Tysons, VA

Ask Val: Definition of a Bedroom

This regularly-scheduled sponsored Q&A column is written by Val Sotillo, Northern Virginia-based Realtor and Falls Church resident. Please submit your questions to her via email for response in future columns. Enjoy!

Question: Is it legal to list a room as a bedroom if it doesn’t have a closet?

Answer:  That’s a common debate! Of all the misconceptions about bedroom requirements, closets may be the most common. There are no requirements in Northern Virginia that a bedroom must include a closet. You’ll be surprised at what else is missing from the requirements for a legal bedroom in Virginia.

Who Makes The Rules?

Fairfax County doesn’t have any local requirements for bedrooms and defaults to the current version of the Virginia Residential Code and Virginia Maintenance Code. In these codes, bedrooms are classified as “habitable rooms” and mostly found in Chapter 3: Building Planning of the Residential Code.

Here are some requirements for bedrooms that apply state-wide:

  • Dimensions: Must be a minimum of 70 sq. ft., with no horizontal dimension under 7 ft. For example, in a rectangular room, if one side measures 7 ft, the other side must be at least 10 ft.
  • Ceiling Height: Ceilings must be at least 7 ft tall. In rooms with sloping ceilings (i.e. upper level of Cape Cods), any area of the room underneath a ceiling less than 5 ft high cannot be counted towards the minimum dimensions.
  • Emergency Escape: A bedroom must have two ways to exit: one that leads to the rest of the home and one that leads directly to the outside. In most cases, the outside egress will be a window with minimum requirements that include not being more than 44 inches off the floor, minimum 24 in height, minimum 20 in width, minimum 5.7 sq. ft. total opening, and if in a basement, a minimum window well of 9 sq. ft. and ability for window to open fully. It is illegal to have locking bars or grates covering an egress window.
  • Heating and Ventilation: All rooms must have a window that can open to the outdoors and the open area must be at least 4% of the total floor area. Must be capable of maintaining a minimum room temperature of at least 68 degrees and have access to a heat source. Portable heaters do not count as an adequate heat source.
  • Windows: Referred to as “glazed area” and must equal at least 8% of the floor area, meaning you can’t have a huge bedroom with one window.
  • Ventilation: Outlets: Per the Virginia Maintenance Code, bedrooms must have at least two separate electrical outlets.

 What The Code Doesn’t Include

According to the Building Code office of the Virginia Department of Housing and Community Development, the following common assumptions of bedrooms are not actually included in the code:

  • Doors: The code makes no mention of having an actual door or second point of egress (Fairfax County has a local requirement for two points of egress). Presumably, this allows for an English Basement with one point of egress, not connected to the rest of the home, to be considered a legal bedroom.
  • Lights
  • Closets

What else do you think should be added to the minimum requirements for a bedroom in Virginia?

If you’d like a question answered in my weekly column, please send an email to [email protected]. I hope to hear from you soon!

Val Sotillo is a licensed Realtor in Virginia, Washington D.C., and Maryland with Real Living At Home, 4040 N. Fairfax Drive, Suite #10C Arlington, VA 22203, 703-390-9460.

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This regularly-scheduled sponsored Q&A column is written by Val Sotillo, Northern Virginia-based Realtor and Falls Church resident. Please submit your questions to her via email for response in future columns. Enjoy!

Question: Are the sellers of a home supposed to leave appliances behind for the next owner?

Answer: Clients of mine moving from North Carolina to Virginia mentioned they were moving their washer and dryer to the new house, which I found odd, but apparently, it’s common in North Carolina and other parts of the country. My theory is that one day somebody decided to take their expensive washer and dryer with them and it created a chain reaction of everybody having to take their appliances with them after that!

Over the years, I’ve picked up on customs and contract terms that differ significantly here from other markets. I thought I’d come up with a list of standard customs and contract terms in Northern Virginia that often come as a surprise to buyers and homeowners who have transacted in other markets.

I’d love to hear from readers in the comments about other local practices that surprised you if you were used to real estate customs and contracts in another market.

