space here).

Thank you very much Klausner & Company for finally providing people with an easy to understand breakdown of taxation in the DMV. For those of you in need of CPA services for yourself or your business, I am a loyal, happy client and I can’t recommend them enough.

They provide specialize in tax services for individuals and small business and have over 40 years of experience in the Greater Washington area.

Once you’ve taken advantage of the provided tax information and would like to talk about the non-tax related questions you have about where to live, please reach out to me at [email protected]. Our team has worked with buyers from all over the country and the world to find the right neighborhood and we’re happy to help you too.

If you’d like a question answered in my weekly column, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.

Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: Are you seeing people use Escalation Addendums in their offers now that the supply of homes has dropped?

Answer: The use of Escalation Addendums in multiple offer situations is not new, but the frequency with which they are being used is. In the last three months over 25% of sales have been for over the asking price (another 24% have been for full ask). All-time low inventory levels + strong demand = price increases and a lot of competition from well-qualified buyers.

In the last 24 hours our team has submitted three offers on properties with multiple offers that will no doubt sell for over the asking price. In many cases, using an Escalation Addendum is the best strategy for buyers and sellers so let’s take a look at what that means.

What is an Escalation Addendum?

An Escalation Addendum provides the maximum value a buyer will pay and an escalation factor, the amount their offer is to increase over the next highest offer. Sellers may use the escalation without further approval from the buyer, but they must deliver to the buyer the entirety of the contract used to escalate the accepted offer. Escalations are based on “Net Price” meaning purchase price less any seller credits.

Understand the Risks

The obvious risk in using an Escalation is that buyers are exposing their maximum purchase price and some sellers may ask for that max, regardless of whether or not another offer allows them to get there contractually. There are strategies buyers can use to prevent a seller from doing this and, in my experience, most sellers use Escalations as they’re meant to be used.

The other not-so-obvious problem is with non-financial differences between two contracts. The Escalation Addendum says nothing about differences in settlement date, contingencies and other non-financial terms that make a material difference between contracts (e.g. no Home Inspection Contingency vs full Inspection Contingency is treated equally in the Escalation Addendum).

When to use an Escalation Addendum

Escalations are best used when there are multiple confirmed offers and the seller has set a deadline for “best-and-final” offers. It’s important for buyers to establish expectations with the seller before they include an Escalation Addendum to maximize the benefit and reduce the risks.

This is where having an experienced agent working for you can be the difference between making a smart decision and irresponsible one or securing a home and helping somebody else secure it.

Proper Communication is a Win-Win

I strongly believe that with proper communication between sellers and buyers, Escalation Addendums benefit both parties by allowing the seller to draw out the highest available price for their home and allowing buyers to confidently maximize their chance of securing a home. Improper communication leads to a lack of trust and a lack of trust will almost always earn sellers less and may keep the most motivated buyer out of the home of their dreams.

I can think of a recent example where a seller left 2% on the table by failing to communicate appropriately which compromised the trust of our client leading them to hold back on their offer terms. A lack of trust kept 2% out of the seller’s pocket and kept our client out of a home they loved.

It’s Not Always About Price

Being the winning offer amongst multiple offers isn’t always about price. Buyers need to focus on non-financial terms as well to set themselves apart and it’s important to understand how you can increase the strength of your offer without taking on excessive risk, but that’s a topic for another day.

If you’re thinking about buying or selling a home and would like to discuss the right strategies in today’s market feel free to email me at [email protected] to set-up a meeting.

If you’d like a question answered in my weekly column, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.

Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: What obligations does a seller have on the condition and cleanliness of a home when it transfers ownership?

Answer: Many sellers apply The Golden Rule of treating others how you wish to be treated and convey their home in the condition they’d like to move into a home. Unfortunately, this rule isn’t a contractual obligation so let’s take a look at what the contract states and some common points of contention.

Contract Language on Property Condition

The Northern Virginia contract states that the “Seller will deliver Property free and clear of trash and debris, broom clean and in substantially the same physical condition to be determined as of [Select One] Date of Offer, Date of Home Inspection, or Other [as defined in contract].”

