Oct. 9, 2017

What You Need To Know About Getting a Mortgage

Mortgage Process in Olympia and Lacey WA

Some Highlights 

-Many people are purchasing homes with less than 20% down.  In fact, many are getting a mortgage with as little as 3% down.

-You DON"T need perfect credit to qualify for a loan.

-Talk to a local expert and take advantage of their knowledge, to help determine what you qualify for and how much you can afford.

Please feel free to contact Brandon at the Premier Homes NW team at Abbey Realty Inc in Olympia, Lacey and Tumwater if you would like more information on Home Loans

 

April 6, 2017

April Can Be a Timely Entry Point for Olympia Listings

 

It’s Spring!--Traditionally the time of year when area homeowners who haven’t yet listed their homes for sale in Olympia, may have a legitimate question about whether it’s too late to benefit from the spring selling season. This year, they may also be legitimately concerned that the rise in mortgage interest rates could hold back prospective buyers.

The answer to the first question is a qualified NO—not too late! The only qualification has to do with the condition of the property itself. If it can be in showable condition within a month or so, this is a fantastic time to jump into the Olympia market—for a variety of reasons.

We won’t know the actual foot traffic numbers for Olympia until after the dust has settled at the end of summer, but we do know for certain that the law of supply and demand points to this year being a standout for sellers. In large part, because the economic outlook has been building optimism for months, early signs point to strengthening buying interest. Realtors® across the nation report that last month’s buyer traffic was either strong or moderate. The index number for December through February was all the way up to 70 (that’s at the top of the chart)—up from 57 just a few months back. At the same time, the volume of new listings remained weak in most areas: down to 41 from 48. That would negate the most common argument for delaying entry into Olympia’s listings—that is, the fear of getting lost in the shuffle as the real estate season peaks. If the number of listings continues to lag, that worry disappears. When demand is up and supply down, everyone from high school economics teachers to Warren Buffet agree there’s no better time to jump into the market.

As for the other concern—the Fed’s having raised borrowing rates—so far it hasn’t seemed to discourage buyers. The analysts at Housingwire offer three reasons why that might be happening. First, most potential homebuyers believe rates will rise further, prompting them to act sooner rather than later. Second, any slackening in mortgage applications will prompt lenders to relax the tight lending standards that have tended to depress the market. Lastly (this is a good one!), lenders had already factored in last month’s rate hike—so actual home loan rates aren’t likely to rise further for a while.

 

The long and the short of it is that for anyone hesitating to add their home to this spring’s Olympia listings, it’s not only not too late—it’s also an excellent idea. Another excellent idea is to give me a call ASAP: the buyers await!

March 27, 2017

Will Home Sales in Olympia Match “Soaring” U.S. Rate?

Olympia home sales usually do respond to seasonal patterns that are familiar in most other areas. Spring and summer lead the way for weather-related, financial, school scheduling and other family-related reasons. From now into well into the early fall, house sales activity can be counted on to peak. Those are the typical expectations.

But when any segment of United States home sales numbers quadruple expectations even before spring bulbs see daylight, that’s worthy of special attention. This was the case last Thursday when the Commerce Department reported on February purchases of newly built homes, and that they rose by 6+%. Since The Wall Street Journal’s experts had only predicted 1.4%, it drew attention.

In fact, this was the second month in a row for sharp rises in U.S. new home sales—and what could be a bright sign for Olympia’s own prospects as the spring selling season begins. Press reports were, to put it mildly, enthusiastic:

  • MartketWatch: “New-home sales roar to a 7-month high”

  • Reuters: “…strength in housing should underpin economic growth”

  • ABC News: “Americans…snapping up new homes at the fastest pace since July”

  • Bloomberg: “U.S. New-Home Sales Climbed to a Seven-Month High”

  • CNBC: “[Sales] were the highest since July of last year—and that was the best number since January of 2008”

Bloomberg’s Michelle Jamrisko believes the house sales rise that the impact from the recent rise in borrowing costs was, at most, “modest.” That sentiment was echoed by the Realtor, which quoted the National Association of Housing’s chief economist. “The uptick in mortgage interest rates,” he said, “is having a minimal effect.”

 

We’ll have to wait and see whether it holds true what the impact of mortgage interest rates on Olympia’s own home sales. They could be either “modest” or “minimal”—or the prospect of continuing hikes might induce more new seller prospects to get busy sooner rather than later. If “sooner” describes your own inclination, I hope you’ll decide to put thought into action by giving me a call!

March 22, 2017

Olympia Housing Market Fits Many Downsizing Agendas

Time Magazine ended last week with a commentary that could foreshadow how this year’s Olympia housing market might differ from years past. Author Bill Saporito identified a mismatch in the housing market that could bode well for empty nesters. Whether or not the implications will be a perfect fit for our Olympia housing outlook, the “Big Picture” assessment does seem to gel with a lot of what we’re hearing and reading.

