Archive for November, 2007
November 30, 2007
A couple of interest rate related stories have surfaced in the past few days, both indicating a boost for the real estate market — but at what cost?
A mere rumor of a federal interest rate cut has been spurring Wall Street to buy, buy, buy. Like September’s rate cut, the nationwide housing crisis will be a causal factor if there is a decision to cut rates. Outside of ARMs and home equity lines of credit, these rates do not affect (fixed) mortgage lending rates, unless they influence the overall economy. How does that happen? People buy things on their lower-interest-rate credit card.
Are you seeing the problem here? If the housing crisis is caused by (for whatever reason) people being in over their heads on their mortgages, what’s the solution? Get people in over their heads with Encourage people to increase their consumer spending. Other people, we would assume.
The other news is a more direct fix for those people who are facing a giant mortgage hike in the next year or so. The treasury department is actively calling for sub-prime lenders to help their borrowers avoid foreclosure. Banks met with the Treasury Department on Tuesday [NYT]:
In that meeting, according to industry and government officials, bank executives said they were close to defining a uniform standard for people who would qualify for a “loan modification” — a temporary freeze on their teaser rates — and a uniform standard for how long that freeze would last.
Some advocates are asking for as long as a 7-year freeze! How long would the freeze have to be to make a real impact? And what sort of ripple would that send through the economy as banks had to make up that income? I’m very happy about people staying in their homes, but what happens next?
Opinions on sub-prime borrowers who are in over their heads range widely, from empathy for the individual who was tricked into the loan to downright disgust at irresponsible money management. How do you feel about giving these folks a break?
November 30, 2007
Cruising the Craigslist events section, I came across this great community event:
2007 Seward Park Luminaria
We will set out almost 1800 candles in the little white bags all along Lk Wash Blvd. This is Sunday Dec 2. Stop by at 2 or 3 pm. Will light the candles at 4:30.
Take the path the candles light the full three miles, and you’ll end up in Mount Baker — just the right spot to watch the Christmas Ship and its entourage sail the south seas of Lake Washington at 5:30.
These South Seattle open houses are a great excuse to be in the area! Homes are open Sunday from 1 - 4 p.m., unless otherwise noted. All information is from sources deemed reliable, but is not guaranteed.
Price: $349,900
4703 S Morgan St
4 br/2 ba; 1,550 sq ft
MLS#: 27161216
Open Saturday, 12-3
Price: $375,000
4639 S Garden St
5 br/3 ba; 2,100 sq ft
MLS#: 27205792
Price: $445,000
2813 24th Ave S
2 br/1.5 ba; 1,340 sq ft
MLS#: 27181426
Price: $449,950
5111 S Myrtle St
3 br/1.75 ba; 1,630 sq ft
MLS#: 27185279
Open Saturday 1-3
Price: $468,000
3805 Holly Park Dr SE
3 br/2.5 ba; 1,900 sq ft
MLS#: 27206371
Open Sunday 2-4
Price: $485,000
7203 54 Ave S
3 br/1 ba; 1,810 sq ft
MLS#: 27191943
Price: $679,000
5217 S Mayflower St
3 br/2.25 ba; 2,080 sq ft
MLS#: 27197297
Open Sunday 2-4
Price: $1,660,000
3220 Sierra Dr S
4 br/3.5 ba; 4,000 sq ft
MLS#: 27090813
November 30, 2007
December’s arrived in all of it’s glory and we’re waiting to see if we might see the first snowflakes of the season this weekend (although some of us got a tiny preview this last week). Perhaps some of you will be out searching for the perfect Christmast tree? If so, whether you like to cut it yourself, or just tie it to the top of your car and go, you can find a list of area Christmas tree farms throughthe Pacific Northwest Christmas Tree Association.
And while you’re out hunting for your tree, you can preview some 4+ bedroom Redmond open houses on Sunday, December 2nd, from 1-4 pm.
15911 NE 101st Ct
4 br/3.25 ba, 3,800 sq.ft.
Price $789,988
MLS 27081490
16537 NE 117th Way
5 br/3.5 ba, 3,400 sq.ft.
