Seattle Housing Buzz

Justin Wilcox wants to sell his home. But, he’s not so sure the traditional methods will work in this market so he’s attempting to try something different. He calls it a “reverse auction” - rather than having buyers bid up a price, the price will be set, then reduced on a weekly basis until someone pulls the trigger. But, he’s not giving the house away…there is a “reserve price”.

The starting price is $499,000 for this 1 story + basement, 2,995 sq ft, 4 bedroom home in Bothell. For more information visit Wilcox’s site: www.BothellCountdown.com.

See also: King5’s report

Tags: Bothell Countdown

The Washington Realtor Association recently surveyed home buyers throughout the state and compiled some interesting results.

Home buyers typically purchased a home within 13 miles of their current residence, averaging 1,790 sq ft with a median price of $300,000.

• Of homes purchased, 72% were single family dwellings and 25% were new construction.
• First-time buyers accounted for 41% of all homes purchased in 2007. They had a median income of $54,700 and their median age was 31 years. Nearly half of first-time buyers were between 25 and 34 years old.
• Of all buyers, the median household income was $73,900 with a median age of 38 years.
• Demographically, 63% were married couples, 21% single females, 6% single males and 9% were unmarried couples. (Don’t know who the other 1% were, though.)
• Seventy-six percent of buyers between 18 and 24 purchased a home out of a desire to own and establish a household.

Technology-wise, 73% of buyers began their home search online while 14% of first-time buyers and 22% of repeat buyers began their search by contacting an agent.

• However, 91% of all buyers utilized the internet at some point to search for homes.
• Interestingly, 37% reported they first learned of the home they purchased through the internet while 30% said their Realtor located the property for them.
• The typical internet searcher was 38 years old and visited a median 12 homes. The typical buyer who did not utilize the internet was 49 years old and only saw a median 4 properties.

Real estate agents assisted 85% of buyers who purchased a home.

• Though, buyers tended to search for homes for two weeks before contacting an agent.
• During the home search process, 72% of buyers indicated their agent was a useful information source.
• Of qualities important in selecting an agent, 98% of buyers stated honesty and integrity were most important. When asked to rate their agent’s performance on those qualities, 87% indicated they were “very satisfied”.
• And, 68% of buyers stated they would use their agent again.

Tags: Home Buyer, Home Search, Seattle Real Estate

Seattle Condos and Lofts (SCL) is pleased to announce that King5.com, the NBC affiliate in Seattle and part of Belo, has selected the SCL blog to provide content for King5.com’s new condo section. King5.com receives over 6-million visitors per month giving Seattle Condos and Lofts tremendous exposure.

SCL is the top-ranked condo blog in the Northwest and among the most visited consumer-focused real estate blogs in Washington (per Alexa). Additionally, SCL regularly out-paces industry blogs such as RSS Pieces, Real Estate Tomato and TransparentRE (per BlogTopSites).

By Lee Morales, ASP

If your idea of preparing your home for sale is putting the kids toys in a box, lighting a scented candle, getting out the Swiffer and sweeping the front porch, you’ve a little behind the curve. Today, staging a home for sale can involve a complete redesign, repainting rooms, renovations, renting furniture and decorative items, or even hiring a family to give a home that lived-in feel.

Per staging diva Barb Schwarz, staging can boost the selling price 6 to 20 percent in a moderately priced neighborhood and as high as 20 to 50 percent for luxury homes or in a particularly hot market.

Vacant homes are particularly challenging for buyers to visualize without a little staging help. In order for a home to sell, it needs to speak to potential buyers. It needs to look good, feel good, smell good and stand out from the crowd.

What is an Accredited Staging Professional (ASP)?

A dedicated professional who has studied and learned the proven and powerful techniques of staging homes, and completed a detailed training course and examination.

What does Inner Beauty Final Staging do?

Stage homes for sale or for everyday living and provides staging consultation services.

SHB contributing writer, Lee Morales, is an Accredited Staging Professional & founder of InnerBeauty Final Staging.

The Seattle PI reported on the growing trend of having a pre-offer inspection, or preinspection as it’s commonly referred to.

Inspectors and real-estate agents say that — at least for desirable homes in Seattle’s more sought-after neighborhoods — purchase offers “subject to inspection” may become as outmoded as offers contingent on the sale of another house. Instead, would-be buyers are paying for inspections before making a bid on the house as is, or forgoing inspections altogether.

Whether to have a preinspection is really dependent on the market. As the market soften and competition for in-city homes loosen, the value of a preinspection diminishes.

Seattle, though, is comprised of a number of micro-markets - there are differences, for example, between Queen Anne or Westwood, Wallingford vs Crown Hill, or Ballard and Lake City. Homes in neighborhoods surrounding the city core (Queen Anne, Capitol Hill, Ballard, Fremont, Wallingford, Green Lake, et al) are still in demand by buyers, not only for their proximity to the city center but also due to the style of homes found in these established neighbhorhoods, and in some cases, affordability.

It is beneficial, though not a necessity, for buyers to consider preinpection in the hotter micro-markets. It certainly helps from a competitive standpoint, as a preinspected buyer will likely present a stronger offer without having a post-offer inspection contingency. Also, in the close-in neighborhoods, the homes are predominately older, possibly hiding surprises. Conversely, in cooler micro-markets, it might not be a consideration at all.

