Seattle Housing Buzz

From CNN Video: Desperate owners burn homes

The past couple of years Ballard has been a buzz with new condominium and townhome developments as well as witnessing the loss of apartments to condo conversions. Over the next two years the Ballard landscape will continue to evolve with the return of new apartment developments in this once sleepy enclave.

Here’s what’s on tap for the new Ballard:

Broadstone Ballard

Address: 1139 NW Market Street
Developer: Alliance Residential
No. Units: 163
Comment: Two 6-story buildings with retail along Market. Construction to begin later this year with a 2010 completion.

Ballard on the Park

Address: 24th Ave NW & NW 57th (QFC site)
Developer: Security Properties
No. Units: 268
Comment: Six-stories with a 45,000 sq ft QFC market on the ground level. A 2009 completion date is anticipated.

Alexan Ballard

Address: Market between NW 15th & 17th
Developer: Ballard Apartments / Trammell Crow Residential
No. Units: 260
Comment: Designed by GGLO who also designed the Hjarta on the north end of the Market. Two buildings, 6- & 8-stories, with commercial/retail on Market. Completion slated for 2009.

Additionally, the new owner of the Sunset Bowl is a major apartment developer and management company with 13 properties in Seattle and the Eastside.

Tags: Alexan Ballard, Ballard, Ballard on the Park, Broadstone Ballard, Seattle Apartments

Last week the state legislature overwhelming approved bill 2778 reforming the licensure of real estate agents. The bill now heads to the governor’s desk for signing. The bill, which strengthens consumer protections and professional accountability, received widespread support within the industry.

The core reforms include:

• Elimination of the real estate salesperson classification, leaving broker, managing broker and designated broker classifications.
• Amends the licensing and educational requirements for brokers to 90 hours. Essentially, the “new” broker designation replaces the “salesperson” classification which only required 60 clock-hours of education.
• Implements greater oversight of licensees.
• Requires a background check by the Washington State Patrol.

Once signed by the governor the bill will become effective July 1, 2010.

Personally, I’m all for this bill even though it should be tougher. There is a definite need to increase the educational and licensing requirements of real estate professionals in Washington State. The changes will help to assure consumers that individuals practicing real estate are qualified, above board, full-time business persons. It’ll eliminate the plethora of agents who aren’t committed to improving their own skill sets or who treat real estate as a hobby or second job.

Tags: Housing Legislation, Real Estate Legislation, Real Estate Licensing, Seattle Real Estate

From NWMLS Press Release:

February housing activity around western Washington signaled signs of an emerging spring market with a noticeable increase in open house traffic, reports of multiple offers and a big jump in pending sales from the previous month.

New figures from Northwest Multiple Listing Service show a 23.6 percent increase in pending sales (offers made and accepted, but not yet closed) compared to January. Prices for last month’s closed sales of single family homes and condominiums (combined) were up in 12 of the 19 counties in the MLS service area.

“In March, the real estate market is set to get its mojo back,” remarked J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “We’re already seeing the momentum build as more and more buyers realize what a great time it is to buy a home thanks to low interest rates, healthy inventory, and a strong local economy,” he added.

Area-wide, the MLS reported 5,563 pending sales of single family homes and condominiums for February, up from January’s total of 4,499. Last month’s total still lagged the busier market of a year ago when there were 8,043 pending sales of single family homes (a decline of nearly 31 percent).

While encouraged by last month’s jump in pending sales from January, brokers also acknowledge hesitancy still exists among some buyers. However, among sellers, one broker said “they’re motivated like never before and willing to listen to reasonable offers much more readily today.”

Read more »

Tags: Housing update, NWMLS

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

The Seattle PI reported that Governor Gregoire signed into law a $1.5 million bill that’ll provide counseling to at-risk homeowners.

The money will go to agencies that counsel people facing foreclosures, as the governor tries to curtail effects of the mortgage loan crisis hitting the nation and the state. The bill signed Monday also will pay for a free number for people to call for help. The number, 1-877-894-HOME, will be operating in about two weeks.

Tags: Foreclosure, Foreclosure Counseling

The Master Builders Care Foundation is currently accepting applications for its May 17th Rampathon project which builds wheelchair ramps for disabled low-income homeowners in King and Snohomish Counties. Last year more than 400 volunteers constructed 25 ramps, bringing the total to over 200 ramps since 1993.

Applications are due to the Master Builders Care Foundation by Thursday, Feburary 28th. Click here for application information.

Tags: , Rampathon

The Downtown Seattle Association hosted its annual State of Downtown event last week providing an overview of downtown commerce, development and livability issues. Downtown housing highlights include:

• Approximately 13% of Seattle’s housing units, or 37,320 units, are located in the downtown area.
• The number of residents increased nominally to 54,773 people. However, the number of children living downtown increased to 2,814, about 100 more than reported for the prior year.
• 16% of downtown units are owner occupied, 84% are rentals, unchanged from the prior year.
• Since 1990, population grew by 61.1% compared to 12.7% for Seattle as a whole.
• The average household income rose to 3.5% to $53,294 with a per capita income of $34,472.
• 39% of residents over 25 years of age hold a bachelors degree.
• Interestingly, there was a drop in the number of residents under 35 years of age, from 41% to 39% of all downtown residents. The average age is 43 years.
• There are approximately 5,700 new residential units currently under construction or permitted.
• Subsidized housing makes up 26% of all housing units in the downtown area.

