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Stroupe Scoop Newsletter – The Place to be is in the Know!

February 16, 2008 by  
Filed under ALL CONDOS

Below is our past newsletter, which features in-city solds and market conditions. Click on the preview to get a peek of our .pdf newsletter. If you would like to receive the Stroupe Scoop monthly, visit our website to subscribe and let us know if you would rather receive the monthly letter via email or snail mail.

Stroupe Scoop A Stroupe Scoop B Stroupe Scoop C

The Law Has Been Passed!

February 16, 2008 by  
Filed under Finance

Understanding the Higher Loan Limits

We have seen a whirlwind of legislative activity these past few weeks! There is much confusion surrounding the recently passed Economic Stimulus Package and higher loan limits. Unfortunately, the new law can be confusing to decipher, and not everyone will benefit. For this reason, we have provided an outline below that clarifies what this new law means for you and how you can benefit from the higher loan limits.

Description and Overview:

An economic stimulus package just passed Congress on February 7, 2008 and was signed into law by the President on February 13, 2008. This new law is effective immediately and includes a temporary increase in both the FHA and conforming loan limits to as high as $729,750 in high cost areas. This means that the interest rates on many mortgages will go down because these loans are now eligible to be purchased by Fannie Mae and Freddie Mac or insured by the Federal Housing Administration (FHA). Previously, the FHA was only allowed to insure loans with balances lower than $200,160 – $362,790, depending on the county where the property was located. Also, Fannie Mae and Freddie Mac were only allowed to purchase loans with balances at or below $417,000. This resulted in limited options and higher financing costs for those with loan balances above these limits. The new law substantially increases these limits in high cost areas and opens up new options and lower financing costs for many people.

How to Determine “High Cost” Areas

There are two things you must know in order to determine if you are in a high cost area:

1. Understanding the Formula

If 125% of the local area median home price exceeds $417,000, the temporary loan limit would be that 125% of the median home price with a cap of $729,750. Here are three examples to illustrate this concept:

  • If the median home price in your area is $225,000, 125% of that number is $281,250. This is below the current $417k conforming loan limit. Therefore, the conforming loan limit in your area will not change. However, if $281,250 is greater than the FHA limit in your county, your FHA limit will go up to $281,250.
  • If the median home price in your area is $375,000, 125% of that number is$468,750. This is above the current $417k conforming loan limit. Therefore, the conforming loan limit in your area WILL change and go up to $468,750. This number is also higher than the highest FHA loan limits, so therefore your FHA loan limit will also go up to $468,750.
  • If the median home price in your area is $650,000, 125% of that number is $812,500. This number is greater than the maximum cap of $729,250. Therefore, the conforming loan limit in your area will increase to highest allowable amount under this new law which is $729,250.

2. Determining the Median Home Price in Your Area

The Secretary of Housing and Urban Development (HUD) will publish the median house prices within 30 days of the bill going into effect (30 days from February 13, 2008). HUD does not have any interim stats or information for us to use. However, the bill also states that HUD can use any commercially available data if they are unable to compile the information on their own within the 30 day timeframe. With that in mind, it is likely that HUD’s numbers will be relatively consistent with the data published by the National Association of Realtors (NAR), which already has a solid track record of tracking and publishing this information on a quarterly basis.
Therefore, until HUD actually publishes their version of the median home prices, the most accurate way to get this information today is to utilize the data that is published by NAR. Ironically, NAR just released their latest median home price update for the 4th quarter of 2007 on February 14, 2008! Contact me today and I’ll research your info and let you know exactly what the median home price is in your area and how you can benefit from this information.

calendar imageWhat do all the dates mean?

There is some confusion because the bill has a provision that says the higher limits are only effective for loans originated between July 1, 2007 and December 31, 2008. In short, the reason it is effective beginning July 1, 2007, is because the credit crisis started to unfold in July and August of 2007. Mortgage market conditions rapidly deteriorated almost overnight. Many secondary market investors suddenly refused to purchase loans that couldn’t be sold to Fannie Mae and Freddie Mac. (For more info on how this process works, please see the article entitled Saga of the US Mortgage Industry.)

Unfortunately, many mortgage banks had already funded these loans in their own portfolio or through their warehouse lines of credit. Their intention was obviously to sell these loans on the secondary market after the loans were funded. However, the credit crisis prevented them from doing so, and they were stuck holding these loans in their portfolio. The July 1, 2007 date in the bill is designed to allow these lenders to unload these mortgages and sell them on the secondary market to Fannie Mae and Freddie Mac.

