Tag Archives: News

$90 million home sets US property record

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garden viewWow!

A 40-acre estate in the Hamptons – the Long Island summer retreat of New York’s rich and famous, has been sold for $US90 million, a new US record for a residential property.

The New York Post cited sources close to the deal as saying the purchase was made by a Swedish industrialist who has rented the estate for the past few summer seasons.

To answer the obvious question… Assuming standard commissions (and this was far from from a standard situation), two real estate agents just earned $2.7 million in commissions!

Interested in Pre-foreclosures?

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Exit 3On Saturday, the Seattle PI hyped pre-forclosures:

A good place to find these cash-flush speculators is at foreclosure auctions, according to longtime Tampa, Fla., property investor Tom Lucier, author of “The Pre-Foreclosure Property Investor’s Kit.” But by the time a property reaches the auction block, it’s probably worthless as a short-term investment. The trick is to find the distressed property in pre-foreclosure.

Pre-foreclosure is that period of time between when the lender files a foreclosure lawsuit or notice of default in the public records and the date the property is to be sold at public auction or trustee’s sale.

Redfin — The Anti-Google

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[photopress:sasha_with_troll.JPG,thumb,alignright]I’m extremely disappointed in the latest direction that Redfin has taken and I’d like to use this post to explain why I’ve completely stopped doing business with them.

For those of you not familiar, Redfin is a company that has developed a really great aerial technology for viewing MLS data. When they came out, I signed up as a “Redfin Agent” because their technology was superior to anything else available for searching the MLS. In previous blog entries I’ve mentioned how great their technology is.

How did they plan to make money? In the simplest sense, their business plan involved displaying MLS information via an intuitive interface using aerial images. When prospective clients would look for a home, Redfin would direct them to local real estate agents. After the prospective clients purchased a home, the real estate agent would send a portion of the closing commissions (20%) back to Redfin. By repacking the MLS data in a new way and getting real estate agents to promote them, they hoped to take the industry by storm. However, their site must not be nearly as popular as they hoped because their newest business venture turns them into a discount real estate company.

However, I wouldn’t write this blog entry if they were just another discount real estate agency. I don’t have a problem with discount real estate agencies and I think they provide a useful service for a subset of sellers (and besides, they keep us full-service agents on our toes!). The reason I write this article is that Redfin went from being a partner with real estate agents to a competitor. I think they assumed they could use the goodwill that they’ve built up with agents to slip a fast one on us.

The worst part is that Redfin didn’t have to go that route. Early on, I talked with them about licensing their technology to display MLS over my site. When the showed only passing interest, I decided to develop the MLS Search Engine myself… And while my technology is still in the infant stage, I’ve found a way to display MLS data over aerial photos (so don’t believe their front-page marketing that says that are the only ones doing this!).

If you are currently a “redfin agent” (like I was!), please join me in severing your business relationship with Redfin until they decide to join us again as a partner. As Redfin doesn’t offer a way to “delete” your account, I recommend doing the next best thing. To delist yourself from their database, go to: http://www.redfin.com/stingray/do/my-redfin. Log in using your username and password. Click “edit your profile

Cutthroat Competition of Online Brokers Benefits Consumers

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Cutthroat CompetitionA recent study showed that on-line brokers had an extremely high costumer satisfaction levels:

With an average reliability of 99.5 percent, the brokerage industry’s Web site service levels far exceed other industries, Keynote found. In addition, pages that take more than one and a half seconds to download–a time considered first-rate by other online industries–fell well below the standards currently being set by online brokerages.

Have you used an on-line broker? (I have!) I’d be interested in hearing about your experience. Was their service as good as this survey suggests?

Thanks to Garrett French for the background info…

Seattle ranked as one of the healthiest cities

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swimmersWith all the great bike and pedestrian trails around, I don’t think it would surprise most locals to find out that Seattle ranked #4 in a list of the country’s healthiest cities:

The Seattle metro area had the study’s best scores in the areas of physical activity and lifestyle pursuits. Respondents here reported the highest level of vigorous exercise. Seattlites had high rates of diabetes, hypertension and, yes, sleeplessness.

Another great reason to live in Seattle!

Home equity

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living room 01The Seattle Times had an interesting article regarding home equity building rapidly in our fast moving real estate market and investors using home equity to make more speculative investments:

According to Economy.com, Americans pulled out roughly $705 billion of equity from their homes last year, up from $266 billion in 1999.

The bulk of that money came from capital gains made by people selling houses, and these profits often are used to purchase another residence.