Other downtown tidbits:

• The number of coffee shops increased 2.9% in the past year to 207.
• 231,532 employees, or 49.2% of all employees in Seattle, work in downtown, down slightly from the prior year.
• 44.4% of Puget Sound’s office market is located downtown.
• Over $1.1 billion in development projects were completed in 2007, up 44% from the prior year. Another $3 billion worth are currently under construction.
• The amount of open space and parks expanded by 38% from 42 acres to 58 acres.
• DSA reports that the number of tourists, entertainment seekers, conventioneers and sporting event attendees stood at over 18 million people.
• 190 cruise ship vessel calls comprising over 781,000 boardings were experienced in 2007. The cruise ship industry generated $268 million in revenue and contributed $6.7 million in local & state taxes.

Tags: Downtown Seattle, Seattle

(Press Release from the NWMLS)

Members of Northwest Multiple Listing Service tallied more than $32.3 billion in sales of single family homes and condominiums during 2007 . The MLS also reported 18 of the 19 counties in its market area experienced increases in median prices compared to 2006, with one county matching the 2006 price.

In its year-end summary report, Northwest MLS, whose service area covers about 80 percent of the state’s population, logged more than 82,000 closed sales during 2007. Single family homes accounted for nearly 82 percent of the number of sales and about 86 percent of the dollar volume, with condominiums making up the balance.

Last year’s volume, measured by number of units, amounted to a drop of about 14.5 percent from 2006. The dollar volume, compared to the previous year, was down about 8.7 percent. Underscoring the “real estate is local” mantra, median price gains among the counties ranged from zero to nearly 16.1 percent.

Among highlights the broker-owned service noted for 2007:

• The median price for single family homes that sold last year area-wide was $342,000, up 5.9 percent from the previous year.
• Among the counties, the median selling price of a single family home (half sold for more, half for less) ranged from $154,500 in Grant County to $563,250 in San Juan County.
• Five counties reported double-digit price gains for sales of single family homes compared to 2006, topped by Lewis County at 15.9 percent.
• Condominium prices jumped 10.6 percent from 2006 to 2007. The area-wide median price rose from $235,000 to $260,000.
• Kitsap County topped the charts in price gains for condos. Last year’s median sales price of $337,400 was 82.4 percent higher than the 2006 figure of $185,000. Several new developments contributed to the price jump.
• 2,311 residences fetched more than $1 million, a 10.1 percent jump from the previous year. Of the million-dollar-plus sales, 2,186 were single family residences.
• The MLS area covering Bellevue/West of 405, including the “Gold Coast” district encompassing Clyde Hill, Hunts Point, Medina, and Yarrow Point, had the highest number of million dollar-plus sales with 240.
• 1,115 condominiums sold for $500,000 or more (including 125 condos that sold for more than $1 million). Seattle’s Belltown area claimed the highest number of condos that sold for a half-million dollars or more, with 201.
• In the four-county Puget Sound region (King, Snohomish, Pierce and Kitsap), less than 5 percent (4.68 percent) of single family homes sold for under $200,000. Nearly three of every 10 homes (28.9 percent) sold for $500,000 or more.
• Brokers added nearly 153,000 new listings of single family homes and condominiums to the inventory during 2007 (up from 140,449 the previous year).
• NWMLS members sold more than 15,000 condominiums, about the same number as the previous year (15,038 in 2007 compared to 15,318 in 2006). About 63 percent of all condos that sold were in King County.
• Single family homes accounted for about 83 percent of all residential sales. Of these transactions, more than half (52 percent) had three bedrooms.
• The second quarter was the most active for pending sales, with 31.4 percent of those transactions being written during April, May or June. The last quarter, reflecting the usual seasonal slowdown plus turbulence in the mortgage market, was the slowest, with only 17 percent of pending sales taking place during that timeframe.
• Counties within the MLS service area have wide variation of prices for 3-bedroom homes. For pre-owned homes (built 2005 or earlier) the median sales price ranged from $145,000 in Grant County to $500,000 in San Juan County. In King County it was $408,000.
• For new homes (built in 2006 or 2007), the most expensive homes are found in San Juan County, where the median selling price was $685,000. In Grant County the median price on new homes was $182,059, earning it the distinction of being the only county in the NWMLS service area with a median selling price under $200,000 for a newly built single family home.
• Mercer Island had the highest priced homes when comparing median prices by school district. Single family homes that sold in that district during 2007 had a median selling price of $1,081,250, followed by the Bellevue School District at $720,000.
• Measured by “month’s supply” last year’s average was 5.57 months (meaning it would take that long to exhaust inventory at the current sales pace). The national average is 10.3 months, according to the latest report from the National Association of Realtors®.
• Northwest MLS members maintained a high ratio of cross sales: about eight of every 10 sales (79 percent) were listed by one office and sold by a different office.
• In King County, the average price of a residence (single family home and condo combined) that sold in 2007 was $497,855, more than twice the price paid a decade ago (1997 - $213,821). For single family homes (excluding condos) that sold in King County last year, the average price was $564,468; in 1997 it was $230,345 and in 1990, the average sales price was $178,187.