If you’re doing a home inspection, use the home inspection as the date of determination because there’s a documented property condition report.

All systems, finishes and fixtures convey in as-is condition as of the time period selected in the previous statement, unless otherwise noted in the contract. Electronic components/devices don’t convey, but all related mounts and hardware do (e.g. TV goes, the wall mount does not).

Your Final Walk-Thru 

The final walk-thru is your opportunity to catch any property condition issues before they become your problem. Once you sign the paperwork any leaks, holes in the wall, or faulty systems are yours to deal with.

While the contract allows you to do a walk-thru as early as seven days before settlement, I recommend doing it just before you sign the paperwork to reduce risk.

Common Points of Contention

Pre-Existing Condition — During the final walk-thru you find a hole in the wall that was previously covered up by a large piece of furniture. If the hole existed prior to the contract, the seller has no contractual obligation to address it.

If a faulty water heater leaks and causes damage in the basement, the seller must clean up the leak and repair any damage the leak caused, but likely won’t be obligated to replace the faulty water heater.

Get it? The seller’s obligations revert back to the as-is condition at the point in time stated in the contract (date of offer, date of inspection, or some other defined time), unless a separate addendum is created that provides other direction.

Clean or Dirty — Broom clean doesn’t mean “clean” in the way most buyers want to arrive to their new home, so plan to hire professional cleaners prior to moving in. On the other hand, it’s normal for sellers to leave behind paint, lawn tools and cleaning supplies.

You should confirm the buyer wants these prior to leaving them behind or you may be scrambling to clear them out at the last minute to remove “trash and debris.”

Nails and Screws — Do you have a bunch of nails and screws left in the wall after removing photos, art and shelving? Leave those in place otherwise buyers can make a case that the physical condition of the home changed due to all the new holes.

Contractual obligations are not what most of us would consider the right way of doing business. That’s why I stress maintaining a positive relationship between all parties during negotiations so that when something unexpected comes up, it’s handled with care and consideration instead of contractual force.

For those who subscribe to the business practice of brute force [ahem Roger Stone], I suggest picking up a copy of Ron Shapiro’s “The Power of Nice.”

If you’d like a question answered in my weekly column, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.

Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: What impact has Amazon HQ2 had on the Arlington Real Estate market so far?

Answer: For those keeping score, this is Part Four of my Four-Part series reviewing the 2018 Arlington Real Estate market and Part Two of my ongoing look at the impact Amazon is having on our market… I’m sure you care.

Over the last three weeks I looked at how the Arlington market for detached single-family homes, condos and townhouses/duplexes did in 2018. Now we’ll dig into the impact of Amazon’s HQ2 announcement.

Key Dates

On Saturday, November 3 the Washington Post broke news that Amazon HQ2 was in final discussions with Crystal City and by Monday, November 5, the impact on property values was all over the national news. Late on Monday, November 12, the Wall Street Journal reported the decision was final, and the next day, it was confirmed by Amazon.

Top Three Takeaways

1. Massive Loss of Inventory:From the time the Washington Post broke the news on November 3 until now, the amount of homes to go under contract increased by nearly 17% from the same period over the last four years.The amount of new inventory to hit the market during that time decreased nearly 25%. The result being a net loss of 157 homes available for sale during a time when we usually have a net gain in inventory due to lower demand.
2. No Time To Wait: 30% of homes listed since November 3 went under contract in five days or less. Of the 410 homes listed for sale since November 3 that are under contract or closed, they averaged just 17.5 days on market which is 3x faster than the average time properties spent on the market the rest of 2018.
3. Prices Are… Down?: In order to draw a high level of confidence in a data set, data scientists generally recommend collecting at least 30 samples.With 350 sales (samples) of Arlington homes having gone under contract since November 3, you’d think that I’d be confident in the conclusion highlighted in the data set below which shows a decrease in the average sold price of Arlington homes that went under contract from November 3 to January 28.

This is a perfect example of data not correlating to reality and a good time to stress the importance of not using one or two data readings, especially average sold price, to drive your decision-making on a purchase or sale.

