Seattle Condos | Seattle Condos for Sale | Reviews by Marco & Wendy

Coffee Table Chat Video Series - What is the Cost of Waiting to Buy?

Coffee Table Chat - Episode 4
Our video series addressing actual client questions and concerns in our current market. They will cover whatever issues our clients are experiencing and will typically feature a guest who also works in the industry such as a lender, an Escrow closer, a Title rep, etc.

Hopefully you find the videos informative and helpful!

Enjoy Episode 4! "What is the cost of waiting to buy?"

Want to check out the Cost of Waiting Analysis tool? Click here! Have questions, reach out to myself or Jay Crowell and we can help you out.

By Marco Kronen with Seattle Condo Review: A guide to Seattle downtown condos.

Lawsuits, Land Prices & WA State Condo Laws all to Blame for Rising Condo Costs in Seattle?

I’ve been saying for years, that one way our city and state can help address affordable housing within our skyrocketing condo market,  is to address the issue that developers are afraid to build condos! Why are they afraid? Because they know they are going to get sued by the HOA’s, and to prepare for that, they have to pad the development budget by driving up the cost of the condo units to make up for the expense. Why are they getting sued? Not because they are building bad buildings, but rather due to the ancient Washington Condominium Act, which was supposed to help protect consumers several decades ago from scrupulous builders and developers that were cutting corners, but now over 25 years since the law was enacted, even for the best development teams with quality control measures, it is now creating a breeding ground for lawsuits, no matter how well and condo building is built.   

What’s the big whoop? Well guess what, these lawsuits drive up the cost of everything related to condo ownership. It makes things more expensive for the developer, for each subcontractor who also gets roped into each lawsuit, for each HOA that has to fund the huge cost of hiring a consulting firm to find construction defects, and on down to the individual condo owner who just wants buy a nice condo so they can live in a cool, fun and vibrant condo building in the city so they can reduce their carbon foot print, ride a bike to work, not commute an hour to work, and walk to the gay pride parade this weekend with their friends and neighbors but have to pay more for this convenience. They are okay to pay a bit more for all these perks of living in the city, but at what cost? 

I loved reading this article by Bob Wallace of Wallace Properties as he is doing a great job of bringing to the forefront some major issues regarding developers, lawsuits, land prices, and “extortion” as he calls it that affecting our condo market.

Great read!

By Marco Kronen with Seattle Condo Review: A guide to Seattle downtown condos.

Zillow's Breakeven Horizon for Rent vs. Buy

When clients are considering buying, they often ask us if it is cheaper to buy or rent. Well, Zillow has just released their Breakeven Horizon for 2015 Q4 which calculates the point, in years, at which buying a home or condo becomes less expensive than renting the same home. It takes into account the typical costs of owning and renting including the opportunity costs of buying a home and the growing value of assets other than real estate that you could be accumulating if you rented instead. Then it factors in historic and anticipated real estate value appreciation rates, rental prices and rental appreciation rates.

What's the Breakeven Horizon for Seattle you ask? It will take 1.9 years before buying a home becomes more financially advantageous than renting the same home or condo. A persistent combination of healthy home/condo value growth and low mortgage interest rates, combined with robust growth in rents, is helping to keep the buy vs. rent equation tilted heavily towards buying in most areas, including Seattle, for those planning on staying in their properties for longer than just a few years.

By Marco Kronen with Seattle Condo Review: A guide to Seattle downtown condos.

Seattle Area Housing Marking Cooling Off or is It Just Taking a Breather?

I work in both the condo and single family markets here in Seattle and the answer to the question, “is the housing market cooling off or just taking a breather?”, is the talk of the town right now. But the answer is different depending on whether we are talking houses or condos so I wanted to weigh in on all the chatter about it.

According to a recent article in the Seattle Times, “The average price of single-family homes in King, Snohomish, and Pierce counties slipped 0.1% in July from June. July was the fourth consecutive month of slowing 12 –month price gains.  Still, over the year, the Seattle metro index posted a 7.3% gain.”

This might make one wonder if the market is cooling down and initially I personally was drawn to the fact that the velocity of the market appreciation has slowed down toward the end of the summer and likely will show the same numbers as we move through fall.  But when I think about the further information where we (Seattle Metro) are still above the average of the 20-City Case Schiller report, I am comforted and also not surprised, because it’s been largely discussed that our growth in value seems to be driven by job growth and economic recovery along with the shortage of housing inventory.