Northwest Multiple Listing Service, owned by its member brokers, is the largest full-service MLS in the Northwest. Its membership includes approximately 31,000 brokers and agents. The organization, based in Kirkland, currently serves 19 counties, mostly in western Washington, plus Grant, Kittitas and Okanogan counties in the central part of the state.

Tags: NWMLS, Seattle Housing, Seattle Real Estate

This morning the State House convened to review the condo conversion bill (HB 2014) which passed its third reading by a vote of 94 to 1. The House version of the bill:

• Extends the notification period from 90 days to 120 days.
• Authorizes a city or county government to require developers to provide relocation assistance to low-income tenants in an amount to be determined by the city or county government. Currently, the state requires a $500 relocation assistance payment to low-income tenants.
• Prohibits construction within the 120 day notification. Though, construction may begin earlier provided the developer waits at least 12 hours after the last tenant vacates.
• Authorizes cities & counties to restrict the number of conversions.

On the other side of the aisle the State Senate will hold a public hearing on Tuesday, February 5th at 1:30 PM at 1:30 PM on January 22nd. The senate’s version (SB6411):

• Extends the notification period from 90 days to 180 days.
• Provides that notice of any county or city relocation assistance programs must be expressly stated to tenants.
• Requires developers to pay relocation assistance in an amount determined by city or county ordinance.
• Provides that the amount of relocation assistance may be adjusted annually.
• Allow developers to begin limited construction/remodeling within the 180 day notification period only if all tenants have vacated or if they provide written waivers to the developer.
• Authorizes cities & counties to restrict the number of conversions.

I have been in favor of some sort of change to the current requirements - 90 days notice and $500 towards low-income tenants - which is hardly anything. The cost to move and secure a new place to live is considerably more than $500. And, if you’re not low-income, you get nothing. But, I’m a little skeptical about placing limits on conversions. I’m a firm believer that the market will self-correct and adjust accordingly. And, it has.

1. “Repartmenting”

In the past six months, the slowing condo market has taken its toll in Seattle. At least three heavily promoted conversion projects have reverted, or repartmented, back to apartments. These include the Max in Greenwood as well as the Strata and Gables in West Seattle.

2. Repurposing

Another trend that we’re now seeing in Seattle is the repurposing of condominium projects to apartments. The most recent example was Expo62 in lower Queen Anne. However, it wasn’t the only one. The Landes on First Hill and the Chloe on Capitol Hill, both originally planned as condos, will be developed at apartments.

Also, there is speculation that more are on the way such as the recent announcement that the Domaine project on Queen Anne is currently up for sale as an apartment complex.

3. Constructing

Often overlooked is the new apartment boom that’s occurring in the Emerald City. Several high-rise apartment buildings are presently under construction or in development in downtown. These include The Olivian at 8th and Olive, Kinects on Minor at Stewart, the Aspira at Stewart & Terry as well as three additional high-rises on 2nd & Virginia and 3rd & Virginia, a twin-tower development at 6th & Lenora, and the massive 500+ unit 1200 Stewart project.

A number of smaller apartment projects are under construction around the Seattle Center including The Borealis (Denny & Dexter), Taylor 28 (Taylor & Denny) and the Bernard (Warren & John).

In the north end, The Tyee is currently under construction across from Green Lake, which joins the large apartment projects planned for the old Vitamilk (The Park 71) and Albertson’s (Alexan Green Lake) lots. And, in Greenwood, the old Leilani Lanes parcel is expected to be developed as apartments as well.

Capitol Hill will also see new rental inventory with the Packard (12th & Pine), The Pearl (15th & Madison) and the Agnes Lofts (12th & Pike). Additionally, two large apartment projects are planned on Broadway at Pine Street and the old QFC lot.

4. Fundless
The mortgage meltown and the evolving housing market have combined to dry up funding for conversions. Many developers, as reported by the Daily Journal of Commerce, are finding it difficult to obtain financing for conversions. Lenders are realizing that conversions are now too risky to fund. The heyday of mass conversions that we’ve experienced between 2005 and 2007 has passed.

The heart of the bills are necessary, namely the parts that softens the stress of displacement and provides relocation assistance for tenants. Though, artificially constricting conversions, which provide first-time homeownership opportunities, on the basis of a declining rental stock is simply unnecessary. Clearly, the market has adjusted as witnessed by the more than 1,000+ new apartment homes being built. The new apartments aren’t just for the wealthy, either. A number of projects are aimed towards the affordable apartment housing market.

Tags: Apartments, Condo Conversion, Seattle, Seattle Condos