[photopress:archie_mcphee.jpg,thumb,alignright]Our first stop on our Halloween tour was Downtown Ballard where hundreds of kids gather to collect goodies from the local merchants! It is always a fun time, and a little bit of sprinkling definitely did not dampen the kids’ enthusiasm!
For those wanting to get a peak at a typical Halloween in Ballard, I put together a slideshow on Flickr…
Enjoy!
[photopress:IMG_5046.jpg,thumb,alignright] In reading today’s Seattle Times article on people who have used interest-only loans to get into homes they could not otherwise afford, I get the feeling that some people are much better at living under constant stress than me! 🙂
It can be a wonderful experience to own a home, but it still doesn’t make sense to me why people put themselves in these situations. I’ve heard some darn good arguments from investors regarding why it makes sense for them to use interest-only loans, but for the rest of us, it feels too much like gambling…
Dean Baker sums up the I/O like this: “In a falling interest-rate environment, you may be saving enough to make it worthwhile. But … in a higher-rate environment, there may not be a loan to bail you out.”
To quote the same phrase Dustin used a few days ago with regard to hiring a lawyer, “A good night sleep should not be underestimated.”
[photopress:greatstory.jpg,thumb,alignright]The PI had a funny story today about a typo on an engraved granite slab for a new park in Ballard’s Bergen Place Park.
The story would not be worth mentioning except Fark picked up the story and there are some pretty funny comments on their site (including this photo with the “a” flipped!).
[photopress:conversation.JPG,thumb,alignright]Part of the vision that I have for Rain City Guide is to add more contributors who can bring different areas of expertise in order to broaden our discussion. Along these lines, I want to extend a warm welcome to Craig Blackmon. Craig is a local real estate lawyer and I hope that he will continue to write more articles like the one he posted yesterday on The Financing Contingency.
Most real estate agents are not trained in the minutiae of real estate law… and there are times when the best response an agent can give to a client is: “you should talk with a lawyer.” I’m glad that Craig has decided to post some articles on Rain City Guide, and I’m sure that I’ll turn to him with questions in the future!
For those wanting a little more background on Craig, I’ve grabbed his bio off of his website (Law Office of Craig Blackmon):
I’ve been practicing law since 1999, when I graduated from the University of Washington. Prior to that, I worked as a public high school teacher, one year in NYC followed by three years in Chicago. I realized that, although teaching is very rewarding, it is extremely difficult being responsible for 150 kids in one hour increments of 30 each. So I followed my father’s career path and enrolled in law school. After graduation, I worked for five years litigating claims of negligence, usually defending health care providers against claims of malpractice. I tired of the stress and long hours, so I took a job as in-house legal counsel for Group Health Cooperative, a large, consumer-owned health care provider here in Washington. After several months, I realized I missed the human interaction that is so integral to both teaching and the private practice of law. At about the same time, my wife and I sold our house, and in the process I realized the importance of good legal counsel during the transaction. Shortly thereafter, in June of 2005, I left Group Health and launched the Law Office of Craig Blackmon.
While I’m a huge fan of people using real estate agents (surprise, surprise…), a quick glance at Craig’s website also reveals that he has reasonable fees for people looking at selling or buying their home via For Sale By Owner (FSBO). If you do decide to go sans agent (and you live in the Seattle area!), then it seems that the $500 or so that he charges could drastically simplify the process AND bring you some piece of mind! (a good night’s sleep should not be underestimated!).
By the way, you can also read some more from Craig on a new blog that he has started to fill in: http://residentialrealestate.blogspot.com/.
One of the biggest reasons homeowners refinance their mortgage is to obtain a lower interest rate and lower monthly payments. By refinancing, the borrower pays off their existing mortgage and replaces it with a new one. This can often be accomplished with a no-points no-fees loan program, which essentially means at “no cost
(This is a guest post by Craig Blackmon, an attorney in Seattle whose practice focuses on residential real estate — see www.lawofficeofcraigblackmon for more information. Please note that this post is not legal advice. You should consult an attorney for specific legal counsel.)
The financing contingency is one of the most common contingencies in a real estate purchase and sale agreement. In order to understand it, one must first understand contingencies in general. This past summer, the Washington Court of Appeals examined a financing contingency in Salvo v. Thatcher, 128 Wn. App. 579 (2005). The Court discussed the rights and obligations imposed by such a contingency, and the principles applied by the Court are summarized below.