Price $778,000
MLS 27150403
17018 NE 101st Pl
5 br/2.75 ba, 2,790 sq. ft.
Price $575,000
MLS 27186616
16602 NE 91st St.
4 br/2.25 ba, 3,660 sq. ft.
Price $539,000
MLS 27200556
November 30, 2007
Open House Date and Time:
Sunday, December 2, 1-4pm
1855 Trossachs Blvd SE #1106
Sammamish, WA 98075
Seller’s Comments
Coffee Shop of Choice: Cafe Ladro - They have THE BEST raspberry scones and they water decaffeinate (instead of chemically decaffeinated) the coffee.
Favorite Restaurant in the Area: Julia’s of Issaquah - great for Saturday morning breakfast.
Favorite Places to Go: There are lots of great walking and hiking trails nearby.
Best Features of the Home: Beautiful craftsman style millwork. High ceilings and large windows which let in a lot of natural light.
Favorite Room: The living room has a gas log fireplace, and lots of windows. It’s the place that makes you want to stay home and read a book, even if you don’t like to read.
What’s in the Neighborhood: There are a LOT of playgrounds peppered through the Trossachs neighborhood and a lot of trails to hike or jog. Cascade Ridge Elementary schools is very close and there is a nice pool and exercise room in the community clubhouse.
What I Will Miss the Most: Low heating bills. Farmers’ market on Saturdays in the summer for fresh local fruits and veggies. An easy commute to Seattle or Bellevue. Trader Joe’s and Costco nearby, both are easy stops on my way home from work.
November 29, 2007
Recent posts on Sweet Digs Seattle:
For most people their home mortgage is the biggest chunk of debt they owe. The Get Rich Slowly blog recently had a great guest post from Free Money Finance about how they paid off their mortgage in 7 years and have been living debt free for the past ten years. This isn’t for everyone and the post includes a little disclaimer to that effect. To me owning a home outright without a mortgage payment is like getting your cake and eating it too. Here’s how one couple did it:
- We spent less than we earned starting as soon as we got married in the early 1990’s. We saved quite a bit, combined it with some previous savings and the equity from the sale of our Northeast home, and were able to come up with a down payment of about 35% of our new home’s value.
- We bought a house we could afford. Instead of stretching to buy the biggest house possible, we decided what we needed in a house and purchased a place that met those criteria. In the end, we only borrowed about 60% of what the bank said they’d let us borrow.
- We applied everything we could to retire the mortgage: extra payments (from still spending less than we earned), pay raises, bonuses, income from a side business, my wife’s income, and gifts. If money came in, it usually went to paying down the mortgage. However, we did not sacrifice what we considered to be better investments, such as fully funding my 401k.
- Within five years, we had the house completely paid off. We lived there a few more years, then when we moved to Michigan, we sold the house and paid cash for our new one. It’s now been ten years since we’ve had a mortgage.
In the early years, I got the biggest thrill out of paying extra on the mortgage. I’d make an additional payment and wipe out six to eight payments at one time (Quicken would show me the results.) During the first year, I eliminated several years of payments on a 30-year mortgage (something like eight years) and the thrill of making such great progress simply built and built into a snowball of enthusiasm. Each payment I made had a dramatic impact on the total, which fueled more payments, which had more impact, which fueled more payments and so on and so on… [read more]
Now when I read that the biggest thrill these people had was paying extra on the mortgage I think to myself “get a life!” but they will certainly have the last laugh on this one since they’re “now on track to retire by age 55 with more than enough to live on and no debts outstanding.”
November 29, 2007
Bargain hunters, take a peak at what Redmond has to offer right now. These homes have the lowest $/square foot ratios, meaning you get the most “bang for your buck!”
Some of these homes boast some nice upgrades, and are well worth a look. I’ve highlighted a few of the amenties below that stood out.
16602 NE 91st St.
4 br/2.25 ba. 3,660 sq.ft.
Price $539,000 ($147/sq.ft.)
MLS 27200556
This probably includes the hot tub area, but can you beat the $/sq.ft.?!
5905 NE 101 Ct.
4 br/3 ba, 4,670 sq.ft. (3,140 finished space, plus basement)
Price $744,990 ($160/sq.ft.)