  • Appliances Convey — Unless specified by the sellers in the listing, all of the appliances, including washer/dryer, have conveyed (transferred to the next owner) in every transaction I’ve been part of. Buyers and sellers have to agree during negotiations what appliances and other items do or do not convey.
  • No Individual Attorneys — It’s rare for an attorney outside of the Title Company to be involved in a transaction. The same Title Company almost always works on behalf of both parties (without bias).
  • (Lack of) Seller Disclosures — Virginia is one of the few “Buyer Beware” states in the country; which essentially means that sellers in Virginia do not have to disclose any property defects, but they can’t hide them or lie about them either. For homes built before 1978, there’s a one-page lead disclosure form for a seller to note if they’re aware of the existence of lead paint on the property. Most states, including D.C. and MD, have lengthy seller-disclosure forms.
  • Dual Agency Allowed But Not Common — Dual Agency, as defined in Virginia, is when one agent represents the buyer and seller on the same transaction. While allowed, if both parties sign-off, it is pretty uncommon.
  • No Response/Counter Deadline — The contract does not require either party to respond to an offer or counter within a certain period of time unless one party writes in their own deadline.
  • Earnest Money Deposits — It is customary for the deposit (EMD/Escrow) buyers make to secure the contract to be due within 3-5 days of ratification (terms accepted by both parties) and the deposit is usually 1-5% of the purchase price
  • Days — Contractual obligations are usually measured in days from ratification. A “day” in Northern Virginia contracts is any calendar day, no skipping weekends or holidays, and ends at 9 p.m.

What’s the takeaway here? Even if you have real estate experience in other markets or past experience in our local market, it’s always good to refresh yourself on local customs and contracts.

If you’d like to discuss buying or selling strategies, don’t hesitate to reach out to me at [email protected].

Val Sotillo is a licensed Realtor in Virginia, Washington D.C., and Maryland with Real Living At Home, 4040 N. Fairfax Drive, Suite #10C Arlington, VA 22203, 703-390-9460.

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This regularly-scheduled sponsored Q&A column is written by Val Sotillo, Northern Virginia-based Realtor and Falls Church resident. Please submit your questions to her via email for response in future columns. Enjoy!

Question: How do you choose a title company to work with when buying or selling real estate? What should I look for in a title company?

Answer: Title companies handle the legal side of the transaction such as ensuring the buyer has clear ownership, reviewing and recording the deed, issuing title insurance, and preparing paperwork for the buyer and seller to sign at closing. They operate in the background of transactions and usually the less you hear from them, the better. They are not legal representatives of either party and objectively support the buyer and seller.

In Virginia (and D.C./MD), buyers select the title company. In some cases, a seller may want to use their own firm/attorney and will request a “split settlement” but that is less common and should be done for a good reason.

Most people don’t know a title attorney or get a referral from a friend, so how do you go about choosing your title company?

Your Real Estate Agent

You shouldn’t be hiring a real estate agent just because they’re the first person to meet you at a property you found online. Among the reasons you hire an agent should be because you trust their advice and want access to their network of professionals who are relevant to a real estate transaction.

Your agent should be the first person you turn to for a recommendation on the title company because he/she has likely worked with dozens of title companies before and hopefully has one or two to recommend.

It’s perfectly fair to ask your agent why they’re recommending a specific title company.

Fees

The highest fee associated with a title company is title insurance and those prices are set by the insurance company, not the title company. Different title companies work with different title insurance companies, but rates are very similar amongst them. If you see big differences in title insurance between two title companies, one may be quoting a basic vs enhanced coverage (buyer’s choice).

I rarely see discretionary fees charged by the title company vary by more than a few hundred dollars. You can always find a cheaper option for title services, but the legal support on a real estate transaction worth hundreds of thousands or millions may not be a smart place to save a few hundred dollars and risk quality of service.

Location

It’s important to use a local title company who is familiar with local real estate and tax practices, not just licensed to practice here. I use one title company (Universal Title) for most of my Northern Virginia transactions.

