2011 Wenatchee Real Estate Outlook (3 of 5)

Guest writer, Rebecca Darley

As the manager of a Wenatchee home inspection company I must stay educated on the latest local real estate news and developments.  On May 19, 2011, the Wenatchee Valley Chamber of Commerce invited local real estate experts to lead a discussion panel called “2011 Real Estate Outlook.” This blog entry along with the next 2 entries will summarize the panel discussions of each speaker.

Previous Entries:

• Speaker from Touchstone Appraisals, Cheri Farivar
• Speaker from Peoples Bank, Darel Ansley

Fritz Nichols is the owner of Windermere NCW in Wenatchee.  He’s been in the real estate industry since 1994 residing in the Puget Sound area and has recently expanded his services to the Wenatchee Valley.  Like us, Fritz works in Western and Central Washington and has seen the effects of the housing market throughout those areas.  He started off his discussion with some stats.

In the first quarter inventory of 2010 there were 620 single family homes comparing to 501 in 2011.  About 10% of the inventory is bank owned homes matching the stats of the past couple of years.  The Puget Sound area is seeing about 20% REOs and short sales in their inventory with up to 45% in some badly affected areas.  In Wenatchee we’ve been fortunate to see rental vacancies trending down along with the inventory.  This is a good sign.

Fritz predicted that the 2011 inventory will increase over the summer as it usually does annually, but he doesn’t expect much appreciation in home values.  Fritz also commented on the media’s negative coverage on the real estate market.  Gallup polls and Newsweek articles claiming that the homeownership dream is dead is not an accurate portrayal of the local opinion.  His experience with clients has been completely opposite.  Home buyers are taking advantage of affordable homes and cheap money realized by low lending rates.

On a side note, I came across an article while research Fritz’s Wenatchee home market stats.  Bloomberg news write this on May 10, 2011: “Among metropolitan counties, the biggest sales improvement from the fourth quarter of 2010 was in Chelan County (Wenatchee), which saw a 25.5 percent increase in sales, followed by Spokane County with a 20.1 percent jump. Sales declined 18.2 percent in Asotin County (Lewiston, Idaho and Clarkston, Wash.) and 9.1 percent in Thurston County (Olympia).”  Good news for Wenatchee!

Source: Sales and prices of homes slip in Wash. State

“Think Local First” in Leavenworth

Leavenworth, Washington, is a great little town of about 2,000 full time residents, but draws just over one million visitors every year.  The Bavarian theme town has a healthy economy, a thriving downtown and abundant recreational and tourist attractions.  Last week Rebecca attended a reception for local independent business owners called “Think Local First.”  While our home inspection company advertises service from Seattle to Wenatchee our office is based out of Leavenworth for the wonderful reasons listed above.

The mission of Think Local First in Leavenworth & the Upper Wenatchee Valley is “to build a sustainable economy by increasing awareness about the personal, community and economic benefits of choosing local, independently-owned businesses first.”  After seeing many familiar faces and sipping on donated local wine in the Barn Beach Reserve River Haus we watched a Bellingham based short docu-film highlighting the processes and successes of supporting locally owned businesses by purchasing their goods and services.  The room was packed!

Next, the group was introduced to the board of advisers that were behind the night’s event.  We were encouraged to “Think Local First” with each purchase.  The idea is that money stays where you spend it.  According a handout from the evening, a consulting firm (Civic Economics) found that “when West Michigan consumers choose a locally owned business over a non-local alternative, $68 of every $100 spent stays in the community.”  It went on to describe that only $43 stays in the community if spent non-locally and $0 remains when choosing to spend online.  Of course, the bottom line here is growth:  in activity, jobs, income and community.

The Call To Action!  Everyone was encouraged to sign a “10% Shift” pledge by the end of the evening.  If you could pledge to spend 10% more of your normal purchases locally then signing the dotted line was not too hard.  Living in a small town you’ll find that you can’t get everything in your neighborhood.  I happen to know that you can’t process film or purchase a car in Leavenworth, but daily tasks and common services are very easy to manage.  The aforementioned handout referenced the same 2008 Kent County, Michigan, study when discussing the power of the 10% shift.  Their study estimated that the “10% shift would result in $140 million in new economic activity; 1,600 new jobs, and $50 millions in new wages.”  In Chelan County that would mean “$16.8 million in new economic activity; 192 new jobs; and $6 million in new wages.”