MLS 27193979
Tile countertops and bathrooms
9516 225th Way NE
5 br/3 ba, 3,890 sq.ft.
$729,900 ($188/sq.ft.)
MLS 27173686
Slab granite, stainless steel kitchen
6325 151st Ave NE
4 br/2.75 ba, 3,320 sq.ft.
Price $629,950 ($190/sq.ft.)
MLS 27174382
Potential MIL area
November 28, 2007
Recent posts on Sweet Digs Seattle:
The veritable smorgasbord of mortgages and things to consider when financing a house can make your head spin. Here are some basics in plain English that every future home buyer should know:
Credit score, credit score, credit score!
Your credit score tells lenders how likely you are to pay your bills on time. The credit score is about the future, not the past (this sounds backwards but it’s true). The credit score is used to determine the amount of risk you pose to a lender. One late car payment can drop your score. Be careful of how many times your credit score is pulled, this can also lower your credit score because it is interpreted as increasing risk because it looks like you’re trying to acquire lots of new debt.
The better your credit score, the lower the interest rate you qualify for, which means your monthly payments are lower, which means you’ll qualify for more house. Conventional lending wisdom limits housing costs to 28% of gross income and total debt payments to 36% of gross income.
Getting financing is a snap when (even now after the subprime debacle):
- You’re credit score is high (in the ballpark of 780 is super)
- You have little or no debt
- You have some down payment (10% or more is good)
- You have been in your job for a few years (at least more than 2 years)
You don’t have to pay PMI even if you don’t have 20% down:
Lenders will require that you to have Private Mortgage Insurance(PMI) if you borrow more than 80% of the appraised value of a home. PMI is an additional monthly cost that can be avoided. If you don’t have 20% down payment you can get an 80/20 loan where a primary loan finances 80% of the value and a second loan (line of credit) finances the rest. Usually the second loan will be at a higher interest rate but it’s on a smaller balance and you’ll want to focus on paying that down first.
Save money on Escrow:
Often if your Escrow and Lender are the same company, the escrow fee will be waved. For a $600k house this can be about $800 savings.
ARMs are risky:
Adjustable Rate Mortgages (ARMs) are marketed to people who “plan to sell within a few years”. If you’re planning to flip the house and want a low interest rate then an ARM might be a good way to go. If you’re buying a house to live in for a couple years and then plan to move, an ARM will force you to sell or refinance at the end of the 3, 5, or 7 year term. If you can’t sell without losing your shirt in the process because housing prices tank, lenders won’t loan you more than what the house is worth so you can’t refi either. Welcome to Foreclosureville. In the current real estate climate, I consider ARMs very risky and not a good idea.
Always pay extra toward the principal of the loan:
Just one additional monthly payment per year will reduce a normal 30-year loan to 22 years. In particular if you get an interest only loan make sure you pay toward the principal even though you don’t have to. Interest only loans have a bad rap because people have used them to get into homes they really shouldn’t be able to afford. Interest only loans enable you to have a lower monthly payment to help you qualify for more house but still being within the debt ratio rules the lenders have. But if your income is not a consistent montly salary but is seasonal for example, interest only can enable you to have low monthly required payments and then pay more when you have more. You have to be disciplined to make this work.
Anything I missed?
Any one else have mortgage tips and tricks they want to share? Please leave a comment!
November 28, 2007
Built in 1910, the Columbia City Theater was then a vaudeville house. Now a dinner theater (food is available at the attached bar or next door at Tutta Bella, and can be brought into the theater), the venue hosts cabarets, benefits, karaoke, live music, and puppet operas.
The glove factory down the street, built in 1921, is now the Ark Masonic Lodge fabulous Columbia City Theater.* The 1891 Town Hall is now a social service organization for kids. Columbia Branch of the Seattle Public Library.* The Columbia Hotel is now the home of Lottie’s Lounge. The butcher shop is, well, still a butcher shop. Check out the slideshow at History Link, but be warned, things have changed since it was made.*
Neighborhood information is chronicled in Captain Columbia City’s blog.
[*Update: See comments for corrections from Scott, who points us to the wiki, ColumbiaCitizens.net.]
