Northwest Housing Prices Heading North

After a two month slow-down, it seems that Seattle area housing prices have once again begun to climb. The trend has its upsides and downsides, depending on who you ask, but the reason for the shift is undoubtedly clear.

For prospective buyers, the rise this month means an end to what many hoped was an opportune time to find a deal. The past few months saw a cooling process for infamously expensive neighborhoods in King and Snohomish counties - inviting many prospective buyers to shop the buyer-friendly market.

Apparently the cooling spell churn up some hot bidding action. The Northwest MLS release numbers today showing the median price for a home in King County rising 6% to nearly $445,000 and Snohomish homes rising 7.4% to $382,000.

For sellers, this bidding fury is a welcome sign. Many homeowners have reported bidding wars that ended up raising their selling prices far above the original list price. Many builders have been reaping similar benefits by flooding the market with new properties during this hot spell.

But can increased consumer interest fueled by cooling rates really be the catalyst for such a dramatic price increase? Not likely. Once again we have to point again to those three usual suspects: employment rate, population growth, and interest rates.

An announcement this week that Microsoft would be leasing over a million square feet of office space in Bellevue to house 4,000 employees lit a fire under the housing pot. This extra muscle to the job market - and the inevitible population growth that will come with it - have put a premium on already hot-selling properties in the area.

On top of this all, interest rates in Seattle have remained stagnant at the relatively low 6.22% for a 30-year mortgage, inducing prospective buyers to snatch up whatever finds they come across.

Condo sales are showing even greater increases - proving that the trend is not only limited to high end properties or suburban areas.

Despite the perception of the national housing market as the economic whipping boy du jour, the spicy trends in the Northwest continue to be hot, hot, hot.

As always, find the best real estate IDX solutions at XoomPad.com and stay up to date on the state of the Seattle real estate market at UrbanTango.com.

VS

A Nice Nod from the NY Times

While the rest of the nation's real estate markets continue to churn through the muck, Seattle remains virtual steam engine in the industry. I don't like to pretend like I know it all - believe me, I've been wrong many a time - but this is the kind of thing that brings smiles to the faces of Seattle real estate experts.

I recently wrote about an article in "The Economist" which discussed sub-prime lending and the jolt that the economy got from better-than-expected housing sales. If the real estate market continues to improve - do jobs really matter, as I said they do?

Well, of course! I stick by my word - and apparently so does the New York Times:
http://www.nytimes.com/2007/04/04/business/04stox.html

Find even more bits of wisdom at XoomPad.com and the state of the Seattle real estate market at UrbanTango.com.

Go Agent Go!

VS

Weeding out the Good from the Rotten

Having been a real estate agent in Seattle has taught me a lot. The biggest thing is appreciation for hard-working agents that represent their clients with honor and honesty. It also taught me how many agents can be quite the opposite. So, as much as I hate to dwell on the negative, I have to share this experience about how a truly unprofessional agent can ruin it for the rest of the trustworthy ones.

My sister and brother-in-law have been trying to buy a new construction condo in downtown Chicago for about two weeks now. They took on a real estate agent working for the builder rather than getting a buyer's agent. He had assured them that he could handle both ends of the transaction, but in reality has been lying to them in order to take a double commission. He tried to pressure them into putting big money down fast, as "the unit may not be available much longer". Thank god my Sister is a smart lady and turned to yours truly for advice.

I told them what I would tell any of my friends, clients, or random aquaintences: get a buyer's agent. It's the only way that you are going to know that your agent is working on your behalf - and your behalf alone. Once they did get a buyer's agent and came back to the crooked one, he continued to make their lives difficult, simply because they outsmarted the trickster at his own game.

This is the second time in recent months that a family member has come up against a crooked agent. Imagine translating this small survey size into the greater industry, just how many times this happens to unsuspecting buyers. I'm all for agents getting their due share - but not at the expense of honest homebuyers. Often times these guys working with the builder will tell an interested party that the unit is "not yet on the market". Then they get all chummy and say, "but maybe we can work something out before it flies off the shelf" and charge them a non-negotiable, over-priced amount and in the mean time take both the seller and buyer agents' commissions.

Some agents are going to scream, "but we deserve the higher commission for all the work we do... I work so hard and get so few buyers and blah, blah, blah..." I simply can't understand how such agents can look at themselves in the mirror, knowing that their riches are coming off the backs of hard working, unsuspecting clients - their clients.

I've always learned there is a right way and a wrong way in life. To live and work with integrity will make you a thousand times richer in the long run. Agents that play these games with their clients may fill their bank accounts, but they know deep down that they're as poor as paupers when it comes to integrity.

At XoomPad, we have all walked in the shoes of agents - we know the challenges, the triumphs. We work for consumers. We work for agents - but only good, trustworthy agents. And there are many, MANY real estate agents that need to be honored for their tireless work and ingenuity. Unfortunately, there are many crooked ones out there too. Luckily there are groups like the Realtor Association and local MLS systems that weed out the good from the bad. I just want to help honor those of the good crop, and make it harder for the rotten ones to see the light of day.

As always, discover the latest in IDX tools from XoomPad.com and keep up with Seattle real estate news at UrbanTango.com.

Go (Good) Agent Go!

VS

Sub-Prime mortgage market woes and the U. S. Housing market article in "The Economist" magazine

For those of you wondering if the United States real estate market is about to crash, please read the full article in the Economist magazine of this last week. I urge you to really understand what is being said - the language of facts, the size of the sub-prime market, the FULL opinion of experst, not just sound bites.

Yes, headlines sell newspapers and magazines - but you knew that already. But it's important to dig below the surface in order to get the whole story. Two particular facts to highlight: 1. the real estate market has slowed down dramatically and 2. the United States unemployment rate has stayed steady at 4.5%. Hmm. If you have read this real estate blog over the last 3-4 years, I have said "it's all about the jobs, stupid". And I will continue to say it's always about the jobs, as far as our economy is concerned--hello, Detroit?.

For those of you who wish to be lazy & trust my opinion or are lucky (and smart) enough to be independently wealthy, you still have no worries. You may see a buying opportunity within certain markets where the foreclosure rates have jumped dramatically. All, I can say is, keep your shirt tucked in, and tighten your belt. Real estate investment has never been a get rich quick scheme and buying for your short term gains may mean loosing your shorts in the long run. People live in houses, they don't trade them for profits - thank God - so why do we compare this asset class to the DotCom bust?

In my years growing up in Minnesota, I've learned a couple things from those wise Northerners. Most wise people keep their shorts on in the summer and wear long underwear in the winter. When they don't know, they simply say "Well, geez Sven, I am not too sure about that," and when they want to say 'No', they often say "Well geez Sven, I just don't know about that, der." The message is, be patient and wait, don't make bold statements that could be wrong. Most people would agree or tell you to hold your real estate investments as long as you can.

It usually pays to hold on to land. As my Minnesota kinsman would say, "Well, der... God's not making anymore, now is he?"

VS