Kenmore Undressed

A Mini Vacation to Italy: I Needed a Break

I received a quick email from a friend who just got back from a vacation in Italy. Quote: “We reluctantly returned today………” He and his wife had visited Lucca which happens to be the main town in the province where my relatives live (on my father’s side). My wife and I visited there this August so hearing about Italy made my heart race. Here’s why:

These are all pictures of the area around Lucca. Oh, how I miss it!!! Anyway, I’ve attached a very nice “real estate” clip from YouTube so you can get a feeling for Tuscany. By the way, if you’re in the market to buy a nice villa in Italy, I know a good agent!! Just click on the picture below for a mini vacation. I could sure use one right now!

Weekend America: Answering the Question about the Meaning of Home

One of the most interesting programs on Radio today is Weekend America (American Public Media & National Public Radio). The program’s topic today is about the “meaning of home” and it’s an incredibly interesting and timely program. Coincidentally, yesterday I wrote a brief post about how the current financial challenges in America may change our perspectives about the true value of our homes. Are they merely an “investment” or are they more than that? Seems like a simple question but, as you’ll find, the concept of home is amazingly complex. Just click on the picture below and you will be linked to this program:

A couple of my favorite sections of the program are highlighted below. The first is “Your Stories of Home” which includes short essays by many different people around the U.S. Click on it to see more:

As a real estate agent, “The Tragedy of Stuff” strikes a particularly deep cord. In the course of doing my job, I have seen how the human tendency to accumulate things holds a deep psychological grip on our lives. Click on the picture to listen to this story.

I hope you enjoy the variety of stories told in this episode of Weekend America.

Readjusting Our Priorities: What’s a House For?

According to Steve Kerch, the award winning real estate journalist of Market Watch, the current drop in home values should remind us that house aren’t really “investments.” In his article, entitled Core Values, Mr. Kerch asks us to consider the following:

“At its core, a house is a shelter. Unless the roof caves in, there is always some economic value in that. But most people when they dream about a house or start looking for a house or actually buy one think about value in a whole different way: they think about the fireplace they can gather around with their families, the kitchen where they can show off their culinary skills, the bathroom that they won’t have to share, the schools they will be able to send their kids to, the neighbors they will be able to entertain in the backyard, the parks they can bike and hike and the community events they will be able to attend.”

The current financial turmoil has forced lots of Americans to do some important soul-searching about their lifestyles and spending habits. Many now know that they can’t use their house as a piggy bank. They can’t continue to carry balances on 10 credit cards. They also know that we are all living a little closer to….well…..home.

Recently, one of my neighbors approached me, worried a bit about the softening housing prices. “I’m afraid I’m losing value in my house.” I asked him if he was moving anytime soon and he said no. I asked him if he liked living in our neighborhood. He said absolutely, yes. I then asked him if he liked his home. He said: “I love my house.” I then told him what I’ve always told my clients: unless you’re planning on moving, houses are where you raise your children, where you cultivate joy and togetherness and celebrate life. In general they do increase in value over a long period of time, but they have a much deeper value, a value I hope Americans can rediscover.

Why Thanksgiving Matters

Two years ago, my wife and I were visiting my family in Italy during Thanksgiving. We had never been out of the U.S. during Thanksgiving, so we didn’t know what to expect. It is known as giorno del ringraziamento (day of thanks) in Italy. Not surprisingly, most Italians know little about our celebration except that turkey is involved. My family did try to accommodate us and my cousin, Caterina made rotello di tacchino, which is a filet of turkey rolled up around cheese and prosciutto pan fried and served in a light sauce. It was heavenly. BUT it wasn’t Thanksgiving……

The interesting thing is, Americans carry Thanksgiving in our collective DNA. It’s an idea that many cultures find odd. For many people around the world, every day is a constant struggle, so taking time off to be “thankful” is a luxury they can’t afford. This simple fact didn’t occur to me until we came back home.

It wasn’t long after we returned from that trip, that the U.S economy began to show signs of weakness. The real estate market was deteriorating and business got tough. As a real estate agent I have had to change brokerages and offices several times since returning. I have watched many agents leave the business and some have even had to file for bankruptcy due to the current economic situation. Here in Kenmore, WA, home sales are at a virtual standstill. Every day, more grim news comes out regarding bank failures, huge government bailouts and turmoil in the Middle East. We are, indeed, living in interesting times.

And you know what? This is why Thanksgiving matters. It matters because it’s simple. It matters because it doesn’t require advertising, corporate marketing or a religious affiliation. It matters because it’s uniquely American. It represents our deepest sense of generosity, unity and hope. And, yes, it’s the turkey, stuffing, ham, sweet potatoes, pumpkin pie and those delicious leftovers……Have a wonderful Thanksgiving.

Difficult Times for the Financial and Housing Markets

There hasn’t been a lot of encouraging news regarding the financial and housing markets these days. An Associated Press article in today’s Seattle Times entitled: U.S. home prices tumble by record in third quarter reports:

“Two widely watched indexes released today showed home prices dropping by the sharpest annual rate on record in the third quarter. But the worst may be yet to come as the full force of Wall Street’s collapse hits the economy in the fourth quarter.”

