August 6, 2021 Real Estate Weekly

INSIDE

This Issue WHAT LGBTQ BUYERS ARE LOOKING FOR IN A HOME TODAY PAGE 5

SELLER BEWARE: UNSOLICITED PURCHASE OFFERS ARE LIKELY LOW ‘WHOLESALERS’ SCOUTING FOR HOMES TO PROFITABLY RE-SELL PAGE 7 CLASSIFIEDS PAGE 7 AUG. 6-12, 2021

TABLE OF CONTENTS What LGBTQ buyers are looking for in a home today ......................................................P5

INSIDE PAGE

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Q&A Ask Our Broker.......................................................................P6

Seller Beware: Unsolicited Purchase Offers Are Likely Low ‘Wholesalers’ scouting for homes to profitably re-sell.......................................P7 Classifieds............................................................................P7

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August 6, 2021

STAT Real Estate Stat

106,548 The total number of real estate brokerage firms operating in the United States as of 2021.

Source: National Association of Realtors

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August 6, 2021

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Wonderful 5 bed / 3.5 bath Samish Island home offers amazing views towards Padilla Bay, Guemes and Hat Islands from the front of the home and Samish Bay from the dining area and beautiful back yard. Great kitchen with an eating area and lots of space to create, with sightlines to the back deck and yard.

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What LGBTQ buyers are looking for in a home today

By Erik J. Martin he percentage of Americans who identify as lesbian, gay, bisexual, transgender, or genderqueer/non-binary (LGBTQ) has been growing steadily in recent years; a Gallup poll taken earlier this year found that LGBTQ citizens now represent nearly 19 million, or 5.6% of, U.S. adults. And according to the National Association of Realtors (NAR), today they comprise approximately 4% of all home buyers and sellers.

Like everyone else, they’re looking for their fair share of the American dream, which includes owning a home that fits their needs and wants.

A fresh recent report by the NAR found that

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LGBTQ buyers tend to purchase smaller and older homes than non-LGBTQ purchasers and anticipate living in their new homes five years fewer than nonLGBTQ buyers. LGBTQ sellers and buyers were more likely to be single males and unmarried couples and identify as male than as female. Bisexual purchasers and sellers, meanwhile, were more likely to be younger, first-time buyers or sellers, and earn lower incomes than other groups.

The study also revealed that the median sales price for homes claimed by LGBTQ buyers was $245,000 versus $268,000 for other buyers.

Additionally, LGBTQ purchasers are more inclined to buy in urban areas versus rural areas or small towns.

Lisa Herceg, director of business insights for the NAR in Chicago, says some of these findings were unexpected.

“The fact that LGBTQ buyers typically purchase smaller and older homes was initially surprising since the median income for these buyers and sellers was similar to other groups.

However, when you look at the fact that LGBTQ buyers are twice as likely as other buyers to purchase in urban areas, this pattern makes more sense: Purchasers in urban areas are apt to get smaller spaces for their money and are less likely to purchase newer construction,” she says. “That the typical LGBTQ buyer expects to own their own home for 10 years versus 15

years for other buyers was also interesting – these buyers may be ready to move on to a new home more quickly.”

Herceg adds that LGBTQ buyers are concerned with the same things that other groups emphasize: quality of the neighborhood, a convenient commute, and overall affordability.

“But LGBTQ buyers are less likely to prioritize convenience to family or friends and more likely to emphasize convenience to entertainment, leisure, and a veterinarian. LGBTQ sellers are more likely to have sold a townhouse, rowhouse, duplex, or condo than other buyers, but they most likely purchase the same dwelling type that most buyers in general pur-

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chased: a detached singlefamily home.”

Allison Smookler, a broker associate with Kentwood Real Estate Properties in Denver, recently purchased a brick ranch home in southern Denver with her wife.

“We chose this particular home because it is in a super convenient location, feeds into one of Denver’s best elementary schools for our daughter, offers easy access to lots of the activities we love, and because we have been able to customize it to exactly what we want,” explains Smookler.

