This week we're heading over to one of the hottest neighborhoods in the District to check out a 2-bedroom condo in a beautiful restoration of two row houses known as the Harper Condominium. On the market for about a week, it's listed at $649,900.
Located within walking distance to the Mount Pleasant and Adams Morgan neighborhoods, this unit is part of a boutique development of eight condos. Parking is available. The condo has a very affordable HOA fee of $155 per month as well as an open floor plan. The kitchen features granite countertops and a gas stove. It also comes with a washer & dryer and dishwasher.
Assuming a homebuyer puts down 20 percent on a conventional loan, her cash to close number will be approximately $148,330.14. Monthly payments will then be around $2,947.36 per month, including the HOA fee. For a complete picture of the cash to close, including the seller's side of the transaction, try the Web version of Close It™ or download the free Close It™ iOS app.
Create is a Web-based application we recently discovered that is helping us improve how we do business. It occurred to me that other real estate pros might like to see how they can also benefit from this useful tool.
We have organized a live demonstration of Create and invite you to join us at our Friendship Heights office on Tuesday, March 1 at 10 a.m. to learn clever ways you can leverage this software to improve your real estate business. Click here to RSVP.
The application provides excellent insight into the District’s inventory of real property – residential and commercial. It's essentially a clickable 3D map of the city. Click on any building to get a highly detailed report of the property, including such things as ownership, zoning and permits.
Beyond the property itself, Create offers a snapshot of current market conditions and the people currently living in the neighborhood: average household income, educational attainment, cars per household, average commute times and more. We've found this information to be useful for tailoring marketing strategies to the specific audiences and neighborhoods where we work.
I reached out to the developer of this nifty tool, Stefan Martinovic – who told me Create is generating buzz with nearly every active brokerage, developer and investment company in town – and asked him to present a live demonstration at our Friendship Heights office on Tuesday, March 1 at 10 a.m. Click here to RSVP.
In the meantime, you can test the application for free by heading over to Create.io from your desktop browser. Stefan is also offering a 40% discount on the premium subscription with the promo code "CreateLove."
We're headed over toward American University this week to check out a 1-bedroom condo in the AU-Tenleytown neighborhood. The unit, which is on the second level of a garden-style condo building, offers a spacious 732 square feet of living space and an assigned parking space. It's listed at $274,900.
This condo has an updated bathroom and a kitchen that features granite countertops, dishwasher and an electric stove. The unit has hardwood floors throughout as well as large windows that let in plenty of sunlight. The condo building is located near Glover Archbold Park, where trails and nature await. The culture and nightlife of the city are also not far away.
Assuming a homebuyer puts down 20 percent on a conventional loan, her cash to close number will be approximately $63,741.43. Monthly payments will then be around $1,733.42 per month, which includes the HOA fee. For a complete picture of the cash to close, including the seller's side of the transaction, try the Web version of Close It™ or download the free Close It™ iOS app.
First-time homebuyers in the District of Columbia can look forward to a lower transfer tax rate at the closing table starting this fall, provided the City Council votes in favor of the "First-time Homebuyer Tax Benefit Amendment of 2015" as it is expected to do.
A new transfer tax rate of 0.725% for first-time homebuyers would go into effect on Sept. 30, 2016, according to the bill that is sponsored by councilmembers Jack Evans (D-Ward 2), David Grosso (I-At Large) and Anita Bonds (D-At Large).
To obtain the benefit, a signed affidavit must be provided at closing essentially stating that the buyer is a first-time homebuyer and the unit will be his or her principal residence.
The current transfer tax rate for homebuyers varies depending on purchase price from 1.1% for purchases of $399,999 or below to 1.45% for purchases of $400,000 or more.
This amendment would not be the District's first attempt at offering tax relief to would-be homebuyers. Up until the 2012 tax year, qualifying buyers were eligible for a $5,000 tax credit when they filed their taxes in April. That program had been in existence since 1997 before it was canceled.
Another popular tax program that's still going strong in District is the tax abatement program.
The First-time Homebuyer Tax Benefit Amendment will take effect following approval by Mayor Muriel Bowser and is subject to a 30-day congressional review.
If you work with foreign nationals in your real estate business, be advised that the FIRPTA withholding rate on home sales exceeding $1 million will increase to 15% on February 16.
Also known as the Foreign Investment in Real Estate Property Tax Act, FIRPTA requires foreign persons to pay U.S. income tax on gains made from the sale of real estate in the United States. Home sales that do not exceed the $1 million dollar threshold are subject to a 10% withholding.
There is an exception to the FIRPTA withholding rule. If the sales price is below $300,000 AND the new buyer intends to use the property as a principal residence, then the home sale is not subject to FIRPTA withholding.
The duty of collecting the FIRPTA tax, owed by a foreign national seller, is imposed on the U.S. national buyer The amount that must be withheld can be lowered pursuant to the seller obtaining a withholding certificate from the IRS prior to closing.
In most instances, the settlement agent will actually collect the withholding from the foreign national seller and remit the funds to the IRS on behalf of the buyer. However, the buyer is held legally responsible for the proper withholding and, under the law, the buyer could be liable for any additional withholding tax, penalty and interest if ever challenged by the IRS.
To help you determine when FIRPTA withholding is required, and the rate to withhold, we created a simple flowchart that contains four easy questions. You can view it on our website and download a copy to share with your clients and colleagues.