Whidbey Island Real Estate Information
Updates, news and information about Whidbey Island Real Estate.
Most Americans still believe that owning a home is a solid financial decision, and a majority of renters aspire to home ownership as a long-term goal. According to the 2011 National Housing Pulse Survey released today by the National Association of Realtors®, 72 percent of renters surveyed said owning a home is a top priority for their future, up from 63 percent in 2010. Visit us for Free Reports about Buying Homes with Zero Down or to How to Stop Paying Rent.
Seven in 10 Americans also agreed that buying a home is a good financial decision while almost two-thirds said now is a good time to purchase a home. The annual survey, which measures how affordable housing issues affect consumers, also found that more than three quarters of renters (77 percent) said they would be less likely to buy a home if they were required to put down a 20 percent down payment on the home, and a strong majority (71 percent) believe a 20 percent down payment requirement could have a negative impact on the housing market.
“Despite the economic setbacks Americans have experienced in today’s current climate, it is clear that a strong majority still believe in home ownership and aspire to own a home,” said NAR President Ron Phipps, broker-president of Phipps Realty in Warwick, R.I. “However, achieving the dream of home ownership will become increasingly difficult for buyers if they are required to make a 20 percent down payment, which may be a reality for many of tomorrow’s buyers if a proposed Qualified Residential Mortgage rule is adopted. That is why Realtors® are strongly urging regulators to go back to the drawing board on the proposed rule.”
Defining the QRM rule is important because it will determine the types of mortgages that will generally be available to borrowers in the future. As currently proposed, borrowers with less than 20 percent down will have to choose between higher fees and rates today — up to 3 percentage points more — or a 9-14 year delay while they save up the necessary down payment.
Over half — 51 percent — of self-described “working class” home owners as well as younger non-college graduates (51 percent), African Americans (57 percent) and Hispanics (50 percent) who currently own their homes reported that a 20 percent down payment would have prevented them from becoming home owners.
Pulse surveys for the past eight years have consistently reported that having enough money for a down payment and closing costs are top obstacles that make housing unaffordable for Americans. Eighty-two percent of respondents cited these as the top obstacle, followed by having confidence in one’s job security.
The survey also found respondents were adamantly against eliminating the mortgage interest deduction. Two-thirds of Americans oppose eliminating the tax benefit, while 73 percent believe eliminating the MID will have a negative impact on the housing market as well as the overall economy.
“The MID facilitates home ownership by reducing the carrying costs of owning a home, and it makes a real difference to hard-working American families,” said Phipps. “Home ownership offers not only social benefits, but also long-term value for families, communities and the nation’s economy. We need to make sure that any changes to current programs or incentives don’t jeopardize our collective futures.”
When asked why home ownership matters to them, respondents cited stability and safety as the top reason. Long-term economic reasons such as building equity followed closely behind. On a local level, respondents said neighbors falling behind on their mortgages and the drop in home values were top concerns. Foreclosures also continue to remain a large concern, with almost half of those surveyed citing the issue as a problem in their area.
This article will provide Whidbey Island Home Selling Tips and 5 Reasons to Hire a Pro to Sell Your Home. We are in a very different type of real estate market, a buyer’s market, and it is just to treacherous to go it alone. With these Home Selling Tips for Whidbey Island sellers, hopefully your experience with selling your home will be better and the outcome will be what you desire.
1. Employ an expert: A typical property owner does not have anywhere near the home-selling experience of a real estate agent. Agents can recommend relatively simple improvements—painting, making repairs, decluttering—that can help a home sell faster and for a better price. Your Realtor is the neighborhood expert. They can walk through a property and see right away what needs to be done to get the home sold. Independent sellers might not be aware of these tricks of the trade.
2. Use better tools: Homeowners using agents can get their property listed on Realtor.com, the most widely searched real estate website. Whidbey Island Home Sellers can get their homes listed on all of the local real estate company websites, including Coldwell Banker Koetje Real Estate website, which is one of the most comprehensive local real estate websites. Independent sellers do not have access to these services. Another of our Whidbey Island Home Selling Tips is to ensure that your home listing is available for mobile viewing, ie. smartphones, Ipads, etc.
