In keeping with the spirit of the holidays and the winter solstice, the National Association of Realtors issued a news release yesterday announcing a continuing rise in the sale of existing homes in November 2011. We can all hope that the housing market may at long last be moving in a positive direction. Challenges lie ahead for certain, but a bit of good news is as welcome as a sunny day in December like we are having today!

Here’s a portion [...]]]>

In keeping with the spirit of the holidays and the winter solstice, the National Association of Realtors issued a news release yesterday announcing a continuing rise in the sale of existing homes in November 2011. We can all hope that the housing market may at long last be moving in a positive direction. Challenges lie ahead for certain, but a bit of good news is as welcome as a sunny day in December like we are having today!

Here’s a portion of that news release below; if you wish to read it in it’s entirety, Click Here >>

Existing-Home Sales Continue to Climb in November

Washington, DC, December 21, 2011

Existing-home sales rose again in November and remain above a year ago, according to the National Association of Realtors®. Also released today were periodic benchmark revisions with downward adjustments to sales and inventory data since 2007, led by a decline in for-sale-by-owners.

Although rebenchmarking resulted in lower adjustments to several years of home sales data, the month-to-month characterization of market conditions did not change. There are no changes to home prices or month’s supply.

The latest monthly data shows total existing-home sales1, which are completed transactions that include single-family, townhomes, condominiums and co-ops, increased 4.0 percent to a seasonally adjusted annual rate of 4.42 million in November from 4.25 million in October, and are 12.2 percent above the 3.94 million-unit pace in November 2010.

Lawrence Yun, NAR chief economist, said more people are taking advantage of the buyer’s market. “Sales reached the highest mark in 10 months and are 34 percent above the cyclical low point in mid-2010 – a genuine sustained sales recovery appears to be developing,” he said. “We’ve seen healthy gains in contract activity, so it looks like more people are realizing the great opportunity that exists in today’s market for buyers with long-term plans.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to a record low 3.99 percent in November from 4.07 percent in October; the rate was 4.30 percent in November 2010; records date back to 1971.

NAR President Moe Veissi, broker-owner of Veissi & Associates Inc., in Miami, said housing affordability conditions have set a new record high. “With record low mortgage interest rates and bargain home prices, NAR’s housing affordability index shows that a median-income family can easily afford a median-priced home,” he said.

“With consumer price inflation rising by more than 3 percent this year, consumers are looking to lock-in steady payments by taking out long-term fixed-rate mortgages. However, the problem remains that some financially qualified families who are willing to stay well within their means are being denied the opportunity to buy in today’s market by the overly restrictive mortgage underwriting situation,” Veissi said.

An elevated level of contract failures continues to hold back a broader sales recovery. Contract failures2 were reported by 33 percent of NAR members in November, unchanged from October but notably above a year ago when it was 9 percent.

Contract failures are cancellations caused by declined mortgage applications, failures in loan underwriting from appraised values coming in below the negotiated price, or other problems including lower conforming mortgage loan limits, home inspections and employment losses.

Recently Whidbey Island Realtors received an email from the Whidbey Island Board of Realtors alerting us to a new ordinance regarding Ebey’s Reserve. Here’s an excerpt from a letter from Island County, the Town of Coupeville and the Manager of Ebey’s Reserve that was addressed to all “Whidbey Island Real Estate Professionals.”

On 10/3/2011 the Board of Island County Commissioners adopted the new Unified Code and Design Guidelines for all development within Ebey’s Reserve. The Code and Guidelines become effective 1/1/2012.

The [...]]]>

Recently Whidbey Island Realtors received an email from the Whidbey Island Board of Realtors alerting us to a new ordinance regarding Ebey’s Reserve. Here’s an excerpt from a letter from Island County, the Town of Coupeville and the Manager of Ebey’s Reserve that was addressed to all “Whidbey Island Real Estate Professionals.”

On 10/3/2011 the Board of Island County Commissioners adopted the new Unified Code and Design Guidelines for all development within Ebey’s Reserve. The Code and Guidelines become effective 1/1/2012.

The code requirements include a new Disclosure Statement that applies to the sale, lease or offer to sell or lease any property within Ebey’s Reserve.

My first thought was “No problem, we will just add that to the list of seller disclosures we normally insure are available for our listings.” So I decided to write down how many seller disclosures a homeowner might be required to prepare for a buyer of their property. I stopped at 9, but am sure if I thought a bit longer I could come up with 1 or 2 more.

So you may be asking yourself, “What does this have to do with using a local realtor?” Well of the 9 legally required disclosures, 7 of them are based on local knowledge and information.

