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Welcome to Real Estate Live, an online discussion of the Washington area housing market, featuring Post real estate writer Daniela Deane.

Submit your questions and comments.

In her live online discussions with the audience, Deane discusses the specifics of the market, from condos and investment properties to contracts and mortgages.

Deane has covered Real Estate for The Washington Post since 1999 and has worked as a reporter for more than 20 years.

The discussion follows.

Editor's Note: washingtonpost.com moderators retain editorial control over Live Online discussions and choose the most relevant questions for guests and hosts; guests and hosts can decline to answer questions.

Daniela Deane: Hello everyone and welcome to Real Estate Live. I have a lot of questions here already (what else is new?) so I'll just get started. Remember to chime in with your experiences, comments and ideas. I know you will....

washinton, DC: Dear Daniela,

I am trying to find out the fair market value of a commercial property in DC, but I have no idea where to search for this information. I am not sure the owner of the property would be offer that information.

Your assistance is very much appreciated.

Regards,
Humphrey Mensah

Daniela Deane: Hi. I asked my editor Maryann the answer to this one since she covered commrecial real estate for the Business section for years and knows all about it. Here is her reply: All commercial property is assessed & in the records. So are most sales. (Some are partnership share exchanges & aren't recorded, but that's a whole 'nother can of worms.) HOWEVER, commercial property is generally valued not simply on comparable sales, but on its income-producing ability. If someone is considering buying or selling (or dealing with an estate), I'd REALLY recommend hiring an appraiser with commercial experience. If they're simply challenging an assessment on a small property, they should consider the cash-flow value model rather than the comparable sales model. If serious money is involved, professional help would be a worthwhile expense. (See today's Metro section for a story raising the question, but not really answering it, of how rent control affects cash-flow valuation of rental properties in DC.) And yes, I recommend that story in today's Metro section too. Very interesting.

Clifton, VA: Townhouses in my neighborhood have been selling within 2 weeks for record prices. Approx $20k above last Falls prices. Single family homes sell within a week. You should do a story on Hayden Village in Clifton.

Daniela Deane: Thanks for sharing your experience. As I wrote in my story last weekend, the market is still hot, especially in "more affordable" price ranges, like up to $700,000...(that's affordable??!)

Laurel, Md.: Because of what time of year it is (well, what time it was two days ago) it seems pertinent to bring a significant fact about the wave of refinancings that occurred this year.

Like a lot of people, I refied my 7.5 percent 30-year mortgage (eight years old) with a 5.5 percent 15-year version. Next year the mortgage interest deduction on my income tax will only be about 3/4 of what it has been, because of the lower interest rate. And possibly even more important is that 15-year mortgages pay significant parts of the principal from the beginning, whereas 30s barely touch the principal for the first decade.

After 10 years, a 30-year 7.5 percent mortgage has paid only 13 percent of the principal. After only five years, a 5.5 percent 15-year mortgage has paid 25 percent. This means that:

Next year I will get only 3/4 the decuction I got last year. In five years, my deduction will be down by ANTOTHER 1/4.

Refying to 15 years was very popular in 2002, making 15s much more common than ever before. A lot of people could be in for tax shocks.

Daniela Deane: You make a very interesting point, Laurel...Most financial planners say to keep a mortgage at least until you retire so that you can get that tax write-off, the biggest deduction we have. Others say it's a false economy, saving on taxes but spending more on interest. Others?

To FSBO or not to FSBO...: Currently, is it a seller's market or a buyer's market in the Fairfax County area?

Is there any company that specializes in taking care of the paperwork involved with selling a house?

Any tips for selling FSBO?

Thanks.

Daniela Deane: I can safely say that's it's still a seller's market in Fairfax County. There may be pockets where conditions aren't as good, but generally it is still a seller's market all around. Many agents will do fee-based services, i.e. you pay them a fee for what they do, as in list your property on the MLS, conduct an open house, or whatever. The big companies, like Long & Foster, don't let their agents do fee-based services, however, sticking to their commission structure. If I was going ot try and sell FSBO, or for-sale-by-owner, I would at least pay someone to list my property on the multiple listing service for me. In many cases, FSBOS end up paying the buyer's agent the 3 percent, remember, saving only on the 3 percent to list it.

