Tag Archives: News

Housing Prices up 12% this Past Year

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ClimbingThe blogging world is abuzz (at least the blogs that pay attention to real estate issues!) with news from the Office of Federal Housing Enterprise Oversight (OFHEO) that housing prices rose over 12% this past year. Since the report is in acrobat format, I’ll quote more than usual (*.pdf) :

Average U.S. home prices increased 12.50 percent from the first quarter of 2004 through the first quarter of 2005. Appreciation for the most recent quarter was 2.21 percent, or an annualized rate of 8.82 percent. The new data represent the largest four quarter increase since the third quarter of 2004, when appreciation surpassed any increase in over 25 years. The figures were released today by OFHEO Acting Director Stephen A. Blumenthal, as part of the House Price Index (HPI), a quarterly report analyzing housing price appreciation trends.

“The House Price Index shows the rise in house prices continues at an extremely strong pace and raises the potential for declines in some areas later on,

Seattle Public Library Resources

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spiderDid you know that you can get the full-text of on-line newspapers through the Seattle Library? I read an article describing how many libraries provide full-text access (on-line) to magazines and newspapers that would normally charge fees for such access:

It’s impossible to list every database available from every public library since resources vary amongst libraries. Simply visit your local library’s web site, or give them a call and ask what’s available and how to gain access. It’s a painless process that can be accomplished in a matter of minutes.

After reading the article, I was pleasantly surprised to find many great resources available on the Seattle Library Website. While just scratching the surface, I’ve already found current and archived collections of all 18 Washington State Newspapers, Technology Review, and Harper’s Magazine. The only catch is that you will need a Seattle Library card in order to access many of the databases.)

Starbucks is Built for Growth

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Pike Place Market StarbucksI ran across this interesting article on how Starbucks manages their real estate. Corporate real estate is not my usual thing, but I thought the insights were quite interesting and show how important location is to the Starbucks brand.

Starbucks is a concept driven as much by real estate as it is by coffee and the coffee experience. These days Starbucks opens at least three new locations a day somewhere in the world. It has taken a lot of real estate to open up 9,000+ Starbucks locations and it will take even more real estate to reach their stated goal of 30,000 global locations.

The blog entry quoted above is from a review of Built for Growth by a former EVP of Real Estate with Starbucks. In the book, the author describes how “Starbucks gained market dominance through finding the best real estate locations.”

While not surprising, it’s interesting to hear the different ways that location has become an intergral part of Starbucks’ growth strategy.

Sales of Existing Homes Hit Record as Prices Soar

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Climbing up Half DomeToday’s NY Times discusses how existing home prices are continuing to soar:

Sales of existing homes swelled to a record in April, rising 4.5 percent, and selling prices climbed at the fastest rate in almost 25 years, the National Association of Realtors reported today, defying predictions of a slowdown and adding to some analysts’ concerns about an overheated market.

While the article is based on national data, the same scenario is playing out locally here in Seattle. Homes that I would have put on the market for only $400K just a few months ago, are easily selling for $430K or more.

Older Homes Appreciating Faster

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Hurley and Patterson CousinsThe Seattle Times had an interesting article that describes how home values of older homes have increased at substantially faster rates than new homes:

New homes may have the latest of everything, but as an investment, a new house simply does not bring the returns that an older home does. Countywide over the past five years, new houses have posted 4.8 percent annual appreciation, while older homes saw about 7 percent. In the past year, new houses appreciated 7.5 percent compared with old houses’ 10.4 percent.

I don’t think many Seattle agents would find this information surprising as most homes as so many of the homes around here have increased in value substantially over the past few years. My experience has been that there is a large subset of home buyers that are looking for homes with character in established neighborhoods. In an area like Seattle with very few new homes being built each year, people are finding ways to fix up old homes in ways that make them shine beyond a typical “old” home.

Most importantly, assuming an old home is located in a nice neighborhood, it is relatively easy to add $100K to $200K through straightforward improvements (update kitchens, build out basements/attics, etc), whereas the opportunity to substantially increase the value of new homes is more limited.

This same report included data on the medium home values for Seattle/King County. If you drill down through their menus, you can find out how many homes were sold in your neighborhood, along with the percent that were new and median price.

Novel Billboard Ad? Is it Possible?

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Bikini AgentAs her husband, I’ve let Anna know that she is not to be influenced by this real estate agent! 🙂

Here’s the story:
The display of one Realtor’s assets draws attention in Belmont Shore.

And here’s the logic:

“It’s kind of flipped people out,” said Heath, who reported receiving almost as many calls from Realtors upset with the ad as those voicing support. “A couple of agents are having a fit about it, but that’s because they just didn’t think of it first.”

My opinion? Go Wendy!

The Boeing Boom

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sasha with eyeglassThe Seattle PI had an article today describing how things are definitely picking up at the local Boeing facilities around the Puget Sound. This paragraph sums it up pretty well:

The company plans to open a second production line in Renton that will push output there to a record 31 planes a month. It is also requiring some 777 workers in Everett to work overtime and will replace a key executive there amid a series of production problems before it boosts output of that twin-aisle jetliner as well.

None of this comes as a surprise to me as I’ve been noticing a substantial increase in people who looking to move to the area related to Boeing jobs. In addition, some of the housing message boards such as craigslist and trip advisor seem to have a lot more questions about good places to live for people whose jobs are relocating to Everett and/or relocating to Renton.

For home owners, any sustained expansion of jobs to the region is great news and I’m of the opinion that job growth plays a larger role in keeping home prices high than any change in interest rates! The success of the tech industry (Microsoft, Amazon, etc) in the area has done wonders for our home values and with the additional growth from Boeing, the future looks real good for Seattle-area home owners.

Home Value Update from the Local Papers

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Daniel with BalloonBoth the Seattle Times and the PI have articles today about the continual high growth in home prices in the area:

I like this quote where Elizabeth Rhodes speculates about a possible housing bubble:

Fuel for speculation of a housing bubble — but not proof of one — increased yesterday on a report that strong buyer demand has pushed Central Puget Sound prices up 10 percent or more over last spring’s already high numbers.

I’m of the opinion that demand for homes in quality urban neighborhoods is here to stay, and while that doesn’t mean the high growth in values will last forever (it won’t), I think the high prices will…

Fantastic, spacious, and charming article on Wired regarding the real estate industry!!!

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ImagineWired News has an timely article regarding on the real estate industry and provided some examples of situations where professionals (not limited to real estate agents) might not have your best interests in mind. I think they could have taken their limited analysis of “real estate information” a step further. In reality, there is so much real estate information that gets locked up in proprietary databases at the expense of the consumer. And to add insult to injury, even this locked up data is riddled with errors.

“Information can be a beacon, or information can be a cudgel; it depends on who wields it and how. In any transaction, it’s common for one party to have better information than the other. In the parlance of economists, this is information asymmetry. There’s value in asymmetry; it’s the reason why someone, such as a consumer, will pay someone else, an expert, for his knowledge.

Of course, sometimes an expert might manipulate his advantage for his own benefit. If your doctor suggests that you have an angioplasty – even though current research suggests that angioplasty often does little to prevent heart attacks – your first thought won’t likely be that the doctor is using his informational advantage to make a few thousand dollars for himself or his buddy”

While I can’t change the industry overnight, I’m trying to do my small part with gHomes by opening up the data and presenting it in a useful way for my potential clients. Just like most industries, the real estate industry lives and dies by references and referrals. By providing the best possible information and service to my clients, I think I will more than earn my commission (and their future referrals).