Using the example above about Ebey’s Reserve, many off island agents would not even know a property is in Ebey’s Reserve, and even if they did, what is the likelihood they know of the upcoming requirement to disclosure that fact? It is not that they are unskilled. They are simply unaware. Why? Because this is knowledge that local realtors learn from experience, from each other and from their managers and owners. Real estate agents from out of the area do not have the benefit of those opportunities, nor will they.

Unfortunately what your broker/realtor does NOT know can impact you negatively.

So do yourself a favor. If you are going to buy or sell real estate, use a competent, experienced local realtor. It is the best insurance you can obtain to be sure you are well served and well protected.

In doing research about Fannie Mae and Freddie Mac, I came across something buried in the Federal Housing Finance Agency website that blew my mind. Called the House Price Index (HPI), it measures geographic (region, state, city) home price trends. It took about 5 minutes to realize that I just discovered the proverbial “Canary in the Mineshaft” when it comes to predicting real estate values in WA.

The HPI is defined as follows:

The HPI is a broad measure of the [...]]]>

In doing research about Fannie Mae and Freddie Mac, I came across something buried in the Federal Housing Finance Agency website that blew my mind. Called the House Price Index (HPI), it measures geographic (region, state, city) home price trends. It took about 5 minutes to realize that I just discovered the proverbial “Canary in the Mineshaft” when it comes to predicting real estate values in WA.

The HPI is defined as follows:

The HPI is a broad measure of the movement of single-family house prices. The HPI is a weighted, repeat-sales index, meaning that it measures average price changes in repeat sales or refinancings on the same properties. This information is obtained by reviewing repeat mortgage transactions on single-family properties whose mortgages have been purchased or securitized by Fannie Mae or Freddie Mac since January 1975.

So it is a comparison of specific repeat sales, so it is more meaningful than median and/or average home price data. Why is that? Because true market value is determined when someone gives us money for our homes, either when we sell or refinance it. The House Price Index is the cumulative result of specific home sales and refinance activities in certain geographic location.

Next I went to the state HPI index page and compared California to Washington and it blew me away.

• CA had 2 digit home price increases beginning in Q4-1999 through Q1-2006, or 22 months of raging increases in home values. Their index went negative in Q4-2006.
• While CA real estate values took off in Q4-1999, WA did not see double-digit increases until Q2-2004 a delay of about 4-1/2 years. And WA’s HPI index did not go negative until Q1-2008, a full 15 months after CA.
• In the first two quarters of 2010, CA’s HPI went positive for the first time in over 3 years, followed by a negative HPI in Q3-2010, while the WA index has remained negative since 2008.

Two things are clear from the data:

• California’s real estate values are more volatile with higher and more rapid price swings both up and down.
• Washington is less volatile and lags the California market by about a year, sometimes more.

So if you want to know when WA real estate values are going to increase again – look south. My guess, when we see 3-4 straight quarters with of positive HPI values in CA, home values will turn positive in WA 9-12 months after. The turn to positive may be faster since there is so much attention and awareness about real estate values.

My apologies to Maya Angelou, but Now I Know When The Caged Bird Will Sing. Can’t wait for the Q4-2010 data to be released.

Try it out for yourself. Is this something that you think is useful for predicting real estate swings in WA state? What do you think?

Affordable Beach homes

It is not unusual in my business for a client to make a political comment to me during a conversation, especially in the heated political environment we are in today.

Over the years I have decided that it is best to not acknowledge in any way these comments beyond a smile. Even that can be dangerous. It is not that I do not have opinions. Just ask my family. It is just that I believe as a [...]]]>

It is not unusual in my business for a client to make a political comment to me during a conversation, especially in the heated political environment we are in today.

Over the years I have decided that it is best to not acknowledge in any way these comments beyond a smile. Even that can be dangerous. It is not that I do not have opinions. Just ask my family. It is just that I believe as a professional that my commitment to a client and my associates means that I must remain non committal to any beliefs I have politically while I am working.

Is this tough? Not really, because I am quite sure that they did not engage my services to hear a discourse on my political beliefs. However, there are times when I am tempted to make a joke about politics. I think the point is to remember is this; that yes, your real estate agent has opinions. But good agents keeps those that are not related to the business at hand to themselves. I would love to hear your thoughts on this.