Attorney Experience

Most sales follow a pretty standard, predictable process that inexperienced title companies/attorneys can handle but occasionally something unexpected comes up that requires experience and expertise to identify and resolve an issue. If problems do surface, having access to an experienced local title attorney can be the difference in whether or not the problem is even identified, whether a sale closes, and/or how much time and stress it takes to resolve the issue.

Back-Office Support

The quality and experience of the support staff is equally as important as the attorney. Look for a title company who has experienced processors who have been with the company for a while. Title companies who can afford to cut fees below their competition likely do so by not having a full supporting cast or not paying to hold onto experienced processors.

Insurance Provider

One of the key roles of a title company is that they issue title insurance, which protects your ownership interests in the property from any future claims. Most title companies have one insurance company they issue policies for such as First American, Old Republic and Chicago Title.

Most buyers are indifferent about their title insurance provider, but you may want to confirm who the title company uses to do some background on them such as size (market share) and how long they’ve been in business. I generally prefer larger insurers who have been in business for a long time.

If you’d like more information, or would like a question answered in my column, please reach out to [email protected]. I hope to hear from you soon.

Val Sotillo is a licensed Realtor in Virginia, Washington D.C., and Maryland with Real Living At Home, 4040 N. Fairfax Drive, Suite #10C Arlington, VA 22203, 703-390-9460.

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This regularly-scheduled sponsored Q&A column is written by Val Sotillo, Northern Virginia-based Realtor and Falls Church resident. Please submit your questions to her via email for response in future columns. Enjoy!

Question: With mortgage rates in the record lows, we have decided to buy our first home this year. Do you have any recommendations on how we should start the home buying process?

Answer: There’s plenty of advice on the topic all over the internet, so I’ll include some suggestions I don’t see on most sites and also put my own opinion on advice that you may have heard before.

Your Search Criteria

Challenge yourself early to come up with 12-15 things that are important to you. Then give yourself 100 points and allocate points to each based on how important they are to you and you’ll end up with a weighted criteria list to help you focus your search and objectively compare properties.

Length of Ownership

This is one of the most important conversations to have with yourself/your partner. You should focus on the following:

  • Likely length of ownership
  • Difference in criteria for a 3-5 year house vs a 10-12+ year house
  • Difference in budget requirements for a 3-5 year house vs a 10-12+ year house

Appreciation is not guaranteed and difficult to predict, but the value of longer ownership periods is undisputed. One way longer ownership adds value is the potential for eliminating one or more real estate transactions, and the associated costs (fees, taxes, moving expenses, etc) and stress that comes with moving, over the course of your lifetime. If you have an opportunity to significantly increase your length of ownership by stretching your budget, it’s often justifiable.

Influencers (not the Instagram ones)

Family, friends, colleagues… they’re all happy to offer opinions and contribute to your home buying process, but the input can be overwhelming and unproductive if you don’t set boundaries. Try to determine up-front who you want involved in the process and how you’d like them to be involved.

Does Your Dream House Exist?

Spend a little bit of time searching For Sale and Sold homes on your favorite real estate search website to see if the homes selling in the area you want and within 10% of your upper budget are at least close to what you’re looking for. If not, try adjusting the price, location and non-critical criteria to figure out what compromises you’ll need to make and then compare those compromises to your current living situation.

Know Your Market

We’re in a strong seller’s market right now with low supply, high demand and increasing prices. Each sub-market behaves a bit differently and comes with its own unique set of challenges and opportunities, so take time early on to understand the sub-market(s) you’ll be involved in and what you’re likely to experience. This is something your agent should be able to assist with.

Pre-Approval & Budget

There is a lot of value in working with a lender early on in the search process. For starters, you’ll have somebody who can provide real rates and advice based on your specific financial situation and needs. A lender can only do this if they’ve reviewed your financial documents and credit. The more you put in, the more you get out.

You’ll need to have a lender pre-approval to submit an offer so if you have to do it anyway, why not doing it early on so you get the most value out of your lender? It also means that you’ll be prepared to make an offer if you find the right home before you expect to be ready.

Given how competitive the Northern Virginia real estate market is, the quality of your pre-approval can make a big difference when you make an offer. You should strongly consider partnering with a local lender with a great reputation to give yourself an advantage when making an offer. Pre-approval letters from big banks and online lenders don’t go over as well in our market. If you’re looking for a recommendation I’ll be happy to connect you with a great local lender.

