Hood Canal Blog 2014-10-12 20:58:00

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Interest Rates Tip Toe In To New Low Territory:  Interest rates break below 16 month lows as the stock markets struggle and inflation readings move back below Federal Reserve target levels. A slow economy is generally good for interest rates and bad for stocks. The economy continues to lack good job growth in terms of wages and quality. In spite of recent favorable readings in GDP the consensus seems to be that the economy is still recovering more slowly than needed for positive sentiment. Another missing component for a robust recovery is Real Estate. The recovery in this sector has slowed nationally even though some markets continue to show strength. On top of that the end of QE3 is looming at the end of the month. All of these factors are weighing on stocks and the market is down about 5% from historic high points two weeks ago. This is causing support for lower interest rates and our information suggests lower interest rates are ahead. Any cause for global panic is also going to be a catalyst for lower rates. Ebola, ISIS and Russia in Ukraine are all giving investors a reason to buy US bonds which lowers rates. For now it looks like stocks will be the losers and bonds will be the winners. 

Industry News

It's been said that history repeats itself. That seems to be the case as we approach the end of the Fed's big Bond-buying program. Read on to learn why.In recent weeks, Stocks have seen a sell-off while Mortgage Bonds have pushed considerably higher. Why has this happened? Concerns about slowing global economic growth have pushed investors into the safe haven of the Bond market, and investors have also secured profits with Stock prices near all-time highs. But there's another reason that's important to mention. After the first and second rounds of the Fed's Bond-buying program (known as Quantitative Easing) ended, Stocks performed terribly—and that behavior seems to be repeating itself as the Fed's latest version of its Bond-buying program is nearing its end later this month. But that's not all that could impact the markets in coming weeks. If corporate earnings are worse than expected, Stocks could continue to drift lower, meaning Bonds and home loan rates could continue to benefit. This will be a key story to monitor in the weeks ahead.

In housing news, research firm CoreLogic reported that home prices rose by 6.45 percent from August 2013 to August 2014, which is down from the annual figure reported in July. CoreLogic went on to say that home prices are 12.1percent below the peak seen in April 2006. Looking forward, prices are expected to increase 5.2 percent from August 2014 to August 2015. The takeaway from this is that home price gains have slowed to more normal and sustainable levels, after the large appreciation seen last year.

The bottom line is that home loan rates remain near some of their best levels of the year, and now is a great time to consider a home purchase or refinance. Let me know if I can answer any questions at all for you or your clients.

Real Estate Miscellaneous Stats

September Home Sales Surge in September:   Pending Home Sales in Western Washington surge 13% in September from the same time last year according to the NAR. Listings are also up so inventory only declined 1.2%. Market analysts suggest that there will be a leveling off but not a slow period  in our market activity as long as pricing increases stay at recent lower levels and interest rates do not rise. Our markets are currently out performing national readings. Closed sales for September also were up from last year by 4.6%. King County median value is up 9.5% from last year but, much of this could be due to the strength in the luxury market. OB Jacobi, president of Windermere Real Estate, noted luxury home sales in the Greater Seattle area have been very strong, with agents reporting stiff competition in certain segments of the market, especially for homes over $2 million. “I attribute this to Seattle’s economic boom, which is attracting an increasing number of high-paying, executive level professionals and international interest,” he remarked. Market experts stress the importance of not overvaluing a listing as buyers are informed about fair market pricing. King County supply is at 2.3 months and Snohomish County is at 2.8. International buyers, primarily from Asia, are a big part of local sales mostly on the Eastside. Home prices in Seattle 12% from 1 year ago to $517,000.00. Median prices in Bellevue is up 6.3% to $605,000.00 and Snohomish County was up 8.4% to $330,000.00. Stephen O’Conner with the UW Runstad Real Estate school expects the market to remain hot through the end of the year but says many buyers are still watching on the sidelines.
Existing Home Sales Drop in August:  Many pundits suggest the Real Estate market has cooled and anecdotal evidence suggest the same. The numbers show that, in spite of the August drop, activity remains stronger than earlier in the year nationwide. Sales activity is 5.3% lower than the same time last year for the whole US. Each area within major markets have their own characteristics and more central areas still show strength. Homebuyers should be seeing some more choices and most markets have around 4-5 months of supply. Investors have backed off significantly which should also help primary residence buyers. Cash sales made up 23% of all purchases which is the lowest level since 2009 and only 12% of all sales closed with cash were investors.

