Snohomish County Home prices Reach New High — Again

EVERETT — Housing prices continue to climb in Snohomish County reaching never-seen-before heights.

Median prices for houses and condos reached $430,000 for July, up from $385,000 for the same month a year ago, according to the Northwest Multiple Listing Services.

That’s an 11.7 percent increase year-over-year. It’s also a $10,000 increase on the same numbers in June, when the median price was $420,000.

“We should be entering the summer doldrums, but I don’t see that happening,” Diedre Haines, principal managing broker-south Snohomish County at Coldwell Banker Bain in Lynnwood, said in a statement.

The median price for closed sales for all homes surpassed $400,000 for the first time this year in April. Prices have been rising steadily ever since.

Last month, a news story in the Orange County Register in Anaheim, California, reported that Snohomish County trailed only King County in the nation for the shortest amount of time a home was on the market. The report citing numbers from Realtor.com said that houses sold in 20 days. Houses in King County sold in 19 days. Arapahoe County east of Denver came in third at 23 days.

Home prices vary greatly with location, with homes in south Snohomish County costing far more than homes in the north.

Almost all of the county saw double-digit price increases year-over-year. The biggest jump was for the Multiple Listing Service area along the U.S. 2 corridor. There, housing prices rose to $433,000, up from $322,475 a year ago, or a 34.3 percent increase.

The only listing service area that did not see a double-digit increase was the one around Edmonds and Mountlake Terrace in south Snohomish County. There, prices reached $470,000, up from $444,000 a year ago, or an increase of just under 6 percent.

The median prices for houses alone is $453,000 for all of the county. The median prices for condos is $323,475, according to the numbers released Monday.

One of the reasons for the climbing prices is a lack of inventory. Only 1,759 Snohomish County homes were on the market for July. That’s down 10.7 percent from the same month a year ago when there were 1,969 homes.

“Inventory remains low, but prices and demand continue to increase, prompting murmurs of a looming bubble,” Haines said, adding, “Some say yes, and just as many are saying no” when asked about the likelihood of a bubble.

In some areas, inventory is showing some signs of growth, Haines noted, but it’s still “way below what would be considered anywhere near normal. Frankly, I am not even sure anymore exactly what normal is — perhaps the current low inventory status is the new normal.”

~Jim Davis, Everett Herald Net

Six Ways to Rustle Up a Down Payment for a Home

The down payment. It’s the only thing keeping you from a home of your own. You’ve got a good job, you’re paying down debt, and mortgage rates are still remarkably low. And rental rates are getting ridiculous.

Let’s see if we can break down this home buying barrier.

It doesn’t always take 20% down

If you’re a first-time home buyer, the down payment hurdle you have to clear may be quite a bit lower than you think. Traditionally, lenders have preferred 20% down, but a lot of low down payment options are available, especially to first-time buyers.

Mortgages guaranteed by the Federal Housing Administration, Department of Veterans Affairs or Agriculture Department can be go-to low down payment loans. In fact, mortgages backed by the VA and the USDA — for those who qualify — usually don’t require a down payment at all. A funding fee is charged on VA loans, but even that can be rolled into your monthly loan payment.

You could get an FHA-backed loan with as little as 3.5% down, but you’d have to pay mortgage insurance to help lenders defray the costs of loans that default.

Conventional loans, which aren’t backed by the government, also offer low down payment programs to first-time buyers. Down payments of just 3% are common. Some lenders will offer 0% down loans. Mortgage insurance will enter the picture here, too.

However, a lower down payment usually means you’ll pay a higher interest rate.

Crowdfunding a down payment

Crowdfunding is the ultimate dream for snagging sudden money from strangers, other than the lottery. It can be done, but there are some catches.

First, you’re not going to get this done on Kickstarter; personal fundraising isn’t allowed there. Sites like GoFundMe are best suited for hard-luck appeals like medical expenses for life-threatening diseases, so it’s unlikely you’ll get a lot of help there when you’re pitching to raise money for a mortgage down payment. But who knows?