3. Sidestep lawsuits: Agents can also help protect sellers from potential litigation. There are all kinds of liability issues that a seller could potentially face when…dealing one on one with a buyer. A homeowner could, for example tell a potential buyer that hardwood floors extend to all corners of the house underneath the wall-to-wall carpeting. But if even one room has cement flooring, the homeowner could be sued. Agents, who have experience dealing with these liability issues, can help homeowners dodge such scenarios. Another Whidbey Island home selling tip to avoid lawsuits: provide a full home disclosure to the purchaser. This is required by law.
4. Duck the riffraff: Independent sellers might not have any idea whom they are letting into their homes during open houses. These potential buyers might not have the credit to make the purchase—and would therefore be wasting the homeowner’s time—or could even “try to rob them later on. Homeowners working with agents will have qualified buyers visiting their properties. The agent has developed a relationship with their client and knows their qualifications.
5. Avoid hardball tactics: It’s a buyer’s market out there. And with all the information available online, today’s well-informed buyers are tough negotiators, too. Real estate agents have been through the home-selling process before and are trained in negotiating tactics—giving them a potential edge in negotiating a deal in the seller’s best interest. Our last Whidbey Island home selling tip is to have a strong negotiator on your side. Using a professional is in your best interest.
Hopefully these Whidbey Island home selling tips have been a help to you. Please feel free to contact us at 360-675-5915 or email us at email@example.com at any time. We are here to be of service to you.
Content provided by: Luke Mullins: USNews.com
One of the responsibilities we have is to help our homesellers establish a realistic market price for their home when they are preparing it for sale. Historically, the sale price of recently sold comparable homes has been used as the basis for calculating a value for the current home for sale. Together with adjustments for the differences in homes and their amenities has produced a very reliable market value.
That was historically. In today’s market enviornment, things have changed. Values have decreased from past sales and there are many other influencing factors involved in the calculations to achieve a realistic, marketable price for a home today. The amount of foreclosures and short sales has dramatically affected values. The deflated price of those sales affects the value of homes around them. Buyers then use those sales as the benchmark for value, offering to purchase at those deflated prices.
In today’s market, we must take a look at a home’s competition before setting a price to sell. If like homes are competing for the buyers attention, we must make sure the price is in line with, or lower than the competing homes that are for sale. Purchasers are shopping for value in the current real estate market.
For information or help in preparing your home for sale, and in preparing the asking price, contact us at any time. We are here to help you with all of your housing needs.
I’ve been saying that now is the time to buy if you’re in the market for a house. We’ve been in a buyer’s market for about 4 years, so you might ask, “What makes now the time to buy.” The answer has a number of variables; the first is availability, how many houses are for sale. Let us assume a price range between $250,000 and $275,000 and a search area of North and Central Whidbey Island. Presently there are 30 houses for sale in this price range.
The next variable to consider is seller motivation. We gauge motivation by how long a property has been on the market. The average time on the market for these 30 homes is 158.7 days or just over 5 months. This is a long time, so these sellers should be motivated to sell. Motivation determines how willing sellers are to lower their price.
The last variable to consider is the home loan interest rate. Interest rates have been at all time lows. Even today, interest rates are very low at 4.25%. However, it is important to consider where the rates will go.
Traditionally interest rates rise as our national debt increases. Our national debt is at an all time high and continues to rise. You might ask if the debt is so high, “why are interest rates so low.” This is an excellent question. The rates are low because the government is holding them low. Low interest rates allow consumers to borrow money cheaply. The government hopes that Americans will borrow money and spend it on consumer products. The spending will boost both the local and national economies. Unfortunately the plan is not working. Because of their lack of confidence in the economy, Americans are saving, not spending. It is important to know that these rates cannot be kept this low indefinitely. They will rise, and this is the point of my letter.
