"Think Local First" in Leavenworth

Leavenworth, Washington, is a great little town of about 2,000 full time residents, but draws just over one million visitors every year.  The Bavarian theme town has a healthy economy, a thriving downtown and abundant recreational and tourist attractions.  Last week Rebecca attended a reception for local independent business owners called "Think Local First."  While our home inspection company advertises service from Seattle to Wenatchee our office is based out of Leavenworth for the wonderful reasons listed above.

The mission of Think Local First in Leavenworth & the Upper Wenatchee Valley is "to build a sustainable economy by increasing awareness about the personal, community and economic benefits of choosing local, independently-owned businesses first."  After seeing many familiar faces and sipping on donated local wine in the Barn Beach Reserve River Haus we watched a Bellingham based short docu-film highlighting the processes and successes of supporting locally owned businesses by purchasing their goods and services.  The room was packed!

Next, the group was introduced to the board of advisers that were behind the night's event.  We were encouraged to "Think Local First" with each purchase.  The idea is that money stays where you spend it.  According a handout from the evening, a consulting firm (Civic Economics) found that "when West Michigan consumers choose a locally owned business over a non-local alternative, $68 of every $100 spent stays in the community."  It went on to describe that only $43 stays in the community if spent non-locally and $0 remains when choosing to spend online.  Of course, the bottom line here is growth:  in activity, jobs, income and community.

The Call To Action!  Everyone was encouraged to sign a "10% Shift" pledge by the end of the evening.  If you could pledge to spend 10% more of your normal purchases locally then signing the dotted line was not too hard.  Living in a small town you'll find that you can't get everything in your neighborhood.  I happen to know that you can't process film or purchase a car in Leavenworth, but daily tasks and common services are very easy to manage.  The aforementioned handout referenced the same 2008 Kent County, Michigan, study when discussing the power of the 10% shift.  Their study estimated that the "10% shift would result in $140 million in new economic activity; 1,600 new jobs, and $50 millions in new wages."  In Chelan County that would mean "$16.8 million in new economic activity; 192 new jobs; and $6 million in new wages."

I'm up for the challenge!  We're going to make the 10% Shift.  I know that whatever we can't find from local business owners in Leavenworth we can certainly find within Chelan County in Wenatchee.  How about you?  Can you make the pledge in your town?

Closing Costs Calculator for the Washington Home Buyer



Photo Credit: http://themortgagereports.com

We perform home inspections in about 10 counties throughout Washington from Seattle to Wenatchee. Occasionally our clients call to book an inspection and are still a little confused about the inspection cost-- who pays it, how much it is, etc. We did a little internet search and found a few closing cost calculators that may help the potential home buyer. The calculator we are sharing seems to have the most descriptions of the costs, but will only give you a rough idea since the costs are only estimations. For example, they estimate the cost of an inspection at $175, but our inspections start at $275...this is standard for a single family home. Condos may be less. Also, the appraisal fee usually starts around $300. A loan application fee will be added to the credit report for a combined fee of $75-$300. With all this in mind you can use the calculator to get an idea of the added costs associated with buying a home. If you have a good agent to walk you through the buying process then you won't be blindsided with these costs. They can also help you negotiate fees that may be shared with the seller.

Closing Costs Calculator from Mortgage-Investments.com

Neighborhood Stabilization Summit

Foreclosures are a huge issue in the United States right now. After July resulted in the worst month in real estate history, the feds are starting to take notice. Today many important professionals met to talk about the compounded problems with foreclosed, abandoned and vacant properties. Read on...

http://www.mortgagenewsdaily.com/09022010_neighborhood_stabiization_reo.asp
by Jann Swanson

Community organizers, state and federal government officials, and representatives from banking, research and educations institutions are currently meeting in Washington at a REO and Vacant Properties Summit sponsored by the Federal Reserve Bank. The two day conference is focused on examining the problems associated with vacant and abandoned property and to explore approaches to neighborhood stabilization.

Governor Elizabeth Duke, Board of Governors of the Federal Reserve pointed out that the impact of each foreclosure goes far beyond that one home; a conference participant estimated that every blighted home negatively impacts five or six nearby homes. Therefore, in Cleveland for example, where 11,500 homes have been foreclosed, 60,000 others can lose value which leads to lower taxes to support schools and other community services. The residents who remain in a community suffer social losses as well as their communities decline.