FeatherTheNest.com might be an option to consider. It lets you build an online profile for a gift registry where contributions to your down payment can be funneled into a linked bank account. The service seems particularly suited for engaged couples and newlyweds. The transaction fees are pretty stout, though — totaling about 8% on each donation.

Family down payment gifts and loans

Getting help from family members might be another way to go.

Garrett Clayton, CEO of AmCap Mortgage in Houston, cautions that receiving a gift toward a down payment takes a “full circle” of documentation to satisfy a mortgage lender’s requirements. The donors will have to verify in writing not only that they made the gift but that they have the financial ability to make such a donation. That will require them to provide bank statements as proof, along with a letter confirming that the donation is a gift and not a loan.

“From a lender perspective, if it is something that will be required to be paid back, then we would need to take those terms of repayment into the calculation of the borrower’s [debt-to-income] ratio, to make sure they still qualify,” Clayton says.

However, while properly documented gifts are acceptable to lenders, you might not want to rely exclusively on the kindness of family members, he adds.

“We see that borrowers that have none of their own money in the transaction are way more likely to default on loans,” Clayton says. “I would much rather do a loan to a 600 FICO client that has 100% of their own down payment, versus a 780 client that is getting 100% [of their down payment as a] gift.”

State and local down payment assistance

Here’s a little-known source of down payment help: state and local assistance programs. Rob Chrane, CEO of Atlanta-based DownPaymentResource.com, says the service has identified close to 2,500 initiatives across the nation.

There are programs in every state, implemented by government agencies, nonprofits, foundations and even employers. Assistance can have a geographic focus as wide as the nation or as narrow as a city — all the way to hyperlocal initiatives targeted as tightly as neighborhoods, and even house by house.

Programs change often; they’re funded, defunded and sometimes funded again.

Often, it’s a matter of matching a property to a program, Chrane says, based on a home’s location and price. Assistance requirements typically set a maximum sale price for a county or other geographic definition. Obviously, these programs aren’t meant to help borrowers buy million-dollar homes or vacation properties, he says.

“There’s typically some maximum household income limit,” Chrane adds. That can vary by location, as well as the number of members in a household, he says. Even statewide programs will have income requirements that are often higher in metropolitan areas and lower in rural areas.

A 2016 study by Attom Data Solutions determined that the typical down payment assistance program benefit, calculated over the life of a loan, was $17,000. The total combined an average savings of nearly $6,000 on the down payment with over $11,000 in monthly house payment savings over the life of a loan.

Benefits can be layered. Chrane says users of the website who were eligible for assistance qualified for an average of eight programs last year.

“There are some myths and misperceptions around this,” Chrane says. “Sometimes people think, ‘Oh, this is only for really low-cost housing, in targeted census tracts, distressed neighborhoods…and very low-income households. It’s much more widely available than that.”

Tapping retirement accounts

If you have a retirement nest egg, you might be tempted to tap a portion of it to help with the down payment. Employer-sponsored 401(k) plans often allow for penalty-free hardship withdrawals or loans. But if you’re under 59½, you’ll pay income taxes and a 10% penalty on the withdrawal. And loans can trigger an immediate repayment — or taxes and a penalty — if you lose your job.

IRA withdrawals for home purchases are allowed, up to $10,000. Roth withdrawals are tax-free and without penalty if you’ve had the account for at least five years. Tapping a traditional IRA will trigger income taxes.

The most obvious strategy
There’s always the spend-less-than-you-earn-and-save-it strategy to building a down payment fund. Maybe a few savings tips can help you there.

More than likely, it may take a combination of strategies to get you into a home with a decent down payment — and still have a little left over to cover those unexpected homeownership expenses.

