The Scoop

The Stars Are Aligned

2009-04-29T11:02:00.000-07:00

Most first-time buyers would agree that the $8,000 tax credit they will receive within the year after their purchase is a great bonus and incentive to purchase now. Especially since as of this year they don't need to pay it back. But a lot of buyers are still having a tough time scrounging up down payment funds. So what if you could get your $8,000 credit before you closed on your house to use any way you saw fit?!

This is where the new housing Tax Credit Advance Loan Program steps in. The Legislature recently passed the state budget with a provision authorizing the State Treasurer to invest $25 million in the program. There are still details to be worked out, but the program would allow first-time home buyers to utilize the tax credit as down payment when closing the sale of their first home. Whoohooo! This is excellent news for anyone who may have previously been on the fence as whether to take the plunge and invest in the market now. Especially with interest rates still as low as they are.

So hopefully within about a month this program will be fully instated for buyers to capitalize on.

New Greenwood Listing

2009-04-17T16:20:00.000-07:00

Check out my lastest listing in Greenwood at 510 N 80th Street! Offered at $437,000, this charming Craftsman boasts 4 bedrooms, 1.75 baths, and has been completely updated inside and out. New plumbing, electrical, gas furnace, insulation, modern kitchen with granite countertops, stainless steel appliances - you name it, it's been cared for and redone.

And to top it off, it's in a great central location, 10 minutes from Downtown and 6 blocks from GreenLake. As a personal resident of Greenwood, I know this neighborhood very well, and truly love all the shops, restaurants, and numerous amenities this community has to offer. And I know you will too!

If you're free on Sunday afternoon stop by my Open House from 1 to 4pm.

What Can the Economic Stimulus Plan Do for You?!

2009-04-15T12:32:00.000-07:00

It seems like there's so much talk about the Obama's recently enacted economic stimulus plan these days, but a lot of buyers and home owners aren't really aware of how it will benefit them. So here are four key benefits that you should be aware of:

Benefit #1 – Expansion of Home Improvement Tax Credit. The tax credit for making energy efficient home improvements is now 30 percent of the cost of the improvements up to a maximum of $1,500. Previously, homeowners could get a tax credit worth just 10 percent of an upgrade cost and the credit was capped at $500. Eligible improvements include energy efficient exterior doors and windows, roofs, insulation, heating and air conditioning systems and hot water heaters. In general the improvements must pass the International Energy Conservation Code or qualify for an Energy Star rating. The stimulus also lifts tax credit caps for certain alternative-energy improvements for businesses and individuals. Under the new law, owners may claim a 30 percent tax credit for qualified solar water heating systems, small wind energy systems and geothermal heat pumps.

Benefit #2 – Expansion of First-time Home Buyer Tax CreditThe tax credit available to first time home buyers was increased from $7,500 to $8,000 for homes purchased between Jan. 1, 2009, and Dec. 1, 2009. Also, the credit no longer needs to be paid back as long as the buyers live in the home without selling it for at least three years. The previous version of the credit required home buyers to pay the funds back over a 15 year time frame, making it an interest free government loan. The income limits are unchanged from the previous version ($75,000 for single tax payers claiming the full credit and $150,000 for married tax payers), as are most other qualification requirements. Also, the credit remains refundable. The credit may be claimed on 2008 tax returns that are filed by April 15 of this year, even if the home is purchased in 2009, according to CMPS. One catch: if you bought the home in 2008, the credit remains $7,500, and still needs to be paid back over a 15 year timeframe beginning in 2011 when you file returns for 2010.

Benefit #3 – Higher Reverse Mortgage Loan LimitsLoan limits on Home Equity Conversion Mortgage (HECM) - or "reverse mortgage" loans - will rise to $625,500 until the end of 2009. Current limits, which mirror conforming loan limits, will be raised to open up reverse mortgage options for many seniors who may want to rely on home equity as a stable source of income.
Loan limits for FHA-insured reverse mortgages are increased to the $625,000 level nationwide, not just the higher cost areas. The previous limit was $417,000 across the country. CMPS officials (an organization that certifies mortgage bankers and brokers) called this "especially important because the FHA program is virtually the only game in town as private and jumbo reverse mortgage programs have nearly all evaporated." This increased limit coincides with another little-known change in the reverse mortgage arena: the availability of reverse mortgages on home purchase transactions. "This is a fantastic opportunity for senior citizens to buy a new home and be relieved of mortgage payments without having to wait for their old home to sell," said Gibran Nicholas, chairman of the CMPS Institute. He suggested seniors could also use this strategy to buy a new home and turn the old home into a rental or otherwise wait for market conditions to improve before trying to sell the old home.”