Oakton, VA: What do you think of those companies that send you letters with unspecified "offers" to buy your property? Are they on the level, or are they just looking for folks who don't know what their property is worth?

Daniela Deane: Good question and one I don't know the answer to. Some of the solicitations I get say fair market price too, so I think some of it is just investors looking for properties to buy. You've given me a story idea.

dc: What could I expect to pay for a basic 24 by 16 two story addition to my 1947 colonial? I am interested in adding a family room on the first floor and bedroom and bath on the second? total of about 800 sq ft.

thanks

Daniela Deane: I really can't say. Get a few quotes from different remodelers before you decide who to go with.

Washington, DC: Hello Daniela,
What web-site can I excess prices of recent home sales in my area(20011)?

Thanks, Jan

washingtonpost.com: Daniela - for your reader - we looked up 20011 in the online Home Values special report in our Real Estate section and saw that the median price for a home in 20011 was $176,000 in 2002. We also typed 20011 in our Home Values searchable database and came up with 500 homes to review. Perhaps you and your readers can suggest some other Web sites to look at, too.

Daniela Deane: I'm sorry, I'm not immediately placing your zip code. But besides our own site on washingtonpost.com, there are also the local county and city government sites that list sales transactions.

Falls Church: Looking for words of wisdom on the options of moving versus an addition. I know all the emotional reasons to stay versus go (liking the neighborhhod, etc.) but how to calculate the financials is what I am having trouble with.

If we stay, we would want to put a fairly simple addition on our rambler - very middle class stuff - master bed and bath (standard fixtures, except for a double sink), dining room, and a basic remodel of a kitchen (not too many cabinets, no new appliances).

What would be a good ballpark price per square foot in this area? I've seen some websites with averages, but they do state that they only apply to certain areas in the country.

Daniela Deane: I don't know a price-per-square-foot to quote you. REmodelers can vary greatly in their prices. A big point to consider in whether to move or remodel, though, is what's out there and how much more would you have to spend to move up a notch in your neighborhood. Many people I've talked to say it would cost several hundred thousand dollars for them to truly improve their house in their neighborhood (that's if there's even anything for sale that they like). Many houses are a compromise. As one woman in Bethesda said to me recently about whether to buy another place or remodel hers: I don't want to trade in the positives I already have. Remodeling and staying put can be the best thing to do sometimes.

Alexandria, VA: Someone wrote last time asking about waiving the home inspection contingency in order to have a cleaner contract. I would like to share my experience. Two years ago, I made an offer on a house in Alexandria. My contract had a contingency clause. Another contract did not, and, with the escalation clause in that contract, the other offer ended up higher than mine, but not by too much. I still got the house! I think the owner was wary of the other bidder waiving the home inspection and then trying to cause trouble later. A home inspection is very important, especially with an older house. Having a contingency in your contract does not necessarily mean that you offer will be passed over.

Happy hunting!

Daniela Deane: Hmmm...that's a new one. Thanks for sharing.

Columbia, MD: HELP! On Sunday we put a contract on a townhouse we love. We bid over the asking price because there were other contracts on the table and we really want it. We are first time home buyers with excellent credit. The sellers and their agent were supposed to make a decision last night (WED) however they are still looking over the contracts. The sellers agent is new and doesn't seem to know everything. Our realtor is being very patient...but is there anything else we can do? I'm afraid if this is not decided on by the weekend there will be more contracts put on the townhouse. Thanks for any input!!

Daniela Deane: What does your agent suggest you do? ... Some prospective buyers have attached personal letters about how much they like a property or photos of their young families, things like that, to try and get the seller to pick them. A nice letter saying how much you love the house could sway a seller. Ask your agent.

Alexandria, Va.: Last year you did a piece on single family homes under $300K that could still be found. This year I suspect that magic number is $400K. Also, there seems to be a leap in the MLS from the high $300s to the mid-$500s, with very little inventory for single family homes close to Metro in the 'burbs in the low $400s. What's up with that?

