Tag Archives: buying a home

A Downsizing Story

Pete and Jody contacted me early this summer about selling their family home on Phinney Ridge. I’ve known Pete and Jody for many years as we were former neighbors and they wanted to work with someone they knew.

Jody and Pete’s Phinney Home

When I say family home, I mean it. Pete’s parents had bought the house about 80 years ago, and approximately 40 years ago Pete bought it from his parents. Pete and Jody raised their family in this lovely craftsman. They had made many updates over the years, and had particularly loved designing the beautifully landscaped yard and the 2-car garage where in his free time Pete worked on his cars.

But it was time to downsize. The house had too many stairs and was too much work to maintain. The property tax bill had become too high for retirees on a fixed income and they no longer wanted to live in Seattle.

Pete and Jody went exploring where they wanted to live and found a 55+ community in Mount Vernon that met all their needs. It was quiet. It was new construction. It was all on one floor, no stairs to even get into the house. The yard allowed for Jody to continue her love of gardening but was not too large. The house they wanted was already completed, but they would need to sell their Phinney home before they could purchase in Mount Vernon. I was able to negotiate with the seller of the Mount Vernon home for a longer closing period, to give Jody and Pete time to sell their Seattle house.

Jody and Pete’s Mount Vernon home

I recommended some minor repairs to their Seattle home before listing and we had the house staged. Jody and Pete worked hard at packing up 40 years of life, giving many items away, and having a mega-garage sale. It was hard work, but they had the house ready almost a week before our target list date. Jody and Pete’s Phinney home came on the market on August 5, and by August 11 we had two offers.

Both homes closed last week, Phinney on Thursday and Mount Vernon on Friday. Pete and Jody will be moving into their new home over the next few weeks. It was such a joy to call Jody and Pete on Friday and tell them that they were the owners of the home in Mount Vernon. Congratulations!!! May you have many, many years of love and laughter in your new home.

Home Facts

Phinney home, listed for $895,000, sold for $890,000, 6 days on market

Mount Vernon home, listed and sold for $459,900, 79 days on market

Shift in the Market?

We are seeing a shift in the market, but it’s not a cause for alarm. This shift is a balancing. We have reached the point where prices have hit the top and now they’re settling down. A recent article from CityLab.com explains it well:

“Housing prices are cooking. Across the nation, the price of homes is rising faster than the rate of inflation—in some places by a factor of three. That’s true of high-cost cities such as Seattle and San Francisco and lower-cost cities such as Charlotte and Tampa alike. And the overheated market for homes is costing the middle class the American dream.

Nationwide, the price for homes is approaching the zenith seen in 2006, just before the market fell into a foreclosure crisis and the economy sank into the Great Recession. . . 

But there are key differences between the housing peak in 2006 and the housing peak today. This surge in housing prices is not necessarily evidence for a bubble—much less any indication that a bubble is about to burst.

Late in July, the S&P CoreLogic Case–Shiller U.S. National Home Price NSA Index tracked a 6.4 percent annual gain in home prices for May 2018. This index has recorded year-over-year increases of at least 5 percent every month since August 2016—a sign of the strength of the recovery. . . . in Seattle, which saw a year-over-year price increase of 13.6 percent for May, home prices are already well above the 2006 high-water mark.

But since most workers aren’t earning 6 percent raises year after year, eventually this party has to come to an end. (Indeed, for four-fifths of privately employed workers, wages are actually falling.) Housing prices will stabilize or soften because they have nowhere else to go. The prevailing trend is unsustainable. “If something can’t go on forever, sooner or later it will end,” says David Blitzer, managing director for S&P Dow Jones Indices. With mortgage rates and prices rising, sales in both new homes and existing homes are starting to slow. ‘Either buyers have gone for the summer, because it’s too hot to look at housing, or they’re pausing to see what’s going on,’ Blitzer says. ‘If the pause continues, you’ll see sales go down.'”

And this is what we’re now seeing in Seattle. Most homes are not selling in 7 days and significantly above list price right now. I’m seeing a significant increase in price reductions and less multiple offer situations as well.

What does this mean for you? If you’re a buyer, this is all good news. It means you may be able to get into the market without a bidding war and having to look at homes significantly below your price point.