Find an Agent

The least surprising suggestion on this list! Agents come in many different forms and finding somebody who suits your personality and goals is important. Ask friends, colleagues and family for referrals and meet with multiple people until you find the right fit.

The worst thing you can do is choose your agent based on whoever responds to an online showing request faster. A good agent can provide a ton of value being involved in your buying process months before you’re ready to buy. Be wary of anybody who wants you to “wait until you’re ready” before working with you.

If you’re considering buying (or selling) in the DMV in 2020 and would like to meet, feel free to email me at [email protected]!

Val Sotillo is a licensed Realtor in Virginia, Washington D.C., and Maryland with Real Living At Home, 4040 N. Fairfax Drive, Suite #10C Arlington, VA 22203, 703-390-9460.

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This regularly-scheduled sponsored Q&A column is written by Val Sotillo, Northern Virginia-based Realtor and Falls Church resident. Please submit your questions to her via email for response in future columns. Enjoy!

Question: I’ve heard the market is extremely competitive these days and sellers are getting multiple offers for their properties. What makes a winning offer?

Answer: Other than the sale price, there are other terms included in your offer that will determine its strength and the value it has to the seller. Of course, every home seller wants to get the most money possible, but they also want to accept a clean and safe offer that is going to make it to settlement without complications.

Flexibility and a willingness to budget are fundamental parts of the real estate negotiation process. In a multiple offer situation, your offer will need to shine above the rest, and the best way to do that is to make an offer favorable to the seller.

Here are some of the terms included in most contracts that have the biggest impact on the strength of an offer.

Price/Escalation Addendum

Higher price = stronger offer. Escalation Addendums are common when there are multiple offers, and allow you to beat any competing offer by a specified amount, up to the highest amount you’re willing to pay for a property. Used correctly, it prevents you from leaving money on the table, while not paying too far above what the rest of the market is willing to offer.

Contingencies

The three most common contingencies are for the home inspection, appraisal and loan. Each provide the buyer with a set of protections that allow them to renegotiate or terminate the contract, without losing the deposit. Removing a contingency or shortening the contingency timeline increases the strength of an offer.

  • Home Inspection: It used to be standard for Northern Virginia buyers to include a negotiation period in the home inspection contingency, allowing them to negotiate for repairs or credits based on the results of the inspection or terminate the contract. Now it is much more common for buyers to forego the negotiation period and simply retain the right to void (aka a pass/fail inspection), which is much more attractive for a seller. Even more attractive is when buyers perform a pre-inspection on the property and remove the home inspection contingency altogether.
  • Appraisal: If you’re using a mortgage to purchase a home, your lender will almost always require a property appraisal. The appraisal contingency allows you to renegotiate or terminate the contract in the event the home appraises for less than the purchase price. It is common for buyers to remove the appraisal contingency or agree to cover up to a certain amount on a low appraisal to increase the strength of an offer.
  • Financing: The financing contingency allows you to terminate the contract without losing your deposit if your loan isn’t approved. Many buyers who have undergone a thorough pre-approval or underwriting process have enough confidence in their ability to secure the mortgage that they remove this protection.

Quick Closing

Most sellers want to close as quickly as possible so cash-buyers have the biggest advantage here because they can usually close in a week or less. Offering a quick-close to a seller can give your offer a significant boost.

Financing

If you’re relying on a mortgage, sellers are usually more drawn to higher down payments. That’s not to say that a 3-5% down payment (or 0% on a VA loan) can’t win in a competitive scenario, but you are at a disadvantage and will often get passed over when all other terms and pricing are relatively equal.

A thorough pre-approval process by a reputable lender can provide the seller with confidence that if they accept your offer, there is very little risk of the deal falling apart due to financial issues. Sometimes sellers take less money work with a buyer they have more confidence in.

Earnest Money Deposit

The EMD is money held in escrow by the Title Company as security for the seller that you’ll perform under the obligations of the contract. It gets applied against what you owe at closing for down payment and closing costs, but is at-risk if you default on the contract and terminate outside the legal contingencies.