One important transformation has occurred in these Columbia City area homes for sale: the price. Here are a couple of price reductions:
Price: $329,900 $319,900
3951 S Graham St
4 br/2 ba; 2,260 sq ft
MLS#: 27147574
Price: $474,500 $449,950 $424,950
4139 38th Ave S
5 br/2.5 ba; 2,720 sq ft
MLS#: 27158860
November 28, 2007
The mercury is headed downward and when that happens, it’s most certainly time for Bellevue’s Magic Season events, which includes ice skating on Seattle’s only open air rink. The Group Health Ice Arena opened last weekend in Bellevue Downtown Park, for all skaters, beginners and up, to glide away on the ice. This seasonal rink will be open through January 6th, so there’s plenty of time to bundle up and hit the ice, and your $9 will get you rental skates and plenty of ice time.
Other deLIGHTful Magic Season events include Sound Transit Design in Light, where you can take a stroll through holiday lights, and the Garden d’Lights, a botanical display of lights.
The temperature’s not the only thing that’s dropping, though. Here are this week’s latest Eastside price reductions of $20,000 or more. Interestingly, there are just about as many $50k-ish drops as there are $20k-ish drops–and these aren’t million dollar properties, either!
BELLEVUE
1860 140th Pl SE
4 br/2.75 ba, 1,970 sq.ft.
Reduced $45,000 to $494,555 ($251/sq.ft.)
MLS 27191888
1820 147 Ave SE
5 br/2 ba, 2,040 sq.ft.
Reduced $19,550 to $549,950 ($270/sq.ft.)
MLS 27181629
ISSAQUAH
1613 Huckleberry Circle
2 br/2.5 ba, 1,398 sq.ft.
Reduced $20,000 to $379,950 ($272/sq.ft.)
MLS 27182805
KIRKLAND
11004 100th Ave
4 br/3 ba, 2,600 sq.ft.
Reduced $50,000 to $849,000 ($327/sq.ft.)
MLS 27160156
REDMOND
9580 166th Ave N
3 br/1 ba, 1,150 sq.ft.
Reduced $55,000 to $495,000 ($430/sq.ft.)
MLS 27175574
SAMMAMISH
48 210 Pl SE
4 br/3.25 ba. 3,535 sq. ft
Reduced $25,000 to $700,000 ($198/sq.ft.)
MLS 27194996
November 28, 2007
Deck those halls! Put some eggnog in your latte. Tonight is the lighting of the Christmas tree at Rockefeller Center in New York (8 p.m., NBC). Whether you’re from one coast or the other, Scrooge or Santa’s helper, Christian or otherwise, it’s hard to ignore the appeal of this enormous tree. I wouldn’t call it a wonder of the world, but my first time seeing it, I thought the same thing I did at the Grand Canyon: “Wow, it’s huge!”
This year the tree has undergone some eco-modification. [via] What’s ecological about chopping down an 84-foot tree? A number of things, actually:
- Attached to the five miles of wire that spiral around the tree will be LED lights. Light emitting diodes have some significant advantages over incandescent bulbs, and with 30,000 lights wrapping around the tree, it’s estimated that this will save 2213 kilowatt hours per day. (If the average Seattle City Light customer consumes 30 kw hours per day, that’s enough energy to electrify your house for more than 70 days!)
- Some of the tree’s electricity will come from new solar panels on the roof of a Rockefeller Plaza building. In their first year the panels will generate enough energy to power the tree all 42 days it’s lit.
- The tree was cut with hand saws. Wow again. An 84 foot tall tree has a mighty trunk, Mr. Bunyan.
- The site from which the tree was taken will be replanted.
- The tree will be milled, and the wood will be donated to Habitat for Humanity.
Also in the plans for greening Rockefeller Center:
- Radio City Music Hall will get a green roof.
- The ice rink has a new ice making system. It will make ice only at night when the City’s energy consumption is low, and will run air conditioning water through the ice to cool office buildings in the Center.
Read more about the 2007 tree at the Tree Guy Blog!
Take some inspiration from those eco-conscious New Yorkers (!), and the P-I, and shrink your own environmental footprint this Christmas.
