A Home: The Only Place That’s Right For Me

Darren Be Schemin'

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Did you know that this global panorama (CoVid-19) has led to a seller’s market in the US?  If you are thinking about selling your home, now is the time.  With the increase in telework flexibilities, many people are opting to move further outside of the city for more land, a slower pace of life, or even to the beach.  As for me and mine, I love the city and I ain’t going nowhere.  As the amazing BackYard Band, so eloquently stated, “Ain’t no place I’d rather be, the only place that’s right for me” …is the southside.

“Darren, I can’t sell a home because I don’t own a home, how do I get one?”
There’s lots of ways to purchase in DC.  None of them are easy, all of them are doable.  One of my favorites is to attend the DC Tax Lien Sale.  Houses that fall behind on taxes and fees to the District go up for auction.  This is a complicated process which could involve the courts.  It’s one of the best ways to purchase because if DC residents don’t do it, developers and banks will.  The person is going to lose their home: should it go to a native or to a developer?  I don’t judge morality here (I be scheming), but I’m fairly certain the new buyer won’t be someone I defeated during my epic run at the Kimball Elementary School 1993 spelling bee (I will not let y’all forget).  You need cash-in-hand to make this work, as the District requires 20% upfront, plus you may need lawyers if the house is not already vacated.  Some of these homes may require repair work.  This is the lowest total cost option.

“Darren, that’s a lot of moving parts, I just want to buy a house the old-fashioned way.  I just need help.”
That’s easy!  There are multiple home buying programs to help people get their first home.  Programs vary depending on where you live and want to move.  Virginia has a program that will help you save for a down payment and Maryland will let you write off part of your student loan.  DC has the most options of the three.  If you check out the DC Housing Finance Authority (DCHFA.org, they usually have an advertisement in this paper), there are multiple programs for almost every first-time home buyer.  Most of these require you to complete a First Time Home Buyer class, but they help with down payments and closing costs, depending on the program.  Income limits are likely higher than you would think.  Also, they usually base that income on your previous year tax return, meaning that the best time to purchase is in the same year that you get a raise at work.  Even if you don’t get the max ($80k), free money is never bad.

“Darren, I looked into these programs and I’m afraid of becoming a homeowner.”
Of all the philosophical, made up questions I’ve asked myself, this is the realest one.  Home ownership can be scary.  We all know the selling points: build wealth and equity, control your payments against inflation, and establishing generational wealth.  There is a comfort in knowing that when something breaks, you just call your landlord.  Here’s what you need to consider: average rent for 20019 (Ward 7) is just under $1,300, the median home sold in 20019 last year was $400k.  The general (completely unprofessional) rule of thumb at the current fed rate of .5% is that you are going to pay ~$500 for each $100k you borrow.  If you qualify for the max program payments you would only borrow $300k, so your mortgage would be just around $1,500.  If you find a home at $300k, you would actually save money, which a wise schemer would put aside for emergency repairs.

But Darren, what if I mess up after I purchase a home?  I’ll lose everything.”
The bank don’t want that house back, they don’t want to deal with the process.  Most of them are understanding and when they aren’t, DC has programs to help when you hit hard times.  Reach out to DCHFA as soon as you realize things aren’t looking good.  Most people lose their homes because they try to wait the problem out, but real schemers know to attack uncomfortable situations head on.  The Federal Reserve has signaled that these low interest rates are going to be here for a while.  If home ownership is something you’ve thought about, be ready to jump on this opportunity as soon as this seller’s market dies down.  And if you happen to buy in my neighborhood, please say Hi to my dog, Barrow, if you see us on our walk. He legit whines for two blocks every time someone crosses the street to avoid us.

Note: Some of these schemes might feel illegal, but if followed according to the steps listed, they are not.  Always consult with appropriate legal council if there is any concern. 

Note 2: Schemes are not scams.  I am not trying to make money off you.  In fact, I’m legit trying to save you money, maybe, if you ain’t scared.  If you see me out in these streets, I will always accept an order of Crispy Chicken Basil from Thai Orchid

Note 3: Darren Thompson is a lifelong border hopper of Ward 7 and PG County, MD.  His highest academic achievement to date is winning the Kimball Elementary School 1993 Spelling Bee and has been chasing that high ever since.  You can watch his comedic pursuits with The Cookout Collective Presents: “Enigma” and Washington Improv Theater’s “Hold Up, Book Club”.