However, the July 1, 2007 date has no bearing whatsoever on new refinance transactions! In other words, it doesn’t matter when the loan you are refinancing was originated. The old loan could have been originated in 2005, 2006 or anytime before or after July 1, 2007 and it would have no effect whatsoever on your current purchase or refinance transaction. If you are refinancing a new loan today, whether it is a purchase or refinance transaction, that loan is subject to the new limits set forth in the bill.

The other date of December 31, 2008 means that the old limits will go back into effect after this year. In other words, now is the perfect time to buy a new home or refinance your mortgage because after this year, your costs will be higher and your options more limited again.

When does this all go into effect?

February 13, 2008 – immediately upon the President’s signature. Therefore, HUD is obligated to publish the median home prices within 30 days of that date. However, Fannie Mae, Freddie Mac, and various wholesale lenders may have different policies as to how these new loans are going to be priced and underwritten. That is why it is imperative that you work with a Certified Mortgage Planning Specialist who is committed, qualified and equipped to give you timely information and expert guidance every step of the way. Contact me today for a complimentary consultation. I can look up the median home price in your area and see whether you can save money in any way. Also, please pass along this update to anyone you know who may be able to benefit, and I’d also be happy to look up the median home price in their area and discuss with them whether they could save money.

Compliments of Lori Richmond at Golf Savings Bank

Escala Wins 3 Gold National Awards

February 16, 2008 by  
Filed under ESCALA

Escala Dining RoomThe 27th black-tie gala awards ceremony, sponsored by The National Sales and Marketing Council (a division of the National Asssociation of Home Builders) took place this week in Orlando Florida. Out of nearly 1,400 entries, Escala was awarded three Gold Awards honoring the Best Communities in the Country. One of the Gold Awards also recognized Escala for thier exceptional floor plan.

The new elegant 31-story development has now been awarded for three Gold National Awards, eight Silver National Awards, 12 Regional Awards and two Individual & Council Awards.

Previous Escala Awards Posting

Hyatt Hotel and Towers Breaks Ground

February 16, 2008 by  
Filed under Ariel Development, Gary Fulcum, Kauri Investments

A new Hyatt Hotel has started development on the corner of 6th and Denny.  In joint venture with Kauri Investments, Ariel Development, and Gary Fulcum, the 158-room hotel and 57 apartments boasts a great location and easy access to transportation.  The development is planned to open in fall of 2009.  The hotel will feature free Wi-Fi and 42-inch flat panel TV’s in each room.  Designed by Johnson Braund Design Group, the project includes two separate buildings, each with their own entrance.

Hyatt Rendering

New Renderings for AVA Hotel Lobby and Rooftop Terrace

February 15, 2008 by  
Filed under ALL CONDOS

Just received these renderings from AVA’s developer. Take a peek and let us know what you think.

AVA Hotel Lobby 1
AVA Hotel Lobby 2
AVA Hotel Lobby 3
AVA Hotel Lobby 4
AVA Terrace

Price Protection for Olive 8 Buyers

February 15, 2008 by  
Filed under ALL CONDOS, R.C. Hedreen Co.

floating piggy bankOlive 8 is offering their buyers security by knocking down the price of an offer made yesterday to reflect a price tomorrow if any reductions are made. The new sales pitch is an attempt to boost sales. Developers of Olive 8 (R.C. Hedreen) sold 175 of the 230 units a year ago, but there’s only been 10 sales since.

Analyst believe it’s because of buyer’s fear that a recession is near and/or an expected drop in prices. However, considering our local economy and number of people that are moving to Seattle, a recession isn’t likely and developers haven’t given any hints that dropping prices is in the horizon. Also, David Thyer (R.C. Hedreen’s president) reported that Olive 8 is more than likely to raise their prices due increasing construction costs and overall market value.

Fifth and Columbia Tower

February 14, 2008 by  
Filed under Daniels Development Co., Zimmer Gunsul Frasca

5th and Columbia TowerIt seems that there’s a new high-rise development in the news every other day. The latest is a new commercial high-rise which will be the city’s fifth tallest building located next to the Columbia Tower. Architects Zimmer Gunsul Frasca Partnership have designed a asymmetrical skyscraper next to the historic First United Methodist Church and developed by the same company who saved the church last year. The tower will stand 660′ with an emphasis on complimenting it’s neighboring structures by it’s transparent or reflective design (depending on the weather).

Building Features:

  • Public courtyard between skyscraper and sanctuary.
  • Sculpture and water feature within courtyard.
  • “Living wall” on Columbia Street (living plants grown in facade).
  • Solar-energy equipment on roof.
  • System to capture rainwater for reuse.