Benefit #4 – $729,750 FHA and Conforming Loan Limits Restored in High Cost Areas"The $729,750 maximum loan limit had been in force throughout 2008, but was reduced to $625,500 in 2009," Nicholas said. "The economic stimulus plan restores the $729,750 maximum in high-cost areas (King County is $567,500)." This makes higher cost homes more affordable – especially in the coastal housing markets that tend to have above-average home values. Now, residents in these areas will benefit from FHA’s lower rates and easier qualification standards. The bill also provides the option, if warranted, to increase loan limits for any "sub-area," i.e. an area smaller than a county. These limits will expire December 31, 2009.

Throw Me a Bone!

2008-08-21T19:07:00.001-07:00

About a month ago I received a notice from the King County assessor informing me that my home had been assessed for $40,000 more than it was valued at last year. And of course I'm thinking, that's fine and dandy, but it also means that my property tax bill is gonna be that much higher next year...Guess I know where my stimulus package is going.

Currently in Seattle, it seems as though taxes are going up much faster than home values, which is causing a great deal of financial stress for many people in the area. The Seattle Times recently reported on a couple, Pamela and Michael Nugent, whose Renton home assessment jumped 43% from last year, while home prices in their area dropped 9%. Like many other retirees on a fixed income they are uncertain as to how they are going to make ends meat as taxes continue to increase.

If home valuations keep rising as they are, the foreclosure rate in our state could rise even higher, as people are unable to pay their taxes and forced out of their homes. It's a scarey thought. And it begs the question -- how can assessed values go up in a declining market? Well, according to the Seattle Times article, by Keith Ervin, it's because the 2008 valuations represent home values as of Jan. 1, 2008. That value was calculated by looking at prices paid for nearby properties over the prior 3 years, which won't reflect falling prices this year. Hmmm...so by that account, we won't see any tax relief for a long time down the line. Does this seem highly unfair to anyone else?!

King county home owners do have the option to appeal their tax assessments, but all appeals must be submitted within 60 days of when your home valuation was mailed to you. And even then, there's no guarantee that your appeal will be granted.

If you have questions about the assessed value of your home you can call the King County Assessor at (206) 296-7300 or go online: www.metrokc.gov/Assessor/

Into the Sunset

2008-07-24T15:14:00.001-07:00

Along with some other quintessential Ballard landmarks, such as the Denny's on 15th, the much loved Sunset Bowl is no more.

Apartment developer Avalon Bay Communities bought the bowling alley, at 1420 Northwest Market St., in January and closed it in April. The developer plans to erect a six-story building with 230 apartments above 15,000 square feet of retail space along the street and parking for 280 cars underground.

While I think that new apartments and affordable housing will be a huge welcome to the Ballard area (considering the bulk of development is towards condos or new mega-homes), I also wonder if there will be ample community gathering spots to accommodate this new influx of people. I mean how many bars and restaurants can you have before they all kind of meld together? If you ask me, we should be adding more bowling alleys, parks, p-patches, skate parks, and other unique establishments to the community to give it more vitality.

If you are interested, this Monday, July 28 at 8pm, the developer is scheduled to present information about this site and project at an early design guidance meeting in the library of Ballard High School at 1418 NW 65th St.

The Times They Are a Changin'

2008-07-01T18:04:00.000-07:00

Some important changes were announced by the NWMLS (Northwest Multiple Listing Service) regarding the way the public can view property listings on the web starting this month. The term Active STI (Subject to Inspection) will no longer be used. It will become Pending Inspection, and two new statuses will be created, Pending Feasibility and Pending BU Requested.

Pending Inspection will be used when the property has a signed Purchase and Sale Agreement and has an inspection scheduled. Pending Feasibility will be used for listings where a purchase and sale agreement is signed pending a feasibility study. Pending BU Requested will be used when the seller would like to receive back up offers.

So this means that homes with pending offers that previously remained visible on listing sites with the status of “Subject to Inspection” will now be taken completely off the market and all listing sites, and will not be visible to the public. If the deal falls through, they will then go back on the market.

Another important change is the inclusion of CDOM (cumulative days on the market) that will be available for display on all listing sites. Previously, if a listing was taken off the market and re-listed, the “days on market” number shared by the NWMLS with public listing sites was reset to zero, while the internal NWMLS database maintained a private CDOM that indicated the true total time a home had sat on the market. Additionally, the price history for listings will also be available, so you will be able to check the original list price and any price reductions that may have occurred on a property.

All in all, the access to this new information will greatly benefit the public and allow them to better educate themselves on the market and their real estate decisions.

Where Do The Candidates Stand on Housing?

