One of the most vocal people, who we call a booster, is Lennox Scott. Without Lennox, and his input, I don’t know where we would be. Lennox made the search for real time properties, online, a reality that is copied, yet never improved on.

When there was a down turn in the economy, while other Brokerages were putting on a brave face, John L Scott changed, quietly, with a “mobile” office, business model.

There was more to this article that I will wait for confirmation on. Fee structure is getting to be a hot item with Real Estate Brokerages.

There is no reason you can’t have a good property. It should be a consideration that you have good schools, enough space, and a good lot, but you also have to consider the cost of upkeep. I know that in the past ten years people stopped considering trading up, but that should be an option today with a few tips on how to do that. Number one is to buy what you can more than afford.

I’m getting to be a broken record about paying off a property, but it is the best way to build equity. Even if a property goes down in value, or price, you can more than make up for that by paying the property off. You save on the compounded interest payments by compressing the Note. Over on www.FixerFixer.com we talk about some home improvement projects, and also how to buy property as an Investment.

For here, our purpose would be to get you to be a ready, willing, and able buyer. You should know that Real Estate is the dirt, the lot, a property sits on, you should buy the best location you can afford, at that time. The structure should be sound with only what you, yourself, can afford to fix. Make big plans if you are capable, but remember that also takes money.

My next post will be about trading up, because most savvy home owners have done that. It’s a hassle, but it keeps the price for you affordable, while you build personal wealth.

This is a link to an important property in Seattle. It is the furthest South West exposure property on Queen Anne Hill. There is an article here, on this blog, about the importance of light in Seattle. This estate has all of the light you could wish for.

It is also situated as an estate by the way it commands the street, and surrounding property. It’s a land mark of elegance, distinct in it’s lines, and interior features. From what people tell me it is a fairly easy project to return to it’s former grace. The exterior is preserved by what appears to be vinyl siding which can actually be an attribute.

You can see the portico still has it’s grandeur with an abbreviated driveway that could be finished to make the entrance much more appealing. The rooms are good sized, and there is an unfinished attic with some low ceilings that could be finished out or kept as a children’s play area.

It sounds like a lot of work, and at $1.5 million dollars it may be more than a young couple want to do. The fact is that it is a part of history. It’s a part of the history that is Seattle, and it is livable, as is, where is. It’s a property worth owning, and when you are done living in it, it’s worth passing on.

I have a blog at www.FixerFixer.com that addresses this at length, but I wanted to add some information here as well.

Any time you buy a property it’s an investment in your future. What the property is worth today can be important, but you also need to keep in mind what it will be worth five, and ten, years from now. In the Professor Wheaton papers, that he has published, he has made some strong arguments for the fact there are formulas to determine future value. What I think is that property value, future value, is best determined by experience.

The interview was actually about foreclosures. Professor Wheaton looks at the period between 2005 and 2008 as an isolated incident of exuberance. I have a different point of view, but for right now let’s put up the original work the Professor had about Real Estate cycles

http://econ-www.mit.edu/files/2396

It’s long, but in the middle he does allow for Real Estate agents to determine future values. I actually refer back to this paper, and have for many years. It outlines some formulas for establishing values.

http://econ-www.mit.edu/files/3780

In this second paper Professor Wheaton discusses the housing bubble. By taking a wide variety of factors, which include low interest rates, he is making some strong arguments that are contrary to his over supply theory. He has charts showing the spike in home ownership, and second home purchases. His charts stop at 2005.

His new paper http://econ-www.mit.edu/files/3782 mostly rehashes his belief that old patterns of home ownership will continue, even though he shows that renting is on the rise. He touches on foreclosures, but never directly addresses the issue head on.

Professor Wheaton has been a defining voice for Construction, Construction costs, Commercial Real Estate, and now, the housing market in general. These samplings give you an idea of his point of view. He thinks Real Estate prices will keep rising. From what I’ve read there is a much better chance the strategy of owning Real Estate will change, or go back to more conservative investment. 

 Low interest rates are an indication that inflation is a distant concern. Without inflation we are left with price reductions in real, present day, dollars. In my opinion, that’s the formula for further economic contraction. When you buy, price will be much more important than the payment. Your payment should only be geared to your ability to pay off the property you purchase.

This is a sales trap that you need to be more aware of. From 1980 to today we have had massive inflation, and home price appreciation. It’s my opinion, those days are over, and you will need to be smarter about your approach to a First Time Home Buyer purchase.

At today’s prices you still need the mortgage. What you also need is to pay off the mortgage, or pay it down to get equity. Equity has been an appreciation gift these past twenty five years. We will be paying for that for some years to come. So, you need to settle on a loan amount you can pay off. This means, once again, your dream home may be a few years off. Once again, as has been the case since the Great Depression, you will need to trade up.

