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

1. Condo Conversion Bill, Senate Bill 6411

Per the Senate’s listserv notification I received, the February 5th Public Meeting on the bill was cancelled. It is not currently on the agenda for this coming week.

2. Reserve Accounts & Studies for Condominiums, House Subsitute Bill 2541, Senate Bill 6215

Authorizes condominium associations to conduct reserve studies and to establish a reserve fund. The bills have passed their respective houses and now move to the opposite house for consideration. A public hearing of the Senate’s version will be heard in the House on February 20th while a public hearing of the House’s version will be heard in the Senate on February 21st.

House Subsitute version summary:

• Requires a residential condominium association, unless doing so would impose an unreasonable hardship, to (1) prepare an initial reserve study based upon a visual site inspection conducted by a reserve study professional; (2) update the study annually; and (3) arrange for a visual site inspection every three years by a reserve study professional.
• Encourages, but does not require, a residential condominium association to establish a reserve account, supplemental to the association’s annual operating budget, to fund major maintenance, repair, and replacement of common elements.
• Requires a condominium public offering statement or resale certificate to include (1) a copy of the current reserve study, or (2) a disclosure to the potential buyer stating that the association does not have a reserve study.

Senate version summary:

• Condominium associations (association) are encouraged to establish a reserve fund account to pay for major repairs or replacement of common elements. An association may withdraw funds from the reserve account for unforeseen expenses, as long as notice is given to unit owners, and a repayment schedule is set up.
• Associations must conduct and update reserve studies annually. The initial study and the study done each third-year thereafter must be conducted by a reserve study professional. Reserve studies must include detailed information on projected expenditures and current reserve account information.
• If an association has not conducted a reserve study prepared by a professional in the past three years, one may be demanded if 20 percent or more of the unit owners agree. An association may refuse the demand if conducting the study would impose an unreasonable economic hardship on the association. An unreasonable hardship exists if preparing the study would cost more than 10 percent of the association’s annual budget.
• Public offering statements and seller’s disclosures must include either: (1) a copy of the association’s current reserve study; or (2) a disclosure informing the buyer that there is no current reserve study and the possible risks that the buyer faces because of the lack of a current study.

3. Seller’s Disclosure Statement Revision, House Bill 2894

The bill amends the Seller’s Disclosure Statement, Form 17, to include wood burning appliances. The bill passed the House and has moved to the Senate. A public hearing as been scheduled in the Senate on February 22nd.

Tags: Condo Conversion, Condo Reserve Study, Housing Legislation, Real Estate Legislation, Seller Disclosure Form

There have been significant news reports about the housing market in the media lately. Most of the reports focus on falling prices, increasing foreclosure rates and rising inventory, but at a national level. Locally, how has Seattle fared?

In November, Seattle’s residential median price of $405,000 reflected a 2.2% increase over October, but a 4.7% decrease compared to the same period last year. As the graph below shows, the median price has been underperforming for the past few months.

In reviewing month over month figures, the single family home median price has stabilized while condominiums have declined the past two months. However, when compared to last November, both single family homes and condos saw higher median prices in November 2007, increasing 3.3% and 2.5%, respectively.

Read more »

Tags: Seattle Condos, Seattle Housing, Seattle Housing Market, Seattle Real Estate

Most professions have they own vocabulary, jargons and euphemisms employed to obfuscate the less desirable. And, real estate, like many sales professions, has its own set of doublespeak terms. Most are well known and are easily deciphered by smart buyers, some aren’t.

The Seattle PI’s Aubrey Cohen recently noted how listing agents are becoming more creative with their marketing remarks as the market changes. The sad thing about the article…there’s truth to it.

Here’s some of my faves from the article:

• Very quiet interior: You can barely hear the freeway with the windows shut.
• Seller has left you to your own imagination: Hasn’t been updated since 1940.
• Turnkey: Just overhauled, complete with granite countertops and stainless-steel appliances…and laminate floors.
• Walk to Fremont: Fremont’s 20 blocks away.
• Unique: Remodeled by someone on acid.

The article noted a Canadian university’s study on the impact that words have on selling time and pricing. “Move-In”, “Motivated” and “Beautiful” apparently incite buyers to make offers sooner and at a premium.

Hmm, “motivated” doesn’t quite seem to equate to higher prices or faster selling times in Seattle. If anything, it’s a beacon to buyers that the seller is desperate and the listing is stale.

My personal pet peeve is the ever expanding neighborhoods that listing agents create. Somehow Maple Leaf, Northgate and the Oak Tree area have been annexed to Green Lake. And, apparently, Ballard now extends to the Shoreline border. Then, again, Bainbridge condos were once transplanted to downtown Seattle.

Tags: , Seattle, Seattle Real Estate, Selling Real Estate

I thought this was an amusing little tidbit of real estate news. While conducting a home search real estate agent Beau Betts noticed that Deborah Arends, the antagonist on 60 Minutes’ Redfin piece, took over a property that was previously listed with Redfin for nearly 100 days. Sometimes experience and service do matter.

Tags: Redfin

Recently, much has been flying around the blogisphere about a certain 60 Minutes report. And, Point2, a Canadian-based real estate website provider recently created a satirical spoof called 16 Minutes which they posted on YouTube.