Real Estate Analysts Focus On Millennials:  Large numbers of economists have looked at how the Real Estate markets are being affected by Millennial generation member’s behavior. Some reports suggest they are the reason for the recent stagnation while other suggest they will soon be the catalyst for a growing boom in the market. I recently sent out a chart giving data that suggests there is a coming surge from this group but many factors are holding them back. Here are a few recent reports: Why Millennials Are Hurting the Real Estate Recovery” (MarketWatch, May 12) to “Millennial-Driven Housing Boom Could Be On The Way” (Time Magazine, June 28) to “More Millennials Leave Parental Nest, Without Lifting Housing Market” (Trulia, Sept. 16) to “How Millennials Could Be Housing Market Heroes” (USNews.com, Sept. 17). With such contradictory info it is hard to develop a marketing strategy. It does seem that the raw force of demographics will take over at some point. Realtor.com reports that nearly 50% of Millenials viewed Real Estate online in August. Another report suggested that many Millennials are not familiar with low down payment mortgage options and do not think they can buy. Many others are waiting for a recovery in the economy and their wages. Student debt is said to limit their ability and timing to buy. One study said the $1 Trillion student debt load in this group will reduce Real Estate purchases by over 414k units. The Federal Reserve Bank of New York that found college graduating Millennials, with student debt, are less likely to own a house than those that never attended college. In spite of this about half of all in this group say they will own a home in the next 5 years. Other data suggests that tighter credit standards, pickier buyers and trauma from the Great Recession are making it harder for this group to buy. The bottom line is this group is larger than the Boomers and will be a force in the next few years. 

Case Shiller Index For July Shows Slowing Price Increases:  Data from the 20 largest markets in the US shows home value increases have slowed. Only Las Vegas, Miami and  San Francisco had double digit price increases as compared to last year. 17 markets showed lower price increases in July as compared to June. The slower pace of price increases is consistent with other data showing the market is slowing. The exception is in new construction sales from August which were up significantly. In spite of the slow down housing continues to rise in price at 2-3 times the rate of inflation. More than 27 years of history for these data series are available, and can be accessed in full by going to www.homeprice.spdji.com. Additional content on the housing market may also be found on S&P Dow Jones Indices’ housing blog: www.housingviews.com. Overall Seattle market came in at .6% increase month over month and 7.1% increase from the same period last year. Seattle metro is still 11% off it’s 2007 peak pricing levels. Local market experts suggest that our market is moving into more traditional activity which is fueled by normal factors such as job and wage growth as well as demographics. Other numbers continue to improve. Only 4.6% of mortgaged homes in King and Snohomish Counties were underwater as compared to 6.1% in the first quarter. Mortgage delinquencies are down to 3.1% as compared to 4.7% one year ago. 

Hood Canal Real Estate, Hood Canal Properties, Hood Canal Homes, Hood Canal Lots, www.hoodcanalliving.com

Hood Canal Real Estate – What are the Top 10 Home Styles in the U.S.?

Hood Canal Real Estate, Hood Canal Living, Hood Canal Homes, Hood Canal Properties, www.hoodcanalliving.com

Top 10 Home Styles in the U.S.

We've all had that moment -- driving down a street and we see a home we like specifically for the architecture and design elements. The United States is full of different home styles and architecture, and pinpointing a specific one can be difficult, especially when dominant home styles change from region to region. The homes below are examples of the most prevalent home styles found throughout the United States.


