I've been very lucky, having enjoyed a pretty darn blessed life. Recently, an article was published in Seattle's neighborhood paper, The West Seattle Herald, about me and my relationship to my famous grandfather, Fred Astaire. Out of this moment have surfaced many interesting people with terrific stories of their own. Today, I received a nice note from the daughter of someone who danced with Mr. "A" (as I called him) on the USO circuit during WWII. It's attached by permission but with contact information redacted.

Inspired by a conversation with a local home loan consultant this morning, I conducted a quick review of mortgage rate fluxuation over the last decade. Focusing on 30 Year fixed mortgage and looking back to 2005, wow, what a telling story. "Mortgage News Daily's" is an excellent resource. I adjusted their dropdow menu setting from a one year to ten year overview. Similarly, I looked at Windermere's housing price index (see below), at residential $ per square footage rates in our Seattle/King County market for the same period. Taking into account that interest rates were sitting at about 5.75% in mid-2005, they are well over one percent lower as of this writing. This a great time, possibly the BEST time to refinance your home loan. And why wouldn't you?

Windermere Real Estate produces a powerful tool; its housing price index calculator matching three data sources, Case Shiller Index, Northwest Multiple Listing Service and the Federal Housing Finance Agency(FHFA)/Office of Federal Housing Enterprise Oversight (OFHEO).




In 2005, the message was rates were at an historical low. Today there is no question. Looking back to December, 2000, only a decade ago and they were at about 7.5%. This is not the time to wait.

As you know, I make it my practice to forward only information I consider important and valuable to you, not fluff. As we approach year’s end with taxes, the new elections, property values, the economy, employment numbers and so much more on our minds, this is a good time to check in with a pulse on the region’s housing market. Predictably, questions I am often posed include “How’s the Market?”, “Is this a good time to sell?”, “Should I hold on to my property, remodel, buy up, downsize, etc.” Of course, as I lack a crystal ball, I can only look to local, regional and national market indicators to answer these questions with any substantive authority. This last week I attended a seminar during which some terrific information was disseminated which I believe you should have.

Following is an article authored by Steve Harney in April, 2010 and referencing a Case Shiller report estimating the time necessary for substantive rebounds to occur in markets around the country. You will notice a large blank/white space in the article’s center. This is a link to a map demonstrating where regions stand in the estimation. You’ll need to ctrl/click to launch the map. Good news is that the Pacific Northwest appears poised to enjoy a quicker return to top-of-market pricing than any other west coast region, as early as 2013.

Referring to my aforementioned lack of a crystal ball, I view this as highly dynamic data, subject to market pressures, stock and bond market fluxes, etc. It may only be viewed as a general statement of probability. One supporting factor is our continuing population growth combined with on-going, strictest-in-the-nation development controls.

On another front, John Paulson (no relation to former Treasury Secretary, Henry (Hank) Paulson), multibillionaire hedge fund operator and bond better extraordinaire, who made a fortune predicting that the housing market would indeed crash against all the pundits’ prognostications of a few years ago, is declaring this to be the best time to purchase a home in the last fifty years.

http://blogs.forbes.com/robertlenzner/2010/09/27/john-paulson-sell-bonds-buy-stocks-double-digit-inflation-coming/

It’s always difficult to predict who’s correct and what data is reliable. I can say that, nationally, real estate has appreciated at a rate of approximately 4% per annum over the last fifty years. In Seattle, that number hovers around 3.8%. In my own opinion, we are returning to a time where the traditional values of home ownership as a stable, long term investment where wealth gains are made by paying down the mortgage, thereby increasing equity. Investors may view these days as an ideal time to acquire new rental properties. The rental market has some strength to it. For new buyers, prices in Seattle, combined with historically low interest rates, make this the first time since 2002 that home affordability as it relates to mortgage amount is deemed affordable based on median income. For those considering a move up, the gap between a home to sell and one sitting in a higher price point for purchase is narrower than we’ve seen in a long time. Lastly, for anyone who purchased in recent years, hang in there, Apparently, there are signs that at least in our region, we may get back to 2007 pricing levels in a matter of only a few short years, not well over a decade as in some markets. That’s good news! Ironically, it appears an excellent time to buy, sell, or hold depending on what hand you wish to play.

I continue to make it my purpose in life to keep you informed and educated so you may make the best financial decisions for yourselves and loved ones.

Enjoy the holidays and know I’m thinking of each of you.