Traditionally, a reasonable deposit ranged from 1-3% of the purchase price, but some buyers are electing to make substantially larger deposits in an effort to establish financial strength.

Rent-Back

If the homeowner is still living in the house during the sale, their preference is to close as quickly as possible and then have some time to move out after the sale is complete — this is called a rent-back. It used to be common for the seller to cover the buyer’s daily carrying cost (mortgage + taxes + insurance + HOA fee) for the length of the rent-back, but in this competitive market, a strong offer often includes a free rent-back for the seller.

Whether you’re buying your first home or your tenth, having a local professional on your side who is an expert in his or her market is your best bet in making sure the process goes smoothly. If you’d like to discuss buying or selling strategies, reach out to me at [email protected].

Val Sotillo is a licensed Realtor in Virginia, Washington D.C., and Maryland with Real Living At Home, 4040 N. Fairfax Drive, Suite #10C Arlington, VA 22203, 703-390-9460.

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Ask Val: Summer Ready Backyard

This regularly-scheduled sponsored Q&A column is written by Val Sotillo, Northern Virginia-based Realtor and Falls Church resident. Please submit your questions to her via email for response in future columns. Enjoy!

Question: What outdoor upgrades do you recommend now that vacation places are very limited and the whole family is home for the summer?

Answer: The summer of 2020 is shaping up to be a long one, especially since many outdoor venues and public pools remain closed due to the pandemic. Now that everyone is spending most of their time at home in the era of coronavirus, our backyards have become our havens, our places to soak up the sun, grill some food and sip some drinks, and where most of us will be celebrating the Fourth of July.

Other than giving some TLC to what you already have, such as power washing your deck, or painting the fence, here are some ideas to make your backyard more enjoyable for the whole summer. I’ve included some DIY links if you’d like to make the most of this time at home and save some money.

  • Consider a large outdoor rug. Not only is this a good way to include a pop of color in your backyard, but it’s also an inexpensive way to change up a space without having to go through the process of painting or staining a deck.
  • Try a gravel patio. You can save a ton of money by adding gravel instead of the more traditional patio materials, which makes this DIY project more appealing. Surrounding the gravel with lumber adds style and dimension to this space and makes it look much more expensive without the expense.
  • A pergola is a fantastic idea for your dream backyard. Clear out an area on a deck or in your yard and build your own. Add curtains for extra shade to create the ultimate outdoor living room.
  • Don’t forget about the outdoor lighting. Drape string lights down from a pergola or across your outdoor living space to give it a starry-night feel. You can also line any patio or garden path with torches and lanterns for soft lighting.
  • Fire pits are a lovely way to add charm, coziness and relaxation to your backyard. You also don’t need a lot of space to create this cozy scene. Whether you want to cook your food over an open fire or cozy up to it with blankets on a cool night, fire pits make a great addition to your backyard. Here are some great DIY ideas.
  • For a nice alfresco dinner, get a patio set that comes complete with table and chairs, or build your own outdoor table out of a few wine barrels and wooden boards for DIY yard decor.
  • Let your backyard be the best spot for entertaining the whole family with a kitchen! There are plenty of ways to build an outdoor kitchen that fit within your budget. Add a charcoal grill and table on a patio for a simple look. You can also build a Grillzebo (A gazebo for your grill).
  • Flowers are ideal for adding a natural pop of color to your landscape. Plant hydrangea bushes or tulip bulbs along the fence if you have a major green thumb. Or go to your local plant nursery and buy a few pots to fill with your favorite blossoms.
  • Now that most public pools are closed, here are some above ground pools you can get on a budget that will be easy to remove once summer is over.
  • You can bring family movie night outside, and try a DIY backyard movie theatre here.
  • If you’re not into outdoor movies, but you’re into music, a simple outdoor Bluetooth speaker will help you set up the summer mood. This speaker is my favorite and it’s the best bang for your buck.
  • If you have a front porch, make it look like an outdoor oasis by installing ceiling fans and hanging a set of sheer curtains.

