North Sound Property News

I am starting a new feature here on the blog to showcase the best examples on the MLS of my favorite architectural styles, Mid-Century Modern and Northwest Contemporary.   For those unfamiliar with those styles, I refer you to my previous article here.

Here are my my picks for the week:

1928 10th Avenue E
Capitol Hill
$1,199,000
MLS#  28024730

Perhaps more modern than mid-century, I love the use of glass and exotic materials.  The exterior is mahogany, steel & concrete with a secluded stone terrace and low-maint gardens. Indoors you’ll find a great room concept w/Brazilian cherry floors, concrete fireplace w/hearth-seating, Viking, Sub-Zero, limestone & maple finishes.  And you can’t beat the fabulous, close-in location.  http://www.windermere.com/28024730

2432 127th Ave SE
Bellevue/Woodridge
$559,950
MLS# 28042856

This great mid-century modern home in the Woodridge area of south Bellevue sits on an incredible 16,000 square foot street-to-street lot. This home has so many great midcentury features such as exposed wood framing, low-pitch roof, huge windows to bring the light indoors.  Best of all, it is priced to exemplify the modern aesthetic of putting great design within reach. Great neighborhood with community pool and park. http://www.windermere.com/28042856

4875 Alpine Drive
Everett/Forest Park
$399,000 
MLS# 28023533

This enormous 3,000 asf home has been recently remodeled/updated but still retains many of its best mid-century features, including the enormous windows, exposed wood beams, a flowing and open floor plan.  http://www.windermere.com/28023533

These homes represent a fraction of the great mid-century homes on the market right now.  Contact me if you would like to see these or any of the other great midcentury homes currently available.

Local online real estate brokerage Redfin just released their second annual customer satisfaction report called “The Redfin Advantage.”  One of the areas they are touting heavily is the negotiating advantage that Redfin’s customers are supposed to receive. 

Here’s Redfin’s graphical representation of their advantage:

I thought it would be a fun idea to compare their numbers to my own, just to see how I’d do. 

Let’s look at the facts.  According to Redfin:

In King County, Washington, Redfin buyers paid on average 98.885% of the listing price, while people who purchased a home through other brokerages paid 99.383% of the listing price. The difference of 0.498% represents an average savings of $2,490.

Redfin did not include numbers for Snohomish County, so I am comparing my results across both Snohomish and King because my market area straddles both counties.  Here is what my results showed:

My buyers paid an average of 96.79% of the average listing price, compared to the above referenced 99.383% through other agents/brokers and 98.885% with Redfin. 

The difference represents an average savings of $10,468 compared to other brokers/agents, and nearly $8,000 more than the Redfin “advantage.”  It also saves an average of about $13,000 off of list price, if we’re going to represent it as shown above.  This is about $2,000 less than the “Redfin Advantage.” 

Uh oh, looks like I’m not doing that well.  Except there are a few catches to the Redfin model.

 For starters, Redfin charges for home tours.  The first two are free, the third and fourth tours are $250 each, which is subtracted from the commission rebate, and after that each tour is $250 in advance.  I’ve yet to meet the client that didn’t need to tour at least 5 homes before choosing one they like.   Usually it’s between 5 and 10, depending on the client.  For the sake of argument, you could end up giving Redfin back the entire difference, or more, between their “advantage” and mine.

 In fairness, Redfin also suggests that you access homes by going to open houses or getting the listing agent to show you the house.  Where do I start with why this is a bad idea?  One of the most important services a buyer agent provides is feedback about the homes you are touring and the areas where you are looking.  Sometimes, this feedback comes in the form of a criticism or warning about potential problems.  You will not get this kind of feedback at an open house, or from the listing agent.  You may get it from your Redfin agent, but you’ll pay for the priveledge.

In fairness, not all traditional agents provide this kind of feedback either.  That just means you need to find an agent who will.  A good agent is going to be very upfront with you about all the pros and cons of what you are doing, because they want your repeat and referral business.  Ultimately we want you to be pleased with your purchase and to feel that there were no unpleasant surprises.

Another disadvantage is that Redfin agents are not area specialists.  They may not know much about the schools or how pending developments are affecting the market.  They may not know much about how different floor plans do on resale in your given market.  They may not know about changes going on with companies in the area that could affect home values.  And they probably don’t know much about the soils in a given neighborhood.  Nor are they going to know about how active or inactive a particular homeowners association might be.  These are just a few of the kinds of local knowledge can save or cost you quite a bit of money over the long haul of owning your home and that you might wish you’d known later on down the road.

I have to admit that I love companies that dare to do things differently, and I think the online brokerage concept has a lot of merit.   And, from what I’ve seen of him online, Glenn Kelman seems like a great guy.  Over the long haul, I believe that online brokerage is the direction all brokerages and agents will be heading.  So this is not a Redfin bash.  I do think that Redfin seems to compare pretty favorably to the “average” (or downright bad) agent, which is a good thing for them and their clients.  But I also think that a great, full-service agent can still beat the online model, hands-down. 

I guess it all comes down to the agent you choose.

 *Props to Ben at Seattle Housing Buzz for the idea.

Spring is here, and for the last several weeks, my husband and I have been working on re-landscaping our backyard.  In fact, we have been working on this since we moved into our house.  One of the very first things we did after closing was have a landscaper come over and tear out all of the trees in the backyard.  It’s not that we have anything against trees, it’s simply that trees grow, and ours were planted with no regard to how large they would eventually get.   This is pretty common in newer construction.