A contingency is a condition that must be satisfied before the parties have a legal duty to perform under the contract. The parties must make a good faith effort to satisfy the condition. When all contingencies are satisfied (or waived), the contract becomes legally binding and each party must perform its obligations (i.e. the buyer must buy and the seller must sell) or face liability for not doing so. If a contingency is neither satisfied nor waived prior to the stated closing date, the contract expires and the parties are relieved of their contractual duties.
A financing contingency makes the contract contingent upon the buyer obtaining the financing necessary for the purchase. Generally, the buyer must apply for financing within a certain number of days of the contract’s creation (mutual acceptance). If the buyer is unable to obtain the financing despite a good faith effort to do so on or prior to the closing date, then the contract expires and the parties are relieved of their contractual obligations. Because the buyer had a valid reason for being unable to perform under the contract (i.e. purchase the property), the earnest money should be returned to the buyer.
In Salvo v. Thatcher, a nasty dispute arose between the buyer and the sellers when the buyer was unable to obtain financing in time to close as required by the contract. The sellers argued that the buyer failed to give notice of his inability to close; because he did not give notice, he was in default of the contract and thus the sellers were entitled to the earnest money. The Court ruled that the language concerning notice did not supersede the general terms of the contingency, and moreover the notice was optional per the terms of the contract. Accordingly, because buyer could not get financing after making a good faith effort to do so, the contract expired and the buyer was entitled to the earnest money, regardless of his failure to give notice.
Of note, the contractual language at issue in Salvo differs from the language generally used in purchase and sale agreements today. Under the current language, and unlike the language in Salvo, the buyer is specifically required to give notice of the status of the loan application. It is an open question as to whether this different language would lead to a different result under similar circumstances. Regardless, buyers (and sellers too) should fulfill their contractual obligations so that they are clearly not in default. If a buyer unequivocally satisfies its contractual obligations but a contingency remains unsatisfied, then the buyer is in the best position possible to demand a full return of the earnest money.
The Search Engine Roundtable brings up the possibility that Google will slip into the real estate market as part of a much large (all-inclusive) database (or GoogleBase). This has a ton of potential and should Google get serious about listing real estate, this should be a major concern to all the people who are creating real estate applications (Zillow, Trulia, Redfin, etc):
There has been some talk this morning onto what will actually be included into Google Base, there are some nice screenshots that have come live this morning. Giving us a little glimpse of how Google thinks the world’s information should be organized. Here is a shot where you can post your items to Google Base and another shot where you need enter in some information about a house.
To get an idea of where they might go, check out this screenshot of a house listing. It is shockingly simple… but then again, the simple solutions are often the best!
Update 1: I was able to get into GoogleBase today and play around a little. I even found the “housing” page that is shown in the screenshot from above. However, when I tried to save a test entry, the system kicked me out. From my early preview, it appears that they’re building a “Craigslist on Steroids!”
Update 2: The NYTimes followed up on the idea of Google getting into real estate: “Among the many projects being developed and debated inside Google is a real estate service, according to a person who has attended meetings on the proposal. The concept, the person said, would be to improve the capabilities of its satellite imaging, maps and local search and combine them with property listings.”
“The service, this person said, could make house hunting far more efficient, requiring potential buyers to visit fewer real estate agents and houses. If successful, it would be another magnet for the text ads that appear next to search results, the source of most of Google’s revenue.”
Update 3: The property grunt had an interesting take on Google Base.
I’ve been having a dialog with one of my readers who is looking forward to moving to Seattle. His last email summarized some of the research he has done on Seattle schools, and I thought the entire email is so good that it deserved a wider audience:
Dear Anna —
I’ve got another issue you might want to explore on your blog, and get readers’ feedback. Do people looking to buy real estate in Seattle base their choice of neighborhoods on the quality of schools? From my understanding of the Seattle public school system, it seems that one does not need to consider high schools among ones neighborhood selection criteria, since at least in term’s of today’s system, there’s no admission advantage (other than just being close) that accrues to living in the “reference area” of ones preferred high school. However, there does appear to be an advantage to living in the reference area of ones preferred elementary and junior high schools. And if budget cuts ultimately mean cutbacks in school choice (though that has been averted for the time being), then it’s likely that it will be even more important. So, what this means is that if school quality is important to you, you should look at the neighborhood elementary and junior high schools.