I have observed that there are buyers wanting to buy property but resisting because of the continued declining market. It appears they are trying to time their purchase with the bottom of the market. On the surface, it seems to be a great idea. Buy low and sell high is the oldest investment adage. What I want to point out to all buyers is watch the interest rates. Interest rates have a tremendous impact on house payments. Let us look at an example. Assume you are interested in a house that costs $270,000. Suppose you can buy that house today at an interest rate of 4.5%, with a zero down VA loan your house payments will be $1,368 per month. Now let us assume you wait until the price drops to $250,000; but while you are waiting the interest rate increases to 5.5%. Your monthly payments will now be $1,419 per month, which equals a $51 per month increase in your house payment. A 1% rise in interest rates negates a $20,000 drop in price.
Stop by and see me. I have much more comparison data between prices and interest rates. It is something you must see before you wait too long.
Recently I was reading an article regarding home seller tips in Money Magazine. I was so impressed by what the article had to say, I thought that I should share some of the highlights with our Whidbey News Times readers.
The essence of the article was that if you are a home seller in this market, you probably feel you can’t catch a break. To help overcome that, you need a bit of razzle-dazzle to nab a buyer today. The following attention-grabbing home seller tips will get prospects to your front door.
- Slash Your Price, Bigtime
Many sellers give in to the temptation to list the property above fair market value to see what happens. Big mistake. About a quarter of sellers in the past year initially listed too high and were forced to knock the price lower, according to Trulia.com. Think you can always drop the price if your home doesn’t sell. Bigger mistake. The first 30 days on the market are the most important. That’s when your home will receive the most attention and get the most showings. So get aggressive right out of the gate.
- Hire a Stager
Veteran real estate brokers interviewed by Money Magazine say that proper staging can speed the sale and often increase the price too. The key is to get it done right. Staging, increasingly popular with homeowners trying to sell mid-range houses, can extend from simply rearranging existing furniture to repainting, replacing fixtures, and bringing in new furnishings. The goal: to highlight the house’s best features while making it as easy as possible for buyers to imagine themselves living there.
Find the Right Hook
These days it’s going to take far more than a For Sale sign in the front yard and a spot on the multiple-listing service to get potential buyers in the door. That means getting the word out in a creative fashion-and finding a Realtor who is willing to do the same. “The more eyeballs that get on the listing, the better,” says Katie Curnutte of the real estate information website Zillow.com. To do that, you need a multi pronged marketing plan of attack.
To read the whole article in Money Magazine please click here.
To discuss these homes seller tips, plus many other ideas for getting your home sold, please feel free to contact us at anytime at Coldwell Banker Koetje Real Estate.
In my last post, I explained my answer to “How is the Market”. As part of that answer, we must consider what effect the distressed homes are causing on values. Because of the economic conditions in our country over the past few years, homeowners are losing their homes through foreclosure because of loss of jobs, changing terms of mortgages, inability to sell, etc. Foreclosed homes then sell at a price that is usually less than comparable homes in the market, driving down the prices of homes. Other homeowners that need to sell are experiencing another difficulty. Their home is worth less now than when they purchased it and they must sell at a loss. If they don’t have the funds to make up the difference, then negotiations with the bank may allow them to sell short, or as is commonly called, a Short Sale. Short sales also have the result of causing prices to decline in the local area. These are factors that have resulted in the way that I answer the question, How Is The Market.
North Whidbey Island 2010 Statistics for evaluating the effect of Distressed Home Sales:
- Short Sales were 11.5% of the active listings and 5% of the sold listings. Foreclosures were 9% of the active listings and 17.5% of the sold listings.
- The average listing price range of the overall market was $263,000. The median sales price of non-distressed homes was $250,000, Short Sales was $220,000, and Foreclosures was $160,000.
- The price per square foot for non-distressed sales was $150 per sq. ft., Short Sales was $124 per sq. ft., and Foreclosures was $112 per sq. ft.
Based on these statistics, it can be noted that a larger foreclosed home could be purchased for less money that a smaller non-distressed home. Also it can be noted that more Foreclosures were being purchased than Short Sales which will make the Short Sale homes probably result in Foreclosures.
With all of this being said, I do believe that prices have stabilized in our market. Over the next year, we will see some gyration of values but nothing like we have experienced in the last few years. It is still a great time to buy if you are a buyer, and if you are a seller that has owned your home for more than 5 years it is still a good time to sell. If you purchased your home within the last 5 years and don’t need to sell, then I would recommend holding on to it if you can. Call us about Property Management if you need to leave the area. If you are still living in your home and just need more space, than maybe a remodel would be best for you. We know of some outstanding contractors that we would be happy to recommend to you. Whatever the situation is, I can assure you that home ownership is still “The American Dream”.