After tearing out everything in our yard, we decided to go with a Japanese style garden. This will achieve our goal of having our backyard be an enjoyable outdoor living space, and mitigates our yard’s main shortcomings, which are that the lot is small and that the drainage is terrible.  A typical yard with a lawn does not work well due to the drainage problem, but with a Japanese garden we can plant trees and shrubs that can tolerate “wet feet” better than grass.  It’s also low-maintenance and looks good year round. 

Drainage is a problem because the area where we live (Harbour Pointe in Mukilteo) was built on what once was a wetland area.  In the last 30 years, Harbour Pointe has been developed with a golf course and a lot of very nice homes, but as the Realtor code of ethics says, “beneath all is the land,” and in this case, the land is wet.  Very wet.

One of the reasons it is so wet is that the soil is composed primarily of clay.  It’s also pretty flat, which means, the water can’t run off and go someplace else. 

But we can take comfort knowing that we are not alone.  Drainage issues are very common among homes in the Seattle area due to the high clay content of our soils and the fact that our climate is so wet.  I wrote more on this topic at the Seattle PI Real Estate blog today, looking at this topic through a more regional lens. 

Anyway, as we’ve worked on turning our muddy bog into something we could feel good about, we’ve discovered that our drainage issues are not just a gardening problem–we also have some problems developing on the south side of our foundation.

 The crawlspace vents on the south side of our home are below grade, and it appears that they were not dug deep enough. Water is getting into the vent boxes, and draining out too slowly.  It doesn’t look as if the water is getting into our crawlspace, but I just don’t like the look of it.  So, some time this summer we will have to redig them, and make them larger and deeper, to keep water from intruding into our crawlspace.  While we are at it, we will also install a French Drain to keep future problems from occuring. 

The upshot, from a real estate perspective, is to know what you are getting before you buy your home. 

And if you are buying a home in the Seattle area, make sure you know if water issues are common in the area where you are buying.  This might not be a reason to rule a home out, but it’s important to know before you buy if this is an issue you could end up facing later.  Fortunately, this is the kind of thing a good home inspector can tell you (as ours did), and is also a good reason to work with a buyer’s agent who knows the area where you are looking to buy a home.

  I knew before I bought my home that the soil had a high clay content, and I was aware that many homeowners in the area have had similar issues.  However, I think most buyers aren’t aware of the type of soil they are getting when they buy a home, and this can lead to expensive surprises later.  

Further to yesterday’s post about Mukilteo’s economic “micro-climate,” here’s a great article that shows Washington State as a whole is doing much better, economically than the rest of the country, according to USA Today.

 The key for our state appears to be exports (think Microsoft and Boeing), as a weak dollar can actually benefit states like ours that export high-dollar items like aircraft and software systems, by making our products more affordable abroad.

Thanks to Rhonda Porter, for the tip.

The Mukilteo Beacon sure seems to think so.  Citing the lack of economic downturn in Mukilteo, Pat Ratliff of the Beacon writes,

“Even during the winter “slow months,” many local businesses are reporting either the same or better business than last year. Some businesses have reported a slowdown, but not the large numbers reported on national coverage.

The Mukilteo economy seems to be shielded from the effects of recession more than most cities in the nation.  Boeing and ancillary businesses, as well as other major employers, act as a buffer, helping our economy remain stable.”

That’s certainly true–with workers at Boeing still working mandatory overtime in many cases, our region’s biggest economic engine is continuing to drive growth for local businesses.

 However, the sunny tone of the article also points to Mukilteo’s real estate market as a bright spot, as compared to other parts of the country.  According to the article,

“Real estate draws many of the headlines in the national news’ recession stories, but the Mukilteo real estate market is doing considerably better than most.

While not at the stratospheric pace of recent years, home prices continue to rise here.

“Prices are rising about 4 percent now,” said a local real estate agent.  “Some people are sitting waiting for the bottom to drop, but that isn’t going to happen here.

“If they wait, they’re going to lose the house they want.”

Again, diversity in the economy seems to help insulate the local housing market. “

It’s true that the real estate market in Mukilteo and the Puget Sound region generally, is doing far better than the rest of the country.  However, it’s important not to paint too bright of a picture, because the Mukilteo real estate market does show signs of some problems.   

For instance, while it’s true that average sale price right now is slightly above where it was last year at this time,  it is down pretty significantly from the highs reached last summer, as the Trendgraphix chart below illustrates (click on the thumbnail to see a full-screen version of the chart). 

 And while prices are not falling precipitously, it’s important to keep in mind that inventory is quite high, and time on market is rising.  These trends would tend to indicate that prices are not likely to rise a whole lot this spring and summer. 

 One trend that I think is important to look at when trying to figure out what the market is doing (and what it may do in the future), is the difference between original list price and eventual sale price.  Last year at this time (and for most of the two years prior), original list price was typically between 94-96 percent of sale price.  That number has dropped over the last few months to 88-89% of sale price.  What this means is that the average seller in Mukilteo is having to drop their original asking price 10-15% to find a buyer in today’s market.

Another notable trend is that while average sale and median sale prices have not dropped, the Dollars Per Square Foot numbers have dropped since last year at this time–in fact, they are back to July of 2006 levels.  That means that while Mukilteo buyers may be spending the same amount or more overall on housing, they are now getting more home for the same money.

More home for the same money is,  of course, great news if you are in the market to buy!  Sellers who are finding that they aren’t able to get as much for their home as they might have hoped, should also consider that when they re-enter the market as buyers, they may be able to get quite a bit more for their money than they would have been able to do in a market that was more in favor of sellers.

So, while I agree that the overall economy in Mukilteo is doing well, I think it is important to avoid painting too rosy a picture of our current real estate market.  The truth is that real estate is local–but even locally, we are feeling the effects of a national and global credit crisis.  We are fortunate that the effects are lessened by the overall health of our local economy.