June :: SoundBiteBlog.com 2007 :: SoundBiteBlog.com

The Kitsap County real estate market in particular, and the Washington real estate market in general are getting better for real estate buyers and tougher for real estate sellers. There are a variety of reasons for this and it is nothing unusual. The real estate market goes up and the real estate market goes down. It’s the nature of any market to move in both directions over time.

Falling mortgage interest rates in the past few years have allowed real estate values to rise significantly. As prices have risen, the number of potential real estate buyers have diminished. This is due in part to the fact that some families simply do not qualify for the higher priced properties. AND, as the number of qualified buyers dwindles, real estate that is listed for sale, sits on the market for longer and longer periods of time, waiting to sell.

This dynamic allows real estate buyers to get more aggressive with their negotiations. Good for the buyer; hard on the seller. Real estate sellers, faced with the prospect of receiving less money for their home or investment property, naturally want to know that the potential buyer can actually purchase. Rich’s article on the subject of Earnest Money, addresses one of the tactics for proving a buyer is serious about buying. This article addresses a way to prove a buyer can purchase.

Improve the odds of getting your offer accepted with a Pre-Approval Letter.

Your chance of being viewed as a Serious Buyer skyrockets when the seller and the Listing Agent are presented with tangible proof that you, as a buyer, prepared for this transaction in advance. The Pre-Approval letter indicates that you have taken the time to sit with a mortgage professional, discuss the details of your financial situation, applied with a Lender and been approved by that Lender, before looking at homes.

Pre-approval and pre-qualification are two entirely different processes.

Pre-approval is (in theory at least) much stronger. The pre-qualification process entails meeting with a mortgage professional and discussing your financial situation to determine:

• how much you can borrow
• how much you want to borrow
• what kind of roadblocks may need to be addressed
• what kinds of loan programs are availabe
• current interest rates
• what the loan will cost you

This is all valuable information needed by any prospective real estate buyer. But, it is not meant to prove that you can purchase. This meeting is a starting point for borrowers. Savvy real estate sellers and their Listing Agents are well aware of the difference between a pre-qualification and a pre-approval. Pre-qualification indicates some organizational skills on the buyer’s part. Pre-Approval indicates much more than that!

Loan officers don’t approve loans!

Just as Realtors® don’t approve acceptance of offers, loan officers don’t approve loans. Lenders approve loans. In both cases, the Realtor® and the Loan Officer are acting as facilitators of the transaction. Neither of them has the authority to legally bind the parties they represent.

A Pre-Approval Letter is such a strong buyer’s tool because it means that a Lender has reviewed the buyer’s application and supporting documentation (pay stubs, bank statements, W2′s etc.). In addition, the Lender has agreed in writing, that they will loan money to the buyer if they find an acceptable property. Loan officers can confirm to a buyer that they will be able to get a loan. The Lender will confirm that the buyer is actually approved for a  loan. This approval will have loan conditions to satisfy, but it is a real approval. The predominant condition will of course be that the buyer finds a piece of acceptable  real estate! Pre-approvals are issued without an address.

If you wish to be viewed as a Serious Real Estate Buyer, have your Pre-Approval Letter in-hand before shopping. The selling agent will take you more seriously. The listing agent will take you more seriously. The seller will take you more seriously. A pre-approval letter puts you in the driver’s seat when you are ready to negotiate.

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Posted in Bainbridge Island Real Estate, Bremerton WA Real Estate, Buyers, Gig Harbor Real Estate, Miscellaneous, Mortgage Bites, Port Orchard Real Estate, Poulsbo Real Estate, Silverdale WA Real Estate | 4 Comments »

ear·nest ¹ adj.

1. Marked by or showing deep sincerity or seriousness.

2. Of an important or weighty nature; grave.

Idiom:  in earnest

1. With a purposeful or sincere intent.

2. Serious; determined.

ear·nest ²

1. Money paid in advance as part payment to bind a contract or bargain.

2. A token of something to come; a promise or an assurance.

(Not to be confused with THIS Ernest!)

WHY DO WE NEED TO OFFER EARNEST MONEY?

There seems to be a lot of confusion these days about Earnest Money, even among those who have previously purchased a home. As many States may differ as to what is considered a normative practice for providing Earnest Money, it’s good to know ahead of time what to expect in your particular market area. Make sure you consult with your Real Estate Agent before you begin the home search process.

