Saturday, October 20, 2007

New Homeowners!

Congratulations to my clients, Leah and Pierre, who just closed on their first home earlier this week!

When they first starting looking at properties, Leah and Pierre thought they would only be able to afford a townhome, but recent market shifts opened up some new doors -- literally! Realizing that home buyers have been steadily gaining clout in the Seattle market for the past few months, we expanded their search to include some older, smaller single-family homes. Sure enough, we found a beautifully remodeled 1924 bungalow on a 7000+ sq. ft. lot. They fell in love with the place, and once a professional home inspector gave it a clean bill of health, we negotiated a purchase that fit their budget as well as their dreams!

Congratulations again, and may you enjoy many happy years ahead in your new home!

Wednesday, October 17, 2007

Interest Rates for the Week of Oct. 11-18

30-Year Fixed Mortgage Rate for the week of Oct. 11-18, 2007 = 6.40%, up 0.4% from last week when it averaged 6.37% Last year at this time, it averaged 6.37% as well.

Interest Rates for Week of Oct 4-11

30-Year Fixed Mortgage Rate for the week of Oct. 4-11, 2007 = 6.37%, down .5% from last week when it averaged 6.42% One year ago, the rate was 6.36%.

Seattle P-I story

The front page headline of Tuesday's P-I (10/16) http://seattlepi.nwsource.com/realestate/ states, "Sellers trying it all to hook choosy buyers." It provides a pretty accurate description of what's happening in the market right now. Although many sellers are still in denial about the marekt shift in buyers' favor, savvy agents (and sellers) are recognizing that they need to offer incentives to attract the few buyers who are actively shopping. Of course, the incentive that inevitably works best is pricing below market value. Money always talks loudest.

What I've Seen

In order to keep abreast of the West Seattle market, I preview an average of 8-10 new listings a day, 2-3 days a week. This means I personally tour between 15-25 new homes each week as they come on the market. It's a great way to keep current on available inventory and see how sellers and agents are pricing homes.

Judging from the homes I previewed yesterday, it seems as if many new listings are still coming on the market overpriced from the get-go. It's hard to say whether this is the fault of the agents or the sellers. A good agent will do their homework and present the prospective seller with a well-researched Comparable Sales Analysis (aka a CMA), showing what similar homes are selling for. Even so, many sellers choose to ignore the evidence and insist on listing at a higher price. Until as recently as June of this year, seller's were sometimes getting away with that strategy. Now, however, inventory is high and buyer's are scarce, so overpricing is a foolish choice unless the seller doesn't mind having their home sit on the market for several months.

Sunday, October 14, 2007

Choosing the right mortgage product

A brief article in the Oct. 14th edition of the Seattle Times (page D4) tells about an online "Mortgage Comparison Calculator" created by the Federal Reserve Board. The idea is to help you as a consumer compare a number of mortgage programs to see which is best for you. The website address is: www.federalreserve.gov/apps/mortcalc

Media headlines

I love the Sunday newspaper. Even so, as a Realtor, I always hold my breathe until I check out the headline in the Real Estate section, because if it's at all controversial, it's likely to be the topic of conversation among clients and colleagues for the coming week.

That's one purpose for this blog . . . to be able to comment on real estate related news stories as they occur.

I understand that journalists have to to draw readers in with sensational headlines in order to sell newspapers. But, for better or worse, public perception of the real estate market has tremendous power to actually change that market, and the real estate market is a major driving force in the financial health of our nation. That puts a significant responsibility on the shoulders of those who write those headlines.

For example, the October 6th editions of the Seattle Times and Post Intelligencer, stated that housing prices in Seattle dipped from last year. To justify the headline, they dug up some atypical and scewed statistics that showed a $50 difference -- yes, fifty dollars, not fifty thousand dollars -- between home prices in Sept. of 2006 versus Sept. of 2007. Well into the bowels of the article was information about how condominium sales may have artificially lowered that median price.

As a result of that story, many buyers were convinced that they should hold off on buying until prices go down more. Unfortunately, prices aren't really going down, and buyers who delay will actually experience a decrease in their purchasing power.

Consumer confidence is easily disrupted and "the power of the press" is very real. News reporters need to wield that power with care.