Tag Archives: view

When is it appropriate to use environmentalism to stop developments?

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Editor’s note: Today, I’d like to welcome Jon Ribary as the newest contributor to RCG. With one of our other contributors, Eileen, he owns LTD Properties in Seattle. When I first started blogging, Jon was an early follower of RCG and began developing an online mapping tool around the first time I started gHomes. Jon’s take on real estate is from a slightly different perspective in that, first and foremost, he is a developer of land as oppose to an agent. In a constant effort to explore new areas of real estate, I look forward to seeing where Jon takes us!

A recent article from the Snohomish County’s Herald Newspaper got me thinking about the fine line between “preserving the environment” and NIMBYism (Not in my back yard!). I find that rather than really caring about preserving the environment, people use environmentalism as a hammer to slow down or stop projects that will “ruin” their view or preserve some favorite local property from being developed.

In the case of the Lake Stickney, the county says that the proposed development meets all applicable environmental laws, and yet one local, Chris Lloyd says “This is all about salmon habitat.” I’m not convinced.

To bring it to a personal level, if the house I live in has a sweeping view of the sound. Between me and my view was a 1940s rambler that just sold. The buyer, a builder who is planning to demo the house to build a 3 story home that would block my view. Do I have a right to stop that development, just to save my view, or is it an individual’s (or company’s) right to do what they wish on the property as long as they are abiding by development standards? If I wanted to keep the property from being developed, is my only right to buy the property to ensure it is not changed (or negotiate a view easement)?

If environmentalist’s #1 goal is to make sure projects are being developed properly, then I am on board. With land use and building codes where they are today, my past experiences tells me the proper precautions are being taken. If the opposition are anti-development and are using this tactic as a way to slow down or trump the development of the land, then I think environmentalism is simply being used as a ‘Trojan Horse’ to stop developments…

Valuing Real Property in the Seattle Area

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[photopress:lega_emc2_l.jpg,thumb,alignright]My engineer friends are asking off screen for more details on a “scientific” approach to valuing property. You know, something they can put on an Excel Spreadsheet 🙂 Here’s a fairly tried and true method of valuation here in the Seattle Area. This method was so accurate a couple of years ago, that many agents were using this calculation to list property, and many owners knew it and were insisting on this method of valuation. That was before Zillow came out of course 🙂

I do have to caution readers from outside of the Seattle Area and the State of Washington, that this may not be reliable in other areas of the Country.

Here in the Seattle Area we have little niche markets everywhere. West Seattle, Downtown Kirkland, North Queen Anne, Ballard on the Freemont Side, Crown Hill, etc… Every pocket of value is self contained and is often called everywhere around the Country, the “snob” factor. I sometimes call it the “nosebleed” section, particularly in “view corridors”. Every place I have ever worked has had many, many imaginary lines that determine value pockets. Like the little sliver of area that has the zip code of the lower valued area, but the school district of the contiguous higher valued area.

OK, my engineer friends are getting bored with all the words. Here goes. When I first arrived in the Seattle Area and was working over by Green Lake, it was well known that everything was selling at 1.3 X assessed value. “Everything” meaning “all things being equal” and the “good-average home” without a view. Flippers were looking for anything and everything they could get their hands on that was selling at or below assessed value and using 1.3 or more x assesed value as their “worst case” after improvements value benchmark.

The beauty of this method is that you can extract the factor from each pocket neighborhood, and then apply the factor to the assessed value. I’m going to use the mls, but Galen and others, if you let me know of a site that has sold data that includes the inside photos of the sold property, let me know, so I can give the tutorial pointing to sites the Average Joe can access.

I just sold a property that closed at 1.54 times assessed value. Prior to that sale the top rate for that neighborhood was 1.33 times assessed value or less. Agents sometimes hold the market value down on the seller side of things by pre-ordaining the snob factor. Sometimes I can extend the imaginary line and drag the snob factor ratio of 1.5 to 1.6 times assessed value over to the nearby area that has not gotten a fair shake by the local agents for too long a time.

Take all of the solds in the same zone, as in nearby homes of like kind. Like kind meaning you compare view properties to other view properties and non view properties to other non view properties. You don’t have to consider square footage or number of bedrooms, as the assessed value will take that into consideration by going up and down to accommodate the inherent differences. This method is often more accurate than using the number of bedrooms and square footage reported in the mls.