I further think the reason for the slowing in the value increases that are quoted from June and July, are also likely due to buyers themselves losing steam in Seattle’s hyper multiple offer environment and many buyers have decided to “take a breather” and let things cool off.  So I don’t think the market slowing is a wide spread economic warning or local market indicator of a general slowdown.  With job growth still occurring in Seattle, and overall economic recovery still in progress, including the fed obviously feeling confident enough to indicate that they may raise rates by year end, my feeling is that our buyers and sellers are still trying to find the new normal and adjust their expectations of the house or condo they can afford.

Lastly, this article does not chat about condos specifically.  That market tends to perform differently than the single-family housing market and historically has lagged behind the single-family market by about a year or so. Therefore my predication, based on this Case Schiller info discussed in this article, is that condos still have some steam left in them and some upward pricing pressure as buyers still try to live closer to the main employment centers that are hiring and seek lower maintenance in-city active lifestyles.

So while things may slow a bit from time to time this year, I feel that, overall, Seattle houses and condos are going to likely increase in value over time.  Even if a rise in rates happens this year. Buyers waiting for “things to cool off” may still find themselves paying more for the same house down the road even if the overall environment is less competitive at that particular moment.

By Marco Kronen with Seattle Condo Review: A guide to Seattle downtown condos.

Client Question of the Week: What is the HOA Payoff Demand & Who Pays for it?

Client Question of the Week: “Escrow just called me and asked for a credit card to pay for an HOA Payoff Demand. What is this and who pays for this? Is it the same as the Resale Certificate I already paid for?” - Condo Seller

Dear 'What is the HOA Demand':

As a seller of a condominium there are several additional fees that you will incur that relate to ordering documents that are required in order for the sale to close. When you list your condominium you will order and pay for what is called a Resale Certificate and provide that to the potential buyer. It contains important consumer information about the association. Included in this package are copies of the association documents such as the declaration, covenants, bylaws, budget, association meeting minutes and so forth.

Once you get into a contract with a buyer, the Escrow Company will contact you to ask you to order and pay for what is typically called the HOA Payoff Demand. This report gives Escrow  payoff information in order to ensure all funds due to the HOA are collected for the property at closing. It will include funds that are owed for both the seller and buyer.  The fees can include HOA dues, late fees, fines that might be owed, transfer fees associated with the transfer of ownership within the building, move-in fees, etc..

Some HOA’s also use a third party service to provide such information to the lenders, title and escrow companies.  The fees are established by your HOA and the company they use, such as Condocerts.com or Homewisedocs.com.  Sometimes there will be a rush fee if you have a short closing time frame to ensure the document arrives in time to meet the contractual closing date agreed to.

There is one last HOA document that is often required when you sell a condo and a mortgage lender is involved, that is the Lender Questionnaire, which has lender specific questions for the HOA (also called a Condo Questionnaire). If this document is required by the lender then it should be paid for by the buyer or the buyer's lender on their behalf. The key is that all of these documents need to be paid for when they are ordered. So plan ahead for that and be prepared to be asked to order and pay for the documents required. And try to order them as soon as possible as not doing so will eat up valuable time, and both the buyer and seller are obligated to close on time. 

In short, the Seller side orders and pays for the Resale Certificate and the HOA Payoff Demand. The Buyer's lender orders the Lender Questionnaire (or any other lender specific requests of the HOA) and the Buyer pays for that.

Hope this information helps sort out the fees that are usually charged for document preparation in association with selling a condo!

- Marco

By Marco Kronen with Seattle Condo Review: A guide to Seattle downtown condos.

Condo Review - Hjarta

Hjarta Condominiums in Ballard
1530 NW Market St



Pronounced (h-YARta) this condo building was named by the developer after the Scandinavian (old Norse) word for heart.  Maybe because it’s in the heart of Ballard!  Built in 2008, Hjarta was one of the Seattle’s first LEED Silver certified condo projects and offers energy efficient building systems.  Located on Market Street, it is very close to the activities and vibrancy of the hip and growing part of Seattle.