Daniela Deane: Even last year, when I did that story, it wasn't that easy to find decent homes at $300,000...And it's even harder now. What's happening is that prices are still going up in this area. Low rates, demographics (a still rising population here) and a relatively good job market here is keeping housing strong in this area.

Alexandria, Va.: I just have a comment to all those people out there who are convinced we're in a housing bubble (in the D.C. area) and are waiting for it to pop. I thought the same way for two years. I figure that thinking (and the stubborn decision to wait before entering the market) cost me $100,000 before I bought my SFH in September.

Daniela Deane: Anyone else on the housing bubble/no housing bubble divide?

Gaithersburg, Md.: Daniela,

I am moving out of the area. I just sold my townhouse that I had owned for a little more than two years for $100K than what I paid for. My jaw just dropped when I saw the multiple contracts offering more than the asking price. That's more than 50 percent profit in two years! Not even in the booming '90s can I recall my stock portifolio returning more than 50 percent in any two-year period. Are you sure we are not looking at a bubble housing market here?

Daniela Deane: For a story I did recently on wealth creation, I had a Fannie Mae economist do me a study. Three people in 1990 wiht $10,000 to invest. One put it down as down-payment on a house he was going to live in, the other invested in an index S & P 500 fund, another in an index Nasdaq fund. The investor who invested in real estate came out ahead, consideirng tax implications of selling a place you live in, leverage of money put down, appreciation, etc...It was a very informative study.

Home values/appraisals: I am in the process of refinancing. I talked to a local real estate agent who specializes in my neighborhood and said my house is worth $169K. Do appraisers generally follow recent local home sales when appraising for a refi or mortgage loan?

Daniela Deane: Yes, appraisers only follow recent home sales. That's what they base their appraisals on -- comps, comps, and comps. The selling prices of comparable properties that sold recently in your area. Your agent should have a good idea since I'm sure she came to that figure by looking at the comps.

re: property valuation: It's always worthwhile to ask the owner/seller. Usually, they'll try to provide you with all the hard info they can including similar sales and profit potential. Of course you should take it with a grain of salt, but there's no reason not to ask. Also, here is the link to the sources for county assessment info on the Post website: http://www.washingtonpost.com/wp-srv/realestate/hpr/help.htm#sources .

Daniela Deane: thanks! who needs me, huh?

alexandria va: for the FSBO seller, I second your recommendation to pay the buyers' agent commission, and put the house in the MLS. I'm actively looking for a new home and have a buyers' agent working for me, she checks the MLS every day so that we don't miss anything (homes are selling so fast, realtor.com is hopelessly out of date). If you're FSBO, the people you want to see your house (qualified, pre-approved, motivated buyers) will see it in the MLS. If you pay their agent's commission, the agent will be sure to show your house to the buyers. Buyers are pretty smart, we all know if you're selling FSBO, you're trying to save 6%, so the buyers will be looking for a break on the price. If you don't pay the agent's commission, you'll lose out on all the buyers who have already started working with agents and don't want to come up with that 3% cash at closing (can't roll it into the mortgage if seller won't pay it out of their proceeds). By the way, our agent was willing to go with a 2% commission on a FSBO, so if you do get a buyer with an agent, the commission may not automatically be 3%.

Daniela Deane: Very good points you make here. Especially that commissions are negotiable, we forget that at times. I didn't necessarily recommend a FSBO pay the buyer's agent, I'm just saying that you often have to. If an agent goes thrugh the MLS and sees a FSBO listed there that says no agents, please, then why should they even pull that listing? .. My experience shows me that it's hard to get away with no commission payments, unless you already know the buyer and that buyer has no agent...Others?

Alexandria, VA: Another waive the inspection story:

A litte over a year ago we put in a bid on a townhouse - but refused to wiave the inspection. We lost to people who bid slightly less but waived the inspection. We ended up buying a townhouse in the same neighborhood a few months later (for less and with inspection). We have observed that the house we lost on has gotten a new roof and had flooding problems, among other things. Lesson: If they want you to waive the inspection, there is probably a reason.

