2006 has ended up being one of the most interesting years that real estate has seen in decades. The local, regional, national and world events greatly affected the real estate market. There wasn’t a month that went by that was uneventful in 2006. These events both helped and hurt the real estate market.
To put things into perspective, we must first acknowledge that 2004 and 2005 were record-making years for real estate in terms of volume, price appreciation, and investment activity. The beginning of 2006 brought about speculation of interest rates that would soar, yet the months that followed would prove otherwise. Interest rates have leveled out and remain some of the best rates in interest rate history. Just when the talk of rising interest rates seemed to be subsiding, the media was flooding the airwaves with talk of the war in Iraq heating up. This, in turn, caused consumer concern which always causes the real estate market to slow down.
When the media got tired of reporting that, the next crisis was the price of gasoline. With consumers now wondering how that would affect their lives, they held their wallets tightly, controlled their spending, and again the real estate market saw a slowdown caused from that. In late spring, the media across the nation was reporting that the real estate market had crashed and while this may have appeared to have been true, it absolutely held no merit regionally. The media continued its real estate market bashing until well into October.
Just when the media began to move away from real estate reports, the Pacific Northwest was hit by weather patterns not seen for decades. This further caused people to question whether they should buy or sell. With the rains and flooding, snowstorm and windstorms, it was no wonder the market saw a quieter fall. In spite of all of these things, 2006 has shaped up to have the third highest activity in the last 20 years -- third only to 2004 and 2005!
2006 real estate was riddled by local event, regional events, and national events that gave people cause to pause. But consumer confidence is back and with that brings an increase in real estate activity. Consumers are bored of all the negative reporting and are starting to get back to normal.
Don’t believe everything that you hear from newspapers, radio and television regarding real estate because the 2006 real estate market did not crash, it did not fall, it did not stumble, but it did take a breather – and a much-needed breather at that.

Buying and Selling Real Estate in The Winter


As we approach the month of December many buyers and sellers are asking themselves if now is the time to buy or sell that property they have been sitting on the fence contemplating. With all of the media coverage lately it is no wonder some buyers have been fence sitting. As we approach December, however, the smart buyers are starting to take a closer look at the real estate market and the possibility of making December the time to buy. December has always been a great month to buy and sell real estate but many uninformed buyers and sellers let this very special month pass them by.
During the month of December many sellers take their homes off the market and many buyers wait until January. This change in the number of homes on the market and the number of buyers in the market actually can give both buyers and sellers an advantage. The key of course is to be prepared and ready to buy when you do find the home you want to make an offer on.
Some of the best real estate purchases are made in December for a number of reasons. Imagine you are a seller and have had your home on the market for a number of months. Wouldn’t you be more motivated to sell during December and know by year’s end exactly what your future plans are? Many motivated sellers report that they have accepted less during the month of December than any other month. It is human nature to want to wrap things up before year end. This makes for a great buying opportunity for a potential buyer. December 2006 has an added advantage and that is that the interest rates havea potential buyer. December 2006 has an added advantage and that is that the interest rates have
just declined…again. The benefit once again is for the buyer.
Imagine now that you are a seller and you really want to sell. December is also a great time to list your home because so many sellers do not want to be listed during December and actually ask their real estate agent to take their home off of the market. This gives any seller that is listed an automatic advantage because it reduces the competition. Imagine there were 100 homes listed and then 40 of them decided to take their home off of the market for the holidays, wouldn’t this help you if you were selling…you bet it would.
December is the only month of the year that automatically offers both buyers and sellers an added advantage. Don’t let December pass you by if you are wanting to buy or sell. Please feel free to call me anytime and I can show you how you too can benefit from jumping into the December real estate market.

Media Hype and the Housing Market

The news media is back and playing it’s old game of pummeling the air waves with predictions of gloom and doom for the real estate industry. “ The Big Crash is Coming” “Disaster Ahead” “The Bubble is About to Burst” “ Jon Benet’s Killer Found” News at 6:00! This phenomenon of modern news is on display every time a storm brews in the ocean. Then the storm turns into a little rain, and it’s all over. News people love to report about imminent air disasters, L.A. car chases, and Wall Streets ups and downs. The problem is that the facts don’t support the claims. or, they do, but no one cares…” Generalissimo Francisco Franco is still dead”. That was a headline on Saturday Night Live ,25 years. Who’d have thought similar headlines would be on the mainstream news in 2006.
When a market crashes, there must be a catalyst for that crash. There isn’t one now. There are only fluctuations. Today's fluctuations are swinging downward more than last year, but it’s by no means a "crash.” There has been no event– like the stock market crash of 1929 or other disaster large enough to cause a crash. We are in one of the best time in real estate history.
Here’s why:
1.A strong economy: This is a key factor in any analysis of the real estate market. The current viability of the United States ensures that no matter how wild the real estate market fluctuations may be, there are still people with money. And people with money will always want more property.
2.Job Growth: Similarly, so long as new jobs are being created, there will always be a demand for housing. Companies open up new facilities and their employees will need new places to live.
3. A moving population: Americans move more than ever before. The average time people spend in a home has dropped dramatically over the past 30 years. They buy, sell, move again, buy summer homes, buy winter homes, buy investment properties, and buy homes for their parents.
The real estate markets have slightly declined, but they’ve declined in a market that was in the biggest boom in history. That fact must be taken into consideration for any accurate analysis. Remember, the past ten years have been spectacular...in fact, abnormally high. Numbers may have dropped a bit, but they’ve dropped to a level that is still above average. Like when people bemoan program cuts , often they are actually cuts in projected increases.
Let’s put things into a numbers’ perspective. If our market in 2005 had increased by 25%, then “ cooled” 4% in 2006, then we’re still up 21%! This is not a “crash”, it isn’t even a slow down. Even if rates were to climb to 18%, there would still be a lot of real estate activity.
Remember 20 years ago when interest rates went to double digits? People were still buying and selling real estate. The market takes care of itself in up -and- down turns. When rates rise, prices drop. there is a balancing effect. (not to mention there are always people who come out of the woodwork to take advantage of these downturns, people who refused to buy in an “up” market.
There will always be changing markets bringing different clients. So don’t fear the crash...there isn’t one.

Condos and Townhouses

The American dream of home ownership used to equate to a single-family home with a white picket fence. Now condominiums and town houses with common areas are part of the latest rage in home ownership. Years ago if you owned a condo it was because you couldn’t afford a house but today owning a condo is more popular than ever before. Condos and townhouses are popular with purchasers of second and vacation homes. Over 60% of all second home purchases are condos or townhouses. Clearly condos and townhouses dominate the second home market.
Single-Family Homes
Single-family homes are free-standing residential dwellings that typically are found in less dense urban areas, the suburbs and rural communities. Most single-family homes boast larger lots, private yards, garages and separate driveways. And as the name indicates, these types of homes generally house a single family. Single-family homes offer homeowners a number of important advantages. The entire space is private to the occupants, owners can usually add onto their home if they need more room, there normally aren’t any property management fees and single-family detached homes often have the highest resale value. On the other hand, owners of single-family houses have to bear the burden of all maintenance and repair costs. They also have the hassle of maintaining the exterior of the home, landscaping and lawn. Single- family homes typically don’t offer extra amenities such as an on-site pool, playground, or fitness center. In many cases single-family homes cost more to own and maintain than condos and townhouses.
Condos and Townhouses
Condos and townhouses are the opposite of single-family homes in that they are part of a multi-unit structure owned by different individuals who share and co-own common areas. A homeowner’s or property owners' association usually manages the complex and collects fees from all condo owners to maintain common areas. The owners pay property taxes on their individual units. Owning a condo or townhouse also has benefits. The owners can typically rent out their units to other people. They often have access to a clubhouse, swimming pool, playground and other amenities—all of which are maintained by the association. And, they enjoy many of the same tax benefits as conventional property owners. However, they must pay monthly fees to cover the maintenance of the common areas. They are bound by the homeowner’s association’s rules for management of the property. Condo and townhouse owners also have less overall personal space, privacy and flexibility.
Choosing between single-family and multi-family housing is a matter of preference. Each of these forms of housing is helping homeowners fulfill their version of the home ownership dream. Whatever type of real estate you buy it is clear that multiple property ownership is becoming the norm -- not the exception.
Co-ops:
A third form of home purchase. With home prices still rising, this type of purchase can be attractive to folks who know they wish to become home owners. While the purchase price can be significantly lower than either condos or single family homes, they can also present challenges not found with the more conventional types of home ownership. They are primarily found in the greater Seattle area.. I’d be glad to tell you about these issues, if you’d like more information.

Three Things that can effect the Real Estate Market


There are three things that can have a significant impact on our local real estate market. They are:
interest rates, jobs and consumer concern. Of these three, the one that can cause the most havoc on the real estate market is consumer concern.

Most people would argue that interest rates can have a greater impact than consumer concern, however, history has proven this incorrect. Of all the major catastrophic events that have happened in our country nothing has affected our real estate market more than wars. Whether it is a war against terrorists or a war in the Middle East, war gets everyone’s attention.

What most people do at some point in their day is get an update on local, regional, national and international news. The greater the event, the more of the consumer’s attention it will get. The media today has a better ability than ever before to report up-to-the-minute world news. We now have the luxury and burden of being constantly informed. As consumers hear about and watch the news concerning the war in the Middle East, they can’t help but reflect on their own lives and how this might ultimately affect them. The closer to home the story is the more impact that it will have.

The war in the Middle East has people thinking about larger, more important issues than buying or selling real estate. They are thinking about things such as “How will this war affect the price of oil and gas?” or “Will this war escalate? And if it does, how will my family be affected? Consumer concern brought on by timely reporting of the news is causing a slight pause in the real estate market. Buyers especially are wondering if it is a great time to buy or if they should wait.

Only time will tell what will happen in the Middle East, but there is one thing for sure – once buyers and sellers get used to the daily dose of reporting by the media they usually settle down quite quickly. The war in the Middle East has been fast and furious and even though it’s easy to focus on our local real estate market, it’s important too to have a look outside of our own backyard to get a feeling for the temperature in the real estate market. This is a great time to buy and sell real estate. Our real estate market is healthy and strong and even though media reports about the war cause a slight pause that is all it is – a slight pause!