Tag: Real Estate

Why’s It Called Nike Hill, Anyway?

Carl Setzer

This morning I drove out to Bothell from Lynnwood. As I hate the freeways, especially in the morning, I back-roaded it out there. Passing a number of construction sites out there didn’t surprise me. This area is quite high in demand, as it’s really the furthermost north end the East-side. One thing in particular stood out: some houses  on Vine Road with fencing around them.

I first remember seeing these decades ago. These looked just like all the military housing I’d grew up around. At first that seemed strange, then I learned about Nike Hill. Named after the missile silo not-so-secretly placed on the summit of the hill, I believed the housing was originally for those soldiers. They were built in in 1950, right around the time the silo first came online. Also, the street (technically 216th Pl SW) is Nike Manor Rd. So, viola!

Now, the buildings are owned by the Navy, so my guess is that they were housing sailors stationed with the Everett Homeport. Today, fenced off and vacant, I wondered if they’d been sold to private developers, but they still show as owned by the LLC that the Navy set up to manage properties in the region. So, perhaps they’re going to upgrade these. As they’re pretty much unchanged from the 1950s, that should be rather welcome.

Anyway, I look forward to seeing what’s to come there.

 

Sidebar: Here’s an interesting article about the site, and how it became the FEMA regional headquarters it is now.

BOTHELL’S NIKE HILL HOME TO REGIONAL FEMA HEADQUARTERS

Supply & Demand Duking It Out

Carl Setzer

Just read Tight Supplies Put Home Prices on the Move over at Realtor.com. Stuff we’re seeing, too. Our market is really tough right now: way more demand than homes. We’re seeing multiple offers on homes (one listing we have ended up with 11 offers), and we’re seeing “buyer fatigue”. When offer after offer falls through, it can get really tough. However, you don’t want to give up. This is where a good agent comes in: strategy. Working together with your lender, finding your range, and prepping you for the potential price battles out there. Navigating this market takes savvy. Savvy is what we got!

Some thoughts on Lynnwood

Carl Setzer

I noticed that the House of Rock restaurant going into the old Celtic Bayou space changed names. What does that means for a business that hasn’t opened its doors yet?  Perhaps there’s some uncertainty about their vision. To me, I worry that they’re more focused on their name and signage than on getting the doors open and serving customers. Thus that this might end up vaporware.

Another building is under construction at the Lynnwood Crossing site. Watching the way they’re developing lends me to believe they already have tenants for the space. I’ve not seen any signage, so don’t know for certain. Looking forward to seeing what lands there.

The changes I’ve witnessed in this area are  amazing. Development along 196th and over by the mall remind me of the changes in downtown Bellevue in the 80s. Lynnwood had a rather unique environment, though, so it will grow into a rather different business community.

Midweek Mortgage Thoughts

Carl Setzer

I was just reading Mortgage applications drop 6.6% on jumbo refi decline over at Housing Wire. There are some good insights into the national mortgage trends, which are a critical part of the housing market.

Refis are still the lion’s share of the mortgage market right now, holding 65% of mortgage activity. As the headline says, the jumbo loan market (>$417,000) is driving a decrease in mortgage applications. The larger the balance of the loan, the larger the dollar amount of any percentage rate fluctuation. Therefore, “borrowers with jumbo loans tend to be most sensitive to changes in rates. That sensitivity has been clearly apparent in the past few weeks with double and even triple digit percentage changes (emphasis mine) in refinance application volume for jumbo loans.” Jumbo loan holders are clearly feeling less motivated to refi right now.

The article expands out, slightly, looking at the rest of the market. Let’s follow along:

  • Adjustable-rate mortgage (ARM) share decreased to 8.2% of total applications.
    • I’d say that’s good on a macro level, as ARMs are a great vehicle to increase short-term affordability with lower rates about 1/2 that of a 30 year fixed. They are a pretty nice deal for the banks; they make money from interest. However, you want to be paying down principle, as that’s the main way to build equity.
  • Let’s Look At Interest Rates
    • FHA – 30-year fixed-rate mortgages  increased to 3.84% from 3.81%
    • 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.13% from 4.10%
    • 15-year fixed-rate mortgages remained unchanged at 3.28%
    • 5/1 ARMs remained unchanged at 2.94%
  • And a breakdown of mortgage types:
    • FHA  increased from 8.3% last week to 8.9% this week.
    • VA  increased from 9.6% last week to 10.7% this week.
    • USDA increased from 0.8% last week to 0.9% this week.

One key thing to keep in mind with all this: these are national numbers, and a look at the past. This stuff fluctuates daily, and regionally. But it does give some good insight into the overall picture.

Happy Wednesday, everyone!

HUD contracts from the REO Guy

Carl Setzer

Yesterday I was expounding on earnest money issues with HUD contracts. Later in the day, I had one more thought on the subject: sending the check. HUDs are weird, in that you send the check to the listing broker. BLB, the company that manages HUD sales in Washington, is in California. The closing company is here in Washington. Hence this logic.