Time’s housing market “mismatch” begins with the national assessment that the U.S. is experiencing an annual shortage of as many as 700,000 new homes. Even though the latest economic outlook is refreshingly encouraging, new home builders are only now beginning to build the capacity to expand operations. As a result, “they haven’t banked as much land” or filed enough permits to keep pace. It’s also possible that the new administration’s crackdown on illegal immigrants may materially tighten labor availability.

The upshot is to create a scenario where demand for existing homes rises, putting current homeowners in “prime position” when they decide to list. Bolstering that proposition are some national statistics which peg the supply of existing homes at a scant 3.6 months—and it’s been more than a decade since the supply was that low.

What that probably means for our local Olympia housing prospects is what you expect when demand outpaces supply. When those greater conditions combine with the more immediate local factors, the overall takeaway should be good news for empty nesters (and downsizers in general). In addition to the extra energy that arrives with real estate’s traditional spring selling season, this year, in addition to the shortage of supply, the specter of rising Olympia mortgage costs acts as an extra prod. Time quotes the chief economist of one global group on that score: “…buyers are beginning to realize you might as well get in now.”

 

If you have been considering any of the opportunities unfolding in today’s Olympia housing market, I’ll be delighted to discuss ways I can help you take advantage of them. Call me for a consultation—of course it will be obligation-free.

March 15, 2017

Predicting Olympia Home Prices Doesn’t Take a Nobel Prize

The timing for when to sell a Olympia home can be a decision that pretty much makes itself. Sometimes family demands call for a move to larger or smaller quarters; sometimes a change in career demands or a schooling decision dictates a residential switch. But there are other times when an eventual move is in the cards—but timing is flexible.

That’s a situation where the decision can hinge on expectations for where future Olympia home prices seem to be headed. Nobody likes to be taken by surprise—especially if the surprises were foreseeable. As we enter the start of the peak Olympia real estate selling season, it would be useful to know the direction Olympia home prices are likely to move. Right now, it looks as if mortgage interest rates are moving upward: will that make selling more difficult?

 Looking for a truly well-educated guess, it’s hard to argue with the Nobel Prize Committee. Fortunately for us, those ladies and gentlemen named someone in the real estate economics field worthy of their international seal of approval (and a chunk of their 2013 Prize money). That’s Robert Shiller, the Yale Economics professor who accurately predicted both the dot-com and housing bubbles and who co-authors the authoritative Case-Shiller Index.

One logical concern for Olympia homeowners might be whether rising mortgage interest rates are likely to soften Olympia home prices this spring. The Wall Street Journal provided a reassuring answer: “U.S. Housing Market Roars into 2017, Case-Shiller Says.” Per their month-end roundup, “Home prices shrug off higher interest rates.” The shrugging they cited was indicated by the fastest growth in home prices since 2013—despite higher interest rates.

This may not be tantamount to Prof. Shiller’s personal guarantee that the recent interest rate rise won’t retard Olympia home sales—yet it does seem that history has seen a similar home price phenomenon before. In 1983, a 2.04% rise in mortgage interest rates resulted in a 6.6% rise in real estate values. In 1987, similar results. Between April 1999 and May 2000, a 1.6% interest rate rise accompanied a nearly 11% rise in values!

Olympia home prices will certainly not see anything like that 1999 kind of dizzying marketplace—and that’s just as well. The national consensus for 2017 is for moderate price gains in the 4%-6% range. But for those holding back from listing for fear that prospective buyers may shy away this spring, it doesn’t seem to be likely.

 

In fact, with a little imagination, you may almost be able to hear the approaching sound of the Journal’s housing market “roar.” If so, I hope you call me soon!

March 13, 2017

The Difference an Hour Makes

This Sunday marked the annual “spring forward” sleep-robbing occasion: the switch to this year’s Daylight Savings Time. “Springing forward” may sound like a spirited, energetic exercise, but for Olympia residents like me who do our best to keep regular hours, this week it will inevitably produce, at minimum, an extra yawn or two.

If it sounds as if I’m a bit grouchy about the whole thing, it’s only partially true. I hardly missed the hour between 2 a.m. and 3 a.m. on Sunday, save for how it made the night’s sleep an hour shorter. Intellectually, I know that the hour is actually in the bank: come fall, everyone in Olympia will get the hour back. Without interest, though.

Despite the Daylight Savings enthusiasts’ objections, the way the Earth and Sun naturally cooperate with each other seems perfectly satisfactory. The gradual lengthening of daylight proceeds slowly enough to give everyone in Olympia ample time to adapt without interference from outsiders. It’s never been clear why we are asked to abruptly reprogram our internal clocks the way DST promoters insist. Originally, they say the reason offered was to save fuel—but if that never seemed to make much sense, you’ll be gratified to know you aren’t crazy. A 2011 study in Indiana proved that 4% more electricity was required once Indianans started observing DST.