The reason average prices are down over this period isn’t because the Amazon announcement or because historically low supply and historically fast sales are magically making real estate less expensive.

It’s simply because we’ve had a higher volume of less expensive real estate sell during that period, thanks to a spike in investor activity since the announcement.

I can assure you that based on what my clients, both buyers and sellers, are experiencing in the market over the last three months that prices are up and competition is fierce in Arlington and the surrounding Northern Virginia communities.

The big question heading into the spring, which usually brings out the strongest buyer demand, is whether or not we will see a spike in new inventory coming to market from owners seeking to take advantage of low inventory or whether new inventory will remain at historically low levels because as owners hold out for potentially larger returns once Amazon starts hiring.

Look out for an inventory progress report from me in a few months!

If you are planning to buy or sell in 2019 and want an in-depth analysis of how Amazon HQ2 and the current market conditions will impact you, don’t hesitate to reach out to me at [email protected].

If you’d like a question answered in my weekly column, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.

Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: How did the Arlington real estate market perform in 2018 and what do you expect in 2019?

Answer: Over the last two weeks I reviewed how the detached single-family market and condo market fared in 2018 and this week we’ll take a look at the 2018 performance of Arlington’s townhouse and duplex market. Next week we’ll close out the four-part series with a detailed look into the data following Amazon’s HQ2 announcement.

Limited Price Growth, Strong $/SQ. FT. Growth

With prices surging in the detached single-family market in 2018 and in the condo market during the first half of 2018, one would expect a spike in townhouse prices.

In reality, North Arlington prices increased by a meager .8% over 2017 and dropped by 3.9% in South Arlington for an overall 2.5% increase in the average net sold price of an Arlington townhouse/duplex. If we drill down a bit further into the data, it turns out that all of the growth occurred in the 2nd half of 2018 in North Arlington.

How does .8% growth and a 3.9% loss equal an overall 2.5% increase in pricing?

Fair question… it’s because the volume of more expensive North Arlington homes increased significantly from 2017, and the volume of South Arlington homes dropped significantly from 2017. This caused North Arlington’s .8% to contribute much more heavily in the overall pricing.

Sold price doesn’t tell the entire story though. When I looked at $/sq.ft. (using above-grade square footage, no basements), I saw a different story unfold in 2018 with 5.3% growth across Arlington — 4.9% in South Arlington and 2.2% in North Arlington.

Couple this data point with the fact that South Arlington townhomes sold three weeks faster than North Arlington’s in 2018 and South Arlington buyers negotiated .4% less off the original asking price than North Arlington buyers, I predict that the South Arlington townhouse market is poised for significant growth in 2019.

What’s the difference between what you get in North Arlington and South Arlington? Quite a lot when it comes to the townhouse market. The average North Arlington townhouse has 2,100 sq.ft. above-grade and was built in 1988 while the average South Arlington townhouse has just 1,250 sq. ft. and was built in 1960.

2018 Arlington Townhouse Market Highlights

• The median net sold price increased by 2.6% to $546k.
• The average buyer could only negotiate 1.2% off the original asking price, which is less than what condo and detached single-family buyers were able to negotiate last year.
• The average 2 BR sold for $483k, the average 3 BR sold for $753k and the average 4 BR sold for $906k.
• The 531 sales in 2018, two-thirds of which were in South Arlington, came in just below the 559 in 2017.
• If you are looking for a townhouse built since 2000, be prepared to spend over $1M. The average net sold price in 2018 was just over $997k.

Inventory has been slowly trending downward over the last five years, but like everything else in Arlington, has reached an all-time low since the Amazon announcement.

Prior to December, the lowest average monthly inventory over the last five years had been 15 (Jan ’18) and 19 (Feb ’16) and December ’18 averaged just 10 homes available. As of January 21st there are 15 on the market.

Up next week… a similar look at the impact Amazon’s decision had on the Arlington market!

If you’d like a question answered in my weekly column, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.

Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: How did the Arlington real estate market perform in 2018 and what do you expect in 2019?