The stats:

• 79 units –one and two bedrooms (and 1 three bedroom) ranging in size from 685 to 1,909 square feet
• Built in 2008
• 8 stories
• All units have at least 1 parking space and most all units have a storage unit
• 3 units have sold in the last 6 months ranging in price from $367,500 to $500,000; at the time of this post there are 2 units pending priced from $329,000 to $365,000 and there are no active units on the market
• HOA dues include: garbage, water, sewer, central hot water, building maintenance, professional property manager, earthquake insurance
• Amenities: Party room with terrace, gym, yoga room and a roof top deck

In the News - Quoted in Seattle Times' 'Behind the Veil' Article

I'm in the news this week: see my thoughts on the repair project at 2200 Westlake condominiums in the link below.

Seattle Times article- Behind the Veil, Condos Repaired

 

A Tale of Two Lenders

The quality difference between individual lenders, like any profession, has always been wide spread as has the spread between different banks/lending institutions. As the market becomes more and more heated and closing dates become shorter, who you choose to work with as your lender has a greater impact on your success as a buyer than it used to.

We understand that often times the bottom line when selecting a lender is cost. And though this makes a lot of sense, it is important to understand all aspects of the purchase transaction so you can make a better more well informed decision that considers costs and other important factors.

A true story of two lenders:

Both stories are similar where a heated market with multiple offers caused the need for a quick close.

In blue is the story of our sellers selling a condo in Belltown that received multiple offers and sold within the first week above asking price. These buyers even put 25% down.

In orange is the story of our buyers who purchased a home with 10 offers, also selling way above list price.  These buyers put 20% down.

Our Seller’s reach mutual acceptance on 6/18
Our Buyer’s reach mutual acceptance on 6/25

The Lender on our seller’s deal is out of state in California
Our Buyer’s chose to work with our local Seattle recommended lender team (which was part of the reason they were selected as the winning offer out of 10, according to the listing agent)

Our Seller’s deal was set to close on 7/8/15 (3 week closing)
Our Buyer’s deal was set to close on 7/15/15 (3 week closing)

Seattle Condo Stats First Quarter 2015

Heading full steam into spring, it’s time for a quick look at the stats and performance of our Seattle condo market for the first quarter.  Will it give us some clues as to what to expect for the summery and fall?  Maybe.  

We first take a look at the whole city of Seattle to get a general overview of our area’s condo market and then we drill down by neighborhood using the MLS areas focusing on the areas that have the largest concentration of condos here in our city.  Those areas we closely track are:

• Capitol Hill/Central/Madison Valley (area 390)
• Queen Anne/Magnolia (area 700)
• Downtown/Belltown/SLU (area 701)
• Ballard/Fremont/Wallingford/Phinney (area 705)

We then use this data and information to make forecasts and to help our buyers and sellers make decisions on their real estate needs.

First Quarter Recap- Seattle City In General

As in previous reports, in Seattle overall, we saw a decrease in the number of listings on the market compared to the same periods last year.  28.5% less in January, 26.4% less in February and 23.9% less in March.  This is substantial and is an obvious clue, to me, that our city as a whole is not bringing on more inventory to help ease the upward pressure on pricing, nor calm the incidences of buyers competing for very limited number of condo options. Curiously, the month-over-month median prices did take a small dip in January and February (-1.1% and -3.8%), but then shot up by 11.2% in March. My guess is that in January and February there were some sales of inventory that languished on the market over the holidays and finally sold at lower prices in the new year, starting the year off slow, but March neutralized that slow down just based of this median price increase in March.

Seattle New Construction Condo Comparison

Many questions from our readers and clients come up about what the different available options are in the new construction and presale condos in our city. We wanted to offer some guidance to help people compare the options in terms of the price points, amenities as well and some pros and cons of each project as well. Other projects are in the works, but these are the buildings that have officially announced sales and gone public with the details about their projects.

Why consider a presale condo?

Presale condominium purchases are not for everyone, but if you are someone who has flexibility on timing, and are looking for the opportunity to select your floor plan, finishes, color palate, location within a building, and even choose your view orientation, than a presale purchase can be an ideal solution. Also in a market where current availability of units for sale is a challenge being patient and considering a new construction presale can be a great solution. But you also have to be okay with buying a home without seeing the actual physical condo you are buying and making a decision based off of a floor plan, drawings and architectural renderings.  There is a lot of blind faith involved when buying a presale condo.  My recommendations are to also take a look at the past completed projects by the developer of the building you are considering to see what those projects look and feel like.  Also, talk to people who have purchased from the developer in the past and do some research.

Some information will change as the condo projects progress but as a guide here is a great overview: