Everett

Sharing some thoughts from Kenneth R. Harney recently as he commented on Federal Reserve Chairman Ben Bernanke’s remarks to congress last week stating “The recession that has gripped the country painfully for 18 months will “end” later this year-moving us into positive economic growth.”

With the improved $8,000 non-repayable home buyer tax credit plus historic lower interest rates and lower prices, home buyers have a unique opportunity.

Not too long ago my seller clients were amazed at the price their home commanded in the Everett market place but were equally in shock with replacement cost…downsizing or up sizing. The bottom line was a higher mortgage payment that tarnished all the glamour.

The National Association of Home Builders have found that affordability of houses is now at its best level in years. The association’s “Housing Opportunity Index” which measures the percentage of homes sold in local markets around the country that are affordable to families earning area median incomes-hit a near record 62.4 percent in the most recent quarter for which their data is available.

By contrast a year earlier, the index was at 47, meaning that less than half of households could afford to buy a medial priced home. During the boom years it was even worse.

For the Everett market and Snohomish county, prices have dropped from 9 to 18 percent depending on location. In addition, sellers are participating in concessions…primarily assisting home buyers with closing costs that greatly reduce the amount of cash needed to purchase.

Ultimately Everett real estate is supply and demand. Driving around and seeing hundred of finished home-sites waiting for building permits reminds me that when the turnaround begins builders respond quickly and new construction will take off..at the same time developer/builders will start development of new Everett lots and projects however there is usually a 12 to 18 month time lag. Thus demand will once again exceed supply and double digit inflation will probably be a major part of the recovery.

Those Everett home buyers who feel confident about their job and plan to remain in the Everett area may have the “perfect storm” buying opportunity.