“Our status as LGBTQ homeowners impacted our decision, as we wanted to ensure we were buying in an area that we felt would be ‘queer-friendly.’”

Yawar Charlie, a gay cast member of CNBC’s show “Listing Impossible” and director of estates at Aaron Kirman Group, Compass, Los Angeles, points out that LGBTQ buyers are not afraid of taking on fixeruppers or homes in need of remodeling.

“I find that they are much less attracted to homes that are completely done turnkey rather than the ones they can leave their stamp on,” he says.

“Most of my gay clients tend to move every three to five years; they like to get into a house, make it their own, and turn it around for profit which they can leverage into another home.”

Bret Weinstein, CEO/ co-founder of Denver-headquartered BSW Real Estate, agrees.

“LGBTQ buyers are not afraid to explore areas that have more opportunity for future appreciation,” he says. “Also, I’m finding a lot of these buyers looking for something smaller so they can still travel, especially now that things are opening up from COVID-19, and preferring homes with great outdoor potential for gardening and entertaining.”

Charlie notes that gay couples usually have more purchasing power because they tend to earn more money than their female counterparts.

“Gay couples may not have children when buying their first home, so they’re able to spend a little bit more, not having to worry about childhood expenses.

Also, since marriage equality is less than 10 years old, it doesn’t surprise me that most LGBTQ buyers are not married,” says Charlie. “My husband and I purchased our first house together before we had the right to get married.”

Before choosing a home, Smookler recommends that LGBTQ buyers carefully consider present as well as forthcoming goals and needs.

“Think about what your family will look like in the future,” he suggests. “Will schools be important? Will pets be in the picture?

Will you want to be close to parks? Will you want privacy from neighbors? Are you okay with a property needing maintenance? And do you wish to be in an area known for having a larger LGBTQ population?”

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Balancing Debt when Seeking an FHA Loan Question:

We want FHA financing. Our loan officer says we may be able to get pre-approved even though our monthly debts equal 52% of our income. Isn’t 52% too high?

Answer:

Under FHA guidelines, it’s possible in some circumstances to have a monthly debt-to-income ratio (DTI) of as much as 56.9%. Not a good idea, but possible.

One of the major underwriting considerations for any loan program is the DTI. Loan programs typically limit monthly debts to reduce lender risk. For example, with the FHA program, the basic DTI ratios are 31/43.

The 31% “front” DTI ratio compares monthly housing debt with gross monthly income. The housing debt includes at least mortgage principal, mortgage interest, property taxes, and property insurance — what’s known as PITI. The 43% “back” DTI ratio includes housing debt plus recurring monthly costs for such things as auto financing, credit cards, and student loans.

You can, however, get FHA financing with higher DTI ratios. In fiscal year 2020 — the period ending in September 2020 — HUD reported that 24.53% of the

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loans insured through the FHA program had back DTI ratios above 50%.

How does this happen? Excess DTI ratios can be allowed if the borrower has certain off-setting factors.

Additional reserves. The FHA program — like virtually all loan programs — loves borrowers with an ability to save. Savings offset the risk. If there’s a job loss or reduced income, the borrower has time to get a new job without missing a mortgage payment. For properties with one to two units, HUD wants to see reserves equal to three monthly payments.

Energy efficiency. HUD allows ratios up to 33/45 for energy-efficient homes, under the theory that lower utility bills offset higher monthly mortgage costs.

High credit scores. Lenders want to know that you have a solid income, but that’s not enough. Someone with a good income who does not pay their bills is a substantial risk. Borrowers with high credit scores have evidence of their commitment to pay monthly debts, something lenders appreciate.

Steady payment. HUD will be very happy if monthly housing costs stay the same, are lower, or increase no more than $100 or 5%.

Residual income. The FHA program wants to assure that borrowers are not impoverished by their mortgage financing. Toward this end, residual income — the

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Q&A

ASK OUR BROKER

By Peter G. Miller

amount of money you have each month after various expenses — can be a compensating factor. Residual income requirements vary by location and household size.

As a borrower, you’re ahead if you can show that you qualify for a compensating factor. You’re doing better still if you can qualify for several qualifying factors.