(Remember to scroll down to read the Case Shiller article)

by Steve Harney on April 21, 2010

Experts can't agree where home values will be later this year. There are so many variables to consider: interest rates, foreclosures and unemployment to name a few.

That is why it is amazing to see a new report which not only looks at this year but also predicts when housing values will return to the peak prices of 2005-2006. Fiserv teamed up with Case Shiller to examine different parts of the country and determine when those regions will rebound to the prices we experienced at the height of the market.

In a press release titled For Many U.S. Markets, the Return to Peak Home Prices Will Be a Long, Slow Road they state where prices are headed this year and they map out certain regions and estimate when these markets will return to peak values.

What will occur with prices this year?

According to the report:

"Nationally, Fiserv Case-Shiller data points to a further seven percent decline in home prices through the end of this year, with a prolonged recovery beginning early in 2011. In many markets, the emphasis is on the word 'prolonged,'" said David Stiff, Chief Economist, Fiserv. "We see several powerful forces in the market that will severely hinder the housing recoveries of many metro areas, particularly in the hard-hit states of California, Florida, Arizona and Nevada. It will take these markets 15 or more years before home prices climb back to their peaks."

When will prices return to peak values?

Here is the map that accompanied the press release:

http://kcmblog.com/wp-content/uploads/2010/04/Future-National-Prices.jpg


What does this mean to you?

If you are thinking of selling but want to wait for peak prices to return, check out the map. If you are thinking of buying, check out when you can expect your market's prices to reach top dollar again.

Newly launched in cooperation with Seattle KingCounty Realtors, this site will bring you wonderful tips on creating energy dollar savings in your home:

Green Home Advisor

"If you live in Seattle, your home is eligible for a reduced-cost energy audit. The audit will provide you with a comprehensive analysis of your home's specific energy attributes (windows, insulation, weather-stripping etc.) and heating systems. You also will receive information on how various energy- saving upgrade options interact with each other and a list of efficiency upgrades that are most appropriate for your home.


In addition, your home may qualify for a combination of rebates, low-interest financing and tax credits for energy improvements such as a new water heater, updated attic insulation, and weatherization."

A good friend of mine, a broker from a competing company, who I’ve known for the better part of a decade, stopped by our office the other day. I’ve only moved my license here recently as the new acting branch manager (though I continue to sell full time as well). John (his name has been changed) and I took a moment to catch up. After that brief encounter, I followed up with a social phone call. We’ve been knocking around West Seattle for years and built a nice friendship in the process, so it’s always good to catch up with him.


While the banter was the predictably mutually respectful and playful exchange, I was struck by one thing, his self-talk about business. When we met at the office, John mentioned he was doing well, “on a streak”. Yet, he was also pretty dismissive about it. Personally, I think it is best not to focus on “streaks” in this business, rather consistent flow, leveling out the exhausting and contrasting peaks and valleys in the process. The practice of real estate isn’t a gambler’s roll of the dice at the craps table. It’s a business in which predictable, consistent and well-practiced activities yields measurable, controllable results. Regardless, I congratulated John on his streak, telling him it didn’t surprise me he was doing well as he’s such as seasoned veteran. Frankly, his reply was surprising, saying things such as, “Nah, I’m just a mediocre sales person. Really, it’s just luck. I don’t do anything special.”

Seriously?

If you were in a heated divorce battle and your attorney claimed only an average track record and ambivalence towards his work, would you trust the outcome? If your doctor told you “she was on a streak, not having lost a patient on the operating table recently, how quickly would you want to go under knife with her?”. In a rapidly changing industry with licensees falling by the wayside in droves, it’s good to know there are a lot of accomplished, seasoned veterans still in the game. Yet, every time I bump into someone whose message is they’ve simply taken too many knocks, I wonder if it isn’t time for them to either recalibrate or perhaps consider a career change. Projecting an attitude of defeat, mediocrity, antipathy or outright negativity is a surefire kiss of death…..even if only a slow one. If you hear yourself saying things like “times are tough”, and they may well be, keep it to yourself. Clients want to work with professionals who project success. They want to know that, when you’re helping them with the biggest financial decision of their lives, they’re in good hands. Same thing is true for peer-to-peer relationships. If I’m in a deal with a competent broker with a great attitude, I know I’m in for a win-win outcome. As far as I’m concerned, less is unacceptable.

Watch your self-talk. Better yet. Can it!