Today’s Seattle Times Real Estate section’s feature article is titled “Real Estate: Sellers, buyers should make sure they’re comfortable with the agent.” The gist of the article is to impart on readers the need to evaluate and choose their agents carefully:

Many people have heard a horror story about a bad real-estate agent: a young agent who butchers a deal because of poor negotiating skills; an agent who lies to prospective buyers about a home’s leaky roof; or one who pressures clients into buying a home they can’t afford.

Bad agents may be few and far between, but prospective buyers and sellers should take steps to ensure that they get one of the good agents and one they feel comfortable working with.

Membership in the National Association of Realtors has jumped 44 percent since 2003, from 876,195 to 1.26 million, the Washington, D.C.-based group said.

That means there are a lot of fairly new agents and even more reason to be picky, said D’Ann Jackson, president of the Seattle-King County Association of Realtors

Of course the part that was of particular interest:

Seattle-area John L. Scott agent Ben Kakimoto, who volunteers at the Seattle Animal Shelter at Interbay, donates a portion of his commission to the Seattle Animal Shelter or to a charity of his clients’ choice.

Got the urge for a little DIY? Some people engage in home-improvement to enhance the functionality and comfort of their living space. Most often than not, improvements increase the home resale value bottom line. Some, however, may not:

Homeowners can find plenty of information on which improvements will help boost the value of their houses. But significantly less attention is paid to what to avoid when remodeling your home. Consider the following seven deadly home-improvement sins before committing to projects that may work against you to lessen your resale value.

Read on- the seven deadly sins of home remuddling

Higher prices and higher rates are putting the squeeze on first time homebuyers and Seattle’s housing market is no exception. CNNMoney.com recently profiled this issue and provided some advice as well.

What a difference a year makes when you’re in the market for a new home, especially if you’re a first-time buyer.

Thanks to a combined jump in mortgage interest rates and home prices, a starter home in many areas of the country could cost you several hundred dollars more per month today than if you bought it last year.

Nationwide, median home prices rose at annual rate of more than 10 percent in the first quarter of 2006, according to the National Association of Realtors.

Meanwhile, rates on adjustable rate mortgages, the most common for first-time buyers, are up more than a percentage point.

According the WSU’s Center for Real Estate Research the Housing Affordability Index for King County is 80%. That means the typical family only has 80% of the income to purchase a median-priced home. For 1st time buyers in King County, it’s even lower at 44.7%. Less than 1/2 of 1st time buyers can afford a home in King County. ¹

1 Washington State University - “Washington Home Sales Stabilize While Affordability Sags”.

In a previous post I wrote a post about a study which Texas A&M University undertook regarding the net effect of utilizing a discounter or limited service company. Their findings indicate there was no net dollar advantage to using a discounter.

I wanted to follow that up with case in point. I recently competed against a 4% listing company for a single family home listing. The owners ultimately selected the discounter because they were saving 2% off the commission (4% instead of 6%). The discounter listed the price at $420,000, considerably below market value by $20,000 - $30,000 when analyzing comparable sales, neighborhood market activity, like size and finishes, and lack of inventory in the neighborhood. It was not the best decision for the seller.

* Assumption: I would have listed at or close to market value based on seller’s requirements. Example uses the low-end of the market value range.

Based on this comparison, by trying to save 2% off the commission, it actually cost the seller $10,400 in gross proceeds.

I’m not privy the the information shared between the seller and the listing company for why the listing was priced so low below market. The seller is relocating but that itself is not sufficient reason for the lower price.

At the time of the sale, the neighborhood was sought after and inventory was very low. I had just listed and sold a home in the neighborhood that was comparably priced and received multiple offers. I had done my market analysis so I knew the market and neighborhood well. Had it been listed at $440,000 and with full-service marketing and promotional activities, the property would have sold at the higher price, possibly with multiple offers as well.

An independent study by Texas A&M University revealed there is little, if any, savings for sellers who utilize discounters or limited service companies. The study of 55,000 residential transactions found that discount companies sold their listings for 1.7% less than full-service companies and took 17.1% longer to sell.

The 1.7% reduction is sale price offsets the average 2% commission savings of most discount companies (i.e. 4% vs 6%), resulting in a negligible net dollar gain for the seller.

Most of the study results were statistically significant, indicating valid relationships exist between limited service representation and agent experience and marketing performance (time to sale and sales price). Licensing type did not demonstrate such a clear relationship.

Interestingly, the empirical results from the models show that limited service listings sold for 1.7 percent less than typical exclusive-right-to-sell listings and took 17.1 percent longer to sell. Given that the typical discount offered by limited service brokers is approximately 2 percent, there does not appear to be any net gain to sellers using limited service representation.

If the limited service broker charges a total 4 percent commission, then the commission plus the 1.7 percent lower price is approximately equivalent to a 6 percent commission from the seller’s perspective. If this result holds up in additional studies, it would indicate that limited service brokerage offers no dollar advantages to the seller over typical brokerage when using the exclusive right to sell contract.

One observation is that discounters work on volume and may not be able to fully represent, promote and conduct a thorough analysis of the market, neighborhood and pricing of the listings they are taking, and thus, detrimential to the seller’s best interest.

Article was originally posted on 6/19 and re-created on 6/22.