Spokane Real Estate Blog

Homebuyer Tax Credits Extended and Expanded

Windermere North Spokane — Tue, 24 Nov 2009 11:55:00 GMT

Spokane's Trickle Up Recovery

Windermere North Spokane — Fri, 11 Sep 2009 10:16:00 GMT

The Spokane real estate market is recovering nicely and here is the proof.....

Sometimes we get bombarded with stats and graphs and charts and expert opinions. They tend to vary widely based upon the experts political agenda and depending upon whether or not they are local, regional or national. But there is one fundamental statistic that says it all.

The basic economic fundamental of supply and demand is expressed as one simple number - Months of Inventory. If there is more than six months of inventory sellers are forced to drop prices in order to attract the scarce buyers. That's not a healthy market.

If there is less than 4 months of inventory buyers have to pay a premium as there are too many buyers chasing too few homes. That causes prices to rise rapidly, which is also not healthy because it isn't sustainable. At some point the market corrects and the people that bought during the run-up are the losers.

The sweet spot is 4-6 months of inventory. When the market falls into that groove it means that buyers and sellers have equal bargaining power. This is the basis for long-term sustainable price appreciation. That is the sign of a healthy market.

So here is what has happened this year in Spokane. In April every segment of the market had greater than six months inventory. However in May the $100-$150k priced homes dropped below six months; in June the $150-$200k priced homes dropped below six months; and in July the $200-$250k priced homes dropped into the sweet spot.

What's causing the trickle up? The First Time Home Buyer Tax Credit has stimulated sales in entry level homes. That enables those sellers to move up to the next level, and so on and so on. As a result the Spokane market is strong and healthy from $0-$250k!

August results will be out soon and we'll see if the trends continue!

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Stimulus Package Approved

Windermere North Spokane — Tue, 17 Feb 2009 12:17:00 GMT

Here's our take on the Stimulus situation as it pertains to the real estate market.

There are three primary components of the Stimulus package and the recently announced Treasury Plan that impact the residential real estate market:

Loan Limits Raised in High Cost Areas

Government backed loan limits were raised in high cost areas. That doesn't have a direct impact on our Spokane market, but it does help some of our feeder markets. When the markets are stabilized in places like Seattle and California it is easier for buyers to migrate into our community. More buyers = quicker stabilization of prices and the return to slow and steady appreciation.

The Tax Credit is Now a Real Tax Credit

The tax credit for first time homebuyers will be raised to $8,000 with NO payback [a true credit]. There are some qualifying parameters but essentially, if you earn less than $150,000 as a married couple, or $75,000 as an individual and have not owned a home in the previous three years, you qualify.

Relief for Distressed Homeowners

The bill contains over $50 billion for foreclosure mitigation. Coupled with Geitner's Treasury plan signaling that the second half of the TARP funds will be used to mitigate foreclosures through a government guarantee, that should help to slow down the flood of distressed properties entering the supply side of the market.

The Bottom Line.....Higher loan limits and real tax credits will create more buyers. Foreclosure mitigation, if successful, will reduce the number of homes on the market and protect sellers from competing with distressed properties. It sounds like a reasonable plan to rebalance the supply v. demand equation and bring stability and appreciation back to the marketplace. However, a plan is only as good as its successful execution so we'll be watching closely!

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Stimulus Update

Windermere North Spokane — Fri, 06 Feb 2009 14:28:00 GMT

Last week, the US House of Representatives passed the American Recovery and Reinvestment Act (H.R.1). This bill has some key provisions that will stimulate the housing market:

It will restore FHA, Fannie Mae and Freddie Mac to 125 percent of median home prices - up to $729,750

It would eliminate the repayment provision for the $7,500 first time home buyer tax credit

It expands tax-exempt housing bonds

Two days ago, the Senate approved an amendment to their bill that offers up to a $15,000 tax credit to people that purchase a home in the next year. The credit would apply to anyone, not just first time homebuyers and you would not need to repay the credit. The credit is based on 10% of the purchase price of the home and the credit is spread over two years. So for example, if you buy a house with a purchase price of $300,000, you would qualify for the maximum credit of $15,000. The first year you claim the credit, you receive $7,500, and you would receive the remaining $7,500 the next year.