I have always felt it was important to be associated with the best company in any market segment. So when I got out of college I went to work for one of the best restaurant chains in the west. After that I sold incredibly good food service products to those fine restaurants with Carnation, the best food service company in the US. Decades ago, when I decided to work in real estate full time, I looked for [...]]]>

I have always felt it was important to be associated with the best company in any market segment. So when I got out of college I went to work for one of the best restaurant chains in the west. After that I sold incredibly good food service products to those fine restaurants with Carnation, the best food service company in the US. Decades ago, when I decided to work in real estate full time, I looked for the market leader there too. At the time I lived in Southern California and the market leader was Grubb and Ellis. Today I am with Windermere, the leader in sales in the Northwest. Why is this company the leader? Because it puts an emphasis on professionalism, integrity and excellence in marketing their listing. So be proud if you have a Windermere agent representing you. But if you don’t, give me a call and I will tell you more about what sets Windermere and me apart from other real estate brokers.

These statistics at the end of July 2010, give you and idea of the strength of Windermere here on Whidbey Island.

Most of us today are concerned about our environment, and recycle paper products with enthusiasm. We try to not use paper products when we can avoid it, and we read our magazines and newspapers and then recycle them too.

That is why it is a mystery to me why some sellers insist on having a flyer box. Granted, not everyone wants one, but if you drive around you will see that many people have them, and they [...]]]>

Most of us today are concerned about our environment, and recycle paper products with enthusiasm. We try to not use paper products when we can avoid it, and we read our magazines and newspapers and then recycle them too.

That is why it is a mystery to me why some sellers insist on having a flyer box. Granted, not everyone wants one, but if you drive around you will see that many people have them, and they are stuffed with faded paper when it’s sunny, wet soggy paper when it’s raining, and a lovely combo of the two most of the time.

I figured out that I use two reams of paper a month to keep my flyer boxes “fresh”. Not only is this a loss environmentally in the production of the paper, but the ink, and of course the energy (power) to copy.

But if you want to know what the sad part is about this, it isn’t about the waste, the money, the time. It is about the fact that I may never get to talk to that person who looks at your house, thinks they might be interested, and then looks to eliminate it through either the price on that flyer or something that they think doesn’t match up with their needs. And that is really too bad
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You see the most important element of our agreement is my willingness to market and sell your home. I have spent decades talking to people about homes, finding what their needs are, and helping them find the right home. When they call about your home I get to take the power of my experience, the facts and the most interesting characteristics of your home and present them to the buyer in a way that will move them one step closer if it is the right home. It’s a win win for all. So what about that flyer box? Well if you are a seller working with me now, give me a call and we will take that off the sign. The sign has my telephone number, and people will use it.

If you have your house listed with someone else call them. Tell them you want them to sell the house to the interested party, so please pick up that flyer box. And if you haven’t listed your home, when you do, please call me, and together we can save a tree and sell a house.

The catch phrase has been around for some time, and can be used to describe homes without any real substance behind it. In the last few years it has taken on a new definition with the public’s concerns about energy costs and global warming. But buyers do need to beware of the loosely used marketing term “green”. There are now third party certifications that can be included when sellers put their homes on the market. The [...]]]>

The catch phrase has been around for some time, and can be used to describe homes without any real substance behind it. In the last few years it has taken on a new definition with the public’s concerns about energy costs and global warming.
But buyers do need to beware of the loosely used marketing term “green”. There are now third party certifications that can be included when sellers put their homes on the market. The LEED program is one of the programs with the most stringent standards. A more likely program available in our area is a certification from Energy Star. To qualify for this program a home must be at least 15 % more efficient than homes that were constructed to the 2004 International Residential Code.
One of the additions to your inspection contract when you are purchasing a home can be an energy audit. Some inspection companies are now adding this as an additional feature of their regular inspection for anywhere from $300 to $500 additional cost. At this time I could not locate an inspection company on Whidbey Island that offers this service. However, below I have a recommendation for a company on Camano. This type of inspection may include an audit of the energy efficient features, make recommendations and also could include a blower-door test which provides a picture of just how tight a home’s building environment is. If the home has air leaks and is poorly insulated a green heating system will not do you much good.
As a side note, energy efficiency may not be considered in the appraisal on your home. Appraisers are not allowed to consider green components separately. Home value is still based on what the market value is compared to other properties. If you plan to stay in your home, some great ideas for “greening” can be found in this video.

If you are interested in having your home tested for energy efficiency you might start here; http://www.pinnacleinspection.com Pinnacle Inspection is located in Island county on Camano Island and has an extensive set of services for those looking to lower their energy costs and help make our world green again.
The subject of building green and buying green is immense, and though you can find a lot of information on line, your best source is to go to those who work in the business. If you are considering buying an older home, or remodeling your current home, a consultation with an expert is highly recommended.

Get your eggs lined up