Answer: Last week I discussed how the detached single-family home market fared in 2018 and this week we’ll take a look at the 2018 performance of Arlington’s condo market. Next week we’ll review the townhouse market and finish up with a detailed look into the sales data following Amazon’s HQ2 announcement.

In Like a Lion, Out Like a Lamb

2018 was a tale of two markets for Arlington condos. In July, I wrote about how well the condo market was doing for the first time in years, boasting ~10% growth from 2017. However, the net sold price in the second half of the year dropped by ~8.5% resulting in cumulative appreciation of a respectable 3.7% for the entire year.

Most of the growth can be attributed to two-bedroom condos (6%), with very little growth in the one-bedroom market (1%) and losses in the three-bedroom market (-2.5%). While this may not seem like much, Arlington had zero growth in the overall condo market since 2014.

Expect prices to continue to rise in 2019 as inventory continues to drop. Q4 2018 was the 11th straight quarter of year-over-year decline in condo inventory and by far the largest drop thanks to Amazon.

The total number of sales increased slightly in 2018 to 1,276 and the total cost of all of the condo sales topped $555M. The least expensive unit sold in 2018 was a 1 BR/1 BA 610 sq.ft. condo in Southwest Arlington for $115,000… that’s a great deal!

The most expensive unit sold in 2018 was a 3 BR/3.5 BA, 3,045 sq. ft. condo at Turnberry Tower in Rosslyn for $3,050,000. If you missed out on the Turnberry sale, not to worry, there’s a 3 BR/4.5 BA with nearly 4,500 sq. ft. on the top floor currently available for $5.2M.

2018 Arlington Condo Market Highlights

• Median net sold price increased 5% to $380,000.
• The average studio (no legal bedroom) sold for $230,000, the average one-bedroom sold for $340,000, the average two-bedroom sold for $504,000 and the average three-bedroom sold for $810,000.
• 2018 was the 5th year in a row that buyers lost leverage in negotiations, with buyers able to negotiate an average of just 2.3% off the original asking price in 2018 compared to 2.8% last year. 29% of buyers paid at or above the asking price.
• The average condo sold for a net $442/sq. ft. The most expensive zip codes by square foot are 22209 ($557/sq. ft.) and 22201 ($528/sq. ft.) which represents the Rosslyn-Ballston Corridor. The least expensive zip code by a wide margin is 22204 at just $276/sq. ft. 22204 encompasses Columbia Pike and the bordering neighborhoods (hint hint… investors).
• The pace of the market continued to increase with average days to contract dropping 12%, proceeding a 16% drop in 2017.
• The average condo sold was built in 1981.
• The average one-bedroom was 772 sq. ft., the average two-bedroom was 1,126 sq. ft., and the average three-bedroom was 1,751 sq. ft.

(more…)

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: How did the Arlington real estate market perform in 2018 and what do you expect in 2019?

Answer: Happy 2019! Before 2018 is too far in our rearview, I’d like to update you on how the market performed in 2018 and what you can expect going forward in 2019. This week will focus on detached single-family homes.

Next week we’ll take a look at the condo and townhouse market, then conclude with a deep analysis of sales activity following the Amazon HQ2 announcement. If you’re here for fancy graphics, I’m sorry to disappoint… good data will have to do.

Happy Owners, Frustrated Buyers… Again

2018 continued the strong appreciation in the detached single-family housing market we saw in 2017, with 4.6% appreciation following last year’s 4.5% growth. Growth in 22203 (15.4%) and 22201 (11%) led the way. Unlike 2017, which added inventory year-over-year (YoY), we’re in the 5th straight quarter of YoY inventory loss with an average YoY quarterly decline of roughly 20% in 2018… brutal.

There was a drop in total sales this year from 2017’s high of 1,153 to a five-year low of 1,041. The drop, in my opinion, has nothing to do with lack of demand, rather frustrated buyers not finding what they want and/or what they want getting too expensive (I’ve got a few clients nodding along).

The prices below represent net sold price calculated by subtracting any seller-paid closing cost credits against the sold price. 22206 and 22213 have relatively few sales, so averages aren’t reliable and I removed 22209 (two detached sales).