As you read this, the Senate is considering its version of the bill. We anticipate much more debate and some changes in the days ahead, so please check back often for updates.

Once the Senate passes a bill, we expect lawmakers to hold a conference to work out the differences, before sending it along to the President. The President wants a finished product by February 16, 2009.

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Don't Look Now But the Market is Heating Up!!!

Windermere North Spokane — Tue, 27 Jan 2009 22:06:00 GMT

It's almost like someone flipped the switch on Monday January 12th. Mark it on your calendar. The phones started to ring, buyers and sellers began to walk in the door unsolicited, homes that hadn't been shown in weeks had multiple showings, open house traffic went from zero to heavy and the office is once again full of agents working with clients.

What happened? Well, first of all the snow melted down to a manageable level and the roads cleared up. That helped immensely as buyers had literally been snowbound for weeks. Interest rates continued to touch record lows. The inauguration seemed to infuse a new sense of optimism in all of America, regardless of political affiliation. The value of the housing dollar in Spokane has never been better. A nice confluence of events that appears to have awoken a hibernating market.

Windermere is the market share leader in Spokane so the activity in our office is very indicative of the Spokane market as a whole. We are happy to report that we've had more homes go under contract in the past week than we had in all of December. We've even seen multiple offers on properties and believe it or not....the upper end market is actually showing signs of life as well.

Activity in the upper end market is significant because for the past several months 80% of the volume in Spokane was transacted in the $250,000 and under market. In fact in the months of November and December COMBINED there were only 5 residential properties sold in excess of $600,000 in ALL of Spokane County. In the past two days we've sold two properties in excess of $600,000 in our office alone.

Do two sales and two weeks of increased activity indicate a market turnaround? Of course not, but if we can tack on two more weeks that will make a four week trend. If we can follow that up with another 30 days of stronger sales, then we will be to mid-March and entering the seasonal upswing. Will the market spark turn into a market rebound? Only time will tell but we've taken the first step and the positive momentum sure feels good.

Yes it might sound like propaganda, but there has never been a better time to buy a home in Spokane than today. You have an incredible window of opportunity, whether its your first home or that next home you've had your eye on. Only time will tell how long that window will remain open, but don't be kicking yourself this time next year if your housing dollar only goes 80-90% as far as it does today.

We have 90 of Spokane's finest real estate professionals ready, willing and able to exceed your expectations! Contact us today to see how we can help you achieve your real estate goals.

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Welcome to the NEW YourWindermere.com!

Windermere North Spokane — Wed, 17 Dec 2008 20:02:00 GMT

After several months of development we are proud to launch the new YourWindermere.com website.

You will find our new site is packed with the best real estate search and information tools in the industry. Please take some time to explore the site. Let us know what you like and what needs fine tuning. This site is for YOU so we'd love to have your feedback!

Check out the map based home search engine. Its easy to use and can be viewed in satellite mode. Interested in school or neighborhood information? Its easy to find on YourWindermere.com. If you want an even more comprehensive report on a school or neighborhood just ask and we'll email you a custom report that will knock your socks off! Want to "interview" any of the 90 best agents in Spokane? Check our Agent roster and get photos with complete bio's and website links. With a single click you'll be in direct contact with the agent that appears to be the best fit for you. These are just a few of the features available on the new YourWindermere.com.

This blog will be updated frequently with valuable information and analysis that will help keep you up to speed on what is happening in the Spokane real estate market. The great thing about blogs is that you can participate. Ask a question, post a comment or share your insights and opinions with us and the real estate community.

This is a work in process so check back often for the best in market analysis, topical information and ALL of the homes and properties listed on the Spokane MLS.

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