If you’re a seller, it’s not a time to panic. This shift is actually creating a healthier market. You probably will get less for your home than if you listed 6 months ago. But you probably will still have significant profits if you sell as prices are at record highs. We still have a significant shortage of housing so even with the increased inventory, demand still outweighs supply. Inventory levels are still under 2 months which means it’s a seller’s market – a balanced market would be 4-6 months, and a buyer’s market would be greater than 6 months.

As I’ve said often, there’s no crystal ball in real estate. In my predictions for 2018, I said price increases would slow down. In fact, year over year prices are still up about 11%. I also predicted interest rates would hit 5% before year-end; we have already hit this number which is reducing buying power for buyers.

If you’re thinking of buying, this is the time to get pre-approved and start your buying process. If you’re a seller, I’d be moving quickly to get your home on the market while prices are still at the peak. Please call me at 206-790-0081 or email me at Jamie@JamieFlaxman.com for a complimentary market analysis for your home.

Just Listed on Phinney Ridge

Just one block from Green Lake and three from the restaurants and shops of Phinney Ridge, this home offers all that you’re looking for.

  • 4 bedrooms, including a master on the main floor and 2 ¼ bathrooms
  • Master bedroom has large walk-in closet designed by California Closets and includes a washer/dryer hook-up
  • 2,370 square foot home on a 4,960 square foot lot
  • 10-year-old roof
  • Seismic retrofitted
  • New sewer line in 2013
  • Rainwater collection system
  • Beautiful gardens
  • Large 2-car garage with a 3rd off street parking spot, all accessed from the alley
  • Copper plumbing
  • Most windows are double pane
  • Basement is largely unfinished but offers good ceiling height and the potential for a rec or media room

Offers will be reviewed upon receipt and the sellers have already conducted a home inspection.

Upcoming Open Houses
Sunday, August 5: 1:00pm-4:00pm
Monday, August 6: 11:30am-1:30pm & 5:00pm-7:00pm
Wednesday, August 8: 11:30am-1:30pm & 5:00pm-7:00pm

(If the home has not sold by August. 10, open houses will be held on Saturday and/or Sunday, August 11 and 12.)

Or call for a private showing.

For more information, download a flyer or check it out here.

Just Sold

One of the things I love most about my job is helping first-time home buyers find their dream home. Last week Sarah and Mike closed on their dream house, a rambler in Shoreline with mid-century features in the living room and an incredible backyard.

We looked at countless condos, townhomes, and single family homes. They lost out on 3 other offers. One of the things I do when I’m out with buyers is watch their non-verbal responses to a property. When Sarah and Mike walked into this one, I saw a response I hadn’t seen previously – of joy and relaxation – and I knew we had found the home for them.

This home did not have an offer review date and had only been on the market for 3 days. Time to move quickly. We wrote an offer above list price with an inspection contingency (which was great because they had already paid for a couple pre-inspections where they didn’t get the house). The lender quickly sent me a pre-approval letter. And voila, Sarah and Mike got the house.

Congratulations to the new homeowners! May you have years and years of joy in your new home.

The American Dream

As we begin this week where we celebrate America’s birthday, I thought I’d write about Home Ownership being part of the American Dream. For as long as I can remember, I have heard that phrase. But what does it mean.

From a CNN piece from last year: “While it has no official definition, the American Dream has always been the notion that citizens of the United States can better their lot in life through hard work.
That encompasses the idea that hard-working kids of hard-working parents would have a better life than the previous generation, and homeownership has generally been considered part of that.”

From 2006 to 2017 the national home ownership rate dropped from 69 to 64 percent. CNN states, “In a 2016 Pew Research Center survey, 72% of renters said they would like to buy a house at some point. About two-thirds of renters in the same survey (65%) said they currently rent as a result of circumstances, compared with 32% who said they rent as a matter of choice. When asked about the specific reasons why they rent, a majority of renters, especially nonwhites, cited financial reasons.”

Here are historical home ownership rates from the US Census Bureau. As you can see, it appears the number is increasing in 2018, but the rate is still below that of the 1990’s.

If you’re currently a renter and would like to become a homeowner, let’s talk. There are loan programs available for people with limited cash down as well as downpayment assistance programs for those with lower incomes.