I am often asked, “How’s The Real Estate Market in Oak Harbor?”
I was recently asked to speak at the Rotary Luncheon about the state of the real estate market in Oak Harbor. My speaking engagement was postponed for a few weeks, but I thought I would share some of the information in this blog. I will continue with a second blog that will address another area that affects the real estate market, Short Sales and Bank Owned Properties.
The first answer that I have after someone asks me about the real estate market is, “It depends”. Now I am not trying to be flippant with that statement, but my answer really does depend on if you are a buyer, a seller, when you bought your home, etc.
- If you are a buyer, the question is a no brainer. The Oak Harbor Real Estate Market is fantastic. In fact, I just helped my niece and her family make a purchase of a home. Interest rates are at all time lows (though they are starting to creep up). There is a large supply of inventory on the market for sale right now and sellers are being very generous in their negotiations.
- If you are a seller and you have owned your home for at least 10 years, than it is a good market. As you can see from the chart, home prices have appreciated 3-4% average over the last 10 years. So if you need to sell, than from an investment perspective, you have made a good decision and the Real Estate Market is good.
- If you are a seller and you haven’t owned your home for more than 5 years, than the value of your home is probably equal to or less than your original purchase price and you might want to consider other alternatives to selling, such as rent, or not moving. If you are in this situation than the Oak Harbor Real Estate Market is not so good but is getting better.
A large component of the Oak Harbor Real Estate Market is Short Sales and Bank Owned Properties. In my next post, I will explain the statistics for these sales and how they are affecting our market.
|“A house is not a home unless it contains food and fire for the mind as well as the body.” – Benjamin Franklin. Last week, the housing market received some food and fire for the mind, but not everyone was at home with the news.
First, the good news. The housing market received a serving of good news last week, as New Home Sales reportedly rose 17.5% in December to come in better than expectations. Overall, the report demonstrated that housing continues to recover – albeit slowly. Despite that good news though, the markets were keyed in on another more important event last week: the release of the Fed’s Interest Rate Decision and Monetary Policy Statement.
As expected, the Fed made no change to the Fed Funds Rate and even the Policy Statement was pretty much the same. But that didn’t stop the markets from getting a little fired up about the release. Let’s take a look at why.
It’s important to understand that the Fed has to be very careful with how bullish their economic comments are, as they don’t want to see long-term rates move higher. Well, the Fed’s comments certainly were not bullish as they said “employers remain reluctant to add to payrolls” and “the housing sector remains depressed.”
So why did Bonds initially improve nicely on the news and then crumble later in the day? The answer is, not everyone in the trading pits is buying what the Fed is saying. Instead, some people believe the Fed is talking down the true underlying strength of the economy, so that it can justify injecting the full $600 Billion of Quantitative Easing into the economy.
Speaking of comments that impacted the markets… President Obama delivered his State of the Union Address to members of Congress last week. Although the President’s call for a freeze on discretionary spending for 5 years may appear to be Bond bullish in that any reduction in the deficit would be good for Bonds, the reality is that so much more has to be done to really get our long-term debt in check. And some of last week’s weakness in Bonds was likely attributed to the feeling that the speech came and went without any real sense that the deficit is going to be reduced in a meaningful way, especially in the near term. The Bond market probably would have liked the word “cut” in spending rather than “freeze,” since a “freeze” suggests only a temporary halt in spending at current levels.
In the end, the news last week demonstrated that economic conditions are improving, but they are doing so gradually. As a result, the market remains volatile, as Bonds and home loan rates move up and down depending on what reports or speeches hit the news wires. The good news is that despite the volatility, home loan rates remain extremely low for now and present a tremendous opportunity for buyers who lock in at the opportune moment.
To learn more about the volatility and how you or someone you know can benefit from a knowledgeable advisor Coldwell Banker Koetje Real Estate, please call or email today.We would be happy to discuss the current economic climate and what it means to your unique situation.