2008-06-19T15:52:00.000-07:00

Now that we finally have a Democratic nominee (Sen. Barack Obama) and Republican nominee (Sen. John McCain) after what seems like years of campaigning, it's prudent to ask what each candidates stance is on the housing market and related economic issues. So here's a breakdown of their initial positions on these topics:

Obama:

Calls for greater government regulation of the U.S. financial system and proposes a new $30 billion economic stimulus plan to help home owners, including a $10 billion foreclosure prevention fund to help people keep their homes and $10 billion in relief for state and local governments hit hardest by the housing crisis.
Outlines six "core principles for reform" that would give the Federal Reserve supervisory authority over any financial institution to which it might make credit available and calls for reform and streamlining of financial regulatory agencies.
Wants to repeal a provision in the bankruptcy law so ordinary families can modify terms of home mortgages.
Proposes a 10 percent mortgage tax credit for middle-class Americans.

McCain:

Proposes to spend up to $10 billion to allow some home owners to trade high-interest, adjustable-rate mortgages for fixed-rate loans.
Proposes a suspension of the 18.4-cent federal gas tax and 24.4-cent diesel tax during the summer.
Supports a middle-class tax cut by doubling the personal tax exemption for dependents to $7,000.
Calls for a simpler tax system with two tax rates and a generous standard deduction.
Supports making permanent the 2001 and 2003 income tax cuts and proposes cutting the corporate tax rate to 25 percent from 35 percent and allowing businesses to immediately write off capital expenses.
Maintains that government assistance to the banking system should focus on preventing systemic risk that would endanger the financial system and the economy.

Source: Reuters News 6/04/08

Eeek!!! Ugly Townhouses are Everywhere!

2008-06-09T13:55:00.000-07:00

This past Saturday there was a Townhouse Forum in Capitol Hill to discuss the surge of "ugly" townhouses being built and the need for changes in development rules and better designs. One city planner described townhouses as "like a fungus network eating up our city." To illustrate, a photo was shown of a North End development that I drive by every day on my way home, near the 85th/Aurora area. These townhouses appear to sprawl for blocks and blocks, with no end in sight. And examples of this sort can be found all over the city.

Some key concerns that were mentioned about the typical Seattle townhouse design of today were:

Entries often not visible from the street
Fences out front (one speaker argues it actually decreases security on the sidewalk and in the area behind the fence (since "fewer eyes" are on each area)
Lack of adequate windows frequently
Narrow driveways leading to similarly narrow, centered "auto-courts", and garages most owners never use

The center parking courts don't work, as depicted in the photo below -- people simply can't get into their garage because it's so tight, thus they find other parking solutions:

One of the reasons we're seeing these projects popping up everywhere is because of the current codes in place, which were last revised in the late '80s. And since developers/builders are restricted to what land-use codes make them do, when they find something that works they do it over and over again. There is an advantage for them to developing fewer than six units in a project (four-unit townhouse clusters) -- so they don’t have to go through the array of permit processes required for bigger projects, including Design Review and SEPA (State Environmental Policy Act). And — this is a point that came up repeatedly, later — they don’t have the same insurance/liability requirements that come up with condo projects. This equals cash in the developers pockets.

So what are the alternatives?! How can we move away from the Ugly Townhouse syndrome that is taking over this city? Well, as many of the speakers at the forum suggested, it has got to become more about the design of the townhouses and less about the production. Quality versus quantity. Some proposals discussed were: a minimum lot width of 100 feet for a townhouse development, wider parking courts perpendicular to the street or underground parking, entries from the street, private open space on the sides rather than out front, pedestrian courtyards, roof decks, and “transparent” fences.

Although changing the Seattle land-use codes may take time, it certainly needs to be done. And while going through the Design Review Process may delay projects and cost more in the long run for developers, these projects should ultimately be about what Seattle residents need rather than what the builders need.

Forever Overvalued?!

2008-06-04T16:45:00.000-07:00

In a recent report published by Global Insight titled House Prices in America, Seattle is ranked as 22.8% overvalued. The Pacific Northwest appears to dominate the overvalued markets, with Portland ranked even worse than Seattle, coming in at 36.8% overvalued. Here's how our area compares to the rest of the country:

According to their analysis, Seattle's current price of $393,200 “should” be $320,195 (19% lower). So does this mean prices here are going to drop 19%? Not necessarily, but based on what has happened in nearly every other part of the country, it seems more than likely. In any case, this is an interesting article that I recommend checking out.

Vespas, Vacations, and Cars -- Ohh My!!

2008-05-27T14:40:00.000-07:00

Would you buy a condo if the developer threw in a car to sweeten the deal? Or how about a vacation package to Hawaii? That's what Seattle condo developers are hoping. With condo sales drastically down and hundreds of projects still in the works, developers are doing whatever they can to get buyers not only in the door, but out with the key.

Pending sales of existing condos in Seattle dropped about 42 percent in April compared with last year, while the number of listings increased 43 percent, according to the Northwest Multiple Listing Service. The median price of a condo has remained at a flat $312,500.

