Real Estate Information

Parents and politicians across the country have been concerned about the status of our schools and the quality of the teachers educating our children. This spurred the passage of the No Child Left Behind Act of 2001 and focused attention on teacher certification. The most respected form of certification is provided by the National Board for Professional Teaching Standards. (NBPTS) This non-profit, non-partisan organization has been applying their rigorous testing standards to teachers nationwide since 1987.

The state of Maryland is ranked in the top ten states having teachers certified by NBPTS. In February, two teachers from the Charles County Public Schools (CCPS) joined the 2,124 Maryland teachers who have achieved this prestigious certification.

Charles County teachers Cary Smith of North Point High School and Marcie Jett of Piccowaxen Middle School achieved certification after a difficult yearlong performance evaluation. The NBPTS standards are high yet both CCPS teachers were able to rise to the challenge to join the 31 of district teachers who have already met the rigorous NBPTS criteria.

Cary Smith teaches English at North Point High School and achieved her certification in language arts. Her certification was aimed at adolescence and young adulthood. Smith was first hired by CCPS as a language arts instructor at Mattawoman Middle School in 2003. She moved to North Point when the school first opened its doors in 2005.

Marcie Jett, a special education instructor at Piccowaxen Middle School, achieved her certification in working with special needs students. The certification covered children from early childhood through young adulthood. Smith originally joined the CCPS as a special-ed instructor at Dr. Thomas L Higdon Elementary School in 2001 before moving to Piccowaxen in 2007.

Both Charles County teachers Cary Smith and Marcie Jett started on their road to certification in 2010 as did the other 6,200 educators nationwide who would later be certified by the NPPTS in 2011. The yearlong certification process revolves around a teacher achieving the standard of the Five Core Propositions:

• Teachers are committed to students and their learning
• Teachers know the subjects they teach and how to teach those subjects to students
• Teachers are responsible for managing and monitoring student learning
• Teachers think systematically about their practice and learn from experience
• Teachers are members of learning communities

The propositions are tested throughout the one-year assessment phase through many different methods including student work samples, reviewers observing the instructor in class or by video, and analysis of their student’s achievements and challenges. How the instructor interacts with their students and presents their material is rigorously scrutinized before a series of written exams. These exams rate the instructor’s knowledge in their field and how they are able to communicate this information successfully to their students.

There are many advantages of NBPTS certification for Charles County teachers and the school district. The certification is good for 10 years and leads to career advancement and higher salaries. It also allows teachers to move between states more easily as many states waive having to take state certification test if the teacher is NBPTS certified. The school districts benefit as studies have shown that NBPTS certified teachers have proven to produce students with higher grades and fewer in-school problems. The certification also helps a school and their district meet many of the Federal standards of the No Child Left Behind Act.

As demand for energy resources increases, officials in Southern Maryland have been looking for renewable and greener sources of energy. One option for renewable energy in Southern Maryland recently cleared a hurdle when the Charles County Board of Appeals granted a special exception for SMECO Solar to build the area’s first solar farm on land zoned for agricultural conservation.

Plans are in the works for a 5.5 megawatt solar farm to be built near Hughsville, Maryland by the Southern Maryland Electrical Cooperative. SMECO officials say the 48.5-acre farm will generate enough energy to power 1,200 homes or enough energy to run the St. Charles Towne Center Mall.

Co-op spokesman Tom Dennison told the Washington Post the solar farm will be owned and operated by SMECO and meets state requirements for renewable energy and customer demands. The state’s utilities are currently required by The Maryland Public Service Commission to use solar power for 0.1 percent of its energy output. This level will increase to 2 percent by 2022. State law requires 3 percent of utilities’ energy output to come from renewable energies. Dennison says SMECO currently meets these requirements through energy credits, biofuels and other natural resources.

The decision to build the solar farm has the support of local landowners and government officials and is expected to cost around $20 million to build. Federal grants and loans through the Department of Agriculture will help pay for the project. The cost-effective project will eventually pay for itself as SMECO owns the land the solar farm will be built on and the utility can generate solar credits.

Ten percent of the energy produced at the Hughesville location will be used for a new operation center near the solar farm and the rest will go to customers in Charles County.

The solar panels will be mounted on the ground and face away from traffic on nearby Route 5 to prevent glare that would distract drivers. A protective wetland zone on the south end of the property will stay protected and will not be affected by construction of the solar farm.  

