Jun. 14, 2009 - How long does it take to sell a house
For the most timely data, I'm looking at the days on market of homes that are still pending and the median number of days from the time the homes was listed until it received an acceptable offer. If your home looks good and is priced right, it still isn't likely to sell in the first week...the odds are against that happening. No impossible, but don't be dissapointed if it takes buyers awhile to look and decide.
Single Family Home in Redmond 98052 - 65 days.
Condo in Redmond 98052 - also 65 days.
Single Family Home in Kirkland 98033 - 45 days
Condo in Kirkland 98033 - 56 days
Single Family Home in Kirkland 98034 - 60 days
Condo in Kirkland 98034 - 49 days
Single Family Home in Bellevue 98007 and 98008 - 56 days
Condo in Bellevue 98007 and 98008 - 64 days
The papers are full of stories about the housing market woes, yet it seems people are still surprised when they don't get an offer the first week they go on market. Perhaps the above median timeframes will help people understand that buyers are really being careful, taking their time, and expecting a lot of value for their hard earned dollars.
Dec. 15, 2008 - Rent to Own, Lease to Own, Lease Purchase
I'm going to start this post with this warning:
"In most cases, the accumulated rent is used to lower the purchase price or to reduce closing costs. (Fannie Mae and Freddie Macguidelines generally preclude using rent money toward the down payment, mortgage experts say, because buyers need to prove that they can save on their own and thus qualify for a loan.)" From this article
I was greatly surprised to see my friend, Jonathan Miller's recent quote in this same article:
"The rent-to-own concept represents “a change in mind-set” during these tough economic times, said Jonathan J. Miller, a founder and the president of the Miller Samuel real estate appraisal firm. “The longer this drags out, the more acceptable this option becomes; this is just evolving,” he said."
Back on September 6. 2008 when I first took Lease Purchase out of the closet, and dusted it off as a possible answer to current market woes, we didn't get a chance to fully explore the option in the many, many comments. An argument ensued about Lease Option vs. Lease Purchase.. That debate has a simple answer (even though it took over 200 comments to keep saying the same thing again and again back in September :)
If you are buying it today, but need time to close and are renting it until you close, then it is a Lease Purchase. If you are renting it today, with the option of maybe buying it at some point in the future at a price set today...that is NOT Lease Purchase.
In the last several days I have had 6 out of 10 situations exploring Lease Purchase vs. straight out buying right now. #1 reason as to why was that the buyer owned another house that isn't sold...isn't even on market to be sold. This means they don't have the money from the sale of their current home to use as a downpayment on the home they want to buy.
#1 reason for sellers to be approaching Lease Purchase as a market and sales tool. i.e from yesterday's stats - FOUR YEAR supply of high end homes in Kirkland 98033. Any builder or seller in that upper price range of $1.2M or above (approx 20% of all homes for sale in that zip code) might be looking at foreclosure as the alternative. Many of these homes are new and vacant. Some are already showing the listings as "for sale or for rent" with the rent option being a Lease Purchase optiona and not a straight out rental offering.
Back to the warning in the first paragraph. I would think if a 3rd party collector collected two separate checks each month, one payable to the owner that he can use to pay the mortgage and one payable to the buyer himself that is put into a savings account in the buyer's name, that might meet the Freddie and Fannie Guidelines. Or maybe Freddie and Fannie and whomever is pulling their strings these days will understand the need to accommodate Lease Purchase in some meaningful way at to cash to close.
One would hope with the market in a mess, that they would be willing to work through this option for the sale of the real estate market...the Country and for Presdient-Elect Obama. In any case, a final step in the Lease Purchase contract, besides attorney review, would be LENDER REVIEW where a lender runs the method past the underwriter before the proposed "rent-buyer" takes possession of the property.
To sellers, if there is a 6 month inventory of property for sale of like kind to yours...you may not want to seriously consider going this route unless you are on the brink of getting seriously underwater. But for those with a 2 to 4 year supply of inventory on market in your price range...open all the windows to freshened ideas...and the door to Lease Purchase.
Three bedroom townhomes in Downtown Redmond are beating the odds. When it comes to what is selling and what is not, 3 bedroom townhomes within 1/2 mile of Downtown Redmond ARE selling. Prices are not holding up at the highest price, and there has been some modest downturn in pricing in the last 4 months, but nothing dramatic. Not as low as many buyers would like them to go.
If you own a 3 bedroom townhome near downtown Redmond, you have a 90% change of selling it in less than 30 days.
That may not sound like any great shakes...but believe me it is! Not many home sellers can be confident that their property will receive an offer within 30 days these days.
A closer look at 3 bedroom townhomes near Downtown Redmond:
There are only 6 for sale and at least two of them are priced incorrectly as they are really 2 bedroom townhomes and not 3 bedroom townhomes
There are 3 currently in escrow
12 have sold in the last 6 months
So if you are priced correctly for what you are and condition is as tip-top as you can get it...you will sell. List it and it will sell is not common these days. That kind of confidence is rare. So if you have a 3 bedroom townhome near Downtown Redmond, know that your market is about as good as it gets these days.