Based on the definitions stated above, in a real estate transaction, Earnest money accomplishes a number of things:

1.  It conveys the seriousness of your intent to purchase the property. Sellers want to know that you’re genuinely interested in buying their home. Accepting your contract offer will require them to remove their home from active status, and lose valuable market time.
2.  In some instances, it can help to demonstrate your financial ability to satisfy the contract and strengthen your position as a solid, qualified buyer. This can be especially important when competing with another offer or in multiple bid situations.
3.  It provides remedial damages for the Seller in the event that you breach the contract (monetary compensation for backing out of the contract for a reason not stipulated in the contract)

HOW MUCH IS ENOUGH?

The actual amount of earnest money will vary from market to market. In many instances, it will represent between 1 to 2 percent of your offer price. If you are involved in a competing, or multiple bid offer, an increased amount of earnest money may make the difference in you being the successful bidder.

WHAT HAPPENS TO OUR EARNEST MONEY?

If your offer is accepted, your earnest money will be deposited into a trust account or with the escrow company, shortly after mutual acceptance. At closing, this money is then applied to your closing costs, or, if your closing costs have been covered, it will be refunded to you at closing. In most home purchases, Earnest Money is money you would normally be spending anyway.

CAN WE LOSE OUR EARNEST MONEY?

One of the main instances where you can lose your earnest money is if you deliberately and willfully back out for a reason that is not specificed within the contract. This is referred to as a “breach of contract.’ As a Buyer, there are normally a number of contingenices that are built into every real estate contract that serve to protect your interests. Your Agent can best explain these to you and counsel you accordingly.

CAN’T WE JUST USE A PROMISSORY NOTE?

Using a promissory note in lieu of actual cash reserves often communicates that you really aren’t a serious, viable Buyer, and that you probably don’t have the financial means to satisfy the contract. Even though there may be many loan products available that allow you to purchase a home with little or no money down, you should plan to save enough money to offer an acceptable earnest deposit, as well as to cover any other ‘out of pocket’ expenses normally incurred in a home purchase.

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Posted in Bainbridge Island Real Estate, Bremerton WA Real Estate, Buyers, Gig Harbor Real Estate, Port Orchard Real Estate, Poulsbo Real Estate, Real Estate Bites, Sellers, Silverdale WA Real Estate | 5 Comments »

Real Estate Market Report/Conditions for Kitsap County WA as of 06/01/2007

The following is a quick analysis of the combined single-family home and condo market within Kitsap County, Washington, provided by Rich Jacobson of Windermere Real Estate, in Silverdale, WA.

• Properties currently active on the market: 1939  
• Properties closed in the last 180 days: 1501
• Average Sales Price: $303,188
• Average List Price: $308,108
• Ratio of List Price to Sales Price: 98%
• Average Days on Market: 90 days
• Sales Pending this Week: 61

The ”Way We Were”comparative snapshot:

• Active Listings:                         2006 – 1159;   2007 – 1939
• Days on Market:                       2006 – 63;       2007 – 90
• Absorption Rate:                       2006 – 17;       2007 – 31.7
• LP/SP Ratio:                             2006 – 99;       2007 – 98%
• Closed Sales last 6 months:     2006 – 1758;   2007 – 1501

Current Market Conditions: Boy, talk about a really screwy market! Inventory continues to increase, but the pool of prospective Buyers has remained the same. As a result, we’ve seen a consistent number of price reductions across the board. New construction has slowed considerably. Activity for properties along Hood Canal has heated up, which is typical for this time of the year. Median prices for homes has gone up slightly, but the Listing Price-to-Sales Price ratio has dipped to 98%. Overall, it’s still a very good market for both buying and selling here on the Kitsap Peninsula.

One of the best values on the market right now is my listing on Franklin Street in East Bremerton. Give me a call to schedule a private showing @ 360.440.4758

For more helpful information and resources concerning real estate and living in Kitsap County, Washington, you can also access Sparky’s other real estate website, www.KitsapLife.com.

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Posted in Bainbridge Island Real Estate, Bremerton WA Real Estate, Buyers, Gig Harbor Real Estate, Kitsap County Bites, Port Orchard Real Estate, Poulsbo Real Estate, Real Estate Bites, Sellers, Silverdale WA Real Estate | 1 Comment »

Last night was the season finale, Spring concert, for the Central Kitsap Junior High Choir Program, under the extremely gifted leadership of Choral Director, Mr. Charles Platten.

