Seattle, Bellevue, and King County Real Estate Blog

Last week I had the privilege of meeting and speaking with Lloyd Hara, the King County elected Assessor, and thought you would appreciate me relaying some of the information and insight I garnered from that opportunity.

The first thing I would like to say is that I was incredibly impressed with Mr. Hara. I took loads of notes about the inner workings of the King County Department of Assessments, but more than anything else I walked away thinking Mr. Hara was doing the absolute best he could given the systems and restraints he tries to overcome on a daily basis. Additionally, I'm a pretty good reader of character, and he certainly struck me as someone who tries to do the right thing.

Anyways, I was very impressed with Lloyd Hara.

I did walk away with an immense amount of insight, but I'll just pass along some of the most important stuff in regards to the King County Department of Assessments.

First and foremost, most people wrongfully place the blame on the Department of Assessments as to why their property taxes seem high. Let me make this clear... the Department of Assessments only determines the ASSESSED VALUE, not the amount of taxes.

But, in the realm of assessed value, many complain that their assessment is too high. There have certainly been instances of this being true in the last couple years as prices significantly dropped, but throughout my years in real estate I have found the assessed value of homes is generally less than market value. There is going to be a lag effect on the assessed value as a department that is being crunched by a shrinking budget and plagued by aging systems tries to keep up with the changes.

* If you are a homeowner that thinks their property is valued too high, then you can appeal the assessment. I plan to have a longer post about the process of doing so in the near future, but in the meantime you can start here. *

While I'm on the topic of appeals, you may be interested to know that appeals in 2009 were four times the amount of appeals in 2008. No surprise that property owners are not appealing and complaining when their properties are undervalued :)

One of the other interesting things I learned about some of the difficulties the department faces is that they are still using data systems from the 1970's. The problem arising here is that the system does not easily allow for unique information, which is one reason why property taxes are not 100% uniquely tailored for each property. Mr. Hara said repeatedly how he would like to improve the systems, but a shrinking budget just doesn't allow him to do so. Another way he wanted to improve things was getting the assessors better field technology allowing them to spend more time looking at houses, and thus being more accurate and timely in their assessments. Currently assessors use regular laptops with minimal battery life... something like an iPad with 10-12 hours of battery life would increase the amount of time they spend in the field for example.

Lastly, I think this tidbit about what Lloyd Hara has done with his time as the King County Assessor is insightful to how he is trying to do the right thing: the first thing he tackled upon taking over as Assessor was to improve the phone system. More specifically, he changed it so callers can actually get a real person on the phone instead of recordings. The next thing he did was improve the website to provide better tools and customer service for property owners.

I have a heck of a lot more information I could write about, but I'll call it quits there. If any of you are interested in personally talking more about this with me, then just give me a call at 425-289-1099.

- Robert Wasser: King County, Bellevue, and Seattle Real Estate News and Blog

CNN Money has completed its annual search of the best cities to live in America, and King County's Bellevue comes in 4th!

This year's study focused on cities ranging in size from 50k - 300k residents and took into account such factors as job opportunities, fiscal strength, top-notch schools, solid health care, low crime, and lots to do to name a few.

We can argue the merit of what makes a city great to live in all day long while citing varying factors, but the bottom line is that for a hanful of important factors... Bellevue got 4th!

So that's cool.

You can link to the full list here, and directly to the snippet about Bellevue here... enjoy!

Posted By: Robert Wasser - King County, Bellevue, and Seattle Real Estate Blog

As you are well aware by now, I have been paying a lot of attention to news surrounding the creation of jobs; a sustained real estate and national economic recovery depends highly upon getting America back to work.

That being said, I have been eagerly awaiting the start of the second quarter earnings session. Thus far, the stock market has welcomed great news from Alcoa Inc (aluminum maker) and railroad operator CSX Corp. Then, after the market closed today, Intel Corp. reported earnings and revenue that beat analysts' expectations, and it also raised its forecast for the year.