~Hal Bundrick, NerdWallet

King County Home Prices Grow $100,000 In A Year For First Time; West Bellevue Jumps 41 Percent

The median King County home price has grown more than $100,000 in just a year.

Following up on a record-breaking spring, the county’s real-estate market had its hottest month of July since such monthly records began in 2000, with prices rising 18.6 percent from a year ago.

The new median price is $658,000, or $103,000 more than last July, according to monthly data released Monday by the Northwest Multiple Listing Service.

Just a down payment on the median house costs about $20,000 more than a year ago. So first-time buyers who didn’t save up that much in the past year are further from buying a house today than they were a year ago.

George Moorhead of Bentley Properties in Bothell said his office is working with 60 first-time homebuyers right now — and it’s been a struggle to find something for any of them.

“First-time homebuyers are really feeling the pinch. Some of them have been looking for a home for almost two years,” Moorhead said. “They have to keep going further and further out just to find something that’s worthwhile. It’s just slim pickings out there.”

Trade-up buyers are dealing with a similar crunch. One-third of homes across the region sold for at least $1 million this past month, according to John L. Scott Real Estate.

“Anything between $900,000 and $1.3 million, you’ll still find yourself in a multiple-offer situation — six to 10 offers,” said Lori Holden Scott, a John L. Scott broker who deals with pricier homes.

While prices have been going up for so long that increases might seem inevitable, this month’s surge is actually a bit unusual.

Median prices in Seattle ($749,000) and the Eastside ($860,000) did dip slightly from June’s record highs. Both were still up about 15 percent from a year prior.

West Bellevue had the county’s biggest price jump — up 41 percent from a year ago, to a new median price of $2.3 million, the priciest region in the county. Areas that saw prices zoom up more than 20 percent in the past year include West Seattle, Sodo/Beacon Hill, Central Seattle/Capitol Hill, Shoreline, East Bellevue and Redmond.

Countywide, the annual price increase in July was the largest ever in terms of absolute numbers. But the 18.6 percent growth was a bit slower than in some previous months.

“I don’t think anything is slowing down,” said Laurie Way, a managing broker at Coldwell Banker Bain in Seattle.

Both Moorhead and Way think the market has to cool a bit eventually; it’s just unclear how long that will take.

The very-long-running trend of declining inventory continues, as fewer people put homes up for sale while those properties that do hit the market get snatched up in about a week, on average.

And Moorhead said more repeat buyers are choosing to rent out their old homes, banking on getting steady rental income while knowing they could sell the home later — perhaps at an even higher price. He said his last four homebuyers all rented out their old homes.

The number of homes for sale across King County dropped 18 percent from a year ago and is at the lowest point on record for this time of year. Sales were down slightly, as well.

One bright spot for buyers: Condos across the county cost a median 5.7 percent more than a year ago, the second-slowest growth in the past two years.

Downtown Seattle, where condos are the only homebuying option, actually saw prices drop a tick from a year ago. Enumclaw was the only place where single-family-home prices decreased.

Elsewhere, Snohomish County surged to a record median price of $453,000, growing 11.9 percent from a year ago.

Both Pierce and Kitsap counties dipped a bit compared with last month’s record prices, but they still were up significantly from a year ago. Pierce’s median price is $312,000, up 9.6 percent from a year ago, while Kitsap reached $322,000, an extra 11 percent from this past year.

~Mike Rosenberg, Seattle Times

Seattle is a Tough Market, Even for Condos

Home buyers are in a tight bind. And Seattle’s market isn’t making it any easier.

The median home price in Washington is rising and rising, and although realtors have faith that it will hit a ceiling sometime, no one is sure exactly when that relief will be.

In a housing market still feeling the effects of the recession, that’s a tough spot to be in. According to a new report from Zillow, the effects of the housing market collapse are still weighing down Gen X homeowners.