The decision to build the first solar farm in Southern Maryland was made by SMECO in October of last year as new sites for renewable resources were sought.

Development plans still need to be approved by county officials but Dennison says they expect to break ground this summer and have the solar farm up and running by late 2012 or early 2013.

Thinking of short selling your home? 2012 is the year to do it because beginning in 2013, the Federal Government will require homeowners to pay income taxes on their short sold home. Make the difficult decision now: What to do with your underwater home?

A short sale home is the sale of a home in which the value of the property is less than the balance of the mortgage or liens owed against the property.  The lender agrees to the terms of the deal, and releases the property to the buyer. For buyers it is a good deal and for the sellers it helps them avoid bankruptcy or Foreclosure. But the rules governing income tax for homeowners short selling their homes are about to change.

The Mortgage Debt Relief Act, which is set to change in 2013, was passed by Congress five years ago when the national housing market went bust. The IRS has allowed income tax to be excluded from the short sale on a home up until 2013. After December 31^st, the rules change and homeowners who have not closed their short sale deals will face paying income tax on the sale.

The law breaks down like this:

A house sold for $50,000 less than what is owed on the mortgage means the selling homeowner will owe federal income taxes on that sale. Typically a homeowner would pay $12,500 if they are in the 25 percent income bracket or $7,500 if they are in the 15 percent income bracket.

The IRS will forgive up to $2 million this year and $1 million if one is married and filing separately.

If the lender has not formally forgiven the debt before December 31^st, the homeowner is still on the hook to pay income tax. The bank must officially sign off on the deal before the end of year.  Lenders have been “gearing up” for the process as it often times takes up to 6 months or even a year for a short sale home to close. 

Homeowners declaring bankruptcy may avoid having to pay income tax on a short sale as bankruptcy tends to trump everything. Federal guidelines also allow a homeowner to not pay income tax if their debts exceed the value of their assets.

Now is the time for homeowners considering listing their homes as short sales to take action and start the process because beginning in 2013, the amount a lender forgives on short sale or Foreclosure will be subjected to federal income tax.

Parents along with local, state and the federal government have been looking at what our children are being taught in public schools for quite some time. From the No Child Left Behind Act of 2001 to the current debate on charter schools and school vouchers, there is concern about ensuring that students are learning. However, many schools are stepping up to the challenge of teaching in a new way through the use of technology.

The students in Charles County Schools have access to some of this new technology due to a partnership between Charles County Public Schools and the Community Bank of the Tri-County. Jim DiMisa of the CBTC recognized the need for students to have a solid grounding in financial training due to the dangers of credit card debt, uncertainty in the economy and the need to save for retirement.

At no cost to the school, the CBTC works to help create a program of online financial training using the Financial Literacy Platform for High Schools or EverFi™ system. This program is an online tutorial where the students learn in an interactive, visual format. It uses examples taken from real life using a format modeled in part on the popular and recognizable SimCity games. By using this format, the program walks the student through the training in which their financial decisions directly impact their online avatar’s life. These direct impacts bring home the lesson in a way traditional lecture and books simply cannot match.

The students using the program reap the benefits using a format which the United States Air Force found beneficial in its own training. By fashioning the lesson in the form of a familiar game, students learn the program faster so they have more time for learning rather than spending time digesting how to operate the program itself. The familiarity increases retention of the lessons and students enjoy the lesson as well.

The EverFi system trains students on a number of important financial concepts:

• Use and risk of Credit Cards
• Budgeting and Managing Debt
• Savings and Retirement Planning
• Different Loan types and College financing
• Home ownership versus renting
• How the U.S. financial system works
• Stock trading and how the Stock Exchange works

The overall reaction to the program has been very positive. Teachers enjoy being able to track their students’ progress through the program and they can provide one-on-one lessons as needed. Teachers also found students using the program were more knowledgeable and asked better questions in class. To everyone involved the program has been a win for the Charles County schools, the teachers, students and the community in general.

Charles County’s property values have encountered some tough sledding. The melt-down of the housing bubble, the fallout from the robo-signing scandal and an explosion of foreclosures have caused property values to drop all across the country. The housing market is still struggling to correct from the over-inflated boom era vales. Charles County, Maryland has been hit hard in this environment and seen median property values drop for the fourth year in a row. What does this mean for someone interested in moving to the area?  What affect does this steady decline have?