Given that fact, it might seem economical for Washington to stop observing Daylight Savings so we could save that 4%—but then we’d be out of luck trying to figure out how to sync up with everybody in the rest of the country (except for Hawaii and Arizona).

That issue hasn’t been enough to discourage some, though. The number of countries observing DST has been gradually falling in recent years. Between last year and this, for instance, Turkey and Mongolia dropped out. The world is now counting 75 observing countries, down from a high of 86 just eight years ago. If this keeps up, by 2030 or so, we may not have to discuss this at all!

This year Olympia’s calendar was complicated by the Daylight Savings kickoff being scheduled perilously close to Saint Patrick’s Day (Friday). This could result in more celebrants than usual nodding off during the festivities. Sleep-deprived party-goers might forget that they’ve already endlessly discussed whether green beer is a useful invention or whether St. Patrick really did drive all the snakes out of Ireland.

If they have fully recovered from Sunday, they might recall that there were never snakes there in the first place. “Snakes” was actually contemptuous put-down for the Druids, who were, in fact, driven from the Emerald Isle. As a group, they’d surely have grounds for a whale of a slander suit. There may be some Druids left somewhere (but probably not in Ireland).

 

Despite these distracting events, I can report that Olympia’s spring selling season is seeing the light of day and proceeding right on schedule. I hope you will give me a call if real estate matters will be part of your 2017!

March 7, 2017

20% Down Payment Fiction vs. Olympia Reality

It turns out that the run of admirable national and Olympia home sales advances have been pulled off despite a couple of strong counter-currents. At least that’s the theme that emerges from last month’s Aspiring Home Buyers Profile report, which supplied one obvious and one not-so-obvious widespread beliefs among would-be future homeowners.

Olympia home buyers are always a mix of current homeowners (who will usually also be selling) and first-timers. Among the latter group, a major drag on their willingness and ability to invest in their own Olympia home is the student debt phenomenon. Enough has been written about that in recent years that it’s hardly a surprise: 39% of non-owners cited student loan payments as a primary reason they weren’t planning on being able to buy anytime soon.

Much less expected is the proportion of current non-owners whose reasons centered on a piece of widespread misinformation. Apparently, the same percentage—39%—were convinced that they need more than 20% of the price of a home to qualify for a loan. Another 26% believe a purchase is only possible when they can produce a down of 15%-20%—and a majority of the remainder (another 22%) think they need a down payment of at least 10% - 14%.  

The chief economist for the realtor.com website summed it up concisely. “Aspiring buyers think it takes twice as much to buy a home” as it actually does in most cases. Although the actual numbers for any Olympia home purchase always depend on the details of the particular situation, the actual national averages will come as a shock to most. According to the latest National Association of Realtors® survey, the average down payment on a purchase mortgage was only 11% in 2016. That’s the average—in many cases, it was much lower. On Friday, CNBC’s Diana Olick quoted Attom Data Solutions’ finding that “down payments are shrinking…to a 6% average.”

That’s a pretty wide gap between common belief and current reality—one with real world implications. After all, if you assume a down payment has to be twice the amount actually required, it probably means you won’t even bother thinking about buying a house until long after you might have been able to get started. That could mean thousands of rent dollars diverted from what could have been spent on retiring a home loan. Long term, the difference would be significant. 

If you are considering becoming homeowner in Olympia or have been putting off even thinking about it because of what could be an incorrect assumption, I hope you’ll give me a call. There is never any obligation, of course—and the old saying is absolutely true in this case: it can’t hurt to ask! 

Feb. 21, 2017

Top 10 Nature Trails in Olympia

One of the best things about living in Thurston County, or in the PNW for that matter, is the abundance of nature trails and hiking. With such tremendous diversity in trails in Thurston County, it may be nearly impossible to pick the best one. Whether you are looking for kid/family friendly, beaches, 3+ miles, or even casual walks, here our top 10 hikes in the Olympia.

 

Priest Point Park & Ellis Cove

One of Olympia's favorite, Priest Point Park as many amenities.  The park has several picnic areas, play areas and a playground.  The park is also a great place for hiking, and walking.  On the east side of the park their are several well maintained wooded walking trails.  On the west side of East Bay Dr. you can take a steep trail down to the beach, where you can walk the beach, or take in the view.  

Also on the east side is access to Ellis Cove.  This 2.5 mile trail wraps around Ellis Cove with a nicely manicured trail, with views of the Capitol building, and on a clear day the Olympic Mountains.

