Seattle Housing Buzz

Well…not really lies. More of a mistake, but a serious one. The published March 2008 condo closed sales median price data for Areas 700, 701, 705, 710, 715 and 720, in the King County Breakout PDF are incorrect. The PDF is published by the NWMLS on its public site - www.nwrealestate.com and its member site. As a result, the reported condo sales figures for Seattle are skewed and have been republished incorrectly by local media.

I’ve reported the error and am waiting for the revised data.

Update: They actually sent me the corrected report fairly quickly. It doesn’t look like they’ve updated the public site yet, though.

Tags: NWMLS, Seattle Condos

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

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

This past weekend was Seattle’s first condo expo at the Westin Seattle Hotel. The expo is an outgrowth of last year’s Downtown Condo & Realtor Symposium which was a single evening event aimed towards industry professionals.

The 2007 Seattle Condo Expo expanded to a two-day consumer event (May 19th & 20th) with a Realtor Symposium on the evening of the 19th. As the event approached, there was great optimism and expectations that this was going to be a fantastic consumer-focused event, providing information on numerous projects all at one place.

On the surface, I’m sure the sponsors - Seattle Times & PI and the condo trinity of Realogics, Urban Condominiums and Windermere OnSite (RUCWOS) consider the event a big success. That fact that they were able to pull off the Condo Expo, in and of itself, is a success.

Dig a little deeper, though, especially from a consumer-centric and Realtor standpoint, it was a bust. Granted, this was the first event of its kind and there’s sure to be logistical and informational challenges faced by the sponsors and vendors.

As the principal sponsors, RUCWOS projects dominated the event. In addition to RUCWOS, Vulcan had a sizeable corner while Intracorp’s Expo 62, GIS/John L Scott’s European Tower and Williams Marketing’s Brix each had a table. But, notably missing were Williams Marketing’s other major projects (Olive 8, 5th & Madison, 22 West Lee) and Miller Condominium (Queen Anne HS, Trio, Luxe) who were no where to be found. You can’t have a condo expo without two of the larger condo marketing firms absent from the event.

The expo was billed as the “ultimate urban open house”. If you were a prospective buyer, it was anything but. Very few of the vendors had full sales brochures available, and many, just had single sheet flyers with a PR article printed on the back (e.g articles published in the Seattle Times New Homes & Downtown Living inserts). There were no floor plans, pricing information, scale models, vignettes or sample finishes. If you wanted more information, and if you were serious about purchasing, you then had to go to the individual sales centers scattered through the city.

Not only was there lack of info, there was lack of knowledge as well. I spoke to the woman who was manning the table for a new project (not yet pre-selling) and she didn’t know anything about the neighborhood where the project is to be built.

The Realtor Symposium was more of a social event than informational. The set-up, location, and visual aides were not conducive for presentations. One had to stand in the small area in front of the screen to have an unobstructed view of it and people were interspersed through out the expo floor where many distracting side conversations were taking place.

Most of the topics focused on the demographics of urban buyers - retirees and younger professionals as well as trying to reassure the public that projects are keeping tabs on flipper-investors. Essentially, they’re trying hard to dispel any notion that there’s going to be an excess of high-end condo units on the market in a few years. The only bright spot was Matthew Gardner’s talk on the current building cycle which was more rational than the soundbites coming from the marketers.

Last year the Realtor Symposium drew 800 attendees, was informative and conducted in seated theatre hall. This year they charged agents (with buyers for their projects) to attend. From the looks of things, there appeared to only be a few hundred in attendance. In my opinion, compared to last year, the Realtor Symposium was a disappointment.

While I’m less than impressed with the expo, I do have to give props to the visionaries behind it. I realize this is the first of its kind in the city, challenges were faced and logistical decisions had to be made. I’m sure the expo sponsors will take away important feedback and lessons from this year’s event. And, should there be a 2008 Seattle Condo Expo, sponsors and vendors need to take heed of the needs and expectations of consumers. Simply, more information that’s easily accessible and transparent.

Tags: Seattle Condo Expo, Seattle Condos