I’m up for the challenge!  We’re going to make the 10% Shift.  I know that whatever we can’t find from local business owners in Leavenworth we can certainly find within Chelan County in Wenatchee.  How about you?  Can you make the pledge in your town?

Closing Costs Calculator for the Washington Home Buyer

We perform home inspections in about 10 counties throughout Washington from Seattle to Wenatchee.  Occasionally our clients call to book an inspection and are still a little confused about the inspection cost– who pays it, how much it is, etc.  We did a little internet search and found a few closing cost calculators that may help the potential home buyer.  The calculator we are sharing seems to have the most descriptions of the costs, but will only give you a rough idea since the costs are only estimations.  For example, they estimate the cost of an inspection at $175, but our inspections start at $275…this is standard for a single family home.  Condos may be less.  Also, the appraisal fee usually starts around $300.  A loan application fee will be added to the credit report for a combined fee of $75-$300.  With all this in mind you can use the calculator to get an idea of the added costs associated with buying a home.  If you have a good agent to walk you through the buying process then you won’t be blindsided with these costs.  They can also help you negotiate fees that may be shared with the seller.

Closing Costs Calculator from Mortgage-Investments.com

Photo Credit: http://themortgagereports.com

Homeowner Tax Guide: Get All Your Deductions!

Photo Credit: http://theiowarepublican.com

In a time where buyers are cautious and are really weighing out all the benefits of home ownership here are some considerations for tax season. Several tax deductions and credits are providing relief to homeowners and making them very proud of their investment decision. Deducting mortgage interest, home equity debt, capital gains on home sales and taking advantage of energy conservation credits are just a few of the tax season benefits that homeowners can cash in on. Do you have a home office? There’s another one. Most of our monthly home loan payment is interest and you can deduct every bit of it. Only those folks with a loan of $1,000,000+ receive a cap on this deduction.

Stephanie Singer, a Realtors.org contributor wrote about this topic in Tax Time Less Taxing for Home Owners. She said that, “ninety-one percent of homeowners who claim the mortgage interest deduction earn less than $200,000 a year, and the ability to deduct the interest paid on a mortgage can mean significant savings at tax time. For example, a family who bought a home in 2010 with a $200,000, 30-year, fixed-rate mortgage, assuming an interest rate of 4.5 percent, could save nearly $3,500 in federal taxes when they file this year.”

We found a great resource from Kiplinger.com. They have listed all the deductions for homeowners at “What’s Deductible? – A to Z.” Check it out to make sure that you’re getting the most deductions as a homeowner. We use a skilled accountant in Wenatchee to guide us through our own tax deductions. We suggest that you hire a recommended accounting professional to point out these important opportunities for you.

Seattle Home Show: Feb. 19-27th

credit: Seattle Home Show

Spring is just around the corner and it’s beginning to look a lot like Home Show Season!  Wenatchee’s Home Show was a huge success last weekend, now we look forward to the Seattle Home Show starting on Saturday and open for 9 days.  Your online ticket purchase includes a full year subscription to “Better Homes & Gardens” and free parking.  Check out this info from their website:

The Seattle Home Show opens its doors for its 67th annual home products extravaganza on February 19, 2011 for a nine-day run through February 27.   This much-anticipated show of nearly 500 exhibits includes everything for the home and landscape, highlighted by Idea Street™ – a community of furnished and landscaped model homes. Idea Street is a showcase for home design, interior style and the latest appliances and fixtures.  Show attendees enjoy the variety and scope of the exhibition which includes green living displays, kitchens and baths, home decorating, arts and crafts, garden displays, and Meet the Expert Seminars featuring home improvement topics presented by industry professionals. America’s Biggest Open House™ – the Seattle Home Show – takes place in downtown Seattle at the Qwest Field Event Center. Details at www.SeattleHomeShow.com.