Address: 3302 East Bay Dr. NE Olympia, WA

Woodard Bay Conservation Area

Woodard Bay wild life sanctuary is just minutes away from downtown Olympia.  Woodard Bay conservation covers over 800 acres of protected land.  The conservation site is a protected habitat for wildlife, as well as 5 miles of shoreline.  

For a light walk the conservation area has a 1.5 mile loop that rejoins the road, to the point, where you can enjoy amazing views. Along the walk you can see many mature old grow, marine life, a variety of birds and other animals.

Address: From I-5 heading south, take Exit 109 (Martin Way Exit) towards Sleater-Kinney Road, and make a right onto Sleater-Kinney Rd NE. Travel approximately 4.5 Miles and continue as it turns into 56th Ave NE For 0.4 Miles. When you reach the "T", turn right onto Shincke Rd NE and proceed one-half mile. Turn to the left and becomes Woodard Bay Rd NE. Cross the bridge over Woodard Bay and find a parking lot on your right.

Chehalis Western Trail

The Chehalis Western trail spans 22 miles going from NE Olympia all the way to SE Tenino. This walk, bike, stroller, dog friendly trail is not your typical hiking trail, with most of the trail being paved. Along the trail there are scenic sites, which include ponds, the Deschutes river, Puget Sound, Chambers Lake, Monarch Sculpture Park, side horse routes, views of Mt. Rainier and access to over 100 acres of park land. The Chehalis trail is for great for taking a relaxing stroll and perfect for anytime of the year. 

There are several access points along the trail, with more notable trail head .25 mile from Woodard Bay Conservation Area.

Address: From I-5 exit 109, turn right on Martin Way, then left on College Street. Pass Lacey Blvd. and turn right on 14th Ave. to the parking area.

Nov. 23, 2016

Why Interest Rates Are Rising

A recently published survey by Freddie Mac shows that 30-year fixed rate mortgage interest rates increased to 3.94% this past week. Recently rates have been around 3.5% since early summer, leaving many inquiring about why the rates increased so significantly.

Why did rates increase?

Presidential elections always lead to uncertainty in markets.  This is usually seen initially through the way investors react. As we've seen since election night, when the market tumbled initially, and throughout election night as they rebounded to record highs.  Many investors pull their money from volatile traditional stock market and move it into bonds.

As this happens, the rates on Bonds don't have to be as good to provoke investors into purchasing them, so the rates go down. As the election draws to an end, investors shift back to the stock market, causing the Treasury to hike rates on bonds to make them more appealing again.

Easily put, the stronger the economy, the higher the rates will rise.  Of course nothing is that easy, and there are many variable as to why rates go up and down. For full explanation, check out some investment websites to get a better grasp on interest rates. 

 A recently published survey by Freddie Mac shows that 30-year fixed rate mortgage interest rates increased to 3.94% this past week. Recently rates have been around 3.5% since early summer, leaving many inquiring about why the rates increased so significantly.

Why did rates increase?

Presidential elections always lead to uncertainty in markets.  This is usually seen initially through the way investors react. As we've seen since election night, when the market tumbled initially, and throughout election night as they rebounded to record highs.  Many investors pull their money from volatile traditional stock market and move it into bonds. 

When this happens, the interest rate on Treasury Bonds does not have to be as high to entice investors to buy them, so interest rates go down.  Once the elections are over and a President has been elected, investors return to the stock market and other investments, leaving the Treasury to raise rates to make bonds more attractive again.

The Good News

All though interest rates are much closer to 4% than they have been in the last 6 months, they are still a little lower than they were at the beginning of 2016 when rates where 3.97%

The even better news is that at 4% rates are still historically lower than they have been in the last 40 years, note the chart below.

Homes for Sale in Olympia WA

May 31, 2016

How Housing Builds Family Wealth

As the United States economy keeps improving, many more people beginning to see improved personal finances. Instead of just living paycheck to paycheck, many are now able to accumulate savings and look for other ways to build their personal wealth. If one has the ability, aquiring real estate is one such way a person can begin to build their own personal wealth.

Let's take a look, assume a married couple purchased and obtained a home for $250,000  this past January. What do you think that home will be worth in 5 years? 

Pulsenomics which takes a survey of 100+ real estate professional experts, investors, strategests and economists each quarter, asked these experts to project real estate prices for the next five years.  Per the survey, they made predictions on appreciation of real estate over the next 5 years, a home valued at $250k today will make these gains in that time

How Does Housing Help Build Family Wealth? | Simplifying The Market

In just 5 years, and depending on the market, a homeowner could potentially build $40,000 additional equity in that time frame.  For many people, home equity is the single largest asset and contributor to a families net worth.

Here's the Bottom Line

If your are trying to maximize your family’s long-term overall wealth, buying a dream home could actually be a great investment.