The study found that 88.7 percent of Seattle metro Gen X homeowners still have a mortgage, and still owe 61.9 percent of their homes’ value. That burden could be one of the potential roadblocks that realtors worry could prevent owners from moving up to a larger home.
“Roughly half of American wealth is held in home equity,” Zillow Chief Economist Dr. Svenja Gudell said.

“Paying off the home mortgage is a key step toward retirement for most Americans, and it’s clear from these results that Generation X is further from that goal than older generations because of the Great Recession. The good news is that home values are still growing relatively fast in most places, building up home equity for homeowners who rely on the investment they’ve made in their home.”

But breaking into that market can be easier said than done – much easier.

Even condos, traditionally the path to ownership for first-time buyers, have been sparse. According to this month’s Northwest Multiple Listing Services report, inventory is down 24 percent from a year ago, and condos currently only account for 8 percent of all active listings (and have less than a month’s supply).

And while condos on the whole remain more affordable than a good chunk of the single-family homes out there, condominium prices have been trending upwards as well – appreciating in the double digits for the last three years alone.

“Condos are typically the next best option for first time buyers who cannot keep up with a surge in pricing from single family homes,” MLS Director George Moorhead said. “However, even condos are being priced out of reach for many new buyers.”

In Seattle, the median condo sales price for June was $475,000, up more than 10 percent from the same time last year. And if you want in-city, expect that to be on the more expensive end.

The Tesla Solar Roof Finally Has a Price and It’s Competitive With Other Roofs

In May, Tesla began taking orders for its long-anticipated solar roof. On average, the Tesla solar roof price is $21.85 per square foot, which is less than the cost of a normal roof, even without the energy savings.

The cost of a Tesla solar roof ultimately depends on how much energy you need and the percentage of active solar tiles on the roof itself. To help people determine that, Tesla also dropped a solar roof calculator with the release so people can estimate exactly the cost and how much money the roof will save them over time when they order. The solar roofs will be able to be installed in the United States this summer, and should ultimately pay for themselves, which Tesla points out makes them significantly more affordable than regular roofs. Along with that, the solar roof is stronger and lighter than a typical roof, which Elon Musk demonstrated on Instagram.

And although Elon Musk joked that he wasn’t going to make the warranty for the tiles infinity, it turns out that he changed his mind. “We offer the best warranty in the industry—the lifetime of your house, or infinity, whichever comes first,” a Tesla rep tells Inverse.
The Tesla solar roof is made of tempered glass, which makes them three times stronger than things like slate or asphalt tiles, according to Tesla. They are also half as heavy as other roofing methods. On an entire roof, the tiles will be a mix of non-active and active solar tiles. And while Consumer Reports found that a solar roof needs to be $24.50 per square foot to compete with other kinds of roofs, the Tesla solar roof comes in at $21.85 with 35 percent of the roof being active solar.

Determining the cost of a solar roof take into account how much of the roof can be active solar tile, and how much will just be the non-active glass tiles. A glass tile, without the solar elements costs $11 per square foot, and the solar tiles themselves are $42 per square foot. For most houses, Tesla says only about 40 percent of the roof will be active solar, but the percentage of active tiles depends on how much energy a household needs.

Tesla released a comparison of the different costs of roofing materials and its glass tile.
If you want to price your own roof, you can use the Tesla Solar Calculator to determine the amount of energy a solar roof will produce over 30 years, the flat cost to purchase a roof for your house, and even adjust the cost based on your electric bill.
Of the four tile options, the grey smooth and textured black glass tiles are open to order, and the slate and tuscan style tiles will be released early in 2018. Within the United States, Tesla plans to start installing the solar roofs right away, and will start installing outside of the US in early 2018. Tesla says that installation will take about five to seven days, entirely managed by the company itself.
With all of the solar roof announcements, Musk took a moment to upload another kind of recommendation for the solar tiles. He posted a video of a hail cannonball hitting a solar tile, leaving the solar tile entirely unscathed.

~Dyani Sabin, Inverse Innovation