TOPA: New law is finally here!

TOPA: New law is finally here!

The new TOPA statute for a single-family home, condominium unit and single-family home with an appurtenant unit is finally in place.

Notices are up on DC Department of Housing and Community Development’s website.

Our underwriters have not come out with their definitive stance on what will now close the loop for TOPA, but we know this – if the property was listed prior to the enactment of the law on July 3, 2018; all of the old rules of TOPA apply.

This means the old notices must be given via certified mail and the formal process must be followed.

If the property was listed on or after July 3, 2018; new rules apply.

At the moment, the underwriters are asking that the new Notices be given as prescribed by the statute and then, to close the loop, tenants are asked to sign a TOPA affidavit.

The GCAAR form 1316 seems to be acceptable, but check in with the title company. All underwriters are different. The concern still being an affirmative step be taken to clarify the tenant is not going to act and is not a risk for title insurance purposes.

We’ll continue to share TOPA updates as they come in.

Close It! House of the Week: Jaw-dropping views of the Capitol, spiral staircase feature

Close It! House of the Week: Jaw-dropping views of the Capitol, spiral staircase feature

This week, we’re headed on over to a spacious penthouse loft of 1,369 square feet. This beautiful property has 2 bedrooms and 2 bathrooms, and is fitted with gorgeous, modern amenities. Also included in this residential, garden-style loft unit, is an assigned parking space and, its most unique feature, its cascading spiral staircase. It's listed at $869,000.

This condo has a two stunning, upgraded bathroom and includes two industrial style bedrooms with exposed ducts on the ceiling. In addition, the unit has a gourmet kitchen with granite countertops, new stainless-steel appliances, and an electric stove. Hardwood floors flow throughout the condo until they reach the condo’s spectacular 200 square foot private terrace that overlooks the city. Also, nearby the condo is Meridian Hill Park, perfect for those who like spending time outdoors.

Assuming a homebuyer puts down 20 percent on a conventional loan, her cash to close number will be approximately $197,834.79. Monthly payments will then be around $3,905.84 (this does not include HOA fees). For a complete picture of the cash to close, including the seller’s side of the transaction, try the Web version of Close It™ download the free Close It™ iOS app.

To protect your data from being shared with affiliates, opt-out

To protect your data from being shared with affiliates, opt-out

You would be surprised at how many people I meet at the settlement table who have never opted out of their information being shared with their bank’s or lending institution’s affiliates.

People often complain about solicitations via mail, email and phone. If you have a credit card, bank account or mortgage with a lending institution, they are often allowed to share your information with their affiliates unless you specifically ask them not to share.

I hear, “I don’t want to be on the phone for hours waiting to opt out.”

Most of the institutions allow you to set up an account online to handle payment and inquiries. Usually there are privacy settings in the same online account you can set up – opt out of their marketing to affiliates, sharing credit information, etc.

If you would rather be on the phone, you can certainly call and opt out of your information being shared with affiliates or used for marketing. Just a few minutes of your time may save you hours sorting mail and/or emails.

Close It!™ House of the Week: Fabulous location, condo in Dupont Circle

This week we’re strolling over to Dupont Circle to check out a unique and appealing condo on the penthouse level of a boutique building. List price is $449,000.

This updated 1BR / 1BA unit features modern wood cabinets, high-end appliances and loads of closet space. The community is a hidden gem with a residential entrance tucked away on quiet Corcoran Street, NW. The new owner of this home will also enjoy sunny western exposures and a fabulous location that’s steps away from shopping, restaurants, culture and nightlife.

Assuming a homebuyer puts down 20 percent on a conventional loan, her cash to close number will be approximately $104,020.86. Monthly payments will then be around $2,296.99 including the HOA fee. For a complete picture of the cash to close, including the seller’s side of a transaction like this, try the Web version of Close It™ or download the free Close It™ iOS app.

What’s the status on B21-0417, aka The First-time Homebuyer Tax Benefit Amendment Act of 2015?

Legislation that would offer tax relief for District residents buying DC real estate is currently under committee review and awaiting scheduling for a mark-up, a spokeswoman for the Council's Committee on Finance and Revenue said.

Known as the First-time Homebuyer Tax Benefit Amendment Act of 2015 (B21-0417), the bill would create a new transfer tax rate of 0.725% for homebuyers who have never purchased a house, condo or share in a cooperative unit in the District. It would go into effect Sept. 30, 2016.

