Friday, July 28, 2017

Waterfront Condos Coming Soon and Coming Fast

I wrote on my 'Couv' Life blog about the first of many cranes on the Waterfront. These monolithic machines are the herald of high-rise, and the harbinger of real estate opportunity.

Vancouver's amazing waterfront project is finally starting to show more than just a bunch a fifty foot deep holes. Tower cranes mark the beginning of the rise of tall buildings and the start of some 3300 living units planned for the north shore of the Mighty Columbia River. This $1.5 billion development will be a mixed use of commercial, office, retail, public parks and residential. Over the next 5-7 years it will build out into a world class waterfront.

Many of these units will be offered with exclusive views of the river, Mt. Hood, and the downtown skyline. At first they may seem expensive but often is the case these things will soon become in tight supply. There is a very finite amount of Columbia River waterfront available on either side.

I am already anticipating the first showings as some may be available as early as next fall. Once the cranes arrive the structure goes up pretty quick.

Urban condos however are not for the feint of heart. These units can be rather spendy and the volatility factor in the urban condo market is a bit more of an ebb and tide than traditional single family homes in the 'burbs. There is a serious pent-up demand for apartments and condos as the millennial generation is much more warm to the idea of condo/apartment living than their Baby Boomer/Gen X parents were before them.

Lead Millennials are also coming into their peak earning years. Yes it's hard to believe, but those first Millennials born in the mid-eighties are now in their mid-thirties. They can afford these now, and that is a good thing because the Millennial generation is the largest generation in US history surpassing the Boomers with more than 80 million people. For the next 10-15 years the younger members will come into their peak earning years as well and that could drive a serious demand for this type of living space. Vancouver is in prime position to capitalize on this generational shift in real estate demand.

Friday, July 21, 2017

Buying in High Tax Neighborhoods, Is it for you?

That's a grabber headline, right? What exactly do I mean by "high tax neighborhood"? Well, in this context it is neighborhoods that have strong property tax assessments most likely supporting school bonds. Here in Clark County we have excellent schools throughout the region. There are however a few districts that have had great success passing multiple property tax bonds to fund projects that enhance the district's facilities. Many families with children at school age often seek these areas out to take advantage of what they view as an opportunity for a superior public education.

I will not debate the issue of education variances across districts, but rather will keep this real estate central. For people who do not have school age children this "advantage" is not realized but the higher taxes are.

Young people who have school age children or feel they may have children in the near future may choose such an area to prepare for the inevitable need for public schools.

One 'school' of thought, punned the heck at of that didn't I? Anyhow, is that these well funded school districts will increase property values over time. This does tend to hold true. But a fresh empty nester holding on to a property in one of these areas may be wise to consider a move. Why, you ponder? Because demographics change over time. School bonds are like other government funded projects in that they ebb and tide with local public sentiment. An empty nester has already reaped the rewards of the higher taxes and now has no children left in the school district. There is no guarantee that twenty years down the road the area will still be the area of choice for schools and families concerned with education. Thus all the extra taxes paid may not convert to increased value later. They do however provide extra value NOW for a prospective buyer.

A person sitting on a house in this type of area with no prospect of having use of the local public schools can capitalize on the demand from others who are seeking these areas out. Perhaps a downsize into another area with less intrusive property taxes could help ease expenses later on when retirement income is in play.

Listing a house when the market demand for it is very high is usually a good thing. This holds especially true if an opportunity to buy the replacement house is in an area that is not in as heavy a demand and could provide a better financial position later on.

This represents just a few ideas on whether to sell or hold is the best option. Always look over your options thoroughly and consider all angles. Check with your tax professional as well. Real estate is often a major portion of ones financial portfolio and should be managed wisely. This is particularly true for those who find themselves in a life transition or approaching retirement.

Tuesday, July 18, 2017

High Atop the Bluff in the Gorge

I wrote about the bluffs in White Salmon a few years back and now a colleague of mine has finally gotten the lots he has been working on completed and ready for sale. Our office is listing them now. The views from these lots are outstanding and they do NOT require oversight by the Columbia Gorge Commission.

In total there are seven lots including one that can be further divided into a total of three lots. Each of the lots offers a view of either the Columbia River Gorge and some offer spectacular views of Mount Hood and Hood River Oregon across the river.

One of the lots has a house on it already with a large deck that takes in one of the best views possible. The others are ready to go. Buy the lot and build the dream.

This area is filled with things to do especially if you like the outdoors. There is also plenty to do "in town" in this area with White Salmon high up on the bluff, Bingen down along the river and just across the bridge is Hood River, Oregon.

Hood River / White Salmon is in the transition point between the lush green west end of the Gorge and the drier east end of the gorge. As such rainfall is significantly less than what we see here in the west. There will be a great deal more sunshine. The winters will be a touch colder but still not as brutal as the central and eastern Washington cities of Ellensburg, Wenatchee or Spokane.

What fabulous spot to take in the view. I have attached the following google earth clips with approximations of the lot locations. If there is interest in the actual real estate, I have them listed on my land site, Southwest Washington Land.

As always please enjoy the view.

Friday, July 14, 2017

Using a Buyer's Agent in a Seller's Market

Buyers can find themselves in a great amount of frustration while trying to buy a home with tight inventory like we have right now in the Metro Portland-Vancouver area. I have mentioned "cocky" sellers and listing agents before. Buyers may be tempted to go straight to a listing agent to try and get the inside deal.

Although it is possible that the listing agent may favor your offer since they stand to make a double commission. But Washington State has very strict statutes regarding agency duties and the listing agent has more than a fiduciary responsibility to the seller. They have a signed contract with the seller to represent the seller's best interests. The sellers best interests are nearly always maligned to the buyer's interests.

It is a bit challenging to represent a buyer against your own seller without someone feeling they got the short end of the deal. In the case of a listing agent the short end would almost certainly be the buyer. Personally I would be wary of any deal in which the principals or their agents participation is motivated by greed. 

Most agents are honest and will work hard to do the right thing. Buyers are fortunate in that the services of selling real estate are almost always paid by the seller. The buyer therefore can enjoy the full representation of an agent who is bound by the same statutory and fiduciary duty to the buyer as is the listing agent to the seller at no cost to the buyer. 

Right now this market is VERY hungry for clean move in ready homes. The in town move in ready homes from $225,000 to around $400,000 priced right, will sell fast and likely with multiple offers. Homes in rural or semi-rural areas with acreage from $350,000-$500,000 will see the same action. Buyers may have to offer on several homes before finally landing one. This is the nature of a seller's market. 

Buyers can also look at homes that are not so picture perfect. I am not referring to a fixer, but a house that doesn't show as well. Maybe it has a lot of clutter. Maybe the yard is overgrown. These types of houses may in fact be fabulous homes that need just a touch of a new buyers TLC. These are not as likely to see multiple offers and bid up pricing because so many people can't look past superficial cosmetics. This can be the ticket to ride to quote the Beatles, for a buyer fed up with the seller's market.

Buyers should be patient and stick to a solid buyer's agent.

Friday, July 7, 2017

Townhouses Can be the Ticket!

originally posted in Retire to Washington, by Rod Sager, June 2017

For many retirees downsizing the big family house after the family has moved out is a typical decision. Moving out of the "family house" can be caused by any combination of factors. The big yard becomes a time consuming hassle to maintain and/or an expensive chore to delegate to the pros.

If the home is large say 2000 plus squares and/or has 4-5 bedrooms, this may be unused space when it's just one or two adults in the home.

Many people are tempted by the "condo" option. For some this is ideal in that you are only responsible for the space between the walls inside your unit. Condos may offer common area amenities like walking trails, swimming pools, exercise equipment, etc. These luxuries can come at a price usually in the form of high HOA dues.

A great alternative to the condo is a town house or row house. These can be reasonably spacious, usually have a common wall between neighbors and a smallish garage. They feel like a house in nearly every way. Often these types of properties have a small back yard that is easy to maintain and the front yards are routinely kept up by an HOA. If the common areas lack a lot of luxury items, the HOA dues tend to be fairly inexpensive. Unlike a condo in which the homeowner does not maintain the exterior structure directly, the townhouse is maintained by the homeowner. The owner owns the dirt underneath the unit and structure including the windows and roof. It is truly a bit of a hybrid when you think about it.

I believe these types of homes are ideal for retirees looking for ease of maintenance, a 'house like' feel and reasonable amount of living space. Town homes are typically priced well below the market for a similar square footage traditional detached house. Modern designs made in the 21st century often have double wall or heavily insulated walls between the units to avoid that 'apartment' feeling where you here your neighbors chatting at the dinner table.

I am the classic example; my wife and I live in a five bedroom 2500 SF house and we are essentially empty 'nesters'. I do have a son about to graduate from college so he may be back in the house for awhile, but his career path will no doubt lead him away somewhere soon.

I can sell this big house for a high price right now and move to a smaller less expensive townhouse pocketing a bunch of cash and saving money every month on the mortgage. A townhouse could be in my future, what about you?