I hope these backyard ideas inspire you to make your yard your favorite place this summer!

I also want to take a moment to wish a Happy Fourth of July to all! May this day be a symbol of hope, prosperity and happiness in your lives. Be safe, be kind, and take care of your family, friends and community.

If you’d like more information, or would like a question answered in my column, please reach out to [email protected]. I hope to hear from you soon.

Val Sotillo is a licensed Realtor in Virginia, Washington D.C., and Maryland with Real Living At Home, 4040 N. Fairfax Drive, Suite #10C Arlington, VA 22203, 703-390-9460.

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This regularly-scheduled sponsored Q&A column is written by Val Sotillo, Northern Virginia-based Realtor and Falls Church resident. Please submit your questions to her via email for response in future columns. Enjoy!

Question: We’re considering buying a house and we’ve been attending a few virtual open houses. There is one property we really liked, and the agent mentioned the seller needs to do a rent-back for 4 weeks after selling. How does a rent-back work?

Answer: A Seller’s Post-Settlement Occupancy, more commonly referred to as a rent-back, allows a home owner to sell their home, collect the proceeds and continue living in the home for a pre-determined period of time after closing.

The most common scenarios for a rent-back are:

  1. The seller has a need for the sale proceeds quickly; such as applying them towards the purchase of their next home. A word of caution on this strategy for sellers — they have to make sure that they’ll be able to find and close on their next home before the rent-back period ends.
  2. Moving out is burdensome and/or highly disruptive to the seller’s family and/or job that they don’t want to start the process until they’re under contract and all buyer contingencies have expired.
  3. Sellers need to remain in their home until the school year is finished.
  4. Sellers want to avoid a double move, first to interim housing and then to a new home. It can be costly to store belongings, and moving twice can be a huge inconvenience.
  5. Buyers are flexible with their move-in date, or their current lease doesn’t end until weeks after settlement.

How Rent-Backs Work

The Northern Virginia Association of Realtors contracts (as well as other regional contracts) provide a standard form for a Seller’s Post-Settlement Occupancy Agreement so you don’t need to worry about hiring an attorney. It functions as a short-term lease including how much the seller will pay the buyer for the rent-back, how long the rent-back lasts, a security deposit and a penalty for staying past the rent-back period.

Buyers will conduct a pre-closing walk-through before they purchase the home where they have all the rights provided to them in a normal sale. At the end of the rent-back, the new owners will conduct another walk-through once the previous owners move out, which is similar to that of a walk-through at the end of a normal rental period.

If the buyers are financing the home as a primary residence, the rent-back has a limit of 60 days per the buyer’s loan regulations.

If the previous owners caused damage during the move-out, the new owners can make a claim against the security deposit, generally held by the Title Company who handled the sale.

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This regularly-scheduled sponsored Q&A column is written by Val Sotillo, Northern Virginia-based Realtor and Falls Church resident. Please submit your questions to her via email for response in future columns. Enjoy!

Question: Do you foresee the real estate market going back to normal in the summer?

Answer: We made it to June! Can you believe it?! Spring has been full of uncertainty and we’ve all been adjusting to a whole “new normal”. Honestly, it’s impossible to predict the future but I’m very optimistic that we’re going in a positive direction now that coronavirus-related restrictions are easing and the economy is reopening.

Here’s why:

  • While the number of transactions in the Tysons area is lower compared with last spring, they did not drop as much as many industry experts predicted. May has been more favorable, with increasing numbers of properties under contract and new listings, according to MLS data.
  • Normally we see sales really ramp up in March and April, but amid the pandemic and widespread job losses, many buyers wanted to wait not only until they felt more secure in their jobs but also until they could physically step into the homes they were considering. As COVID-19 cases (hopefully) drop significantly and states are loosening restrictions, buyers are becoming more comfortable with the home buying process as they’ve gotten used to taking precautions such as wearing masks and keeping social distance.
  • During these past months at home, homeowners had lots of time to figure what type of space is more valuable to them. Many people have found that they need a home with more space, while others have decided to downsize. What I’m seeing more often on my buyer clients must-have list, is a true home office and not just a desk area in the kitchen. The demand to work from home will remain strong motivating buyers to look for a separate space for that home office.
  • Although home sales have declined due to social distancing and economic unpredictability, home prices are still strong in the Northern Virginia market. In the past couple of months, most of the buyers I represented were competing for properties with multiple offers and they either offered full asking price or above.
  • Active sellers are key to a healthy market. We are seeing sellers getting their properties on the market as they are more confident with pricing than the last couple of months and they’re more comfortable as buyers and agents are taking health precautions when showing a property for sale.
  • Another driver for a stronger third quarter is Millennials with families want to settle in new homes before the school year begins. Don’t expect an increase in sales to last into the fourth quarter though.
  • The low mortgage rates, without a doubt, is helping to entice buyers back into the market.