Daniela Deane: Interesting. Thanks for sharing. Remember, that a lot of condo buyers are waiving inspections, though, to get the condo and then not having problems...The risk involved with waiving an inspection also has to do with the type of property in question...

washington, dc: I have undercontract a one bedroom condo in falls church, only 1.5 miles from the metro and located off 50 at the juncture of 66 and 495. do you think this a good location for future appreciation value for a one-bedroom condo? the complex was built in 1984 on a lake, very nice and well kept.

Daniela Deane: Condos are doing very well, especially those located close to metros or major road arteries. The maintenance of the condo facility is also a major consideration. Yours sounds good. It's very hard to make a comment on future appreciation. As you've probably noticed, agents basically won't go there. If you're buying instead of renting, financial planners would tell you you're doing the right thing.

FSBO: Last week I emailed boasting about my
FSBO plans, but I've changed my mind
and listed with an agent after talking to
another FSBO in my (very hot) Takoma
Park/Silver Spring market. She said 90%
of the people who came to her door had
an agent--in this market, they have to. So
you have to plan to pay their 3%, and then
you're basicaly paying a savvy dealer to
play against you.

Plus, I may be a seller but I agree with
buyers that prices are INSANE around
here--yet buyers are paying, I think, in
part, becasue they trust the name of the
agent on the sign--they figure, "She
always gets her price, so she will this
time--how hgh can I go?" I think with a
FSBO we would not have been able to
command such a high price or create a
buying frenzy like I see all over here.

And frankly, potential FSBOs, I'm relieved
since I signed with the agent. Except for
washing the windows this weekend, It's
out of my hands.

Daniela Deane: More on the FSBO debate...It's not an easy decision.

dc: I agree with Alexandria can you do another story like the one last summer under 300. Maybe this year the magic number is under 400, maybe more?

Daniela Deane: I'll talk to my editor..Sounds a little bit too samey as last year, though, doesn't it, except with a higher price tag?...I GOTTA THINK OF NEW STUFF!!!

Laurel: Why DC housing is NOT a bubble...

The US population keeps rising about 12% per decade. How many new nation's capitals are being built?

Daniela Deane: More on whether this is a bubble about to burst...Others?

arlington va: For the first time homebuyers with the sellers still holding contracts--make your offer expire soon (e.g. 9pm tonight or tomorrow). They're playing games--holding offers to see what else comes in. They can use your offer to "auction" the house to someone else "Well, I have an offer for $350,000, but if you can beat it, the house is yours". Sorry to be so pessimistic, but I've been there (as the losing buyer). Walk away from anyone who starts delaying or playing games.

Daniela Deane: Thanks for sharing your experiences...

Washington DC: Housing bubble? I'm afrid so. First, many are buying "investment" properties rather than investing in stocks. With stagnant rents, this doesn't look like such a great idea, and may lead to a future sell off. Second, the rise in prices is -far- outpacing the slow increase in population. I think (as in any bubble), the expectation of higher home values in the future is driving people to pay foolishly high prices now.

Daniela Deane: I'm one of those investors, so I really don't want to hear this...

FSBO & fees: You wrote: "In many cases, FSBOS end up paying the buyer's agent the 3 percent, remember, saving only on the 3 percent to list it." Are you pointing out that buyers working with an agent take into account the fee they have to pay and adjust their bid accordingly, or do FSBOs actually end up paying the 3 percent to the buyer's agent directly? I bought a condo from a FSBO who said the asking price was net of any commission - that is, the buyer would have to pay the commission. I wasn't working with an agent, so it seemed like we each saved 3 percent.

Daniela Deane: What I meant by that is that FSBOs often still end up paying 3 percent of their purchase price to the agent that has represented the buyer of their property, because as someone pointed out, very few buyers don't have agents these days....Just a reminder to sellers consideirng going FSBO: You often do not save 6 percent. That's it.

Bethesda, Md: Re: Waiving inspections on a condo. Unfortunately the -really- expensive stuff in a condo is in the common area-- better to look at recent condo board minutes.

Daniela Deane: Right.

Alexandria, VA: We've recently sold our townhouse. Got an offer slightly under asking price in less than a week. We took it because the buyers were extremely well qualified and were able to close on the day we wanted.

I've noticed that another house (same model as ours) on our street, which went up for sale a week before ours is still on the market. We have the exact same asking price, even though they have an end unit. These houses are only 2 years old. Could ours be that much nicer inside? I just don't understand how we had a flurry of visits, a quick offer, and others coming back for second visits, while that house sits for nearly 2 months.