During mark-up, which is a vote in the Committee to send the bill before the whole Council, the Committee will have an opportunity to amend the bill (or not) and will also have a chance to review a financial impact statement to analyze costs and revenues of the proposed legislation.

If the bill passes mark-up, it will go to Mayor Muriel Bowser for a signature before going to Congress for review and passive approval. If it fails mark-up, the bill will get kicked to the Committee of the Whole and added to the agenda for the next legislative meeting.

Impact on low- to moderate-income residents a concern

The Council held a public hearing about the bill on February 10 of this year, which is when Settlement Observer picked up on the story. Then on February 24 a representative from the DC Fiscal Policy Institute testified before the Committee about concerns regarding a lack of income restrictions and the impact the tax cut would have on the city’s Housing Production Trust Fund.

“Rather than provide a new tax benefit for all first-time homebuyers, DCFPI recommends that policymakers review the city’s current deed tax assistance to low- and moderate-income homebuyers and make adjustments if they appear warranted,” said DCFPI Housing Policy Associate Claire Zippel in her testimony.

The bill was introduced last October by councilmembers Jack Evans (D-Ward 2), David Grosso (I-At Large) and Anita Bonds (D-At Large).

Grosso acknowledged concerns regarding the economic impact of lowering the transfer tax rate across the board and, in particular, how such a deduction would affect the Trust Fund.

“I am committed to working with my colleagues to ensure that the [Trust Fund] receives annual commitments so that it is not dependent on yearly fluctuations in recordation tax revenues,” Grosso said in a statement.

Mayor Bowser’s budget proposal last year included $100 million for the Trust Fund in fiscal year 2016, according to the website of the Coalition for Nonprofit Housing & Economic Development. The Trust Fund is administered by the DC Department of Housing and Community Development with support from the Coalition.

The Trust Fund “enables non-profit housing providers, mission-driven for-profit developers and renters wishing to exercise their Tenant Opportunity to Purchase rights to improve and develop affordable housing in all eight wards,” according to the Coalition’s website.

Since its inception in 2002, The Trust Fund has produced or preserved more than 8,000 affordable homes with upward of 2,000 more in the pipeline, according to the Coalition’s website. In addition the Trust Fund has created an estimated 10,000 short-term and permanent jobs and has helped more than 18,000 DC residents.

The District's homebuying taxes significantly higher than Maryland or Virginia, about 50% higher on average

Current DC transfer and recordation taxes are on average 50% higher than neighboring Maryland and Virginia, Grosso said in a statement, which was the impetus for introducing a bill that would lower the tax burden for homebuyers purchasing for the first time in the District.

Transfer tax rates for District properties vary depending on the purchase price, from 1.1% for purchases $399,999 and below to 1.45% for purchases of $400,000 or more. The tax payment is traditionally paid by both the buyer and seller.

The DC tax abatement program offers relief for some, but homebuyers must satisfy income, purchase price and other restrictions and provide documentation to qualify.

Tax abatement waives the recordation tax obligation for low- to moderate-income first-time homebuyers while also crediting the seller’s portion of the tax to the homebuyer, resulting in a 2.2% swing in favor of the homebuyer. In addition, a qualifying homebuyer is exempt from paying property taxes for the first five years of ownership, but again some restrictions apply.

“If policymakers are concerned that the current deed tax assistance programs are inadequate, the District should look to modify existing programs while keeping a focus on low- and moderate-income families, rather than adopt another tax break that has no income targeting,” Zippel, the housing policy associate, said in her testimony.

We will continue to monitor the story, and readers can also follow along on the Council's website.

  • Ways to save at closing

    Title charges are the largest chunk of closing costs and can vary by hundreds of dollars.

    Learn more

  • What are closing costs?

    The real estate closing process involves loan steps, legal steps and title steps.

    Learn more

  • What's title insurance?

    Insure your legal ownership just like you'd insure the building, but for lots cheaper.

    Learn more

Connect with us


Our blog contains general information only, not intended to be relied upon as, nor a substitute for, specific professional advice. Rate tables and figures that appear on our blog are deemed reliable but not guaranteed. For current rates & policies, refer to our Quick Quote and Consumer Guide. We accept no responsibility for loss occasioned to any purpose acting on or refraining from action as a result of any material on our blog.