While all these are signs of a market kicking into more of a recovery mode, there are still some challenges we’re still to overcome:

  • Sellers haven’t come back as quickly to the market as buyers.
  • Even if buyers can find a home, they may not be able to secure a loan. Mortgage rates are historic lows. But today’s reality is lenders are increasingly getting tougher on qualifying criteria.

Tysons Market Update

Here are some numbers for April and May’s real estate transactions within 5 miles from Tysons:

April

  • 235 Properties sold
  • 192 Properties went under contract
  • 26 Average days on the market

May

  • 219 Properties sold
  • 272 Properties went under contract (considering they close within 30 days, we should expect higher numbers in June)
  • 21 Average days on the market

Fairfax County in May

In the chart below you can see our current inventory is about half of what it was in June 2019. However, the number of properties under contract is pretty close which means buyers are very active in this market.

Final Thoughts

We’ve seen a quick bounce back due to record-low mortgage rates and virtual home shopping options and I’m positive that our market will remain strong throughout this year. I will keep you posted!

If you’d like more information, or would like a question answered in my column, please reach out to [email protected]. I hope to hear from you soon.

Val Sotillo is a licensed Realtor in Virginia, Washington D.C., and Maryland with Real Living At Home, 4040 N. Fairfax Drive, Suite #10C Arlington, VA 22203, 703-390-9460.

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This regularly-scheduled sponsored Q&A column is written by Val Sotillo, Northern Virginia-based Realtor and Falls Church resident. Please submit your questions to her via email for response in future columns. Enjoy!

Question: Can you explain mortgage forbearance? Is it a good idea to get it and will it negatively affect my credit in the future?

Answer:  Many homeowners who are dealing with a financial hardship during this pandemic are considering mortgage forbearance or asking for clarification about the process. We don’t have all of the answers yet, but enough information is available to help people make more educated decisions about forbearance.

I asked one of the top mortgage lenders in the D.C. area, Jake Ryon of First Home Mortgage, to join as a guest columnist and provide a rundown of how mortgage forbearance works, and what are some of the unintended consequences.

Take it away Jake!

What is Mortgage Forbearance?

Congress passed the CARES Act, allowing those facing financial hardship due to COVID-19 to request a mortgage forbearance (pause in mortgage payments) for 180 days, with the option to extend for an additional 180 days.

The bill does not require you to provide proof that you’re suffering a hardship, but the CFPB makes it clear that if you can pay your mortgage, you should. However, not everyone is following that guidance and some borrowers who are able to pay are choosing not to and may suffer unintended consequences.

Mortgage forbearance is a temporary pause in payment; it is NOT forgiveness. All missed payments by the borrower must be paid back.

Repayment

Unfortunately, the repayment terms for a forbearance are vague. Statements from Fannie and Freddie indicate that you do not have to repay the missed payments all at once, but that it is for the borrower to work out with the servicer. If the payments are not paid back in a lump sum or over a designated period, but instead added to the end of the loan, the borrower is agreeing to a loan modification.

During a forbearance the servicer (the company you pay) is still advancing the monthly mortgage payments to the end investor. This has led to major issues for lenders, and as a response, tightened credit standards and made it more difficult to obtain a mortgage.

Unintended Consequences

While taking a forbearance is not supposed to negatively affect your credit, there are some unintended consequences I’d like to explain.