All three ensembles – the Cub Choir (7th grade boys & girls), the Treble Choir (8th & 9th grade girls), and the Centralites (8th & 9th grade boys and girls) - performed to a packed and enthusiastic crowd of families and friends at Dempsey Gym in Silverdale.

Just so you know, this is definitely ‘not‘ your Father’s junior high choir! For anyone who has ever attended this annual event, or has had kids that have gone through the program, you know how fun and entertaining this concert truly is. Rather than subject the audience to the same stoic and stuffy classics that every junior high choir repeats over and over again, Mr. Platten creatively arranges a medly of songs from popular musicals or current artists, replete with choreography, props, and costumes. Providing his usual capable assistance to the successful affair was fellow teacher, Mr. Greg Williams, and Director of the CKJH Drama Club.

The Cub choir gave us highlights from “Chicken Little,” including the songs, ”Don’t go breaking my heart,” “One Little Slip,” and “We are the Champions,” with solos from Victoria Meyer, Lucas Thoresen, Deanna Storkey, Kaylee Lingenbrink, Michaela Hunter, Tanner Ausbun, and Julie Fedorko.

The Treble Choir did a collection of Kelly Clarkson songs, the Faith Hill tune “Breathe,” and Aretha Franklin’s “Respect.” Gifted solos were provided by Taylor Romero, Katie Hedrick, Desiree Marker, Summer Benke, and Jesica Law.

The Centralites performed excerpts from the hit musical, “Little Shop of Horrors.”  Student soloists Gimberlie Masikat, Cooper Hartman, Bryka Ryans, Jakob May, Megan Markle, Laura Firth, Derek Coe, Colton Myers, and Shannon Moskowitz thrilled the crowd. Colton and Shannon’s moving rendition of “Suddenly Seymour’ was clearly the audience favorite!

For the finale, all the choirs joined together for a heartfelt version of “In Whatever Time We Have,” from the musical “Children of Eden,” featuring solos from Gimberlie Masikat, and Taylor Leger.

Last year, our son, Elliot (now a sophmore at CKHS), played the part of Danny Zuko from ”Grease,” singing the duet “Summer Love” with Carol Duryea. This year, his younger brother, Luke, is following in his footsteps, performing in the Cub Choir.

As parents of students enrolled in the Central Kitsap school district, we are extremely pleased with the incredible quality of programs like this, and the valuable contributions they make in our kids lives. We are very fortunate to have talented and dedicated teachers like Mr. Platten who strive for such excellence in education and the arts.

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Posted in Kitsap County Bites | 2 Comments »

According to a recent Forbes.com article, homeowners in the Seattle Washington area are figuratively ’dancing’ in the streets!

Why? Because the Seattle WA area is “The Number One Best Housing Market in the U.S.”

According to data compiled by the National Association of Realtors (NAR), the Emerald City’s median home price in the 1st quarter of 2007 hit $380,200, up a boastful 12.3% from the same time a year earlier. And it’s not just the Seattle WA area, but the majority of the Pacific Northwest Region as well. In the City of Roses, Portland, Oregon, prices jumped nearly 9% and the capitol city, Salem, grew up over 15%!

In my previous career before moving to Washington State, I had traveled rather extensively throughtout the US. I’ve been to all 50 States, with the exception of North Dakota and Vermont. Of all the places I’ve been, nothing compares or rivals the breathtaking beauty of the Pacific Northwest.

Today’s weather here on the Kitsap Peninsula was yet another reason why many are flocking to our region. We nearly reached a rather unseasonal 90 degrees! It’s days like today that make us Washingtonians quickly forget the long endless overcast days of constant drizzle associated with our Winter months.

On July 1st, the crabbing season will start up again, and many local boaters with take to the scenic waterways of the Puget Sound, in search of the coveted and delectable Dungeness Crab!

Many times when I’m out toolin’ around in my boat on Hood Canal, I have to pinch myself. I keep thinking that eventually the vacation will be over and we’ll have to move back to Kansas. It amazes me that people come from hundreds of miles away just to camp, fish, and play only 10 minutes from where we live!

Ah, freshly caught cooked crab, oysters, clams, and smoked salmon. Where else can you live off the land and watch it appreciate, All at the same time!

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Posted in Bainbridge Island Real Estate, Bites of Washington, Bremerton WA Real Estate, Buyers, Gig Harbor Real Estate, Kitsap County Bites, Port Orchard Real Estate, Poulsbo Real Estate, Real Estate Bites, Sellers, Silverdale WA Real Estate | 4 Comments »