Real Estate Weekly: March 3, 2023

HOW RELIABLE ARE HOME VALUE ESTIMATES ONLINE?

PAGE 5

SOME SELLERS SOLD ON RENTING

PAGE 7 CLASSIFIEDS

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MARCH 3, 2023

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Real Estate Stat

-0.7%

For a twelfth consecutive month, existing-home sales dropped.

Source: National Association of REALTORS, 2022.

Mondo is a well- established and well-loved family-style restaurant at the foot of the Cascade Mountain Range. Locals and travelers make this par t of their Hw y 20 and Nor th Cascade National Park trip. Major ar terial choice to Newhalem and continue on to Winthrop; or cross the Skagit River bridge and continue up to Cascade Pass and hiking to Stehekin. The restaurant is warm and inviting, with incredible fare. Ver y spacious dining area. Some outside seating available. Small gift shop area. The kitchen is beautifully remodeled New flooring and ex terior lighting.

MLS#2038466

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How reliable are home value estimates online?

By Erik J. Martin CTW Features

Curious how much your home can probably fetch today? The answer is likely just a few keystrokes or finger taps away. That’s because sites like Zillow, Trulia, Realtor.com, Redfin, and others provide fast and free online home valuations indicating what your property is probably worth currently.

But can these sites and their estimates be trusted?

And to what extent can these snapshot valuations be useful?

Ben Wagner, a real estate investor and house flipper in New York City, often

visits and trusts these and other sites because he says they provide relatively accurate estimates of home values based on data from public records and recent real estate transactions.

“Redfin is a great option for those looking to buy or sell a home, as it offers detailed information on properties – including prices, photos, and reviews,” he says. “Zillow is another popular option, as it provides home value estimates and market information for homes all over the country. Realtor.com also shows detailed info on home values and recent sales as well as estimated rent prices for specific

homes. And Trulia is an excellent choice for those looking to buy or sell, as it offers comprehensive information on properties, including market trends and data.”

Knowing the current estimated value of your home can position you to make more informed decisions about financial planning. It can help you better decide whether or not to refinance your mortgage or take out a home equity loan, for instance.

“It can also help you determine how much home insurance coverage you need, and it can provide you with leverage in negotiations if you are looking

to make improvements or repairs to your home,” adds Wagner.

Jasen Edwards, chair of the Agent Editorial Board, explains that sites like Zillow offer multiple benefits beyond an instant valuation of your home.

“These websites also make it easy to compare your home’s value with those of other homes in your area. You don’t have to meet with a real estate agent or appraiser, either” says Edwards.

However, online valuation sites can provide misleading information, cautions Chuck Vander Stelt, a Realtor in Valparaiso, Indiana with Listing Leaders.

sites also don’t consider more specific factors that can impact your home’s worth, “such as the area’s local economy or the specific location of your home.”

If you disagree with an online valuation tool’s estimate of your home’s value, you should be able to supply helpful fresh data to the site.

“The algorithms they use cannot account for subjective factors, including things like attractive paint colors, aspirational decor aesthetic, or having more desired white trim and doors versus natural wood. Instant online home valuations don’t necessarily incorporate all the features found in your home, therefore inaccurate results are relatively frequent,” Vander Stelt. “That’s why these tools should only be treated as a guidepost. Your home’s true value is likely within 10%, up or down, of the value provided by an instant online valuation tool.”

Edwards adds that these

“With Zillow, for instance, you can update its Zestimate to reflect recent renovations or other changes to your home’s property value. You can submit a ‘Home Details’ update to Zillow, which includes information about recent renovations, additions, or other changes to your home. You can also request a ‘Zestimate Recalculation,’ which will recalculate your home’s estimated value based on the new information,” suggests Edwards. While Trulia and its rivals are quick, convenient, and gratis, they’re still no substitute for two tried-andtrue methods for obtaining an accurate home valuation, the experts agree.

“Enlist a real estate agent to conduct a comparative market analysis of your home, or hire a professional home appraiser,” recommends Nicole Beauchamp, a licensed associate real estate broker with Engel & Volkers in New York City.

“These remain your two best bets to get an accurate and timely opinion of the value of your home.”

Is there such thing as good mortgage news these days?

Question:

Was there any good mortgage news in 2022, a year when loan rates soared?

Answer:

The government reported that the Consumer Price Index rose 9.1% in June 2022 when compared with a year earlier, the biggest increase in 40 years. The technical term for this, according to leading economists, is yikes.

Since June the inflation rate has fallen, in large measure because the Federal Reserve forced up bank rates by repeatedly increasing the federal funds rate, the rate banks pay to borrow from each other overnight. The Fed actually raised rates seven times during 2022, for a total increase of 4%. Such increases forced the prime rate higher and that, in turn, has led to higher borrowing costs in general.