*Please note this is based on the most up to date information I could find and is subject to change as this is a fluid situation. Please reach out to your loan servicer directly for your options.*

Refinancing: This may vary by lender, but as I understand it, to be eligible to refinance, borrowers must be out of forbearance and current on their mortgage. This is a big concern if rates continue to fall throughout the year.

Repayment Terms: As mentioned earlier, there are options to repay the missed payments via a lump sum, over a repayment period, or modifying the term of the loan. Keep in mind the servicer must agree to the repayment plan.

I’m hearing that modifications are only being offered if there is documentation to show you’ve been adversely affected by COVID-19. This is going to be problematic for borrowers who didn’t lose their job and assumed their skipped payments would be tacked onto the end of their mortgage or forgiven.

Buying Your Next Home: Since this is so new, we haven’t seen any credit reports reflecting modifications as a result of COVID-19. It’s unclear how lenders and investors will treat these modifications when evaluating new loans.

For example, most investors want to see borrowers pay their mortgage on time for a minimum of 12 months after their modification begins. If someone takes the full 12 months of forbearance, they could be looking at a minimum waiting period of 2 years before obtaining a new loan.

Residual Effects to Your Credit: While the CARES Act says mortgage lenders won’t report you as delinquent during a forbearance, they can’t control how other lenders will view it. For example, if you’re a credit card company and you see a borrower is in forbearance, are you inclined to increase their credit limit or issue a new card? If your credit card debt is increasing and your available line of credit is staying the same or decreasing, it will most likely lower your score.

Weekly Tysons Market Snapshot

Thank you very much for all this helpful information Jake!

If you’d like to talk with Jake about a loan, refinance, or any other mortgage related question you can contact him at [email protected].

Here’s a quick look at how the market performed over the past week within 5 miles from Tysons. I will provide a Market Report for the month of May in my next column. Through these tough times, our market has remained busy and hopefully things will only get better moving forward.

Past Seven Days in Tysons

If you’d like more information, or would like a question answered in my column, please reach out to [email protected]. I hope to hear from you soon.

Val Sotillo is a licensed Realtor in Virginia, Washington D.C., and Maryland with Real Living At Home, 4040 N. Fairfax Drive, Suite #10C Arlington, VA 22203, 703-390-9460.

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This regularly-scheduled sponsored Q&A column is written by Val Sotillo, Northern Virginia-based Realtor and Falls Church resident. Please submit your questions to her via email for response in future columns. Enjoy!

Question: Is there any new development in Fairfax?

Answer: I hope this column finds you and yours well, healthy, and you’re managing to stay productive.

Yes! West Oaks Corner is conveniently located by West Ox Road and I-66, at 4489 Lateleaf Trail, Fairfax Virginia 22030. Built by Winchester Homes, it’s a community with 188 luxury townhomes. They opened their sales office last July and they have already sold over 80 units.

They just released two properties in their model row available for immediate delivery (they look amazing!), and they have a few homes ready to be customized and depending on the model they can be delivered anytime between October and December this year. The expected completion date is 2021. I visited their model homes and it looks like construction is moving quickly.

The Homes

The community looks beautiful and it was thoughtfully designed. The homes have a traditional brick front-architectural style and all of them offer different outdoor space options. They have many green areas and their amenities are nature focused: 2 tot lots, a community lawn, a picnic area with grilling, a community pavilion, meditation park and a Bocce court.

There are 4 different models, each with unique features:

The Jackson: It’s about 2,311 sq. ft. Three levels and a terrace off the kitchen level.

The Wesley: I loved this one! Approx. 2,701 sq. ft. Four levels and a loft (that can be built as a 4th bedroom with a full bath), and a spacious rooftop terrace in addition to the kitchen level terrace.

The Burke: About 3,061 sq. ft. Three levels with a backyard in addition to the kitchen level terrace.

The Sully: Approx. 2,979 sq. ft. End home, 3 levels and the model has a dreamy terrace with a zen space ideal for practicing yoga or meditation. There’s also a backyard and some are fenced.

You can see all floorplans, photo gallery and videos here.

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