Wenatchee Real Estate Outlook 2011 (4 of 5)

Guest writer, Rebecca Darley

As the manager of a Wenatchee home inspection company I attend many local real estate events to stay informed of the latest industry news and developments.  On May 19, 2011, the Wenatchee Valley Chamber of Commerce hosted a discussion panel called “2011 Real Estate Outlook.” This blog entry along with the other 4 entries will summarize the panel discussions of each speaker including a loan officer, appraiser, commercial real estate broker, builder and residential real estate broker.

Previous Entries:

• Speaker from Touchstone Appraisals, Cheri Farivar
• Speaker from Peoples Bank, Darel Ansley
• Speaker from Windermere NCW, Fritz Nichols

Randy Gold is the owner of Gold Construction and has 26 years of experience in the building industry.  Gold Construction won two awards in 2002: the Building Industry Association of Washington (BIAW) Washington State Builder of the Year and Wenatchee Business Journal Reader’s Choice Award for Best Builder. He was the founding President of the local Home Builders Association (NCHBA) and the 2003 President of the BIAW, the largest trade association in Washington State.  He moved to Wenatchee from San Diego in the early 1980’s.

Randy started his discussion with a look back to the building industry cycles of the preceding decades.  In the 1970’s the interest rates averaged 10%.  In the early 1980’s the interest rates escalated to an astonishing 19%.  Randy commented that he was trying to build anything that he could “from fences to dog houses” to make ends meet.  In the 1990’s he started building spec homes and was doing really well.  As that decade ended the demand fell and he was stuck with 2 -3 spec homes on the market for two years.  In 2000 he decided to focus on high-end custom homes and was feeling like he had figured out the industry when the bottom fell out in 2008.  He says “this is longest downturn I’ve ever seen.”  Everyone on the panel agreed that they’ve experienced slow and hard times in our real estate market but the fallout of 2008 is taking a long time to sort out.

Randy believes that bargain hunting, longer processing periods, low offers and desperate sellers accepting lowball offers are all factors contributing to the decrease in home values.  He has already sold one spec home for less than it cost to build. 

He predicts a huge epidemic will surface once the new construction demand returns.  Many mills and plants closed and skilled workers found other jobs due to lack of demand in construction.  Randy believes that building material costs will skyrocket and construction lag time will increase while a shortage in building materials and skilled workers will have to be figured out.  He agreed with the other panelists that this is the best time to buy.  New regulations and requirements from building codes will increase the cost of building as well.  He believes that interest in remodeling will increase due to everyone’s equity being tied up in their home.

Wenatchee home inspectors, AMS Inspection, sponsors NCHBA Breakfast June 8th

Are you hungry for important information about the North Central Home Builders Association?  Then join us Wednesday, June 8th at SMITTY’S PANCAKE HOUSE, Wenatchee at 7:30 am – 8:30 am.  This great FREE breakfast is sponsored by AMS Inspection Services, Inc.  Come fill up on awesome information about the benefits of being a member of the NCHBA.  Whether you’re brand new or been here since the beginning there is always something to learn about.  If you know of someone thinking about joining then this is a great opportunity for them to learn what the NCHBA is all about.  ***Please RSVP by calling Cindy at 509-665-8195 by Monday, June 6th.  VIEW FLYER.

Wenatchee Area Builder Association Talks About Code

 A couple of weeks ago we posted information about Washington State’s new HVAC requirement.   We are members of the local North Central Home Builders Association and along with the BIAW they are frustrated with the adoption of this new code and fear that it will cost contractors time and money to meet the new requirements.  Read the summary below written by NCHBA.

“On February 7th, Judge Robert Bryan of the Federal District Court in Tacoma denied BIAW’s Motion for Summary Judgment and Granted the State Building Code Council’s Motion for Summary Judgment. The Judge issued a lengthy opinion, finding that Chapter 9 of Washington’s Energy Code was not preempted by Federal Law, even though it concerns the use of components that exceed federal standards…The Federal law states that credits under state energy codes must be on a one-to-one ratio to energy savings. In other words, a one point credit for installing a high efficiency furnace under Chapter 9 must equal the same amount of energy savings as the one point credit for building a house under 1,500 square feet…BIAW is appealing the ruling.”