5th and Columbia Tower Skyline

Pagoda and Heron Twin Towers

heron and pagoda towersAlec Carlin with Hummingbird Advisors of Seattle informed us that last nights design review meeting with the Department of Planning and Development went well and is moving to the next stage. Mr. Carlin said concerns were addressed by Escala and that he’s interested in working with them on the project. In the meantime, DPD and Carlin will be moving towards the Master Use Permit (MUP) and recommendation process.

If you’ve yet to hear about the new project, preliminary plans for the 45-story twin tower, high-end hotel, condo, office and deluxe retail development will be located at 1913 5th Avenue (between Escala and Westin Hotel). Architect Ishmael Leyva from New York has been chosen for design to bring a new edge to Seattle. Ishmael was also 1 of 5 architects who designed the Time Warner Center in NY which has a center atrium similar to plans for the new Seattle project that will separate the two towers.

The Pagoda Tower (northern) is planned to have a distinct difference with 9-floors of hotel rooms including hotel ballrooms, meeting rooms, pool and spa.

The Heron Tower (southern) is planned to be all condos. Both 550′ towers are planned to be topped with an arboretum, roof garden and recreation facilities.

Completion is expected to be in 2011 and Alec feels that the market will support more condos at that time. We’ll all be able to make a better guess at the projects success when we hear more about estimated prices (which have yet to be determined).

Heron Pagoda Rendering

Big Week for Downtown Real Estate – Buyer’s Moving Off the Sideline

February 12, 2008 by  
Filed under 1521, ESCALA, Gallery

Dean Jones with Realogics (award-winning marketing catalyst for residential and mixed-use real estate) informed us of some great news regarding new construction sales. News and media headlines have sidelined buyers this season and new construction sales are generally not accounted for in Seattle’s NWMLS pending and sold statistics. So here’s the inside scoop:

  • 3 homes have already sold at 1521 for an approximate $3 $9 million.
  • There has also been a number of sales made for GALLERY.
  • Equinox chalks a sale.
  • Escala still consistent in sales.
  • Bravern in Bellevue has also made an approximate dozen sales just over the weekend and they’re booked with appointments all month.

However, Dean also informed us that credit and construction costs require new construction high-rises to be priced in the $850 to $900 per square foot to pencil. Hint: an exception may be AVA.

new construction sales chart by realogics

AVA Takes Unique Sales Approach

February 11, 2008 by  
Filed under AVA, Executive Group of Companies, Weber + Thompson

AVA Rooftop PoolOur team had the honor of meeting with AVA’s developer Salim Sayani with Executive Group of Companies and sales manager Peter Oh from Windermere On-Site at Ruth Chris (across the street from the AVA site). I have been watching this building for over a year now and believe it will be a wonderful project and an exciting addition to Seattle’s skyline. The sales center will be located on the corner of 8th and Olive and will house a scale model unit (with the exception of a bedroom) with much more use of space than the previous Cosmopolitan sales center. The sales center is scheduled to open to the public sometime in September.

  • We have been given an opportunity to introduce our V.I.P. clients to view the sales center for a private viewing and 1st opportunity to make a reservation before opening to the public. Look for more information on this opportunity in the next few days.

Some insider information Salim delivered was his opinion on some of AVA’s key selling points.

  1. location, Location, LOCATION – AVA is located just a block away from everything. The ease for travelers coming from the airport from the new light rail transit center will be unparallel and insures AVA’s boutique hotel success. The community is also located in Seattle’s booming retail core and entertainment section of downtown near 8th and Pine.
  2. Well-thought out HOA – Salim also has a well thought out HOA which will maintain owner’s sky lounge and hotel amenities for an approximate $0.58 per square foot. He also emphasized that hotel amenities are paid for ‘a la cart’ as opposed to being burdened on the homeowner if they decide to not use the services. The owners will only pay for what they use.
  3. Experience in delivering a project of this type – Executive has delivered other projects in Canada including the 19-story Encore in Coquitlam, the 15-story Executive Tower and Plaza Hotel in Richmond, the 12-story Executive Plaza Hotel in Coquitlam and the 18-story Portofino Tower in Vancouver.
  4. Well thought out lifestyle experience. – Comparable to 2200 Westlake w/o the expensive dues, the lifestyle experience at AVA will be in the center of the city. The property itself will feature an outdoor rooftop pool that looks down Pine Street on the 5th floor. The top floor will have a sky lounge for homeowners which includes a wet bar, game room and business center. Another rumor is that the 5,000 square feet of retail space will be taken by the renowned Palm steakhouse.
  5. Zen theme – Some other physical characteristics that got our attention was the contemporary design by Garrett Cord Werner which will have zen-like features including spa shower heads, fireplaces and natural stone/wood finishes.

Make a Reservation:

We have much more information on this wonderful project and will post more information soon. If you have an questions about making a reservation, please ask.

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