Take the sold prices of each home divided by the assessed value of that home. Once you get the range of value for that area, say 1.4 – 1.48 times assessed value, you look at the assessed value of the home for sale and multiply it by that given area’s factor. If you pay more than that, then you know you are at the high end of the value range and might have to hold the property longer to come out whole. If you pay at or lower than the low end of the range, you can likely sell it whenever you want and make a profit.

View property will generally go for 1.6 times assessed value. The problem comes with flip projects. Flip projects and remodeled homes have jumped to 1.8 to 1.9 times assessed value. These homes, while they may be worth the price, must be evaluated with regard to the improvements of the basic systems and not just the comsmetic changes. If the roof is three layers and the wiring is original and the basement is yukky, but the kitchen has granite counters and the bathrooms are remodeled and the home is staged…be very careful. To garner 1.9 times assessed value, the home should be “like new” not only based on aesthetics, but all of the main components and systems of the home as well AND be a view property.

By calculating the 1.? times assessed value, you can determine how picky to be about the inspection, how much is too much to pay and where you are paying for “snob factor”. If nearby homes are selling for 1.4 times assessed value or even 1.9 times assessed value, and your offer is 1.8 times assessed value…that should tell you something you may need to know.

OK you data crunchers out there. Time for you to test your valuation using the x assessed value method and compare it to your Zestimate. Let’s hear what you come up with. This should work in any part of the Country that does not re-assess based on sale price, such as California.

Seattle Street of Dreams – 2006

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Robbie, Stephanie, Harrison and I went to the Street of Dreams together yesterday. What I enjoyed most, was their company. What Harrison (age 3 1/2) enjoyed most, was the school bus ride from and to the car. His first ride on a school bus.

The house I liked best, though not everything about it, was of course the highest priced one at $5,500,000, but I’d want it moved somewhere else with a view. Because I am a “view person”, not everyone is, I came home and liked my own house better than any of them.

Trends, products, styles, features…a run down. I guess I’m “jaded” by having seen lots and lots and lots of houses all over the country, because I didn’t see anything I liked, at least not that I liked in that setting. House number 6, which is purportedly “sold” was the best of the batch, all things considered. Best lot, house that seemed appropriate to the lot and setting, house that seemed appropriate for the area. But I’d like to “live in it” for a week or two like a timeshare. I’d want to move it to the bottom of a ski resort and timeshare it out for two weeks at a time unless I could afford it as one of many homes as a “getaway” house. But then I’m a City Girl who can’t be rustically oriented for more than two weeks at a time. I get hives.

Lots of too much dark, caves, caverns, pitch black theater rooms, stone inside the house, even a clay tile roof inside the house. Lots of too much “old” as in new made to look “old”. Coming from Philadelphia, I know what old looks like, and that’s not it. Two of the homes had a very dark “wood” floor that was supposed to look like the floors of an historic home. Not. Wide plank…yes, dark, yes, waves in each and every plank…not. Someone said it looked like it was made out of plastic.

Every house had a “butler pantry”, I think, and I was evaluating them all. One was totally off as if the designer didn’t know what a butler pantry really was all about. A butler pantry, copied from historic homes which were likely homes patterned from England, is that small galley between the dining room and kitchen with counters and cabinets on either side. It originally did not have a sink, as any water used by the butler would have been the “soda water” type in a bottle to freshen and make new drinks for the guests. For a “butler pantry” to be “true”, the butler should be able to stand in it and see the whole dining room table from it. He watches and quietly comes out as needed to fill a wine glass, freshen a drink or refill the string bean bowl as it gets low. The vantage point should be such that the guests do not really see him most of the time. So the one butler pantry that had only one side and standing there gave the butler a view of the backyard? I don’t think so.

Stephanie noticed this and it was a riot. In one house there is a fish tank inside the shower. Cool, but…the other side of the fish tank built into the wall was not in the master bedroom, it was in the hallway! I went into the shower and did a little dance as Stephanie stayed in the hallway to see if she could see me moving about. All of the people in the house were laughing and talking about how the kids in the “West Wing” could sneak down the hall and watch Mommy and Daddy in the two headed shower through the fish tank.