The Good and Bad of Declining Property Values

The key to looking at declining property values is to see that it’s not necessarily negative. Certainly those who whose home values were inflated are facing losing a lot of money. However, when one buys a home, there is always the risk the value will go down instead of up. In the volatile housing market of the last decade, many home buyers bought homes under the faulty idea that home values would always go up.

So now we are seeing a correction to where the market is returning to realistic home property values. To use one example, this presents an opportunity for buyers to buy a home which once sold for $450,000 for as low as $350,000 and to have confidence that this value will hold.

The bad, of course, is felt acutely if one happens to be the owner of a $450,000 mortgage on a home which now has a value of only $350,000. Another negative accrues to Charles County because it must make do with tax receipts on a home that has dropped $100,000 in value. This has led to tight budgets not only in Charles County but for counties across the nation. However, the current problems obscure the fact that Charles County remains an excellent place to live.

The Ground Truth

While property values have dropped for the fourth time in as many years, one has to remind oneself why they were high to begin with. The answer is simply that it was worth paying $450,000 to live in Charles County. Why? There are many reasons ranging from the scenic beauty of the area, to the excellent schools and colleges, to the availability of work in the Washington D.C. metro area. None of these factors have changed. So, in the short term there will be budget issues for city and county politicians to deal with, but the fact remains that Charles County is an attractive place to live.

Viewed from this standpoint, Charles County property values declining means prospective buyers are well positioned to be able to purchase a home and reap the rewards of a buyer’s market.

In March, 2009 the federal government initiated the Home Affordable Refinance Program (what is now called HARP 1.0) in order to help struggling homeowners in cases where the value of their mortgage exceeded the value of their home. The larger goal was to help move the housing market towards stability. To many observers, HARP 1.0 failed to achieve its objectives. In response, the government has launched an updated version of the program, now called HARP 2.0. The hope for “underwater” or “upside-down” homeowners is that, this time, relief will materialize. Let’s look at how the new edition of HARP works.

The original version of HARP required that participants have a loan-to-value (LTV) ratio less than 125% but many homeowners’ LTV fell below this level so HARP was unavailable to them. Now, under HARP 2.0, homeowners must simply have homes valued less than their mortgage (and the loan must be owned or guaranteed by Fannie Mae or Freddie Mac). It also requires that the loan be in good standing with 12 months history of good payments.

Next, the original HARP was mainly designed for the five largest banks (Citigroup, Wells Fargo, Bank of America, Ally Financial and JPMorgan Chase), but HARP 2.0 includes mortgage companies across the nation. These loan servicers are able to qualify people for a loan even where the borrower previously had loan insurance attached – a problem with the first version of HARP.

Here are some additional changes in HARP 2.0:

• It limits lender’s liability if loans default. Fannie and Freddie will not force lenders to buy back a problem loan. In short, this will increase HARP’s reach. Lenders will be more interested in participating so homeowners will face an easier time obtaining a loan modification.
• Fees charged by Fannie and Freddie to lenders for high LTV loans have been removed so loans will be cheaper for homeowners.
• Credit and income requirements have been eased. Provided that one’s new HARP monthly payment is not more than 20% more than the current payment, specific credit and income guidelines do not apply. This means that low credit scores or high debt-to-income ratios don’t automatically disqualify applicants.

There are a number of additional changes in HARP 2.0, all of which are designed to benefit homeowners in difficult situations. To read more visit here and here.

For more information about the HARP 2.0 program and all of your real estate needs contact DeHanas Real Estate Services at (301) 870-1717. We're here to help!

I have long been associated with some of the top real estate professionals in the industry from all across the country through a network called Star Power Systems, and my fellow Certified Distressed Property Experts.  I had the surprise of turning on the news a few days ago to see one of my mentors, Alex Charfen, as a guest on FOX and Friends.  Alex has an insight and a delivery of information that is next to know one I know.  Here is the clip:

Great information on how a short sale works.

ST. CHARLES, Md. -- The St. Charles Companies recently announced the start of infrastructure work on Fieldside, the newest neighborhood in the St. Charles community, located near Waldorf in Charles County. Ryan Homes will be the exclusive builder within Fieldside, offering single-family homes and townhomes at prices starting from the low 200's.

Located off Piney Church Road and St. Linus Drive, the new 500-home community is within easy reach of the Southern Maryland Blue Crabs Stadium and adjacent to the newest Charles County high school; the state-of-the-art, St. Charles High School, now under construction. Amenities will include a community center with extensive common areas, walking paths and playgrounds.