However, if one looks at the Seattle city schools in comparison to suburban schools in terms of grade scores (as tabulated by the Seattle Times School Guide), quite a few elementary schools (e.g., Lowell, View Ridge, Wedgwood, Hay, Lawton, North Beach, Whittier, etc.) compete with the best suburban schools (Mercer Island, Bainbridge Island, etc.). However, at the junior high school level, all but a few junior high schools (Eckstein, Tops, Washington) fall out of step with the best suburban schools. And at the high school level, only the Center School ranks with schools on Bainbridge, Mercer Island, Bellevue, Issaquah and the Northshore. The obvious conclusion, then, is that if you seek top notch schooling in the upper grades, your choice comes down to having your child compete for a place at a few select Seattle city public junior highs or high schools, or else looking at private schools, or moving to the suburbs.
What do you think of this analysis? What other school related-factors are there to consider?
I hope you don’t see this as too self-serving. It strikes me as it is a fundamental part of buying real estate, but is rarely fleshed out in public, probably because of the hot-button racial issues involved.
(I’ve left the writer of this email anonymous at his request)
When he asks if any other factors should be considered, I think of some of the specialty programs that different schools offer. For example, all of the 5th grade students at Greenwood Elementary School are taught how to fly airplanes (Cessna 172’s). I imagine that some parents would be willing to give up a few test score points to know that their child was in a more stimulating environment.
What other specialty programs are there that might be of interest to parents moving to Seattle?
What other school-related factors should he consider in looking for a home in Seattle?
I would definitely like to open up his questions to other readers, so please feel free to leave comments below.
[photopress:tyler_scott_01.jpg,thumb,alignright]In response to my recent slew of posts on real estate search engines, a reader (Amy Wu) left a comment asking if I’d ever tried Redfin. I’ve definitely tried Redfin and at one point I was a huge fan of their site. As a matter of fact, way back in March (before the days of plentiful google map-hacks), I mentioned how great it is to be able to get a birds-eye view of properties using Redfin. By the way, that was only my 3rd post for Rain City Guide (RCG)!
However, around June, RCG had a falling out with Redfin when they changed their business model to directly compete with Real Estate agents. One of the more interesting outcomes of my June post is that a former employee of Redfin wrote a long comment detailing some of his negative experiences while working at Redfin. After posting the comment, he asked that I delete it after David Ecker (founder and CEO of Redfin) wrote to him threatening a lawsuit.
However, I’m always willing to give people a second chance, so based on the Amy’s prompt, I decided to revisit Redfin. I was pleasantly surprised to find that they no longer mention the service I objected to. Go Redfin! I’m not sure if my posting had anything to do with the elimination of that poorly thought-out service, but either way, I’m pleased to see that they no longer advertise that service on their site.
So, in honor of my complete re-look at Redfin, I thought I’d compare them in the same method that I’ve been comparing sites like Trulia and Home Pages?
The Great:
The Good:
The bad:
The Ugly:
Regardless of their business politics, Redfin offers some pretty darn good real estate mapping features. If you are looking for a home in King County (Seattle, Redmond, Bellevue, etc.), I would definitely recommend checking them out! But when looking toward the future of real estate search, I just don’t see much excitement happening at Redfin, so unless there is a major change in their direction, I doubt they will still seem like an interesting real estate search one year from now (let alone 5 years!).
The Mercury News reports that both Google and Yahoo are in talks with CoStar Group, commercial real estate’s largest firm. With Google’s reputation for building clean and fast web applications and their vast source of neighborhood data from Google Local, they definitely have the potential to build a killer application.
Along these lines, there have been some interesting discussions around the web lately with regards to developing sites around Google Maps. Greg Linden reminded me of a conversation I had a long time ago with Paul Rademacher (of HousingMaps). Back in June, Paul mentioned that he was reluctant to build a real estate search engine using MLS data because (1) all of the data was owned by other people and (2) the mash-ups are so easy to replicate.
I thought that Search Engine Watch had an interesting addition to this conversation when they point out that the real winner of the API/mashup model is often the company that is opening their service up. The mash-ups are a great breading ground for interesting ideas… but that when push comes to shove, the mash-ups are really just providing a way for companies like Google to let others figure out what mapping add-on technologies are worth pursuing:
It also demonstrates what I told a journalist recently about APIs not perhaps being as altruistic as they seem. Give the world an API to your service, and it’s a nice way to let everyone develop new ideas that you might later decide to do yourself, if they seem successful. It’s like Google’s 20 percent time on steroids, because non-Google developers still end up doing work for you.
As someone very interested in the future of real estate search, I’d definitely welcome someone like Google in the mix because I think they could add some some desperately needed innovation to the real estate industry.