While it may look like a 6 month supply of inventory with 12 sold and 6 for sale, likely only 2 of those are positioned to sell as to condition and price. Anything not selling is not selling for a reason that the seller can fix...and just isn't fixing. A truly motivated seller can sell if they have this product in this location. In this market...that is truly a blessing.
The only oddity is that some people seem to be paying the same price for a 1 car garage as they are for a 2 car garage. Or paying the same for a tandem garage as they would for a true 2 car garage. Using price per square foot methods does not account for garage differences. That is the only caution to buyers who use price per square foot methods. The garage is not a consideration unless you make it a consideration...and it is wise to do so.
When we look at sold prices, we don 't get the real story. Yes, sold prices are generally lower on a price per square foot basis than those that are not sold. But the real story is in what are people buying, and what are the odds of selling at all?
If you own a one bedroom condo in Downtown Kirkland, price is not the only solution to selling it.
There are currently 19 people trying to sell a one bedroom condo in Downtown Kirkland
Only two 1 bedroom condos are in escrow
Only 7 one bedroom condos have sold in the last 6 months
That means you have about a 1 in 10 to a 1 in 18 chance of selling at all.
19 condos represents about a year and a half of inventory. 2 sold means that maybe 2 of the 19 will sell and the remaining 17 people may have to do something besides selling. Rent it out. Stay in it. Let it go back to the bank. What are the options if selling is not an option?
Will price alone cause all 19 to sell? Not likely. Even if half the people take their property off the market, all of the remaining condos will not likely sell in the next few months.
What does that mean to someone who is planning to put one on market? Take the lowest possible price at which you will sell it and list it at that price. Make it look the very best at that low price even though you feel like you are "giving it away". And then...after all that...know that it still may not sell.
It is not likely if only 7-9 people have bought a 1 bedroom condo in Downtown Kirkland in the last 6 months, that 19 will sell. Yes, yours
CAN beat out the 19 already on market, but not without extreme sacrifice of some kind.
Is it price?
Is it condition?
Is it location?
Is it view?
There is no one right answer. Sometimes its price and sometimes it's view and location. That the competition is severe when you are #20 on market, is all that is a known factor.
Jul. 4, 2008 - Should I Sell My House Now or Wait?
Recently I am meeting three kinds of people who are considering selling their current home. Some are buying a bigger home, while others are buying a smaller home, and some are selling and renting.
Use the same line of thinking from my previous article, that is to expect the market to be down over the next 3-5 years. Sellers have missed the peak of the market, for sure. But really, who can pick absolute peak without hindsight?
Yes, I think if you sell this year you will sell for less than you could have sold for last year. But I also think the liklihood is that you WILL sell for less than this year, if you are already considering selling and decide to wait.
Let's say the market goes down for 3 years and not 5. It could still stay flat for two years after that. It could take 7 years for it to get back to where it is now or where it was last year. Can you see yourself waiting for 7 years? Can you hang in there without home equity loans or cash-out REFIs for 7 years? If no, then bite the bullet and sell now, and forget that you could have gotten more last year.
More importantly, know that when you sell your home you are "Paid in Full" and hopefully "Debt-Free" for a split second when you close escrow. Now think hard about what that means to you in your life at the moment.
If you are young, and your income is high, you want to talk to an accountant about what you are losing in tax write offs and seek appropriated advices about what to do next.
If you are near retirement and don't see yourself retiring where you are but still need to work where you are, consider renting where you are and buying where you will be retiring. Talk to an accountant about being able to claim your future home as your current primary residence and the requirements for doing that.
If you need a home for your family, your pets and your hobbies and cannot enjoy your life in a rental for many reasons, then buy wisely. Buy in the best area your money can buy, so that you are buying in the strongest of markets and the one that will go down the least and spring back first.
Look at selling and becoming Debt-Free as an opportunity to start over from this point forward. Shake all of the advices out of your head, yes even mine! :) Ask youself what would make you happiest rigfht now in terms of where to live and what to live in. Make yourself happy...life's too short. But when you consider "happy" don't forget to consider the financial aspects of paying the monthly cost of where you will be going.
Make yourself as happy as you can without over-extending yourself. Pick the best where and the best what...and don't forget "the sleep factor".
Mar. 15, 2008 - Pottery Barn Paint Colors - Benjamin Moore
I often recommend that people check out Pottery Barn paint colors when trying to decide on a paint color when getting their home ready for market. Plain white or off-white is often just too boring, and in a market with lots of other homes on market, sometimes you want to stand out a bit.
I am writing this post today for a man Kim and I visited this week who is preparing a home for market over in Shoreline. A small home in a private, lush setting with medium colored wood trims around the wall of garden windows and for kitchen cabinetry. I recommended that he use a little color in the high vaulted walls in the kitchen to accent the height of the space. You don't want to use colors that are too dark anywhere in a small space. Perhaps semolina in the kitchen and stem green in the master bedroom areas. By painting both the bedroom and the dressing area the same color, you expand the size of the master space beyond just the bedroom.