Home Show in Wenatchee: Feb. 11-13th

Every year the NCHBA or North Central Home Builders Association produces a spectacular home show in Wenatchee, Washington.  There’s a little something for everyone whether you are interested in remodeling, decorating, building, buying or selling a home…they’ve got all the experts there for your questions!  Here’s some info from their website.  Download this COUPON for $1 off admission:

This year, we have a lot of new things going on and are very excited to “get the Show on the road”! The Kid’s Zone by Lowe’s is going to be fantastic this year. Not only will the kids be able to build their own project with a professional from Lowe’s, they can go on a scavenger hunt with their parents or enjoy FREE ice skating on Friday and Saturday. So, if you have kids that are 12 and under, make sure to take them to the Kids Zone by Lowe’s, located in the Crunch-Pak Hospitality Room on the the main floor of the Town Toyota Center!  Workshops and How-to’s that you WON’T want to miss! Come and see what the Master Gardeners have to demonstrate on Friday, Saturday and Sunday of the show!   Be one of the first 250 attendees on Saturday and Sunday and receive a special Home Show Entrance Bag! These bags will be filled with small gifts, specials and discount coupons from participating sponsors and vendors! These bags will also come in very handy when you need a place to stow away other information and items you gather!  There will be additional event parking available for attendees across the street at Walla Walla Point Park, both parking lots, as well as at Lowe’s Home Improvement Warehouse. Many thanks to Lowe’s for generously allowing our Home Show attendees to use half of their parking lot for our event!

Hot Water Heaters Expansion Tanks, what do they really do?

Thermal expansion of water in a closed plumbing system can create a number of annoying and potentially dangerous problems. These include: unusually high pressure in a system, pressure surges, and the chronic or continuous dripping of a temperature and pressure (T&P) relief valve. In addition, dripping faucets and leaking toilet tank ball cock fill valves are also symptomatic of thermal expansion.   More serious problems can also occur due to thermal expansion. When dangerous pressures are built up in a water heater, internal parts may fail such as the internal flues, fittings or water connections. If a flue way collapses it can lead to the potential release of toxic gases, such as carbon monoxide into living spaces.

Virtually, every modern plumbing code requires the installation of an expansion tank on hot water heater installations. The reason is simple. Water expands when heated. This extra volume of water needs to go somewhere. Before the widespread usage of backflow preventers, check valves and pressure reducing valves, this expanded water simply pushed the cold water back into the city water main. Now with these devices required in new construction and most permitted remodels we have successfully closed this system.

Where does the pressure to go?

Expansion tanks are really simple devices. They contain compressed air and a special rubber bladder. When your hot water heater turns on, the water within your piping system begins to expand. This expanding water slowly enters the expansion tank as the water is brought to temperature. Eventually, hot water is drawn from the system thru a faucet and the expansion tank releases the extra water into the piping system.

The installation of an expansion tank is a simple upgrade for any hot water systems.  There are some things you need to know before running out and purchasing your unit such as existing water pressures, capacity of the hot water tank, and ensuring the unit you purchase is for potable water systems.   I always recommend working with a licensed plumbing contractor.

Wenatchee – Leavenworth Tour of Homes Sept. 16-19

Tomorrow will start the North Central Home Builder Association’s annual Tour of Homes with 8 homes throughout Leavenworth, Wenatchee and East Wenatchee. You’ll get a little bit of everything in Central Washington from a grand home in the heart of the Bavarian-themed ski retreat town to an energy-efficient Energy Star home in the Apple Capital. AMS Inspection Services is a member of the NCHBA and will be helping on the tour so stop by and see us!

Details and Tickets HERE

Neighborhood Stabilization Summit

Foreclosures are a huge issue in the United States right now. After July resulted in the worst month in real estate history, the feds are starting to take notice. Today many important professionals met to talk about the compounded problems with foreclosed, abandoned and vacant properties. Read on…

http://www.mortgagenewsdaily.com/09022010_neighborhood_stabiization_reo.asp
by Jann Swanson
Community organizers, state and federal government officials, and representatives from banking, research and educations institutions are currently meeting in Washington at a REO and Vacant Properties Summit sponsored by the Federal Reserve Bank.  The two day conference is focused on examining the problems associated with vacant and abandoned property and to explore approaches to neighborhood stabilization.
Governor Elizabeth Duke, Board of Governors of the Federal Reserve pointed out that the impact of each foreclosure goes far beyond that one home; a conference participant estimated that every blighted home negatively impacts five or six nearby homes.  Therefore, in Cleveland for example, where 11,500 homes have been foreclosed, 60,000 others can lose value which leads to lower taxes to support schools and other community services. The residents who remain in a community suffer social losses as well as their communities decline.