Many people also use some of the extracted cash to pay off credit-card debt, which is widely viewed as a sensible way to use equity. Another large chunk of the equity withdrawn goes into home improvements. Spending on such projects totaled $138.3 billion last year, up 38 percent from five years before, according to Harvard University’s Joint Center for Housing Studies.

When Lawyers Steal the Escrow

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The NY Times has an article today describing the experience of people whose real estate lawyers have been caught stealing their escrow money. The most extreme example they give was from Jay Rosen who would intentionally create problems with the transaction in order to hold onto his client’s escrow money:

A dispute over the home’s title or its certificate of occupancy would stymie the deal, making it impossible for Mr. Rosen to release his clients’ money from an escrow account he controlled. An ancient property-line dispute would rise from the dead. Checks would get delayed. Cash transfers wouldn’t connect.

It was as if money just didn’t want to leave Mr. Rosen’s hands, clients said.

While there will always be a bad apple in the bunch, I’m actually surprised to hear of this problem. (Granted, the article makes a big deal of the problem, but then goes on to say that there were only 100 reported real estate thefts in 2004.)

I’ve yet to hear that this is a problem in Seattle, and considering that the industry relies so heavily on referrals, it would seem the bad apples would be quickly rooted out… However, if you’ve ever been taken advantage of by a local agent, broker or lawyer, I’d be interested to know so that I can adjust my recommendations appropriately.

Where are the sellers?

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Richard and Alice on a BikeThe Seattle Times highlights the fact that there are fewer sellers in the Seattle Market than last year:

According to May statistics released yesterday by the Northwest Multiple Listing Service, the number of available King County houses and condominiums was off by 31 percent compared with a year ago.

The reason?
I’d tend to agree with Judy Hay’s assessment from the article that:

The lack of inventory is at least partially the result of a shift in homeowners’ thinking. A year and a half ago, she says, they were trading homes simply because they wanted something else. Not now.

Unless there is some reason to move, they’re not doing it. They’ve refinanced and they’re saying, ‘Let’s remodel and stay where we’re at.’

The lack of sellers is all the more surprising considering the median home price in Seattle has risen 17% in the past year.

It seems to me that trying to time the market (whether real estate or stocks) is a game that should be left to the professionals! However, it is just common sense that Seattle home owners even remotely considering selling their home should talk to a real estate agent to find out how much their home would probably fetch on the open market. If you’re interested, I’d be happy to provide a free home valuation report.

King County Home Appreciation

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AppreciationThe Seattle Times put together an informative graphic that illustrates homes home appreciated by neighborhood between 2003 and 2004. No surprise in that every single neighborhood in King County experienced increase values:

Thanks to low interest rates, last year was a record-breaker that saw 31,333 single-family home sales and 9.8 percent appreciation on a per-square-foot basis. That’s the highest since 1999 and well above 2003’s 4.2 percent. But one thing remained constant: Appreciation varied greatly among neighborhoods, ranging from 31.6 percent in Newport Shores and Kennydale to 3.2 percent in Lake Youngs, between Kent and Renton.

The top five neighborhoods in terms of appreciation were Newport Shores/Kennydale (31.6%), South Central West Seattle (22.7%), Madison Park (22.6%), West Shoreline (17.1%), and East Ballard (15.1%).

Lessons learned from riding two real estate cycles

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Swinging for a HomerBill Wendel over at Boston’s Real Estate Cafe has been posting podcasts on his blog for a little while now. The interview from his latest podcast is from a woman who…

..describes lessons learned over last two real estate cycles: first losing money (at least on paper) on a starter condo purchased at the top of the bubble in Philadelphia in the mid-1980’s; then purchasing another home at the bottom of the last cycle; and ultimately hitting the real estate jackpot in Atlantic City.

To hear the podcast, follow the link to his website and then click on the link that says “Real Estate Bubble Audio Time Capsule #2”. That should download it to your machine and then open it to your default mp3 player.

What is podcasting?
In it’s simplest form, podcasting is a recording that is saved in an mp3 format that is made available via the internet. The recordings could either be groups of songs (a la a typical radio station), interviews (a la NPR), simple rants (a la many blogs), or a mix of all the above.

I’ve linked to this podcast, mainly because I’m intrigued by the idea of podcasting. I know that at some point in the future, I’ll give it a try… If you have some ideas for good podcasts (obviously the topic should be related to Seattle real estate), please let me know…. Would it be useful to have a podcast of my impression of featured listings? Are there any major players in Seattle real estate that I should interview? I could probably cover more ground in a two minute podcast than I could in a three paragraph description…

My take is that podcasting the same information that could easily be written about would be a waste of time and bandwidth. Ideally, it would be great to cover topics that can’t easily be conveyed via a written format. I’ll keep thinking about this and would appreciate your ideas.