"Fieldside combines all of the best of St. Charles in a smaller, walkable neighborhood with the top notch amenities," said St. Charles Companies CEO, Alan Shearer. "Homes in Fieldside will be aggressively priced to appeal to a wide range of homebuyers looking for a convenient suburban location with a fully developed infrastructure, mature shade trees throughout and natural features and amenities designed to enhance a sense of community."

With site work underway, Ryan Homes expects to begin home construction in January with new residents moving in by spring of 2012.

Recently featured in the Washington Post's "Where We Live" section, St. Charles is the largest population center in Charles County and is known for its diverse and abundant neighborhoods, lively retail centers, recreational opportunities and excellent schools. St. Charles is home to the Southern Maryland Blue Crabs Atlantic League baseball team at Regency Furniture Stadium, and has several additional new construction projects underway within its boundaries, including the new St. Charles High School and a new public library. St. Charles appeals to all ages and lifestyles and was recently named by U.S. News and World Report as one of the nation's top bargains for places to retire.

The St. Charles Companies includes American Community Properties Trust, The Apartments of St. Charles, American Land Development and St. Charles Community, LLC. The St. Charles Companies' lines of business include the residential and commercial development of St. Charles, a 9,100 acres planned community in Charles County, Maryland and the ownership of an apartment portfolio of approximately 3,000 units, primarily in St. Charles.

Federal Capital Partners acquired The St. Charles Companies in December 2009 through its FCP Fund I, L.P. Federal Capital Partners (FCP) is a Washington, DC based, privately held real estate investment company that has acquired interests in more than $3 billion in assets since 2003. FCP invests in multi-family and commercial assets throughout the Mid-Atlantic region, including Washington, DC, Baltimore, Philadelphia, the Virginia Tidewater region and the Raleigh/Durham area and currently manages a portfolio of approximately $1.8 billion in real estate assets throughout those markets. Through its discretionary co-mingled private equity funds, FCP invests directly in core plus, value-add, opportunistic and development properties. In addition, FCP provides both equity and debt capital to real estate operating partners and is aggressively seeking office, residential (for sale and for rent), industrial and retail investments in all of its target markets.

For more information about buying, selling or renting in St Charles, contact DeHanas Real Estate Services at 800-842-0190 or go to www.dehanas.com.

This real estate prediction might just be the easiest one yet; If the world ends on December 21, 2012, I predict we will see an end to the housing crisis.  Or if there are any impending disasters, Nevada real estate could see property values sky-rocket, as most of the western part of the State becomes Pacific coast water-front.

Sorry to joke about a matter that has plagued us for more than 4 years now. Humor will keep us sane.

 There just doesn’t appear to be any light at the end of the tunnel. The real estate market remains sluggish, and indications are that we will continue to see much of the same.  With the failure of a budget decision by the “Super Committee”, investors and potential home buyers will continue to be reluctant to jump into any kind of spending.  Consumer confidence is on a roller coaster.

Freddie and Fannie are in a panic, and on the verge of going broke. And lending giant, Bank of America seems to be in a death spiral. I have heard rumblings that they might be getting out of the mortgage lending business all together. With all of the recent negative press and plunging stock values, I am certain that Warren Buffet is having a few restless nights lately. 

In 2012, there will be plenty of “good deals” to be had by qualified home buyers. Short sales will remain popular for the next 8 to 10 years. The Charfin Institute, a National educational firm specializing in training real estate professionals on how to help their clients avoid Foreclosure, says that Bank owned properties will see a decline in inventory, while short sales will increase.  A short sale is where a homeowners’ mortgage company will allow the sale of a home where the value of the home is less than the amount owed. As a result, the average real estate transaction will take about 4 months. Buyers and sellers will need a great deal of patience.

Additionally, look for a change in the way we live.  There is an increase of multiple families and extended families living under one roof. And homeowners will be living in the same house for much longer than they did a few years ago.  Without the ability to create fast equity, most homeowners will not be able to pick up on a whim and move.  I predict a return to neighborhood values, where you get to know your neighbors and socialize with them again.

One thing is for sure; there will still be home buyers and there will still be home sellers. As you go into 2012 whether you are moving to another State, or preparing for the end of days, planning ahead is the key to surviving this maze of uncertainty.