Now, about that allowable 52% DTI. Yes, the rules may okay it, but consider some cautions.

First, many lenders will decline loan applications with super-sized DTI numbers. They see such applications as simply too risky.

Second, steep monthly debts can significantly limit your lifestyle options and ability to save.

Third, what happens if you lose a job or suddenly earn less? If the pandemic, automation, and job losses have taught us anything, it’s that jobs are a lot less certain than we used to believe. Less income and big monthly debts are not a good combination.

A lender might allow 52% or even more, but what’s best for you? Maybe a more comfortable option is a less expensive property, a smaller mortgage debt, and better sleep.

Email your real estate questions for Mr. Miller to peter@ctwfeatures.com.

August 6, 2021

RE-Weekly CLASSIFIEDS REAL ESTATE FOR SALE Open Houses

NEW TODAY

Seller Beware: Unsolicited Purchase Offers Are Likely Low ‘Wholesalers’ scouting for homes to profitably re-sell

By Marilyn Kennedy Melia

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t’s a hot seller’s market.

But is it so hot that even homeowners who’ve expressed no desire to move should be receiving calls and letters from strangers urging them to sell?

That’s what’s happening in select housing markets around the country, typically in areas where homes are priced affordably.

August 6, 2021

Individuals known as “wholesalers” have been hounding owners of homes that will be attractive to investors looking to refurbish and resell or rent at a profit with increasing frequency, notes John Petrack, executive vice president of the Realtors Association of Metro Pittsburgh.

Investment firms and individual investors have been hungry for properties, spurring the practice.

Typically, wholesalers

convince owners to enter into a contract to sell, but they never intend to actually close on the sale and take the title.

Instead, a wholesaler looks for a buyer-investor who will pay more than the price negotiated with the owner – often 15 percent more.

If the wholesaler doesn’t find a buyer, he backs out of the contract with the homeowner.

While the wholesaling itself isn’t illegal, some states and cities have

707 Kodiak Drive, Burlington $429,900 Open House Friday, August 6th, 2-4 Saturday, August 7th, 11-1 Looking for that perfect rambler with a shop, well here it is! Well established neighborhood in a great location. 3 bedrooms, 2 bathrooms, 1500 SF. Large kitchen for entertaining.

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to regulate wholesalers to crack down on the predatory aspects of the practice.

Some “iBuy” firms like Zillow Offers or Redfin Now, will also buy homes that need refurbishing.

But, “there really isn’t any comparison” between the two business models, says Petrack.

The iBuy firms “actually

Rental Wanted

purchase the property and take legal title. They then either improve the property for resale or hold them and rent them out for long-term investment,” Petrack explains.

The wholesaler never takes ownership and has nothing to lose by walking away from a contract if he can’t find an investor to purchase. And, the profit the whole-

saler pockets is unfairly inflated.

“Obviously,” says Petrack, if an end buyer is willing to pay a price well above what the wholesaler offered the homeowner, “then the property was probably worth that higher value in the first place, which represents equity lost by the [homeowner] seller.”

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1203 E SEction St, Mt VErnon

$674,900 15909 27th AVE nW, StAnWood Contemporary 2 story home offers 7 bedrooms plus a bonus room! Open floor plan, spacious kitchen, 3.5 baths, recessed lighting and skylights.

Spacious covered porch for relaxing before, after or instead of work. Located in a desirable neighborhood, close to schools, shopping, medical and easy commute to I-5.

MLS# 1810956 Danya Wolf

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471 E Whitmarsh rd, Burlington

$379,000

118 E orangE aVE, Burlington

Great Investment or bring your fishing pole! 1.74 acres with a 4 bedroom house, all-purpose buildings. Garden space, newer roof.

Property sold “ As-Is “ seller will do no repairs. Do Not Disturb Tenants. Great potential, property back up to FedEx on South Walnut street. Possible light Industrial use, buyer to verify! Elva Hunter (360) 202-3086 MLS# 1812068

Great opportunity for a small business.

Includes commercial kitchen & other restaurant equipment. Great space out back for outdoor dining/drive-thru. There is parking and storage.