Daniela Deane: That's really very interesting and it's hard to understand why...Usually the main reason a property sits unsold is that it's overpriced. Maybe it's trashed inside, or they picked hideous paint colors or shag carpeting that doesn't show well? ... I'd be dying to go see it, if I were you. And if you do, let me know!!

Alexandria, VA: I bought a condo in Old Towne last December and it's already appreciated $30K. I just took a walk through the neighborhood last night, and saw about 15 more homes that had recently sold, a few of which had been on the market for some time. I think the nice weather we're having is really encouraging people to get out there and buy, at rising prices even.

Daniela Deane: Yes, the spring market has finally taken hold after a slow start because of lingering winter weather....

Alexandria, VA: I considered the FSBO route. I did all of the research, and came to this conclusion: if I wasn't working and we didn't have to sell the house by a certain date (moving out of the country, no wish to be absentee landlords), I would do it. Otherwise, it's worth that 3% (nobody saves 6%. Even if there's no buyer agent, there are many other costs).

It's not selling the house that's the hard part, particularly in today's market. It's taking the deal through to the end. Arranging inspections, paying off the existing mortgage, making sure the buyers don't bolt, answering all of my stupid questions, etc., etc.

We decided, in the end, that our sanity was worth the $11k (3%) that we will be paying our agent.

But if you have the time and flexibility, I think FSBO really can be a good option.

Daniela Deane: Remember, you can always pay a lawyer a fee to handle the paperwork.

Arl., VA: Re: Bubbles. For Investment Buyers - - rents might not be keeping up to pay the mortgage INITIALLY, but Real Estate is a LONG TERM investment and eventually rents catch up. This is nothing, however, compared to the HUGE benefits of appreciation and tax deductions.

Daniela Deane: Yes, yes, yes!!! and thank you, thank you, thank you...All good points.

Alexandria, VA: I heard those same arguments that the DC area's real-estate is in bubble-form 4 or 5 years ago. It hasn't popped yet. And DC is still one of the fastest growing areas in the country.

I'm just psyched that I'm taking the cash I made on my house ($120k appreciation in 2 years, less that nasty 6% fee and the money I took out in a refi) and moving somewhere much cheaper with much less traffic. Whoo hoo!

Daniela Deane: When you sell a property here and move to a cheaper place, it's definitely time to break open the champagne...Selling and staying is a different story; you get more, you gotta pay more too....

Bubble: I bought stock in Amazon.com in 1997 for something like $17, then some more for $25ish. I sold at 70-something, then kicked myself when it went WAY higher than that, before falling back to less than I'd paid.

Do I think the same thing will happen to housing prices? Well, not as drastically, (I hope!) but if you look at the % of incomes people are paying to finance mortgages, particularly in DC, it clearly can't go on forever.

Daniela Deane: More thoughts on the bubble theory.....

arlington va: Another reason a seller might be holding contracts beyond the decision date--they're trying to bring another buyer in. I have a coworker who had their offer held for 2 extra days only to lose the house and find out later that the listing agent sold it themselves to another last-minute buyer. It is obvious that the agent had this buyer lined up and held the consideration period open in order to give their buyer time to get their offer in (and give the agent a shot at a double commission). Ugh.

Daniela Deane: Sigh....Remember, you can file a complaint if you feel you've been treated unethically....Call the local realtor board to ask how and where to file a complaint...

Alexandria, VA: Not in the market (have owned same house for 19 years, since it was worth 1/4 its current appraised value), but like to stay informed.

I would be wary of being a FSBO in a hot market, where deals can get complicated because of all the money and risks flying about. A good agent can get you more for your house, probably enough more to make the commission worth it.

Daniela Deane: Another point of view....

Woodley Park: Re: Bubble

I too tried to wait out the bubble and watched interest rates continue to fall and house prices continue to rise as a result. I agree w/ the earlier estimation and figure that our 18 months of waiting/searching cost about 100 to 150K. Hope it doesn't bottom out now...