All three companies additionally issued upbeat forecasts for the rest of the year.

Alcoa is a particularly good indicator because it's product are sold to a varied customer base, providing a snapshot of a broad range of other industries.

Ultimately, this doesn't mean companies are back to hiring full tilt, but it is a major step forward in the eventual creation of jobs. Let's hope this will be the start of more and more good news that will help ease a wary country.

Posted By: Robert Wasser - King County, Bellevue, and Seattle Real Estate Blog

There's no doubt that the U.S. has made a lot of progress since the worst of the recession, but whether or not that success will continue depends heavily on jobs.

The exact same can be said for the Greater Seattle real estate market.

As usual, we get some good news then we get a bit of negative news and it goes on and on like this back and forth. The bad news doesn't bother me so long as there's more good than bad.

So, it is my pleasure to report that the government said initial claims for unemployment benefits fell last week to their lowest levels since early May.

I've grabbed this pleasant quote from Yahoo! Finance:

Hank Smith, chief investment officer of equity at Haverford Investments in Radnor, Pa., said some investors have been worried about a so-called "double-dip" in the economy but that more recent data, including Thursday's jobs report, are a reminder that the recovery is continuing.

"It's hard to see rolling into a double dip," he said.

I like the sound of that!

Posted By: Robert Wasser - King County, Bellevue, and Seattle Real Estate Blog

Pending and closed sales have risen in Washington just a month after most homebuyers took a break after the expired first time buyer tax credit.

I've written before that the months leading up to the expiration of the first time buyer tax credit was something along the lines of a marathon. Correspondingly, we could expect the runner to need a break after completing the race.

That break was May.

This is June and the runner is getting back to training. This is great news in the continued recovery of the Greater Seattle real estate market.

For the Northwest Multiple Listing Service's 21 county area, pending sales (mutually accepted purchase and sale agreements) for single family homes and condos rose 5.8% from May to June while closed sales rose 8.9% for the same time period.

Additionally, closed sales for June were up 12% compared to the month of June last year.

Fewer homes are being purchased when compared to the beginning of the year, but prices continue to improve. The median and average prices of single family homes in King County again rose in June after also rising in May:

• June Median/Average - $383,000 / $485,597
• May Median/Average - $379,000 / $458,736
• April Median/Average - $375,000 / $443,653

A large portion of the sales are a result of buyers who entered a contract to purchase prior to April 30th and closed the actual sale in May or June. With slower pending activity in May and June I won't be surprised if prices inch back down a bit, but I don't expect too much of a dip as long as the US gets back to hiring. More on that coming soon...

Ultimately, I'm happy to see that buyers are becoming more active as we get into the summer season.

Posted By: Robert Wasser - King County, Bellevue, and Seattle Real Estate Blog

The Seattle Police Department has released a new interactive map website that shows where crime happened and what type of incident it was.

The incident image, for example, is a set of handcuffs if someone was arrested, a vehicle if it was a car prowl, or a fist if it was an assault.

Users can create an account with Seattle.gov to download additional information, but my playing around with it hasn't gotten me as much info as I would like.

Overall, this is a neat tool for homeowners who are curious what's going on in their neighborhood, and also for home buyers who want to get an idea of the crime activity around a home they are interested in.

Check it out for yourself at http://web5.seattle.gov/mnm/policereports.aspx

Posted By: Robert Wasser - Bellevue, Seattle, and King County Real Estate Blog

I just read a couple articles saying that new homes sales dropped 33% from April to May to the lowest sales pace since 1963. So I'm thinking to myself, yeah, the tax credit expired so this shouldn't come as a big surprise. This obviously isn't good, but the drop was expected. Really, I am more interested in how the next 2-4 months go in terms of price stabilization, and more importantly how the job market fares during that time span.

What the article didn't stipulate was whether it was closed sales or pending sales. Surely they are talking about pending sales which did indeed dip significantly in our area, but did you know that closed sales for King County were up in May compared to April? Yep. Both the median and average prices of homes rose as well.