It’s located just one door from one of the busiest corners in Burlington; E Orange Ave & Burlington Blvd. Upstairs there is 1BR/.75BA and den. The possibilities are endless in this fast growing community. Sherry Ruderman 360-540-1552 MLS# 1780005

h strEEt rd., BlainE

2xxx urBan aVEnuE, mount VErnon $600,000

$1,200,000

Eighty (80) acres of mostly woods including Western Red Cedar and Douglas Fir, Cottonwood; Alder; and Birch; with one large pond great for duck hunting toward the northerly portion of the 80 acres, some meadows, one small beaver pond, plenty of walking trails or bring your ATV; and an old dug well near the old home site by the southerly edge of the property to the east of the gate. Future homesite/Pasture land along the southwesterly edge of the property.

Potential for additional building Danya Wolf sites. Shown by appointment. 360-708-8294 MLS# 1568051

JoAnn Boudreau Patricia Box (360) 391-0746 Office Manager/Broker O: (360) 424-0300 C: (360) 941-9186

819 n 18th, mount VErnon

$650,000

$624,900

$865,000

Open House Saturday August 7th, 11-2PM Beautiful 4 bedroom plus den home with large spacious rooms. This contemporary home features formal oversized dining room, large kitchen with island, formal and informal living areas, central vac and new carpet throughout. This vast backyard provides great entertainment choices with its large deck, pool, and firepit. Green belt behind enhances the private outdoor atmosphere. Short distance to Lake Goodwin and Carla Fischer 360-982-0010 Crabapple Lake for additional outdoor fun. MLS# 1817964

60102 StAtE roUtE 20, MArBLEMoUnt $777,000 Mondo Restaurant has a newly remodeled kitchen with beautiful, new appliances.

Great work space and tremendous storage.

Public area offers very spacious seating.

There is also an outside dining option.

Small gift shop area. Chef creates incredible and varied menu, both nutritious and delicious. Restaurant is situated in a beautiful location in the Cascade foothills.

Well worth a day trip.

Danya Wolf Sherry Ruderman MLS# 1757641 360-708-8294 360-540-1552

Home on the hill, close to shopping, schools and medical. This home features 6 bedrooms and 2 baths with 2 additional bonus bedrooms in the garage (easily convert back to a 2-car garage). Plenty of parking, nice size yard with mature landscaping.

MLS# 1811049

WELcoME

41546 south skagit highWay, FinnEy CrEEkWatErFront $90,000

Please help us welcome Juanita Bunch to our office.

Beautiful 1.71 acres of amazing recreational waterfront property.

Enjoy swimming, fishing, walking on the beach or just watching the wildlife.

Carla Fischer MLS# 1800415 360-982-0010

Prime commercial property with utilities in street, including P.U.D. water, Puget Sound Energy electricity; Cascade Natural Gas, fiber optics; cable; and sewer. Subject To survey and short plat. Property is located between Chicago Title Company easterly parking lot and Max Dale Restaurant’s south easterly parking area. Danya Wolf MLS# 1649968 360-708-8294

Juanita Bunch 360-941-5530

Carla Fischer (360) 982-0010

Elva Hunter (360) 202-3086

John Hunter (360) 202-3086

Suzanne Jenkins (360) 941-2983

360.424.0300

Hi! My name is Juanita Bunch, proud daughter of a 22 year veteran, raised in the beautiful Skagit county. I have worked with the community for over 21 years and love to meet new people. With the experience I’ve gained, I’ve learned to be a great listener and communicator. I’ve got two boys, so with raising them, I’ve learned to be patient as well. I’m excited to Juanita Bunch work on a new adventure with Skagit Tradition and 360-941-5530 help you find your dream home!

Russ Lanker (360) 708-1117

Sherry Ruderman (360) 540-1552

Kim Schlimmer (360) 661-7670

Brett Tacker (360) 840-7931

Danya Wolf Designated Broker/ Owner (360) 708-8294

3780 E. College Way, Mount Vernon

www.skagittraditionrealty.com 120486-1

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August 6, 2021