Critically, though, you’re given two business days to get that to me. TWO! With that, I highly caution against dropping these checks in the regular mail. HIGHLY!!! First, the likelihood of it getting to me in time is dismally small. Secondly, and more scarily, you have no way of tracking down that check if it fails to arrive. None. Lost, stolen, shredded by angry postal  trolls (with their razor sharp pointy teeth), I’ve seen all of these. I’ve seen them show up two weeks late, had people from the building next door bring them by a month later; on and on I can go. The point? Send it via a service with a tracking number. Not just FedEx, but also UPS and the USPS (Priority & Express). None of us ever want to say to a client “sorry, just lost a grand if your money. Oppsie!”

Just a few pro tips to make your life easier.

HUD Properties, Process and Earnest Money Check Joys

Carl Setzer1 Comment

As many of you know, I’m something of an accidental real estate agent. I find myself managing the office of a team of agents, and my focus is on REO (aka: Bank Owned) and Government Owned property sales. One of my main functions is navigating the perilous maze of intrinsic weird contract “stuff” inherent in these transactions.

One my key sellers is HUD, and we’ve been seeing a few repeated issues with these contracts. HUD is pretty particular about earnest money checks. The biggest issue we’ve seen: the payee line. HUD wants to see “Escrow Company OR Buyer’s Name”, eg: “Chicago Title or John Doe”.

With the above, there’s another common issue: check type. They want either a cashier’s check or a US Postal money  order. Sorry, no personal checks; they’re looking for certified funds. Below is a slide created by BLB (the company charged with selling all HUD owned homes in Washington, as well as a few other states) to make it more clear.

HUD EMD Guidelines

With all this, we send tons of information as part of these transactions. As tempting as it may be to blast through these transactions minimizing the amount of reading you need to do, I counsel you against that. These hiccups do cause problems for transaction, thus delays and sometimes cancellations. A relatively small investment in time can, really, save you a lot of aggravation and grief.

Mortgage Qualifications Ebb & Flow

Carl Setzer

Since the beginnings of “the financial crisis”, lending rules tightened massively. I’ve been hearing that these criteria have been loosening, at least slightly. Then I have these message in my inbox:

 

Loans

 

Not Tax

 

Though getting lending more accessible is desperately important to rebuild the housing market, I don’t want to see a return to the “fog the mirror” qualification process.

 

My sincerest hope is that we can find some type of middle ground. However, society and pendulum swings are massive forces to be dealt with.

Mortgage Rates And Other Fun

Carl Setzer

One of the drier topics in Real Estate, or so it seems. Yet for most home buyers, this is one of the most critical factors in the whole home purchase equation. The rates below were provided by my colleagues at Jolene Messmer’s Cobalt Mortgage Team.

So, the main message: mortgage rates are either stable or slightly down, depending on which loan type you look at. I keep hearing that rate will rise, that the current rates are unsustainablely low, so the main bet seems to be on WHEN rates will rise back up. So, “when”, not “if” they rise.

So, low rates keep home buying affordable, but low inventory pushes prices up. It’s challenging, to be sure. Still, though, this is one of the best times to buy. Much like the African proverb, “the best time to plant a tree was 10 years ago, the second best is now”, it’s easy to find missed opportunities, harder to see them now. For those who manage to buy in the near term, though, the appreciation should be exceptional.

Rates 5-30-14

Average Rate 5-30-14

A Lynnwood Eyesore Is Gone

Carl Setzer

Between 76th and 68th on 196th, South side of the street was this old, dilapidated building, which was just decaying due to neglect. This building one housed the Enterprise, years ago. Before that weekly was absorbed into the Herald. Later in its useful life, it became an AA meeting hall. Finally, though, it became uninhabitable. Boarded up for years, it housed graffiti, pretty vandals, and drugs. Fencing it off simply slowed things them by a few minutes. As time wore on, ownership ignoring the space had me convinced this would either simply collapse from decay, or catch fire.

Yesterday, though, driving past, the building was crashed. Clearly deliberate work. I’m glad to see the space finally being cared for. The space really brought down the area, which is otherwise pretty nice.

I’ve wondered if there was soon be legal issue being wrangled for the space. Those sorts of things can drag on for years, and often are why one sees terrible properties sit for ages. Who will be benefit from it, who will pay? Things that must be figured out before work can even start. And, there always the chance the City ordered the work done and will the seek a judgment against the owners.

Anyway, I’m quite pleased the eyesore is gone. And I look forward to finding out what will go in.

Critical Communication

Carl Setzer

A sad moment this morning when one of our cooperating agents notified us about problems. Basic ones, really: some of the required signatories on the contract were hard to reach. The challenge, though, was this  offer was for a HUD owned home, with pretty rigid deadlines. However, they’re not ironclad. But waiting until a day or two past the due date to notify that there are problems isn’t effective. Sadly for the buyers on this one, HUD cancelled the contract. They can rebid, and have a decent chance of getting it with the same bid, but the bidding process will be opened to everyone again. Thus, they do have a real chance of losing out to someone else.

It’s important to note that, given lead-time, a time extension could have been granted. So, the lesson to take-away: communicate early, especially if there are problems. Please…