Moral of the story is NEVER go to The Steet of Dreams with a Real Estate Agent. They look at what’s wrong…not what’s right, at least this one does. Mostly the homes were not “true to themselves” mixing modern smack against historic replica features. That new sink that looks like a laundry tub (modern) next to an island with an Early American spindle table leg built into the corner. The pantry with relatively cheapo looking shelves, with a crystal chandelier hanging in the middle of the pantry. Better to hire a carpenter to build the shelves in, if you are planning to hang a crystal chandelier up between the Frosted Flakes and the Pop Tarts.

So Robbie and family got a taste of what looking at homes with Ardell is like. They look at what’s right, I look for what’s wrong. Robbie kept wanting me to give an opinion of value and projected days on market…but that’s something I do after I get home from showing property, as it is a “data” driven function, not a WAG 🙂

What is a view worth?

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[photopress:lake.jpg,thumb,alignright] The higest value attributable to the view component of a property, would be “an unobstructable panoramic view”. The lowest, would be a potentially obstructable “peek”, or a “winter view” meaning the view is totally blocked by deciduous trees, and the view only appears when the trees shed their leaves in winter.

The value of a view is built in layers. The value of the lot, with no house on it at all, contains the first layer of view value. Some people are amazed when they see a property with no view at all, that is practically falling down, valued at $800,000. Who would pay that? If the answer is that no one except a builder would pay $800,000 for that “house”, then the house becomes a “tear down”, as the “value is in the lot”.

How a house is constructed, and the positioning of the rooms, and the windows in those rooms, is ultra important to its value. Especially here in the Seattle area. If the best views are from outside on a deck, then the value is diminished to the number of days in a year you can be outside to enjoy that view. If the best view is from “all main rooms”, meaning those rooms where you spend most of your time and do most of your entertaining with guests, the value will be higher than if the best view is from a little “cozy art studio” perched high above the main living areas. If the view is only from a bedroom, the house will be worth more if the builder puts the master bedroom in that view corner, rather than one or two, or even all, of the “odd” bedrooms.

Then you have the “bad” side of the street and the “good” side of the street. For instance here in Kirkland, the Market Street side of 1st Street will have a lesser value than the opposite side of the Street, particularly in those blocks where the opposite side is higher…much higher. The noise factor from Market Street and the ability to see traffic going by at a steady pace, detracts from the value of the view, even if the long distance view is pretty much the same from both sides of the street. The house on the “bad” side of the street, blocks the view of Market Street from the “good” side of the street, so that house being there, adds to the value of the property across the street.

If all of the properties in your view have already been built out to max height, the value is more likely to be retained long term, than if all of the houses, between your house and the view, are older ramblers that could potentially be built up to max height. So when you look out the window, don’t just look at the view. Look to see if most of the homes, between you and the view, are newer construction at “max height”, or “tear downs”.

What is “max height”? You can do a quick and fairly accurate determination, by spotting the newest houses in each level of slope between you and the view. Construct a “view viewer” with your hands (thumbs together and palms up, the way movie directors used to do to construct a facsimile “frame”), and move your hands from the height of the newest house, scanning over the entire landscape in your vision. This is one of the cases when Zillow can’t value a property for you, because Zillow has no hands! LOL

When it comes to view…do not make the mistake of basing what you will pay, on “what you see is what you get”. You have to determine the long term probabilities of view retention. Don’t expect to be told by anyone that the view “may” at some point in the future, be obstructed. You are pretty much on your own in that regard, as what “might” happen to your view is usually not a disclosure item, unless the neighbors have already pulled permits to build. Even then, I have yet to see a property flyer say, “This great view is going to be obstructed by a condo complex going up sometime next year”.

All that being said, for a view-oriented person like me, a home with a view is indeed “priceless”. Waking up each morning to see the Seattle Skyline across Lake Washington, AND Mt. Rainier to the left, brings a joy to my life that is hard to place a “value” on. But being a real estate agent, I can place that value, and for my house it was $50,000 when I bought it, and hopefully will be $250,000, after I finish enhancing certain features to capture more of the view’s value.

So to Mr. Freakonomics, who asks “Why do agents get more for their homes than other people”? Maybe it is because we tend to choose homes where a seller “left money on the table”, and then make those minor changes that capture value, before we sell. Always choose an agent that helps you make the same kinds of decisions that they would make, if they were buying or selling the property themselves.