So anyways, we take this news on the chin but keep our head up. Time will tell what it all means... maybe a portion of the drop can be attributed to less short sale contracts that have a much lower likelihood of ever closing? I won't be surprised if we find out next month that closed sales didn't drop as significantly as pending sales did the month earlier.

I've said it before and I'll say it again, the speed and success of the real estate market turning around is highly dependent on getting Americans back to work. The first time buyer tax credit simply helped try to smooth real estate's inevitable drop back to reality while encouraging consumer confidence. It's done that, but at the end of the day employment is about the biggest factor in whether we pull completely out of the recession.

So to me, today is not that different from yesterday in that the coming months will be very telling of whether real estate prices stay relatively flat as they've been for months now, or whether we see a bit of a double dip. We all expected home sales to dip following the tax credit, what we have to hope is for employment figures to get better.

It sounds like my marathon runner analogy is rounding into form... mortgage applications jumped almost 18% from last week, a sign that the real estate market might be stabilizing after last months drop after the expiration of the first time buyer tax credit.

Mortgage applications include applications for refinancing, and that made up almost 75 percent of all the applications. Interest rates are near all time lows on 30 year fixed mortgages, so not much of a surprise that homeowners are taking advantage of it.

The best news in the report is that remaining applications for new home purchases jumped 7% from last week, the first rise in 6 weeks (the end of the tax credit)! We all expected a bit of a dropoff after the tax credit expired, but market experts pointed to great interest rates and low priced homes as reason to think we would avoid a double dip in the real estate market.

We'll monitor where we go from here, but this is along the lines of what I expected and a great start towards sustaining the real estate recovery.

- Robert E. Wasser, Prospera's Seattle Real Estate Blog

After three straight declines, the number of people filing for jobless benefits rose by 12,000 last week to a seasonally adjusted 472,000.  Obviously, no one was happy to see this but I'm not going to commit to anything beyond speculative fear for now.

I've been saying for some time now that the health of the real estate market will depend highly on getting the jobless ship turned around (not to mention the recovery of the economy as a whole). But, you've also likely taken notice that I talk about our real estate recovery as a generally flat to positive trend, and this for now is no different.

Check out this chart and you can see the trend plain as day (this chart ends in April which is about where we stand today):

The bottom line is that no one wants to hear jobless claims rose, but the fact of the matter is that it rose after 3 weeks of declines. I'll take a 75% clip because that forms a positive trend... give me anything below 50% and I'll worry more. Needless to say, I'm interested to see how the coming weeks and months go to make sure we avoid a double dip.

After falling considerably over the second half of 2009, first time jobless claims have hovered near 450,000 since the beginning of the year. Economists say not to expect sustained job creation until we get below 425,000 each week, so keep that number in the back of your head.

The state Employment Security Department, in its monthly report, said that Washington State's unemployment rate dropped from 9.3% to 9.1% in the month of May. This marks the fourth month out of the last five months that Washington has added more jobs than lost.

Of the 8,600 jobs added last month, 8,100 were temporary census workers, so it was a net gain of only 500 discluding census workers. Still, it was a gain and I'm happy to see what is shaping up to be a trend that is in the flat to positive range as opposed to a negative trend.

In regards to the particular fields... construction added 800 jobs, retail added 600, and professional and business services added 800. On the opposite side, financial services cut 1,100 jobs, accommodation and food services cut 600, aerospace manufacturing cut 500, and transportation and warehousing cut 400.

Overall unemployment figures across the state are very mixed county to county. The Seattle Metro area dropped from 8.5% to 8.4%. Both Clark and Ferry counties had the highest jobless rates at 13%. San Juan and Whitman counties had the lowest rate at 6%.

Overall, I'm happy to see the trend working in the correct direction. Getting unemployment turned around will play heavily on the rate at which the real estate market recovers.