Great advice contained herein. The more we avail of social networking tools to augment business channels, the easier it is to fall down the rabbit hole. As with anything else in your business, time management is key.

5 ways to cheat Facebook and Twitter time suck Inman News

An agent called me on one of my active short sale listings. She was vetting the property for her client. I’ve made it a practice to “Google” agents when it appears we may be doing business together; helps to connect a face with a voice. As it turns out, this particular agent is also an actress working here in town who is represented by someone whose name I have known for fifteen years. The talent agent and I have a friend in common from my entertainment production days in Los Angeles. I have not spoken with this friend for the better part of twenty years. On a whim, I sent the talent agent an email yesterday, introducing myself and inquiring after the common friend. Coincidences of coincidences, she just happened to be in town for twenty four hours visiting the agent. How weird is that? We just had coffee this morning.
Needless to say, act on your impulses and they may lead to very interesting intersections, business included.

I disagree whole heartedly with the "Freakonomics" analysis stated here.

"Freakonomics" authors on real estate agents The Real Deal New York Real Estate News

While arguments may be made that professionals in any industry may be operating from a position of self interest, these authors have not done their diligence in asserting that brokers are inclined to "market our personal properties" longer than we would our clients' in pursuit of a higher sales price. Not true! Better than ninety percent of all homes sell for a price other than their original list price. This is a product of market value being established by a meeting of minds between the buyer, willing to pay a certain amount, and the seller, willing to accept an sales price; usually some distance traveled in market time and/or negotiation from that starting point. Furthermore, in a downtrending market (the case with most regions of the nation over the last twenty four months), market time correlates directly to price depression. It simply does not hold true that the longer a broker's personal home stays listed actively, the greater the liklihood of a higher sales price. Additonally, savvy brokers do not represent themselves when listing/buying real estate for two reasons, we are not insured by errors and omissions and are no more immune to the emotional rollercoaster ride that is a real estate transaction.

REALTORS, members of the National Association of REALTORS and the only licensees qualified to use the moniker, adhere to a strict code of ethics. While there remain bad apples in any bunch, a well-trained, professional, ethical practicioner is infinitely qualified to provide solid client counsel. I have been in many a transaction where the seller has accepted an offer for lesser dollar value than either list price or even a competing offer because other aspects of the deal were stronger, more compelling. I simply do not accept we're all out for number one. We have a fiduciary responsibility to our clients, and an obligation to treat all parties fairly. Lastly, most competent, productive brokers have built business around a strong referral base of repeat customers and word of mouth. The short-sighted strategy of counseling sellers to accept any offer simply on its merits does not take into account this fact. We want our clients to be happy and well-served.

Should there be any debate? In this ever expanding real estate frontier where most buyers find their new home on-line, often before even talking to a Realtor, first impressions are everything. I can't number the times my clients have said they skipped past a new listing during their web searches because it didn't have photos attached when the listing went live. The following link is for a recently published Wall Street Journal article pertaining to a Redfin study demonstrating the increasing importance in return on investment good listing photos yield. Interestingly, though, the same does not necessarily hold true for listings at lower prices. The adage "You put lipstick on a pig and it's still a pig" is apropos. It does not necessarily benefit the seller of a distressed or less than perfect street appeal property to create the illusion it is in better condition or will show more favorably than it actually does.

https://docs.google.com/leaf?id=0B1gQgjP5HvJFYTg1ODM4YWEtMjA0Mi00NTVlLTlhMmQtNTg2YWQ5MTYxZTZh&hl=en

While housing news across much of the country focuses on the foreclosure mess, Attorneys General from all fifty states launching investigations and the like, it's easy to remain mired in the morass of lousy tidings. Though I only speculate, there may be one bright sector in the local Seattle market; an increase in market rental pricing. An associate of mine with intimate knowledge of the Seattle Housing Authority Section 8 voucher program shared recently that its rental rates are feeling upward pressure. HUD-subsidized housing voucher calculations follow the market. In Seattle, vacancy rates are dropping; perhaps a combination of more people streaming into the region while short sellers and home owners turning their keys back to the bank are reenter the sector. Fewer available units means higher prices; simple math. Combined with an affordable house pricing index not seen since 2002, this may be an early sign that buyers will return to the market en masse in the not-too-distant future as they re-embrace the reality that homeownership may be more affordable than renting in the long run. We've seen the pendulum swing before and are likely to again.

