Tri-City Area and Real Estate Blog

Attention to all Buyers or potential buyers of homes!  What a time we are in! With all the negative news and the stock market being in the shape it is in, no wonder we all stressed to the hilt!

There is a gold lining however (not silver, but gold) with interest rates at 5.15%. Prices of homes are down and selection is absolutely great here in the Tri-Cities! This is the time for those who have no fear about their job position being solid for them. (here in the Tri-Cities we are fortunate our employment situation is very good).

So if you have good credit, this is a golden opportunity to increase your wealth that does not come along very often. Opportunities are all around us and we are just too buried in the negative news coming out of other parts of the nation, to see what the Tri-Cities truly has to offer! Let’s turn off the negative news and move forward with a piece of life you CAN control.

If your opportunity is a new home or investment property in the Tri-Cities area (Kennewick, Pasco, Richland, West Richland, Finley, or Burbank), call us and we will advise you competently and completely, to make the best move for your best interests!

Christa Sasser, Broker for Distinctive Properties, Inc.

In the Tri-Cities, there have been many new and beautiful condominiums built in the last few years. Some take in the beauty of the Columbia River or the scenic views of the ridges and hillsides of our desert paradise. These condo units provide ease of living for folks of many age ranges, and especially for older folks who are downsizing from large family homes. These condos offer an ease of lifestyle and most are maintained by the develops of the communities. No muss, no fuss, no maintenance! What else could you ask for? 

If you’re nearing the age of 50, then you’ve probably already heard about a type of design in housing called “universal design”. Universal Design allows for the day in which mobility and energy of Baby Boomers may be reduced. For example, designers can create easily accessible, functional and beautiful bathrooms by integrating a large turning radius, wide doorways and level handles allowing those in a wheelchair easy access.

While is may not sound like much of a difference in traditional design, universal eliminates “steps or floor-height differentials and incorporating broad doorways and hallways throughout that take into account the potential for future lifestyle changes, says Nanette Oberly, VP of Epcon Co. A well-designed universal dwelling is one that anyone would be happy to call home.

Interest rates here in the Tri-cities are dropping and it’s time to consider buying a home!!  It was recently announced that financial industry lobbyists are urging the treasury Department to take steps to lower mortgage rates in an effort to stabilize the housing market.

Under the proposal, Treasury would seek to lower the rate on a 30-year mortgage to 4.5 percent. That’s about one percentage point below the current rate of 5.6 percent. Treasury would do so by purchasing mortgage-backed securities from Fannie Mae and Freddie Mac.

Treasury is strongly considering the proposal and could announce a decision as early as Monday. In recent weeks, a diverse set of industry groups from real estate agents to carpet makers have called on lawmakers and the incoming administration to subsidize lower mortgage rates and beef up tax credits to help stimulate housing demand.

The National Association of Realtors has been pushing a plan under which the federal government would spend $50 billion to lower mortgage rates. It says doing so would yield about 500,000 more home sales.

The National Association of Home Builders is leading a new “Fix Housing First’ coalition to push for aid to the ailing housing sector, including a tax credit of up to $22,000 for anyone who buys a home before the end of 2009. The goal is to drive mortgage rates so low that home prices not only stop falling but begin to rebound.

While the plan, if enacted, will help anybody looking to buy or sell a home, or refinance out of an expensive mortgage, it may not help those whose credit is so damaged that banks don’t want to lend to them. It may change the number of borrowers seeking loans but it won’t change the qualifications for who gets those loans.

Nancy Walsh is our Certified Negotiation Expert at Distinctive Properties, Inc.

Nancy has gained confidence in dealing with any negotiation situation in real estate. She understands the “tough” approach to negotiating, when to use it and how to handle that highly competitive hard bargainer across the table. She has learned collaborative negotiation techniques and why this ‘win-win’ approach leads to better outcomes for the buyers and sellers.

She has a marketing plan, an open house plan and lead generation plan; she now has a negotiation plan to give her new clients. E-mail Nancy Walsh at: nancy@distinctiveprop.com.

Two policy aspects concerning residential real estate are also impacting commercial building in the Tri-Cities and statewide. The first is related to contractor registration and is covered under RCW 18.27. It requires all contractors to be registered prior to beginning work on a building.