Every which way you turn, you bump into another condo in the city. But does offering a reward really have more of an impact than actually lowering the price of a condo? Incentives are nice, and it certainly makes a great story to tell your friends that you bought your condo and rode off into the sunset on your free Vespa -- but come on, isn't it just a bunch of fluff?! Personally, I think the best way to move units is with serious price reductions, not incentives. Money in the bank may not be as flashy, but it always resonates with buyers.

For an article from the Puget Sound Business Journal that goes into more detail about this topic click here.

Suburbanites Need Their Jimmy Choos

2008-05-16T14:11:00.000-07:00

Downtown Bellevue is one of the fasting growing areas on the West Coast. And anyone who has driven through it lately has noticed the massive cranes and new high-rises that abound. Perhaps one of the most exciting projects currently underway though is the $40 million renovation to Bellevue Square and development of The Bravern complex, which will be anchored by Neiman Marcus.

The Bravern is a mixed-use project being built on five acres along I-405 in downtown Bellevue, which will include two office buildings that Microsoft has leased, two condominium towers totaling 455 units and 305,000 square feet of retail space. Jimmy Choo, Wild Ginger, and a New York-based gym with the motto "Look Better Naked" have already signed on as tenants. The grand opening for it is planned for the fall of 2009, and developers are saying it should compare to the Union Square shopping district in San Francisco, and Rodeo Drive in Beverly Hills.

I guess it really shouldn't be all that surprising that the high-end retailers would choose Bellevue over Seattle as their destination, considering that Eastsiders, on average, make and spend more than any other King County residents. They can afford a $4,000 Stella McCartney dress and $1,300 pair of pumps. So now when suburbanites need to do some serious shopping it'll be just a Mercedes ride away. And as for me, I'll look forward to window shopping in my fleece and flip-flops.

Money Does Grow on Trees

2008-05-13T15:51:00.000-07:00

Here's a simple but highly effective way to increase the value of your commercial or residential property -- landscaping. I don't know how many times I've driven up to a property with clients who are excited to see what seems to be the perfect home (online), and then they let out a ghastly cry upon seeing the overgrown bird's nest that's swallowed the house, and suggest that we should perhaps skip it and continue on with our search elsewhere.

Poor curb appeal may very well overshadow the perfect house. A residential eyesore in an otherwise good neighboorhood, is a serious handicap -- renters don't want to live there, and potential owners don't want to buy there. The property delivers precisely the wrong message: that no one cares about its preservation

or image.

By investing in shrubbery, trees, grass, plants and flowers you increase a home's worth by nearly 15 percent, according to several studies. In fact, landscaping is one of the best means of immediately improving a house's appearance without exceeding your budget. Consumers almost always value a landscaped home more than a non-landscaped one. So by taking care of your property and boosting its curb appeal you can distinguish yourself from other sellers in almost any real estate market.

Leggo My Fico

2008-05-13T12:39:00.000-07:00

The current mortgage market continues to change, and so I'd like to keep you abreast with some of the major updates in mortgage lending guidelines. Here are some of the highlights:

Buyers must have excellent Fico credit scores to access the best loan interest rates -- 720 is the new 680. Lenders are currently offering "risk-based pricing" on loans, meaning, the lower a buyer's Fico score, the more they can expect to pay for a mortgage.
The loan limits have bumped up significantly, and there is still a premium charged by lenders for those higher loan amounts -- $567,500 is the new $417,000. Buyers in higher-priced real estate markets should expect to pay higher rates for jumbo loans over that limit.
100% financing is a thing of the past -- 97 is the new 100. Lenders across the board, for conventional as well as FHA loans, are now requiring a minimum 3% down payment on purchases. The good news is that in many cases that 3% can still be gifted to you.

There are some really great deals out there for buyers right now in the Seattle market. Some borrowers are able to purchase homes that wouldn't even have been in their ballpark one year ago. But regardless of the buyer, it's still definitely to a borrower's advantage to have all their ducks in a row and to get pre-approved before putting in an offer.

To Blog or Not to Blog?

2008-05-12T16:13:00.000-07:00

I recently took an E-Buyer (electronic buyer) course in Real Estate that explored how traditional business practices are changing and how we all may have to apply new technologies to keep up with the times. Hence, the seed was planted for the creation of my very own real estate blog!

Prior to taking this course, I must admit I never thought I would be adding blogger to my real estate credentials. First of all, I'm not exactly the most internet savvy person, and if it weren't for Geek Squad and my husband, my computer would most likely still be in a box. Secondly, I didn't want to come off as tooting my own horn if I were to write about my business and experiences. But then I realized that the act of regular blogging doesn't have to be purely self-promoting -- it can be about showing my interest, passion, and commitment to my clients’ education and understanding of their needs. Hopefully this blog is where you will stop for your real estate fix.

But go easy on me, because I still have a lot to learn about the ins-and-outs of blogging.