The story with mortgages is somewhat different. No doubt mortgage costs have increased when compared with a year ago, but by the end of 2022 they actually fell from mid-year highs.

According to Freddie Mac, weekly mortgage rates started at 3.22% in January and reached 7.08% in

October and November. By the end of December, weekly rates were back down to 6.27%, according to Freddie Mac.

Let’s not sugarcoat 2022: If you’re a borrower there’s no doubt that a 3.22% mortgage rate is a lot more tempting than 6.27%. The higher rates plainly resulted in fewer mortgage originations and reduced home sales.

But both real estate and money are commodities. Their value – what they can buy – goes up and down. It’s not realistic to believe that home values will rise everywhere all the time or that mortgage rates will always be at or near historic lows, as they were in 2021. However, there were some results in the 2022 marketplace that can be seen as positives.

First, most mortgage borrowers – 95% according to analysts Stephen Kim and Trey Morrish with Evercore ISI – have fixed-rate financing with rates below 3.4%. Such borrowers have not been hurt by rising mortgage rates because their stable monthly mortgage costs are actually a hedge against inflation.

Second, mortgage debt has increased. According to the Federal Reserve Bank of New York, mortgage debt amounted to $11.99 trillion at the end of the third

ASK OUR BROKER

By Peter G. Miller

quarter of 2022 versus $10.99 trillion a year earlier. That’s an additional $1 trillion in mortgage debt despite high rates, evidence that people are borrowing, though surely not at the levels seen in recent years.

Third, home prices are generally higher than a year ago.

While home SALES fell in 2022, PRICES did not. The National Association of Realtors estimates that the typical home value was up 3.5% as of November 2022 when compared with a year earlier. Home sales in 2022 will likely be around 4 million units, not a great number but not a collapsed market, either.

So, as strange as it seems, even with quickly-rising mortgage rates and fewer sales, the 2022 real estate market was generally a hedge against inflation and enjoyed rising values.

All things considered, that’s a good result given a year dominated by worries about the pandemic, inflation, the Ukraine war, and perhaps an oncoming recession. As to what will happen in 2023, it’s too early to tell, but we should know a lot more in the next few months.

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

Some sellers sold on renting

By Marilyn Kennedy Melia CTW Features

Many homeowners who want to move are reluctant to sell since they can no longer command the sale prices their neighbors enjoyed during the recent era of three and four percent mortgage rates.

But some would-be home sellers who are relatively well-heeled and also hold a low-rate mortgage are crunching numbers and taking a new path to buying a new place: Renting their former home instead of selling.

Experts at John Burns Real Estate Consulting, which advises home builders, wondered whether with the many homeowners who pay less in monthly mortgage than they could command in rent, and with the strong demand for suburban single-family rental homes, if owners would rent rather than sell. From a survey in late summer, they found that a significant portion of owners were doing just that – especially in regions with strong home rental demand, like the West and South.

Landlord lessons

But renting can be a difficult way to make money, points out

Scott Bishop, financial planner at Avidian Wealth, Houston, who points to dealing with delayed rental payments, and attending to needed repairs as some of the hassles. Moreover, novice landlords might be ill-informed about demand and rental rates, Bishop says. He suggests talking to local real estate agents to discern local rental realities.

Money matters

Usually, homebuyers use the sale profits from their former home to make a down payment on their next one. By not selling, these buyers must dig into their savings instead.

Although mortgages are available with a down payment less than the standard twenty percent of a home’s purchase price, “If you cannot afford to either pay twenty percent down or afford a 15-year mortgage (which has higher monthly costs than a 30-year loan), you may not be really able to afford the home,” believes Bishop.

Moreover, he says landlords need to be able to cover expenses on their property when a tenant can’t be found.

Still, it can be a workable, with John Burns Real Estate Consulting finding that as many as ten percent of sellers in housing supply constrained Southern California taking this tack.

This 750 sq. ft. cottage floor plan condo is open & light for the living room, dining room & kitchen. Located on the end next to the road adds to the natural light for this corner unit, 2 bedrooms with walk-in closets, one bathroom that has a walk-in shower. Single car garage connected with an outside parking space. Appliances included; stove, refrigerator, dishwasher, washer & dryer.

or

24017 trInIt y lane, SeDro-woolle y $895,000

oPeN HoUSe

Sunday, march 5th, 1-3Pm

There are so many investment possibilities with this home and proper t y. Classic 4 bed/2.5 bath farmhouse style 2560 sq.ft. home with east facing deck on 1.7 acres. Home offers kitchen w/island and ceramic tile floors, office, bonus room, mud/laundr y room, living room with propane fireplace, built-in bookshelves, and beautiful laminate over hardwood floors. Studio cottage has own kitchen and bath. Proper ty also features a 16,000+ sq.ft. pole building/barn with office space, shop, and room for RV storage. Potentially 5K in rental income each month from the cottage, barn, and RV storage. MLS#2028784