In the next few months I will promise to post more about your ability to trade into a very nice home to raise the kids, but in the mean time you are going to have to work for it. You are building an estate to leave your children, or a nest egg to travel, and enjoy retirement.

So, you are buying a property of value, that you can pay down the principle balance on. You want a thirty year fixed mortgage, and with any extra money you throw at the principle balance. If you can double down your mortgage payments you will save hundreds of thousands of dollars, do the math.

The first home purchase needs to have a value. If you look at the www.FixerFixer.com site you may find something that gives you an idea of what constitutes value. Maybe I’ll do a post over there about that.  

I’m just saying, be smart, buy low, so you can sell high. As always, if you have questions, I have a secure e-mail page you can use for confidential advice. There is a button at the top of the page.

What we have seen is that more properties are preparing to come onto the market. Essentially people are spending more so they can sell for less. Your property needs to be in top condition for buyers, qualified buyers, to look at it seriously. You also need a qualified Real Estate agent to move you through the process.

I have been surprised by some of the agents who are doing well in today’s market place. Actually it is more surprising that some of the agents that I truly respect and admire are kind of floundering. Experience really is going a long way in getting a property sold today. Experienced agents are bringing more to the table.

If you are a buyer you have some very difficult choices to make. The easiest choice is to wait. We’ll see if the government will interfere in the Real Estate market place again, but I sincerely doubt they will. In my opinion it will be next November before we see stability in the Real Estate market place.

Goldman Sachs published an opinion about Real Estate pricing last month that was hotly debated. It projected another 22% decline in Real Estate prices in Seattle. The first leg down will be before the end of the year. We should see that by November.

We already have seen the drops in condo pricing. It seems a $100K drop is the most common in the $300K to $650K prices. For me the $500 a square foot is kind of hard to imagine, but it is what it is. Down Town condos, for me seem like an excellent position to be in, at the right price.

My point about condos is that residential Real Estate won’t be far behind. This year we will see prices dropping more steadily as the sales data becomes more in line with value. The real trick will be to qualify for a loan, but that will be a post for another time. The theme today is the waiting.

My first Word Press site I put up in 2006. Many changes have happened since then and with great reluctance I converted the www.aspringcleaning.com site to Word Press. It’s now my newest project.

There are a lot of great untold stories in the A Spring Cleaning business. Most have to do with preparing properties for sale.

Marlow has bought, and sold properties in her personal portfolio to make a retirement plan that includes giving her four boys the best education. She has never stopped working, and though she would deny it, I have seen her working on her own properties, on more than one occasion. She has fulfilled every goal she has outlined during her career. She is the Top Producer in her office.

He husband Joe is an artist who has been way laid into working on Marlow’s web site at www.SeattleDreamHomes.com which has won numerous awards. She chose Coldwell Banker to hold her license for it’s national presence. It has worked out well for her site because Coldwell Banker was one of the first to set up web based Real Estate tools. In my opinion, for a national company, they have tools that work well.

In today’s Real Estate world you do need to have an agent with web presence of an International reach. Few companies, or especially individual agents, can make that claim. In this particular case you have both the company and agent on the same page, working for you.

This is a personal testimonial because Marlow has been my agent on more than one occasion. She is level headed with a focus on what’s best for the client. As a complete example of what is possible in Real Estate Marlow is the very best. If you are even considering buying or selling a property in the next three years Marlow is one of the few people you need to talk with.

400 residential properties is a lot, for one County, in a week. Now, no matter what the excuse, that makes a back log of housing units. I can address some of the other arguments, such as a housing tract, or a condo development coming on the market all at one time, but those are specific, in one kind of housing. Random, across the board, and a variety of housing, makes this week spectacular for buyers.

You have choices. Sellers also are going to be hearing from listing agaents that they will need to compete by lowering prices. Those properties that have been on the market for a while are especially vulnerable to an increase in inventory. My next post will be about how to structure an offer. This is different from what your agent will want you to do. There is a deeply entrenched idea that the seller is in control of the asking price. It has been that way for over a decade.

Even in the worst of markets there was a hopeful understanding that Real Estate was a solid investment. Today is much different with properties still over priced by at least 10% and possibly more. We’ll cover Real Estate values of the future, but right now I wanted to share that the time is coming to start making offers on property.

In the mean time get qualified for a mortgage from Scott Cunningham at Prime West Financial, 206-632-LOAN (5626). Scott’s a great guy and I have trusted him for over twenty years. He’s honest.