And I concur w/ the observation of mid 300s and then a jump to 500s for a 3 bd, 1.5 bth w/in a couple miles of a metro for the close in city/burbs. Not much in the 400s for the past 6-12 months.

It's a tough market.

Daniela Deane: That's certainly the way many people feel when appreciation is healthy...they don't though,when it isn't....

Leverage and wealth creation: Daniela,

In the study that the Fannie Mae economist did for you: is it really a fair comparison to compare a $10,000 downpayment with $10,000 in an index fund? Isn't the appropriate comparison (to hold the leverage effect constant) to compare a $10,000 downpayment with investing $10,000 of your own money and $90,000 of a margin loan in the stock market?

Daniela Deane: Well you have a point there, because one of the big reasons that real estate is such a great investment is the leveraging aspect of it: you put $10,000 down on a $120,000 house and get appreciation on it all, not just the $10,000...

Laurel, MD: Hi: Just my two cents, but I think way too much is made out of contingency clauses, escalation clauses, etc. when it comes to buying a house. We bought our first home from a family with two small kids. At the time, my son was toddler and my husband and I toted him along to the open house. The wife and I chatted briefly as we toured the house.

When we presented the contract, we included a letter explaining how much we liked the house and talked about how we'd been looking for months. Our agent told us later that it was the letter that made us stand out...despite another bid which would have put a little more money in the seller's pocket.

Forming a relationship and making a good first impression seems to get overlooked in discussions about strategies to "get the house." What do you think?

Daniela Deane: Your experience shows that sellers actually care about who buys their house. They want to think that someone else will love it as much as they do. That's why I suggested a personal letter for the questioner who was waiting to see if his contract was accepted. But other forces could be at play there too, as several posters mentioned...

Somewhere, USA: Maybe not something you can answer, but hopefully someone in the audience can.

Our landlords are trying to sell the rental house in which we live. It's been on the market almost two months, the first contract fell through after the home inspection, and so far as we know there haven't been any other offers. The landlords are getting, understandably, a bit impatient, but have remained mostly reasonable. Their realtor, however, has gotten downright hostile -- calling us and screaming, threatening to break the lease, being personally abusive, and now seems to be lying to the landlords about how we're being rude to and "harrassing" people who come to view the house (not true!). Things have been sufficiently soured between the landlords and us that they aren't listening to our disavowal of the behaviour of which we're accused, and since we haven't been videotaping each visitor or audiotaping each phone call, we've got no proof. Thank heavens, we take possession of our new place very, very soon.

Is there any recourse we can take? I've checked the realtors' association web sites, but this doesn't so much seem to be an "ethics" issue as an issue of exceedingly unprofessional (and possibly emotionally disturbed) behaviour.

Daniela Deane: Gosh, what a bad situation...Thankfully, you'll be out of it soon. Call the realtor's associations and ask what you can do. Some web sites can be hard to navigate at times, can't they?...Sometimes it's just the good old telephone that you need...

re: appraisals for refi: My apprasier actually came in and checked out my condo unit, not just comps. Bought in Nov. 2001, has appreciated by 19%. No bubble bursting as far as I'm concerned. People were saying then, oh, everything is overpriced--wait till the prices drop. Well, here we are less than 2 years later, and that's the best investment performance I have.

Daniela Deane: Oh, and yes, appraisers also do on-site appraisals...they also have something called a drive-by appraisal...(is that like a drive-by shooting?)

bubble?: It seems like the thing missing from all of this bubble talk is remembering that it is your home and as a result the day to day living someplace you like and are happy with is also worth something. I bought recently and I hope it is not a bubble and things keep appreciating, but even if they don't I get to live my life there. You can't live in the stock market.