Conveniently located corner building lot with available utilities. Build your dream home in this neighborhood that is close to schools, Hillcrest Park, and the 18th Street Water Park. Easy access to I-5, shopping, and medical facilities

1 MountaIn VIew rD, Mount Vernon $115,000

Wow! 5.2 acres just outside

Mount Vernon, close to Big Lake, great oppor tunit y to build your new home!

Surrounded with trees and privac y.

Custom build your commercial enterprise: 13,361 square foot commercial tract (two lots) zoned C-2. Great location near recreation center; major grocer y store; hotel; restaurants; offices; health club; house and farm supply stores; gas stations; banks; and I-5. Water, Cascade Natural Gas, Puget Sound Energy, City sewer, and Comcast are all in the street.

3710 MoHawk Court, Mount Vernon $775,000

Proper ty is beautifully unique; there is no close comparison. Spec tacular views from most ever y room in this unique

Dan Estabrook built custom 4,000 sq.ft home: amazing attributes throughout; outstanding kitchen features Thermador Professional range w/ex tra burners and griddle; oak cabinetr y; generously sized closets 4 bedrooms, den plus amazing, spacious office separate from the main par t of the home. Air conditioning. High-speed internet. Built-in Bose speakers and stereo. Lg utility room w/deep sink. 960 sq.ft garage. Situated on .65 acre. MLS#1975189

oPeN HoUSe Saturday, march 4th, 11-1Pm

Located just outside the Mount Vernon City limits, this wooded 1 acre plus lot could be a building site for a stick built, modular, or manufac tured home, with plenty of room. Trac t has been sur veyed and wetlands have been delineated. Power and PUD water are available at the street.

Perc test per formed/3 bed septic possible, permit#SW22-0073

Welcome home to this beautifully appointed 3 Bed/2.75 Bath NW contemporar y home with upscale touches. Living room has vaulted, beamed ceiling & lg windows providing lots of natural light. Dining room has a window seat and sliding doors to the covered brick patio. The kitchen has a breakfast room, window seat, SS appliances, granite counters, and so many cupboards & ex tra counter space for all your enter taining needs. Primar y & 3rd bedrooms both have access to Trex deck overlooking landscaped backyard & concrete patio. Primar y also offers en suite bath w/shower, vanity w/ ex tra storage & counter space & walk-in closet. Upstairs bedrm/bonus room, w/walk-in closet, bathroom, & tons of storage. Lg 2- car garage w/ex tra space, all on 1/3 of an acre. MLS#2008624

Great visibilit y commercial proper t y: plent y of parking; small storage building/garage (20’ x 24’) in back.

This adorable little 3 bed/1 bath fixer is waiting for your ideas and elbow grease Has a den/office off the living room and a large bonus room upstairs Freshly painted, new carpet in bedrooms Newer roof Fenced yard Storage shed Good-sized yard for gardening and/or enter taining Convenient location, near the Skagit River, the Park, a shor t trip across the bridge to the River walk, shopping, and dining MLS#1931436 Patricia Box (360) 941-9186

Proper t y is set up for offices on main level with 1.5 baths; and basement

*access (with washer dr yer hook up plus t wo additional rooms) *from both inside and outside. Second stor y offers t wo additional rooms, one with a sink. Just over 1/2 acre: .547 acre.

commercial

Designated Broker/Owner (360) 708-8294 CRS/CBA/GREEN

2121 Market Street, Mount Vernon $279,000

4302 aPaCHe DrIVe, Mount Vernon NEW PRICE!

1760 S BurlIngton BlVD., BurlIngton $3500/MontH

MLS#2038424 Danya Wolf (360) 708-8294

kato lane, Mount Vernon $149,000

MLS#1880982 Elva Hunter (360) 202-3086

MLS#2029949 Suzanne Jenkins (360) 941-2983 Carla Fischer (360) 982-0010

nHn S. 15tH Street, Mount Vernon $199,000

Danya Wolf (360) 708-8294 PATRICIA BOX BUYER S AGENT (360) 941-9186

Danya Wolf (360) 708-8294

Suzanne Jenkins (360) 941-2983 CRS/SRES

Elva Hunter (360) 202-3086 CRS/SRES

Carla Fischer (360) 982-0010 CRS/SRES

Danya Wolf

MLS#1861233 Danya Wolf (360) 708-8294

BUilDiNG For leaSe