The report references the closely-watched Case-Shiller price index which  measures the residential housing market, tracking changes in the value of the residential real estate market in 20 metropolitan regions across the United States. According to the the numbers from September, home prices are off a record 17.4% in the past year. Here’s a summary of the top 20 cities:

Phoenix, down 31.9%; Las Vegas, down 31.3%; Miami, down 28.4%; San Francisco, down 29.5%; Los Angeles, down 27.6%; San Diego, down 26.3%; Detroit, down 18.6%; Tampa, down 18.5%, Washington, down 17.2%; Minneapolis, down 14.4%; Chicago, down 10.1%; Seattle, down 9.8%; Atlanta, down 9.5%; Portland, down 8.6%; New York, down 7.3%; Cleveland, down 6.4%; Boston, down 5.7%; Denver, down 5.4%; Charlotte, down 3.5%; Dallas, down 2.7%.

More bad news: The Times also reported that personal bankruptcies are up 40% in Washington State over last year. That’s over 18,000 households so far this year.

Overall, we have some difficult times ahead of us.

Picture by http://www.flickr.com/photos/frankikuka/

Realtors and Those Silly Recipes: You Must Try This Cranberry-Fig Chutney!

I credit my 25-year marriage to one thing: I’m pretty handy in the kitchen. It helps that I was a professional cook for many years so my wife never has to cook! She likes it that way, especially during the holiday season when I get to create all sorts of fun food for numerous potlucks and parties.

Thanksgiving is my favorite holiday because many of the foods created for this occasion are simple, seasonal, bold and yummy: turkey, gravy, stuffing, sweet potatoes, squash, root vegetables, pumpkin pie, and on and on. And let’s not forget that ubiquitous condiment: cranberry sauce. Growing up, my mom always served the canned-jellied stuff, you know the goop that came out of the can and looked like the can. Does this look familiar?

I loved this stuff, especially on the leftover turkey sandwiches my dad made. Good times. Then I went away to college and worked my way through school as a cook. I learned a lot about food in those days and my tastes expanded into all sorts of cuisines. And then IT happened:

One year I encountered a fabulous recipe for Cranberry-Fig Chutney. It’s the perfect condiment for Thanksgiving and it’s also good with chicken, pork, lamb and it’s heavenly on toast for breakfast. This particular recipe came from Bon Appetite Magazine and was published in November 1988. This sauce is sweet, sour and a bit spicy….perfect for the bold flavors of holiday foods. Most of the ingredients are easy to find. I hope you try this wonderful sauce for Thanksgiving.

Oh, and for those of you who love cranberries as much as I do, here’s a short film showing how these delicious litter berries are harvested. Just click on the picture to watch the video. Happy Thanksgiving!!! 

Are Real Estate Agents Really Working Harder? A Complicated Question

The Real Estate section of yesterday’s Seattle Times tackles one of the most fundamental and important topics in the real estate industry today: what value does a real estate agent bring to the purchase or selling of a home. The article entitled “Slow housing market means more hours, more expenses for agents,” focuses-in on the increased effort and cost agents incur in today’s tough marketplace in order to be successful.

What I find most revealing about this particular article is the following confession:

“The days of just taking the listing and putting it into the [Multiple Listing Service] and letting the MLS sell the property are gone,” said Brigitte Pascutoi, managing broker at John L. Scott Real Estate’s Bellevue North office. (quote from the article)

This may be over-stating the simplicity of a real estate transaction; however, it should be no surprise to the public or, more importantly, the real estate agents themselves that times have changed. In 2004-2007 our local market was overheated to the point of third-degree sun burn. Almost 70% of listed homes were selling each month and prices were increasing at double-digit levels. Lending was, let’s say, more liberal (this is a whole other subject) and it was truly the case that merely putting one’s home in the multiple service was enough to bring a buyer through the front door and sell the house.

Fast forward to today:

• Only 9%-11% of homes are selling each month
• There are almost 50,000 homes for sale in the multiple service
• Buyers, even willing buyers, are having difficulty obtaining a loan
• Credit markets have been frozen
• Home prices are contracting
• There is a vacuum of confidence in the marketplace
• Technology has revolutionized the relationship between consumers and the marketplace
• Owners must now pay with real money (not fake equity) to sell their home

These trends, among many others, have forced the Real Estate Industry to make huge changes in its business model. It has also revealed many of the weaknesses of agents, brokerages and business practices. I won’t go into the subject of commissions in this post, but I will say this: I’m not sure that agents are, indeed, working harder nor am I convinced that “working harder” is what they should be doing. Let me explain:

• We would not have almost 50,000 homes for sale in this marketplace if agents were advising clients to take their homes off the market UNLESS THEY MUST SELL! This isn’t hard work, it’s professional representation (something that became less valuable when the market was humming along).
• The article points out that some agents are helping owners by doing yard work, putting in crown molding, etc.. I would submit to you that this is hard work, BUT, real estate agents are rarely qualified to do this work. More importantly, they should not be expected to. An agent may recommend a landscaper or contractor to do these chores, but an agent runs the risk of taking on a mantle of expertise that he/she may be held liable for.
• Many agents have been offering FREE staging services or any number of other benefits to sellers to better market the property. Here’s something all you sellers need to know. NOTHING IS FREE IN THE REAL ESTATE BUSINESS. The article rightly points out that proper staging and preparation of a home can run into thousands of dollars. In the old paradigm, when the marketplace allowed sellers an easy sale, non of this was as important. Sellers would gladly (or maybe not-so-gladly) pay a high commission to an agent with an expectation that marketing was happening. We all know this was not the case and this lack of integrity on the part of the industry led to a consumer backlash that continues to this day.
• Finally, sellers need to start putting skin into the game. Indeed, there’s a lot of blame we can heap on agents, NAR, and a lot of other players in this industry, but ultimately sellers must realize that agents should not be expected to take on all the costs of selling YOUR home. Put another way: Don’t expect agents to take your listing at a reduced commission and then demand the agent to overprice your house, pay for staging, marketing, open houses, professional photography, landscaping, your title report………and carry these costs for the average three to 8 months it’s taking to sell a home in this market. On the flip side, if you are willing to pay an appropriate commission, demand that the agent use professional services and hold the agent accountable for these activities.

I know I’ve gone on a bit here; however, I believe we all need to be more up-front about the current state of the real estate market. There are no magic bullets. There is no amount of hard work that will make this process easier. As the article correctly points out, this is a business based on trust and relationships. I have been in this business going on eight years now and I can tell you, after helping a huge number of families buy and sell homes, real estate can be complicated, emotional and difficult. When the time comes, choose your real estate agent wisely.

Picture by mrsdalloway

A Transformed World: “Global Trends 2025″

The National Intelligence Council recently submitted it’s “Global Trends 2025″ report to U.S. leaders in order to give them insight into looming problems and opportunities throughout the world. The report is compiled every four years and includes a huge number of stunning and, sometimes disturbing, global trends. Although the report is not intended to be a “crystal ball” analysis, it’s assessments are provocative:

It projects a “multipolar” global landscape, where the United States is merely “one of a number of actors on the world stage” and where the U.S. dollar will only be “first among equals” in a basket of international currencies.

Other trends include:

• A decline in Western Democratic Capitalism/A rise in State Directed Capitalism as in China
• Growing youth populations in the 3rd world, especially in the Middle East
• A decline in the influence of terrorist groups (a good thing)
• IMF & United Nations will lose influence
• Corporations and organized crime organizations will emerge as a challenge
• By 2025 clean, non-fossil fuels will be the norm

If you’re interested in reading the report (or skimming through it), just click on the icon below.

I’ve also included a NPR audio segment about the report which encapsulates it’s trends quite well. I believe it is incumbent upon all of us to try and understand the United States within the context of a more global perspective. Anyone who is being intellectually honest in these challenging times knows that we are not, nor can we afford to be isolationists. The better informed we are, as citizens, the more effective our leaders can move us into the future. Living in ignorance is not an option.

Click this picture to hear the NPR report on “Global Trends 2025″

Excessive Costs of the New Kenmore City Hall? Express Your Opinion to the City Council

In my November 6th post, I wrote that the development company for the future Kenmore Village  has asked for a one-year extension on the first phase of the project due to global financial pressures. It seems that these uncertain times have also focused attention on the New Kenmore City Hall. In today’s edition of the on-line Kenmore Reporter, a number of Kenmore residents expressed concerns regarding both the scope and cost of the project. Among these concerns are:

• Hire an independent, unbiased firm to determine which features could be eliminated that would reduce costs.

• Reduce the size of the building to 16,000 square feet, yet retaining sufficient space to accommodate city employees and permit citizens to conduct business in an efficient facility.

• Remove plans for an underground parking facility.

• Postpone the construction of city hall until funds become available without creating debt. There is no emergency in this project, a delay may be in the best interest of our citizens.

• Reject any proposal that requires funding by bond. In the event a bond is considered, submit it to a vote of the people.

You can review the complete letter to the editor by clicking on this link: http://www.pnwlocalnews.com/north_king/bkn/opinion/34612449.html

The authors of this letter to the editor are asking Kenmore residents to contact the City Council to express opinions or concerns regarding the negative financial exposure of this project. If you wish to contact the council simply click on the picture below. This will take you to the city directory:

Mid-November Home Sale Statistics for Kenmore

At the risk of sound like a broken record, mid-month home sales in Kenmore look like a flat-line emergency room patient. As you will see from the charts below, the inventory has dropped over the last two months. In the early autumn, Kenmore had an active  inventory hovering slightly above 200 homes. We’re down to 175. Most of the drop is due to sellers taking their homes off the market. I’m actually happy to see a smaller inventory as this gives qualified buyers a chance to purchase homes from motivated sellers:

On the flip side, there aren’t many pending sales (19) and only three homes have closed this month (so far):