Buggin' Out

Termites are pesky little critters.  They eat dead plant material including wood which makes them a threat to any home.  Termites can be a huge problem in certain geographic areas.  Termites love tropical and temperate zones.  Cold weather keeps them away from extreme northern and southern latitudes. Different types of termites are found on every continent except Antarctica.  In the U.S. dry wood termites are only found in the southern states from Virginia to California.  In Washington we share the problem of damp wood termites with coastal California, Oregon and Florida.  So, what's the problem with these guys?  They can destroy wood components of a home.  If not treated termites can turn a strong support beam into a fragile twig.  But have no fear, if you live in an area of termite threat you can hire pest inspectors to treat your property so termites will not be able to thrive in your living space.  Other wood-destroying organisms to be aware of are:  powder post beetles, carpenter ants, carpenter bees, anobiids, lyctids, bostrichids, shipworms, wood-boring wasps, borers and orchard mason bees.  At AMS, we include a structural pest inspection in every home inspection because wood destroying organisms can be found in Seattle, Wenatchee, Bellevue, Issaquah or even hot and dry Yakima.

2010 Real Estate Outlook

I just attended the Wenatchee Valley Chamber of Commerce’s 2010 Real Estate Outlook breakfast panel discussion on April 22nd. This event provided valuable information and discussed the indicators of the health and direction of the economy…and in effect- the real estate market. The panel included an appraiser, a construction company owner, a mortgage broker, realtor, commercial property manager.

The panel was split on their feelings about the direction of 2010. It was about a 50-50 positive- negative outlook. I’m “the glass is half full” kind of guy so the positive notes inspired me and were really appreciated. Everyone was in agreement that slow growth in the real estate market would be equally healthy and almost inevitable. The big boom from a few years ago isn’t happening again any time soon and for several good reasons. A bubble will always burst. Here’s what I learned from the Wenatchee Valley experts:

The real estate services professional, commented on the slow commercial leasing market. Rents have reduced from $22 per square foot to $12-14 per square foot. Down payments have increased from 25-40%. East Wenatchee is becoming a popular location with several vacancies showing up downtown.

The appraiser indicated that there is a 2-year supply of 500k+ homes and a healthier 1-year supply of 100-200k homes. He agreed that rents are being lowered in order to keep filled. It appears that an occupied space is better than a vacant one, even if it’s not getting its full value.

The contractor remained positive and boasted profits even though he performed below “boom time.” His company modified their target consumer. Now they get more contracts for folks moving into town or retiring and downsizing. They see far less First Time Home Buyers and have yet to sell a home to anyone taking advantage of the 8k home buyer’s credit. I was really surprised to hear this because so many of my realtor friends have been able to help their clients with this credit. This contractor is seeing more buyers paying with cash or financing with great credit and their company offers financing. A true concern for their company is supply costs. With plants closing there is (as Jay explains) an “artificial shortage” that increase the supply costs dramatically, but he also says that if you “provide custom quality at spec house prices, they’ll buy!”

The mortgage expert provided some cold, hard facts to keep us on our toes. Yes, Fannie Mae and Freddie Mac are pulling the purse strings with tighter requirements. There was a small increase in foreclosures in Chelan County this year but we’ve remained above the state or country average. He suspected that the government policing will decrease growth and concluded that the market is 15% above the long term trend. I asked him for clarification on this. The long term trend is calculated by taking housing appreciation and adding 3% per year. After keying the calculator, in his opinion the market will still decline 15%. Food for thought…Approach with caution or take advantage while you can?

The realtor added more positive spin on the morning. Her introduction: “realtors look forward and appraisers look backward.” With 21 counties in the Northwest Multiple Listings she has seen a 51% increase in pending sales. The March 2010 pending sales were up 35% from March 2009. This is great news! The hottest price range in Chelan County is $250-300k which is also comforting because the Appraiser said there is a 2-year supply of these homes. We need to put them to work! The realtor concluded that she has worked harder than she ever has since her start in 1993. Consumers are making responsible decisions but require a lot of education, hands-on attention, negotiating, meetings and counseling. It’s not coming easy anymore but it is comforting to know that our consumers are making wiser choices.

Well, this was a well-rounded discussion of where the real estate market has come from and where 2010 may take us. I think it’s safe to say that we’ll all approach with caution. We’ve got to get creative in this industry and maybe change tactics a bit, but our consumers are strong and aware. As a home inspector we want our clients to be very active in the services that we provide. Being present on inspections and asking questions is strongly encouraged. It appears that consumers are taking their time to make wise decisions and planning quality investments. That’s good news to me.