Daniela Deane: Yes, yes, yes...You have to have somewhere to live and financial planners unanimously say that you should own rather than rent....

re: buyer's agent commissions and FSBO: I totally understand that most FSBOs will have to pay 3% to their buyers agent, and that really is the best way to get a home to sell quickly, but I just wanted to answer your question about why someone would choose not to pay a 3% commission or even say "no agents" on their listing. Believe it or not, there actually are a lot of buyers out there who search for homes without an agent. Sure, they are a small group in comparison with all the buyers who do use agents, but it is definitely a group that is quickly growing in size. With the advent of the internet, it's possibly easier to do one's own searches of the listings, entering many different combinations of criteria, than to have an agent do it. That's how I found my condo, and, despite a bidding war, how I won it without paying as much as some of the other offers over asking price. While some FSBOs are just unreasonable in their expectations, I think that others know that the MLS is the best way to reach buyers, even those without agents. I'd still recommend listing in the MLS with a selling commission of 3%, and then picking and choosing among the offers you get. If you're lucky enough to find a buyer without an agent, then you can split that extra 3% with them, but at least you won't turn off those buyers who do have agents, in case those are the only replies you get.

Daniela Deane: Thanks your comments. Yes, of course, you can find someone not working with an agent..But it's harder...It is possible though.

WDC: Having just bought a home in Bethesda and sold our DC condo, I think our realtor was worth every penny she received. We probably would not have gotten our house without her, and she continues to work hard, taking care of details for this transition period.

Daniela Deane: A nice word for realtors...some of whom are extraordinary, for sure...

re: falls church appreciation: I talked with someone who keeps tabs on the county planning board and things a few months ago, and he really thought the Falls Church area would be doing well in the future. A lot of developers are changing the area, and many of the "less pretty" parts are expected to be redeveloped. Plus, there is very tentative talk of a possible metro station out there (the new purple line that would maybe go to Dulles) 10 years from now.

Daniela Deane: Thanks your comments...

NW DC: Just a report from the field -- waiving inspection certainly isn't a good idea in all circumstances, but I think there are times when it makes sense. We finally got a house in NW DC on our fifth try, and my understanding is that our "clean" contract (no contingencies) and good financial standing is what got us the house over other, higher bids (there were nine bids total). We went into the market last year very, very hesitant to waive inspection, then did a few pre-inspections on houses we ended up not getting; during that process, we got a sense of the big, deal-breaker things to look for and ended up feeling comfortable waiving inspection on this house, which is in great condition. We still plan to do an inspection for our own information.

Daniela Deane: Very good...Remember you can always do an inspection but not make it a contingency. We ran a story last Saturday about a buyer that quickly got a home inspector in the morning the seller was accepting contracts....You're right about the big things, though....

arlington: for the harrassed renters: Go to the local library and find the county code on landlord tenant law. Most jurisdictions have a law that the tenant is entitled to "quiet and peaceful enjoyment" of the property. A screaming realtor and troops of potential buyers coming through are not "quiet and peaceful enjoyment". Also, consult your lease to see if it says anything about whether or not you have to let buyers through. You have the upper hand here--tell the landlord that you will continue to show a clean house and be reasonable only if they get the realtor off your back. Otherwise, you will be asking for a reduction in rent for the diminished enjoyment of the property. You can always go the sneaky way--leave the house a complete mess. Other realtors won't want to show it while you're still in it, and the showings will trickle away. The realtor can't do anything about that.

Daniela Deane: Very good points, Arlington...

Columbia, MD: I'm the first time home buyer with the sellers still looking over the contract. The thing is we put a deadline on the first contract and it has already expired. Our agent told the sellers agent we are still interested and we can put an addedum (sp?) if they choose us.

I'm going to call my agent to double check if they have made a decision and give him the suggestion of us writing a letter. Thanks for your help!

Daniela Deane: I have no idea whether it'll work..But good luck Columbia! And please let me know...

Alexandria: People who want 3 or 4 bedroom, $300 - $400 K homes near Metro should look in southeastern Fairfax co., just south of Alexandria and near Huntington or Van Dorn Metro. There are 3 and 4 bedroom homes in those ranges in that area. New ones are $500 and up, of course.

Daniela Deane: Thanks for the suggestion. Others?

Bubble?: Yep.

1. As noted, rentals are declining now, but folks are buying with expectation of income from investment properties.

2. Interest rates are as low as they can go. Too much further and we're in effective negative interest. As soon as this goes up, down goes sales.

3. The stock market burned everyone, so they're looking for new places to hide money. Once they get over this, wealth will shift away from real estate.

4. There are only so many folks who can afford to buy this lunacy. Eventually, you are going to run out of people who can consider $700K to be the top of "affordable".