Puget Sound Business Journal this week: "King County foreclosures rises as borrowers fall further behind"


Attorney General Rob McKenna and Washington State Department of Financial Institutions working to get ahead of the trend, protect consumers:

http://www.atg.wa.gov/pressrelease.aspx?&id=26630

When I mention to my colleagues I sit on both our local and state Realtor® boards, I'm often met with blank stares. Though a good portion of licensees in Washington State are Realtor® members, what this actually means remains frequently an unknown. In a state such as our where our local multiple listing service is not Reator-owned, fewer than 50% of licensees are National Association of Realtors members. However, as an organization at both our Seattle KingCounty Realtor and Washington Realtor levels, our lobbying efforts are in support of the "Realtor" party and all licensees, members or not, benefit from the volunteer efforts of the Realtor body.

Case in point: Vicky Cox Golder, this years NAR president, has been pounding the pavement, meating with the nation's leading lending institutions in an effort loosen their grip on credit and overcome the many obstacles inherent this short sale and foreclosure climate.

The attached report provides a review of those efforts.

Halting of bank foreclosures arrives in Washington State.

http://seattle.bizjournals.com/seattle/blog/2010/10/bofa_halts_foreclosures_in_wa.html

To quote the great Yogi Berra, "It's Deja Vu all over again." My good friend and former manager, Karen Lavallee, was president of the Seattle/King County Association of Realtors in 1991. One of her regular contributions, a monthly editorial. Coincidentally, we were having a chat during my office visit today and she pulled it out. The climate of the time.....strikingly similar to 2010. Check it out.

I was enjoying a nice cup of coffee with my good friend, Howie Martin, president of the DNDA (Delridge Neighborhoods Development Association) board of which I am also a director. Howie's progressive, grassroots blog, Howie in Seattle, is worth the read. We were discussing blogging and I was thus reminded it's been ages since I posted last. So, to follow up on my August post, Taylor, Bean, Whittaker was purchased by Bank of America who, in turn, sold off their assets.

I can tell you it has been nothing but a complete pain for my clients. The more short sales I do, the stranger the lien holder decision-making I'm seeing. I won't wax on. Suffice it to say that, while short sales do close, most lenders left hands are certainly not conversing the right.

Things might be cooler this week, temperature-wise that is, but the same heated challenges exist in the real estate market. Most of my business currently is short sale related - both sellers and buyers. Yesterday, Taylor, Bean & Whittaker (Nation's 12th largest lender) closed their lending doors. I represent a client with several investment properties for which TBW is the lien holder. I'm pleased to announce their short sale loss mitigation department was back in action today, though their phones were all turned off yesterday. They may not be loaning, but are certainly looking to recoup as much of their losses as possible. I did have a moment to ponder....if a bank shuts its doors, who's there to take on the paper of foreclosures and short sales? Question answered today, at least in part.

It's a 100 degrees outside today, a Seattle record. Despite the soaring temperatures, the world goes about its business. While lunching with a colleague, I enjoyed watching a U.S. and international navy floatilla cruise to the wharfside piers of downtown, a part of Seafair, our annual summer festival. Spectacular!

Ours is an amazing city, to be sure.

Wow! One blog post every six weeks does not a dynamic blogging environment make. This is one of the great challenges of blogging, keeping up that all-important head of steam when the reality of the day job comes crashing in. I have been beyond busy, which is the good news. Bad news is that most transactions currently are short sales which makes for much more work, longer escrows and thoroughly unknown paydays. It's easy to forget we agents are compensated only when transactions close, not a nickel before.

I digress. I'm firing off this quick blog post in service to a good friend of mine, Ksenia Oustiougova and her company, Lilipip Studios. I was just checking into my Facebook account and noticed she had uploaded a new video produced for one of her clients. http://www.youtube.com/watch?v=l3R66Nq9nBA). Her's is a very simple business model and mission, to create brief, engaging coporate animations which capture succinctly a company's vision and value proposition. The power of animation is that it's maleable and relatively inexpensive to produce compared to live action. Imagine embedding an animation in your e-mail signature which quickly conveyed the heart and soul of your vision; was engaging and viral in nature. Not a bad up-side for the investment.

I encourage you to check out her company. Tell her I sent you.

Trouble with blogging is that it requires time and consistency, neither of which I seem able to summon currently. I'm pleased to say I've been busier than ever before; products of government tax incentives, peer attrition and general industriousness on my part. Downside is bandwidth. So, I'll make a better effort to keep this thing up to date.

