Drop the price or upgrade? (apartment, buyers, property taxes)

[johnsonkk]

What's the maintenance or condo fee? Do you pay property taxes too? If high, this alone would be reasons outside your control. Are buyers coming in (price is good but condition is an issue) or are they not even showing your condo (price is too high)?

As an investment, got excited and ran thru the numbers but figure there are $300 per month condo fees and 3% property taxes so need to charge $2000 rent to break even. From taking to co workers, there are lots of new condos going up in that area and a couple of them recently moved to a new place for less rent with more amenities. It's getting competitive. Look at the new condos being built just east of the Pentagon mall, hundreds of new condos. Your realtor should know those prices in order to gauge your price. 10% drop in your price was significant already.

[ACWhite]

Originally Posted by johnsonkk

What's the maintenance or condo fee? Do you pay property taxes too? If high, this alone would be reasons outside your control. Are buyers coming in (price is good but condition is an issue) or are they not even showing your condo (price is too high)?

As an investment, got excited and ran thru the numbers but figure there are $300 per month condo fees and 3% property taxes so need to charge $2000 rent to break even. From taking to co workers, there are lots of new condos going up in that area and a couple of them recently moved to a new place for less rent with more amenities. It's getting competitive. Look at the new condos being built just east of the Pentagon mall, hundreds of new condos. Your realtor should know those prices in order to gauge your price. 10% drop in your price was significant already.

Arlington real estate tax rate is about 1% of assessed value, which usually lags the FMV a little (more where there have been significant updates not requiring permits). So, ~ $2k annually on this unit.

[ACWhite]

OP, I feel your pain. We owned a house we loved and it took forever to sell, at a loss. are you sure that your home is being listed on MLS? On edit: I did find a unit that may be yours. It has a $545 monthly condo fee that the description says includes utilities, but does it also include your RE tax? If so, the description should say that.

In looking at the photos (which did not show the kitchen or bath, and are dark) I think buyers are likely thinking they will have to put a lot of time and money into each room, and some don't like parquet floors. I think you should drop the price and agree about spiffing it up with some new paint (choose neutral colors shown on the HGTV flipping shows) and rearrange your furniture and wall pictures a bit. If you can afford to replace the vertical blinds with curtains appealing to young buyers, that may help. Then take good new photos with all blinds/curtains open and lights on. If there is good soundproofing as often is true in buildings of that era, emphasize that.

It's hard to sell 1/1s in general. The CC/PC sellers are still affected by high office vacancy rates, from the BRAC realignment and fed budget cutbacks, shiny new competition in DC and elsewhere, and maybe now a little by the cancellation of the street car project.

[jtees4]

Drop price, get what you can....the only important price is the one you get offered. The longer you wait the more problems you will have. Don't upgrade at this time, but you could try offering say $10,000 towards upgrades to the buyer if the price is high enough.

[ACWhite]

Originally Posted by jtees4

Drop price, get what you can....the only important price is the one you get offered. The longer you wait the more problems you will have. Don't upgrade at this time, but you could try offering say $10,000 towards upgrades to the buyer if the price is high enough.

The catch with that option is that property has to appraise at the selling price, not the selling price minus $10k.

[want2moveout]

Tons of wisdom! Thank you all. My upgrades in the kitchen limited to floor tiles, repainted walls and replaced dishwasher. Light color cabinets stayed. ACWhite gave the best explanation to the problem - BRAC, Navy annex gone, office vacancy in CC.

[jtees4]

Originally Posted by ACWhite

The catch with that option is that property has to appraise at the selling price, not the selling price minus $10k.

You're correct, and also brokers don't like it because their commission will not include the $10K (so they discourage stuff like this).

[kww]

Originally Posted by want2moveout

After worriless years of owning a small 1 BR condo near Pentagon City I discovered that condo sales slowed down. I planned to sell it, retire and move to another state with the money. The plan does not work well for me: the condo sits on the market for 60 + days already. My initial price dropped from 230K to 210K with no results; last years same units in our building went for 239K. Condition is clean, but the galley type kitchen is not upgraded. Upgrades in our 40 years old high-rise building mean knocking the wall between the kitchen and the living room, costly and useless (to my opinion). Here is my dilemma - to upgrade, or drop the price further. What buyers think? Thank you!

if yours is the one on army navy drive, the first thing I'd do is get new photos.

[kww]

Originally Posted by jtees4

You're correct, and also brokers don't like it because their commission will not include the $10K (so they discourage stuff like this).

$300 difference to a broker. An agent that would be discouraging this is an agent that needs not have a license.

[johnsonkk]

I'm going back to why it's not selling and monthly condo fees of $550 combined with $200 monthly property taxes is a factor for a one bedroom condo. Are either of those expected to go down in the future? Combined with the typical mortgage, over $2000 per month. Rentals, new ones, can be found near the area. The market is challenging in that area. Lots of new high rise apartments and condos being built. Count the cranes.