5. A continuing economic downturn will kill incomes and increase mortgage defaults, popping the bubble. A new upturn will move money into stocks, and raise interest rates, popping the bubble.

We're at about 1999 in comparison to the stock bubble. The basic fundamentals are all pointing to a big collapse, but everyone is pretending they don't apply. There is, logically, no place to go but down from here.

Daniela Deane: Thanks for your well-presented comments. Not everyone agrees with you, though, you know that, right?

Housing Bubble?: Previous poster - "the rise in prices is -far- outpacing the slow increase in population"

What does that have to do with anything? If there are more buyers than sellers prices go up. How fast the population increases has nothing to do with it if that is the only factor you look at. The population can increase and prices go down if the supply of housing goes up faster than the demand.

Currently supply is going up but demand is going up faster. I don't know if there is a bubble or not, but didn't anyone here take any econ classes?

Daniela Deane: Now let's not get nasty.......

Southern Maryland:: Re: Inspections -- It's a scam! They are franchises and anybody with the fee can buy a business without any inspection experience. Their reports are so full of disclaimers and "we are not responsible for..." that it's practically useless. Try calling them on something they missed in the inspection that shows up later. Lots luck!

Daniela Deane: Here's an opinion on inspections....

Washington, DC: RE Alexandria, Va.: I just have a comment to all those people out there who are convinced we're in a housing bubble (in the D.C. area) and are waiting for it to pop. I thought the same way for two years. I figure that thinking (and the stubborn decision to wait before entering the market) cost me $100,000 before I bought my SFH in September.

I have also had a similar experience. After getting married in 2001, my wife and I decided to wait out what we thought was a housing bubble in DC. Other friends purchased single family homes in DC at that time for around the mid 250's. We now have a contract on a home very similar to what our friends purchased. However, the purchase price is about 130k more than what they paid AND their were several offers on the home we have under contract! Needless to say, none of our investments have kept pace with that kind of appreciation. It would be interesting to read more about the study you mentioned doing with Fannie Mae. Can you provide a URL to the story. Thank You and Happy Easter Daniela!

Daniela Deane: We're getting very excited about this bubble idea...I've asked my post.com producer for the url to that story. I'll post it when she gives it to me.

washingtonpost.com: BTW, the url for the home values special report is www.washingtonpost.com/wp-dyn/realestate/specials/housingoutlook/

FSBO -- can work in the country ...: if only because the country folks are SO averse to using real estate agents. Had one call me the past couple days about my house up for sale in Central VA and she's an absolute bulldozer/used car salesman type (even by city standards); I feel so bad for her that I may say something, because I can't imagine she makes much out there (90 miles out).

Daniela Deane: Here's a different perspective....

Silver Spring, MD: 3-4 bedrooms can be had here and in wheaton for under 400 but are getting scarce

Daniela Deane: Thanks, Silver Spring....

Waiving Inspection: Well, on the advice of our agent, we did waive inspection on the house we bought. However, it was really a easy decision - 3-yr old roof, new AC, new furnace, new hw heater; no water stains or musty smell in the basement. We lucked out, and because of the waived inspection, we got the house at asking price.

Daniela Deane: Whether to waive an inspection or not, it seems to me, has a lot to do with the property in question....

Fairfax, VA: From a longtime DC area denizen: yes you can gush on about how 'hot' the market is and how thousands are waiting to move here, but for this nearing-retirement person, it is a big turn off. The area is losing its 'livability', i.e. it is getting more crowded every day, air is dirtier, open spaces vanish. After a while, I can't believe I won't be the only person to notice this and it may then be 'hot' no more, just a dirty, crowded place to live.

Daniela Deane: Hmm...food for thought....

Daniela Deane: Folks, I gotta run....I can tell my Fannie Mae study really riled you guys up...I love you all. You forever keep me on my toes. Come back in two weeks. Same time, same place. And have a great Easter weekend.

Doom and Gloom: The people predicting a "pop" in the housing bubble are the same people who predicted 17 out of the last 3 recessions. When they finally get lucky and are right they'll scream "told you so".

Daniela Deane: Couldn't resist posting this one....

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