Most Homes Sell At or Above List Price

Hot off the press, here are some highlights of the May housing market:

  • The median sales price for a single family home in Seattle in May was $802,000. For condos it was $529,500. Combined, we saw a 17.3% increase in the median sales price from May 2017.
  • Inventory improved in May and for the first time in a long time, we have more than 1 months supply of housing (1.1 at the end of May). There’s still a long way to go to get this to the 4-6 months necessary for a balanced market.

The most impressive statistic for May is this one – 84% of properties sold at or above list price! (26% sold at list, 58% above.) That tells us that it is likely that 6 out of 10 listings received multiple offers.

If you’re a seller, it’s the time to sell. If inventory continues to increase, we may start seeing smaller increases in sales prices and less competition. If you’re a buyer,  let’s get you into a home.

Give me a call/text at 206-790-0081 or email Jamie@JamieFlaxman.com and let’s talk about your real estate needs.

Interest Rates are Rising

If you’re thinking of buying a property, you should move forward with your plans now. According to one lender I work with, last week she saw an increase in interest rates every day. While most of us have been predicting that rates would hit 5% by the end of year, we have already reached (and exceeded) that percentage.

As interest rates increase, your buying power decreases. Let’s say your lender has qualified you for a home purchase of $700,000 with 20% down. A month ago your monthly payment would be around $2,837 with a 4.5% interest rate. At 5% that payment would be $3,006, or $169/month more. Your lender may no longer qualify you to purchase a $700,000 home but instead more likely around $675,000 to keep your payment around the $2,837/month. If we see a 7% (being conservative) increase in prices this year, your $700,000 home would sell around $750,000 by year end. By waiting, you are likely to decrease the amount you can pay for a home.

If you’re considering buying a property this year, the time to move is now. Give me a call at (206) 790-0081 or email Jamie@JamieFlaxman.com so we can talk about your plans and needs.

 

How Many Offers Does it Take?!

It’s a tough market out there for buyers. With demand for housing seriously outweighing supply, buyers are competing on most listings, and losing out on many.

The most offers I’ve had to write for a client was 2 years ago, when it took 8. I’ve heard of buyers who have submitted in the double digits.

Right now I have 2 sets of buyers who are on the offer roller coaster. One set has submitted 4. The other 2 (and we’re waiting to hear on the 2nd). It’s frustrating. You find a house you love and want to buy, but end up competing with 26 other offers (yes, last week buyer set 1 was one of 27 offers). You move on, but then you go through it again. What to do? Here are some tips I offer to buyers:

  • Know the numbers. You know what your maximum you can spend is. But also know the market numbers. If homes are selling 10-20% above list price, you should be looking at properties listed 10-20% below your maximum.
  • Have your financing lined up, and make sure your lender has taken you all the way through underwriting (except for a property address). Have a local lender who is available on the weekends.
  • Look at homes that have been on the market for more than 10 days. These are less likely to receive multiple offers. In this case, you might be able to look at homes at or slightly above your maximum as you might be able to get an offer accepted below list price.
  • Think about what you can compromise on. Could you go a few miles farther out? Is having a garage more important than getting a house? Don’t restrict yourself to fenced yards, you could put a fence in yourself.

For more ideas on how to compete or to talk about the real estate market, please call/text me at 206-790-0081 or email me.

April Inventory Report

Spring is here and there are more homes coming on the market!!! While we did see an increase in listings in April over April 2017, we still have a severe shortage of properties for sale. If you’re considering selling, now is the time to talk. Give me a call/text at 206-790-0081 or email and find out what your home is worth today.

Home Buying Class

This Thursday, April 26th, Julia Eaton of Axia Home Loans, and I will be teaching a class on learning to buy a home. Topics include: steps in the home purchase process; understanding today’s real estate market; options for financing your purchase including how to obtain a mortgage; and why it might be in your best interest to buy sooner rather than later.

Thursday, April 26, 2018, 6:00-8:00pm at the Phinney Neighborhood Association, Blue Building, Room 3

To reserve your space or with questions, please email Jamie@JamieFlaxman.com or call/text 206-790-0081.