The spirit remains.

There have been many recent reports about the Obama Administration’s efforts to move the government’s means of open and transparent communication into the twenty first century…..a process which some refer to as Government 2.0 in a salute to its on-line efforts. A new White House website, launched January 20th on Inauguration Day, and the fiscal expenditure tracking website, Recovery.gov, are excellent examples of their efforts. All business endeavors benefit by having a clearly articulated business plan. While I am not espousing any political philosophy or personal leaning with this e-mail, I do think it’s important to see whether or not our nation’s leaders are living up to their promises of full disclosure and accountability. I leave it to you to decide. I will say I think the White House’s website is an excellent example of an on-line business plan.

Now I am home again, the dust relatively settled and Seattle's grey skies return as a comfortable fixture, I ponder the phenomenon of "Murphy's Law". I'm pleased to say things on the real estate front are definitely in high gear. I have even more on my plate than I can recall in past years. If this is anecdotal of a shift in the market place, then so be it. I ascribe it to a combination of agent attrition, buyer and seller incentive with recent changes and perhaps my many years in the business having built a client-base robust enough to weather any storms.

Knowing that I was leaving town for nigh on two weeks to travel to a client's wedding in Ireland, then on to London for the spring break, I carefully and deliberately set up my office systems so a seamless transition would be made between continents. This was to be a working vacation. Though I was not bringing laptop with, I made certain to have .pdf copies all pertinent real estate documents in hand. I purchased a DSM cell phone, capable of making and receiving calls in Europe while retaining my (206) number. I subscribed to "Gotomypc.com" to enable remote access of my laptop from abroad. I covered every base so that, only in the most unlikely of circumstances, someone might know I was not taking calls and conducting business right around the corner. Frankly, and though I have an extensive technology background, I was really pleased with the depth of organization.

Explain for me then why literally a few hours before my departure I experience not just a soft system, oh we'll deal with you later kind of pc crash. No, the Universe, God or whatever greater power one believes in gifted me with a "blue screen of death" hard drive calamity. My pc froze at about noon-time the day before I left. I scrambled downstairs to our neighboring business, conveniently a computer repair and sales store, and pleaded for immediate assistance. To their credit, they jumped right on it. A couple of hours later I was informed indeed the hard drive was toast, I would need a new one and to recover the data would take hours, cost hundreds. Once I had absorbed all my organizational finesse had just been laid to waste, I directed installation of a new hard drive and figured I'd have to deal with the data issue as time and investigation permitted. As it turns out, the data is essentially lost unless I invest several thousand dollars in a clean room resurrection.

Yes, I had backed up some files regularly. However, my external hard drive had also just gone on the fritz in recent months. All real estate transactions are filed and scanned with the office, so duplicates are readily available and I have CDs of everything. However, what was lost was years of templates, the little tweaks one makes on a project basis to perfect systems. Nothing too egregious, but enough to remind me of what it takes to keep the cogs smoothly oiled.

The question I put to the Universe (as I did my broker on the day this occurred) is what possible benefit can come from raining down upon me such an ill-timed test? I suppose we all know the answer, something to the effect of "only those who are capable are tested," but still, COME ON! Who needs to put up with this?

What lesson have I learned? We're not in control, no matter how great the illusion. Just before leaving, I was referred a terrific new client. Turns out, the perfect home for him was a listing I've had for several months. In eight years I had never considered dual agency on a transaction as I think it's a bad idea generally. Knowing the parties, I thought perhaps this time I would be doing each party a good service by representing both. Though I received permission from seller and buyer, I learned quickly my initial instincts are correct and referred my new client to a close colleague in the office. Had I tried to take on dual agency in the midst of my computer woes, it would have certainly been disastrous, not to mention representation from afar.

Furthermore, I learned that letting go of ones business and placing trust in others requires deep commitment and faith. And last, the loss of data compels me to re-evaluate my systems, forcing the question why I retained so much of it in the first place? I don't have any other answers. Powers greater than I are at work every day. I suppose trust in their purpose, obscure as it may appear, is the only road to sanity.

I've returned from a delightful trip to Ireland and England. Many details to follow. However, in the meantime, my silence is attributed directly to a hard drive crash and "blue screen of death" only hours prior to departure; an event giving rise to questions concerning "Murphy's Law" and the Universe's cruel humor. Pictures and thoughts to come soon.