It had the consequence of turning any home improvements, including work done by the owner or property developments, into contracting work, said Brian Lewis, a real estate attorney with K&L Gates Law Firm in Seattle. “In order to put an improvement on a property, RCW 18.27 says you must be a registered contractor,” Lewis said. “It adds development to a list of activities which require a contractor.”

Improvements can include standard home additions, such as a shed or renovated bathroom - work often done by the homeowner, who would now need a contracting registration. Any improvements over $1,000 require registration, as do projects lasting fewer than 12 months, both of which are changes. While the revisions are intended to protect consumers, they could have the effect of opening them up for trouble, Lewis said.

The law was changed in 2007 to protect homebuyers and to define them from home “flippers,” who buy a house only to renovate and sell it for a higher price. The issue is that RCW 18.27 was not intended to engage in the development of property by the owners. The intent of this was to give the consumer protection from ‘flippers.’

The issue is that the rules were not meant to deal with property development or for people planning to remain in a home for more than 12 months. According to RCW 18.27.114, any contractor working on a project for four or fewer residential units or structures above $1,000, or of a commercial building when the bid or contract price total $1,000-$60,000, must provide the customer with disclosure statements and registration.

The other recently incorporated rule on property is a seller disclosure statement, known in Washington as a Form 17, which is used on residential purchases to verify property condition during the sales process. It is a multiple-page document in which the seller is supposed to reveal all known information about the property. Problems arise for the Form 17 when an unimproved property with a nixed or residential zoning distinction is sold.

Typically, commercial real estate does not deal with the form. If no form is provided, the buyer can rescind in the deal up until closing until one is shown. The intent of the legislation there is that certain environmental conditions are not getting disclosed, and this would provide the same amount of disclosure for empty lots as for developed ones.

For residential home purchases, a completed Form 17 has been required since 1995.

More homeowners facing foreclosure are turning to short sales as a way of getting out of a troubling financial situation and with the shaky real estate market, more banks are accepting short sales from troubled borrowers.

At the beginning of November, there were about 1,600 homes on the market in the Tri-Cities and about 30 of those are seeking bank approval for short sale. With the average cost of foreclosure around $38,000, the short sale is one way banks can cut their losses, and it’s a growing trend that was relatively rare a few years ago.

A short sale occurs when a homeowner sells a home for less than its current mortgage. The bank or mortgage company agrees to discount the loan balance due to economic or financial hardship of the mortgage holder. The homeowner sells the mortgaged property for less than the outstanding balance of the loan and turns over the proceeds of the sale to the lender. In some cases, but not always, the lender writes off the remaining portion of the debt.

Although Benton and Franklin counties didn’t see big spikes in the real estate prices before the nationwide bubble burst, the area is seeing a slowdown. While sales are slow, notice of trustee sales, the first step in the foreclosures prices are up 5.5 percent for the year.

Unfortunately, many homeowners facing foreclosure aren’t aware of the options available to them and if they file bankruptcy, reasonable options they did have disappear. To make matters worse, more homeowners than ever will likely face foreclosure in 2009.

Existing home sales prices plunged 18.5 percent in the West region in September, according to the National Association of Realtors, driven by rising foreclosures and distressed sales, like short sales, which represent 35 percent to 40 percent of total sales nationwide, and as many as half the homes are in California, Nevada and other former bubble regions.

Whatever the reasons for pursuing foreclosure, homeowners needs to be careful and make sure they know and understand all of their options. In June, a new state law went into effect that was intended to protect homeowners facing foreclosure from equity skimming and foreclosure rescue scams. The law, proposed by Attorney General Rob McKenna, requires those buying ‘distressed’ homes to provide homeowners with a written contract completely describing the terms of the sale - and giving the homeowner the right to cancel the transaction for up to five days following the sale.

Because licensed real estate professionals are not exempted from the law, as they are in similar statutes in other states, the Realtors may have to limit their involvement in distressed sales, or face unanticipated liabilities. Homeowners can receive up to $100,000 in damages for violations of the law. Normally, real estate buyers and sellers have different goals, so under the law, foreclosure or short sale buyers could be sued if they later resell the property at a profit. That fear is keeping real estate investors who delve in the foreclosure market at bay. But the law likely will help homeowners facing foreclosure receive better advice. Realtors, by law, are not allowed to negotiate short sales.