Victorian homes give off a certain air and possess a very stately feel. Victorians are more about beauty than functionality, with complex designs, ornate trim, and large wraparound porches. The Victorian exterior is seen as a medium for decoration. These homes generally have gables, bay windows, towers, overhangs and many are known as 'Painted Ladies.' The Victorian style also has sub styles, the most notable being Gothic Revival, Italianate, Second Empire, Queen Anne and the Romanesque style.

Craftsman Bungalow

The Craftsman or Bungalow style is seen as an expression of structure and elements that rely heavily on simple, elegant design. The Craftsman is one of the most common and popular styles in the United States, with an incredible resurgence in the last five years. These homes are characterized by their wide front porches, low-pitched roofs and exteriors that use wood, stone and/or brick. The interior of the Craftsman also has an open floor plan with many built-ins throughout the house.


Tudors are very distinct and based on English building traditions during the Tudor Era (1485 - 1603). Tudors are characterized by their asymmetrical exteriors with windows playing a large part in the design. These homes generally have stone and stucco walls with wood accents/framing, and Tudor roofs are steep-pitched. Tudor homes are one of the most recognizable styles in the United States due to their specific architectural components.

Cape Cod

Cape Cods were first built in the 1600s and took inspiration from Britain's thatched cottages. Cape Cods have steep roofs, dormer windows and large chimneys -- elements that helped the homes withstand harsh Northeastern winters. The Cape Cod style is most recognized for its dormer windows, which play a large part in the design of the home.


Ranches are also known as 'Ramblers.' Ranches are characterized by their single-story construction and low pitched roofs. Ranches became very popular in the post World War II era, with a large resurgence in the 1960s as 'mid-century moderns.'


Colonials are another home style that have a distinct appearance. Symmetry plays a large part in Colonials -- evenly spaced shuttered windows, dormers, columns, and old Colonials will have many fireplaces. The most common Colonial in the United States is the Georgian Colonial, characterized by its strict symmetry, box shape, paneled front door below a decorative crown, simple or flattened columns, and the most notable feature of five shuttered windows across. Other notable Colonial styles in the United States are Dutch, Federal, and Spanish.


Contemporary homes have an almost futuristic look to them, but many contemporary homes look to connect the indoors with the outdoors. Natural light plays a large part in the contemporary home, as do flat roofs and simple horizontal and perpendicular lines. Contemporary homes embrace industrialism and put an emphasis on the use of efficient and affordable materials, and the homes emphasize an importance of combining materials (steel, glass, wood, stone, etc.) to create a fluid space.


Spanish style homes incorporate a fusion of design elements from European and Native American architecture. The Mission Revival style is the most popular, which has its roots in Spanish churches built by missionaries. Spanish style homes tend to have clay roof tiles, arcaded porches, arched corridors, bell towers, square pillars and quatrefoil windows (these windows resemble flowers).


The Mediterranean style became very popular in the United States in 1918 to 1940. This style is modeled after the hacienda style, where red tile roofs, arches, and plaster surfaces play a large part in the exterior of the house. Mediterranean style homes have become popular again, but the style has adopted more design elements like porticoes, balconies, and ornamental details that include heavy wood doors, tiles in multiple colors or designs, and balconies with ornate iron railings and embellishments.

Pueblo Revival

The Pueblo Revival is a style favored in the Southwest, highly influenced by the ancient Pueblo's simple multifamily homes. This home style favors materials sourced from the earth -- adobe, concrete, stucco or mortar, and wood beams -- and the homes tend to feature enclosed courtyards and flat or sloping roofs. The Pueblo style is also characterized by rounded exteriors that exhibit square windows, weathered wood doors and exterior stone accents.

Homes can take any shape or size, and many homes built today embrace two or more styles. The United States has many other home styles not featured. If you're looking for a home in a particular style, your agent will be able to help find that perfect property.

Hood Canal Real Estate, Hood Canal Living, Hood Canal Homes, Hood Canal Properties, www.hoodcanalliving.com