Future of NOVA housing market (Arlington, Alexandria: condos, home sales, neighborhood)

[EmiSky]

Originally Posted by NOVA_guy

The only reason I'd tell someone in your situation to hold on to it a bit longer is because as cliche as its become, I do think Amazon is a game changer for NoVa. This area has always had a robust job market, but when you start talking tech jobs which I think Amazon is just a launching pad for, it changes things especially in terms of real estate.

Will NoVa get San Francisco insane expensive? Doubt it but I do think it's going to continue to get more and more expensive. Obviously with COVID that makes things more precarious so there is that aspect of it too.

I agree with Amazon being a game changer, and that’s my hesitation for selling now. Facebook will be adding 1500 jobs next year, that’s in addition to Google, Microsoft and many others who will be increasing their footprint here, in the near future.

[oneasterisk]

You could always sell and take the proceeds and invest it. That's what my wife is doing after selling her house she bought when she was still single. She's lived there the last 10 years and the 95k she profited will be completely tax free. One of the stocks she bought coincidentally is Amazon, so you can still profit on their success. Have your cake and eat it too...

If you've lived in the property for at least 2 of the last 5 years, 250k if you're single or 500k if married of the gains are tax free. But if you start renting it out the clock starts ticking and you may lose out on those tax free gains as well as have to payback the depreciations you'll take on a rental property.

https://www.irs.gov/taxtopics/tc701

[EmiSky]

Originally Posted by oneasterisk

You could always sell and take the proceeds and invest it. That's what my wife is doing after selling her house she bought when she was still single. She's lived there the last 10 years and the 95k she profited will be completely tax free. One of the stocks she bought coincidentally is Amazon, so you can still profit on their success. Have your cake and eat it too...

If you've lived in the property for at least 2 of the last 5 years, 250k if you're single or 500k if married of the gains are tax free. But if you start renting it out the clock starts ticking and you may lose out on those tax free gains as well as have to payback the depreciations you'll take on a rental property.

https://www.irs.gov/taxtopics/tc701

Yes, that’s actually what I’m leaning towards; selling the property and investing in the stock market. If I play my cards right, I could make a lot more in the stock market in 10 yrs vs. real estate, and without the hassle. Also, what concerns me about renting property now is the eviction moratorium. I would be stuck indefinitely with a tenant if s/he stopped paying rent, which could lead to a serious financial hit.

[Hiker-biker]

Originally Posted by EmiSky

Yes, that’s actually what I’m leaning towards; selling the property and investing in the stock market. If I play my cards right, I could make a lot more in the stock market in 10 yrs vs. real estate, and without the hassle. Also, what concerns me about renting property now is the eviction moratorium. I would be stuck indefinitely with a tenant if s/he stopped paying rent, which could lead to a serious financial hit.

In the same situation and when we leave the Nova area, we are selling. Since the capital gain tax exemption is 2 of the 5 years, renting it only for two years is not worth it. Without the capital gain exemption, selling after 10 years will expose you to high capital gain and section 1250 taxes on the sale unless you defer taxes by doing a 1031 exchange which has headaches of its own. We had two rental properties in the past and we’re done with the headaches of irresponsible tenants or constant turnover while doing the property management on our own and working our W2 jobs.

[EmiSky]

Originally Posted by Hiker-biker

In the same situation and when we leave the Nova area, we are selling. Since the capital gain tax exemption is 2 of the 5 years, renting it only for two years is not worth it. Without the capital gain exemption, selling after 10 years will expose you to high capital gain and section 1250 taxes on the sale unless you defer taxes by doing a 1031 exchange which has headaches of its own. We had two rental properties in the past and we’re done with the headaches of irresponsible tenants or constant turnover while doing the property management on our own and working our W2 jobs.

I hear you. Last yr. I sold my rental property after 10 yrs. and paid a lot in capital gains taxes. And you’re so right about the turn over of tenants, those costs add up quickly. I got lucky with my last tenants, they lived there for four years, only moved out because of a job overseas. After they moved out last yr. in May, I tried to rent it again but I wasn’t getting well qualified applicants. The last one really pushed me over the edge when he demanded my agent modify like 15 items on the lease agreement. At that point I told my agent to decline his application and to list the house for sale. It sold in one day. Had I accepted these applicants, the would have been nothing but problems for me. And due to COVID, both the husband and the wife would most certainly lost their jobs and I wouldn’t have been able to kick them out due to eviction restrictions. So I’m so grateful that I sold that property.

With all the talk about Amazon and real estate prices going up, one feels like they will miss out on great property increases. All my friends are telling me not to sell yet. But I’m still leaning towards selling.

[movin2Reston]

No.

Supply vs Demand.

Originally Posted by ozzyngcsu

With everything going on (COVID, Amazon and Microsoft expansion, etc), what do you think the future of NOVA real estate will be? The current market in my experience is insane.... We have put offers on three properties in Herndon, Chantilly, and South Riding. All were for $15k over and they were not selected by the buyers. One ended up going for $50k over and all have had the inspections waved. Once COVID restrictions die down will more properties be available?

[ozzyngcsu]

3 months later and the builder has increased the base price on our model from $556k to $660k. Seems to be a combination of low rates, supply/demand, and increased building costs that are being passed on to the buyer. Pretty insane to have a 18.7% increase in three months.

[Dmvjay]

Originally Posted by ozzyngcsu

3 months later and the builder has increased the base price on our model from $556k to $660k. Seems to be a combination of low rates, supply/demand, and increased building costs that are being passed on to the buyer. Pretty insane to have a 18.7% increase in three months.

Hi, Where are you located?

[ozzyngcsu]

Originally Posted by Dmvjay

Hi, Where are you located?

This property is a TH in the Chantilly/South Riding area. So definitely feels bubble-ish, but who really knows.

[oneasterisk]

I got a quote for a fence install last week and were told that because of wood shortages, our quote was only good for 3. At first I thought it was a sales pressure technique but looked it up and sure enough it's true. With covid production has slowed.