Real Estate Highlights from 2018

• Median net sold price increased 3.5% to $890,000 after last year’s 5% growth
• Buyers had a harder time negotiating in 2018, paying .4% more relative to the original asking price than last year. 40.7% of homes sold for at or above the original asking price.
• Median days on market remained almost unchanged from previous years, sitting at 49 days in 2018. 36% of homes sold within their first week on the market.
• New construction sales dropped for the first time in years from 129 in 2017 to 87 in 2018. It’s the first time new home sales have been below 100 since 2013. I’ve been saying for a couple of years now that I think buyers are tiring of the same designs in new construction and builders who deliver some variation will reap the benefits. Note: the MLS captures a majority of new home sales, but not all of them.
• The average detached home sold in 2018 was built in 1959, which is in-line with historical trends. It’s likely that this stat will remain about the same until more of Arlington’s Baby Boomers decide to downsize/relocate and free up more 1970s-1990s housing.
• On average, a home in Arlington has 4 BR/3.5 BA over 3,000 sq. ft. on .20 acres of land

What to Expect in 2019

Building Price Momentum — A majority of the YoY price growth in 2018 occurred in Q3 (13.3% YoY) and Q4 (8.6% YoY). Hold on tight, as of 12 p.m. on January 7, 29 homes had already gone under contract this month.

Historically Low Housing Inventory — Over the last five years, Arlington has averaged 145 detached homes for sale in January and never had a month that averages below 100 homes for sale in 10+ years. There are currently 84 detached homes for sale in Arlington and only 13 of them are under $1M, but don’t worry friends, 22 of them are over $2M!

Leveling Interest Rates — Many buyers hesitated in 2018 due to rapidly increasing rates and it held pricing back. Buyers will start to adjust to these rates in 2019 and the Fed is expected to increase their rate twice this year, after doing so four times in 2018. A more stable interest rate will likely give buyers more confidence to purchase.

Amazon — A big question is how both buyers and sellers will react to Amazon HQ2 coming to Arlington. Based on what I’m seeing in the market and what I’m hearing from clients and colleagues, buyers will be more comfortable increasing their budget or paying above past sales with the security of (probable) future mid-long term growth.

On the other hand, quite a few would-be sellers are finding ways to hold onto properties for a bit longer which will exacerbate our housing inventory problems.

Up next week… a similar look at the Arlington condo market!

If you are buying or selling a home in or around Arlington in 2019 and would like to talk further about your strategy, you can send me an email at [email protected] to schedule a meeting.

If you’d like a question answered in my weekly column, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.

 Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.

This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Rosslyn resident. Please submit your questions to him via email for response in future columns. Enjoy!

Question: I partied too hard last night and am nursing my hangover searching for homes online. Am I alone in my misery?

Answer: Congratulations, you are among the millions of Americans who choose to nurse their New Year’s Eve hangover by searching for homes online. In fact, New Year’s Day ranks among the top three most active days for people to search for a home online, along with July 6 and the weekend after Thanksgiving. Conversely, these tend to be some of the slowest days/weeks for showings and offers.

If you’re searching for homes today, chances are you’re using one of the Big Three — Zillow, Trulia or Realtor (Yahoo Homes is ranked as third most traffic, but I’ve never heard of somebody using it and couldn’t find it online).

For years I told clients that these third-party sites were their best bet for search because our MLS failed to deliver a good client-side search experience compared to what was being offered by other sites.

However, earlier this year MRIS went through a merger and rebranded to BRIGHT MLS and finally created a respectable client-side search portal that gives buyers access to more search fields, a much better user interface, and better collaboration tools with their Agent. A major advantage of searching through the MLS is you have real-time, accurate new listing alerts, status changes and price reductions.

Check out this short YouTube video highlighting some of the new features and tools of the client portal.

I hope everybody had a great 2018 and wishing you all an even better 2019. Happy (online) house hunting to many of you today. If you’d like me to get you set-up with a BRIGHT MLS search portal send me an email to [email protected] and I’ll be happy to add you.

If you’d like a question answered in my weekly column, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.

Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.