Content courtesy of: AlaskaUSA Mortgage
1. What is a real estate short sale?
A short sale occurs when a lender agrees that it will take less than what the homeowner owes on their note. The lender usually agrees to this during the beginning stages of foreclosure when the they realize that the homeowner will not be able to meet the terms of their agreement and will be foreclosed upon if a short sale does not occur. This short sale would result in a substantially discounted purchase price for the end buyer of the home. The buyer would then proceed with the purchase of the home when the lender agrees to a price.
2. Will a lender allow a real estate short sale when the seller has some a good amount of equity?
If the home has some amount of equity, the lender may choose to continue with a traditional foreclosure proceeding to regain title to the property and dispose of it at a fair market price. Short Sales are generally discounted below fair market value, because the time value of money makes it more viable for the lender to sell it quickly rather than waiting through the redemption period, which in some states can be 6 to 12 months. Banks are not in the real estate business and generally don’t want to own the home.
3. What documents are necessary to proceed with a short sale?
The individual documents necessary to proceed with the short sale will depend on the lender. Typically, the lender will require hardship letter detailing the circumstances leading to a short sale. A signed, valid purchase and sales contract, preliminary HUD-1 settlement statement and a preliminary estimate of proceeds to the lender. There may be additional requests for more detailed information on the financial condition of the seller, ie; pay check stubs, bank statements, a personal financial statement and monthly budget assessment, amongst other things.
4. Will the seller’s credit be affected if they agree to a short sale versus a foreclosure?
While it is up to the individual lender to decide what to report, what often happens is the loan will report as “paid” on their credit report for a short sale, and sometimes with a reference that says “settled for less than originally owed”. A foreclosure will show as a default and can affect one’s credit for 3-7 years. It is absolutely less damaging to have the short sale referenced than to have a foreclosure on a credit report.
5. Will a lender allow the homeowner to make a profit on a short sale?
Absolutely not. The lender is taking a loss when they agree to a short sale and they will not agree to let the homeowner benefit financially.
6. If a seller is in bankruptcy, will that affect the short sale of the property?
Absolutely, as most lenders will not consider a short sale if the homeowner is in the middle of a bankruptcy proceeding. Negotiating a short sale between the parties is considered a collection activity and such a negotiation is prohibited during bankruptcy proceedings.
7. Will the bank or lender require an appraisal on the home in a short sale?
Most lenders will hire a broker to develop a Broker’s Price Opinion (BPO) to determine the value of the home. Some will require that a full appraisal be submitted in the short sale package. The lender will need some formal assessment of the value of the home in order to make a decision as to an acceptable offer. Settling on an agreeable price usually requires some negotiating between the end buyer and the lender and this can be an iterative process.
8. Are there tax implications for the short sale?
Much like the issue of credit reporting, the circumstances vary by lender. As a short sale represents a loss for the lender, they can report the amount lost as “debt forgiveness” to the seller. If a formal tax form 1099 is filed, the seller may be responsible for paying taxes on the amount of debt forgiveness. A CPA should be consulted by the homeowner in this situation.
9. Why would a lender agree to a short sale?
The lender doesn’t want to own the home because they are not real estate experts. Foreclosure proceedings can be very time-consuming and costly. The seller is relieved of the home they can no longer afford. The buyer is purchasing the home at an attractive price. A professionally executed short sale can benefit all parties involved in the transaction.
Courtesy of: Donna Sanford
Rick Schutte, Broker/Owner of Coldwell Banker Koetje Real Estate in Oak Harbor, Wa. interviews Lyn Bankowski, senior loan originator, from AlaskaUSA Mortgage about the need of checking your annual credit report.
In this interview, Lyn mentions the free reports can be found at https://www.annualcreditreport.com/. This central site allows you to request a free credit file disclosure once every 12 months from each of the nationwide consumer credit reporting companies. AnnualCreditReport.com is the official site to help consumers obtain their free credit report. You can also go to http://ftc.gov/freecreditreport for more information.
The Fair Credit Reporting Act guarantees you access to your credit report for free from each of the three nationwide credit reporting companies every 12 months.