For a small home with medium colored natural wood trims, the colors that work best together from the above list are semolina, stem green, suntan yellow, brookside moss
Due to the coloring of the millwork, I recommend from the above chart, Semolina, Stem Green. Semolina may be a little too bright except in the kitchen where there is not much wall space due to the cabinets. Stem Green in both the kitchen would likely work well, but I don't think semolina can carry into the bedroom. Suntan and acadia look nice together, but you want the house to blend well with all of the lush dark greens peeking in from the outside.
A little color goes a long way in a small home and Pottery Barn clearly spends a ton of money determining which colors are popular at any given time. You can benefit from their research dollars by emulating or choosing from their prechosen colors.
The right color can really make your millwork pop.
Here in Seattle where you want a lot of internal brightness to compensate for the lack of sun, painting only the angled accent walls, instead of the entire room, keeps everyting light and bright even when the weather says otherwise.
Did you ever ask yourself how it can be that you meet people all the time that first saw the home they live in at an Open House. Yet if you Google "Open Houses" you get story upon story of how Open Houses rarely, if ever, help to sell a house?
Did you ever ask yourself why you can't drive through any neighborhood on a Sunday between 1 and 4 without running into scads of Open House tent signs pointing to an Open House, if they don't work?
Mainly it's because Open Houses DO work for the owner who is selling the house but they DON'T work for the agent who is holding the house open. Many people see a house at an Open House and then call their agent to buy it. The same agents who will say Open Houses don't work, will be the same runs crying the blues that a buyer who came to an Open House bought the house...but not with the Open House agent.
Because often the agent holding the Open House is not the listing agent, you read many stories about how they are a "waste of time". They are not a waste of time for the owner who is trying to sell the house...but often they are a waste of time for the agent who stands to gain nothing if both the seller and buyer have an agent...but the Open House agent is "none of the above."
Open Houses DO work, and often, for the seller. Sometimes people go home after an Open House and can't get that house out of their mind. They come back later with their own agent and buy it.
Mar. 6, 2008 - Pricing Your Home Right and Having Patience
It is more difficult now more than ever to determine whether or not you have priced your home right.
With average days on market doubling in many areas, it is hard to tell if you are not getting showings and offers because your price is incorrect, or simply because there are fewer buyers in the marketplace.
It is not unusual for buyers to want to see price reductions, but it is also not unusual for buyers to want to pay less than asking price. Consequently you could get a triple whammy if you lower your price to get an offer, the offers are coming in at less than asking price AND then you get hit hard at the time of the Home Inspection.
Still, I think the next 6 months will be better than the last six. Just try to be more patient, more flexible, and try not to worry if you don't get an offer in the first 10 days. The market is not a Buyer's Market and still leans to the seller side for the most part, but only if the seller is realistic and pays a lot of attention to condition and pricing well.
Feb. 28, 2008 - Where is the Seattle Real Estate Market Going?
Every week on Rain City Guide, I have been posting data from King County Home Sales.
Click here for weekly statistics from Jauary 6th or so of 2008 to present.
The big news is that volume is down pretty much across the board by just over 30%. That many fewer homes are selling compared the the same months a year prior and that started in September or so of 2007.
Days on Market has also been affect to the point where it is taking most owners about twice as long to sell their properties.
Determining if the reduction in number of sales and the lengthening of days on market has impacted prices yet, and if so what extent, is not an easy calculation. Every year the expansion of price happens in the months from April through July. So we will be watching closely to see if the Seattle Area squeezes any appreciation into 2008 during those months.
For those of you trying to decide whether or not to sell your home in 2008, you need to ask yourself this question. If you do not sell in 2008, when will you likely sell at a later time?
While it is true that selling in 2008 may be more difficult than in the hot market of 2005 or in the next hot market, you may be totally screwed if you are waiting a short time vs. selling now.
Let's assume for a moment that we are at a point near the peak or just past the peak of that bell curve. If it takes three years to get to the bottom of the valley and eight years past that to get above the previous peak, you may be better off selling in 2008. Maybe that will be a fraction less than you could have gotten had you sold 12 months ago. But it very well could be 20% more than you will eventually sell for, if you can't wait until a very long time from now.
The expectation of market changes is that since prices have doubled, they may drop back by 30% or even 50% before the rise up again to values higher than the current peak. It's OK to wait...but ask yourself this. What exactly are you waiting FOR and how long can you wait for THAT?
If your current sale price is double what you paid for it, and you want to move, then DO IT! Don't worry so much about whether you could have sold it for more several months ago. Worry more about whether or not you will be forced to sell it for even less if you wait.
ARDELL
DellaLoggia
On Seattle Real Estate including Kirkland, Bellevue, Redmond, Green Lake and most areas around Lake Washington North of Downtown Seattle.
Phone: 206-910-1000 - Mailto:Ardell@RainCityGuide.com
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