The gist of the piece was that sellers may actually lose money on the sale of their home in the attempt to save on commission.

This brings to mind listing I competed for against a discount listing company. The seller, who I knew, elected to go with the discounter and I wrote about it last June in a piece called The Cost of Using Discounters. In trying to save $10,000 in commission, he actually netted less than had he listed with me. He could have walked away with $10,400 more in gross proceeds even with paying a full-service commission rate.

The market is diverse enough to accommodate various business models. Some people, in certain markets or who are in tight financial circumstances, may benefit from the alternative business models. Though, for the most part, in trying to reduce the cost of selling a home, sellers may actually be reducing, not increasing, their net proceeds than had they selected the full-service model.

Related article - Myth of the Discounters.

Quietly, real estate in Western Washington will be less visible. On April 23rd, the Northwest MLS, a listing service representing companies in 19 counties, will stop uploading its property listings to Realtor.com.

Realtor.com is perhaps the closest thing we have to a national listing database. It’s supported by the hundreds of local MLS’ who provide their listing data to Realtor.com.

So, what does this mean for the average home seller? Less visibility and potentially fewer buyers.

What does this mean for the average home buyer? Well, if you’re already in Washington, it probably has very little impact. Most ‘local’ buyers most likely already use the big company websites such as johnlscott.com or windermere.com to facilitate their online searches.

The move by the NWMLS will impact out-of-state buyers and those looking to relocate to the area the most.

However, individual companies may decide to upload their own listings to Realtor.com. As of April 23, John L. Scott will the be largest real estate company in Washington to provide property listings on Realtor.com. Interestingly, Windermere has long chosen to keep their listings off of Realtor.com.

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.

NOTE: Since this post was originally written, many of the forms have since been revised. The information contained below may no longer be accurate.

This Summer the NWMLS revised a number of the forms commonly used in the purchase and sale of residential property (single family homes, condos & townhomes). Listed below is a synopsis of those changes. Whether you’re a seller or a buyer, it’s important to understand how these changes can affect you. This article only highlights the changes and is not meant to convey & explain the complete set of revisions.

Seller Disclosure Statement (Form 17)
Revision of farming disclosure. In the previous update the form incorporated a question where the seller had to indicate whether there was a “farm” within a one mile radius of the property. There was ambiguity as to what consistuted a farm, thus potentially creating undue exposure on part of the seller. The current revision simply states that the property may lie in close proximity to a farm. It no longer requires to Seller to actively acknowledge the existence of a farm.

Residential Purchase & Sale Agreement (Form 21)

Possession Date:

• Eliminated a possession option on the contract allowing for possession to occur after closing. Contracts now default to possession at closing, though other alternatives may be agreed to. A possession date may fall on a weekend or holiday.

Computation of time:

• Clarifies that time is expressed in days, not hours. In respects to the contract, 24 hours does not equal 1 day. Time starts by counting the next day. Time periods end at 9:00PM unless otherwise specified.
• If a specific date is entered, that date will apply even if it’s a weekend or holiday.
• For time periods of 5 days or less, business days are counted. For more than 5 days, calendar days apply.
• If the last day falls on a weekend or holiday, it is not counted, except for the Possession Date.

Legal Description:

• A legal description must be attached as an Exhibit at the time of the offer for the contract to be valid. If not attached, the contract is considered illusory and not binding.

Assignment:

• The Purchase and Sale contract prohibits assignment to another party without written consent of the seller. However, at the time of offer, the parties may include “and/or assigns” on the first page of the agreement.

Financing Addendum (Form 22A)

• Buyers must disclose type of loan they are obtaining including whether the loan is a Second or Bridge.
• Clarifies that the downpayment is in addition to all sources of financing.
• The Contingency runs from Mutual Acceptance or Satisfaction of Form 22B.
• Buyer must either waive or provide a letter of loan commitment within 30 days; obligation to provide the letter is automatic. Unless waived, the Contingency remains active.
• If the Buyer does not provide the loan commitment letter, the Seller may provide a 3-day termination notice or allow the deal to continue.

Buyers Home Contigency Addendum (Form 22B)
The revisions clarify that:

• Sellers must accept the bump offer before giving the bump notice.
• Satisfaction is something much different than waiver and with different ramifications
• By waiving Form 22B, Buyer waives all other contingencies including Financing and Home Inspection

Inspection Addendum (Form 35)
Previously, the NWMLS supported two differently Home Inspection Addendums. The former Form 35A allowed for the Buyer to back out of the contract simply by disapproving the Inspection report. The former Form 35B allowed the Seller the opportunity to make repairs on items which the Buyer disapproved of. Both, Forms 35A and 35B, have been discontinued and replaced with Form 35.

• The new Form 35 closely resembles the former Form 35A, providing the Buyers the right of termination by disapproving, albeit subjectively, the Inspection report. This allows the buyer to essentially walk away from the deal.
• The Buyer has 10 days to inspect and may (1) approve and waive the contingency, (2) disapprove and terminate the contract, (3) request additional inspections or (4) propose modifications. If the Buyer does nothing, the contingency is automatically waived.
• Removed provisions for Deferred Deposit of Earnest Money and the Neighborhood Review (now separate form).

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.