Change to U.S.-backed condo loans comes as summer market wraps up

A monthly real estate snap shot by John L. Scott Real Estate.

  • Thursday, September 19, 2019 1:30am
  • Business

By Erin Flemming

Special to the Record

Though the local real estate market tends to be a bit quieter this time of year due to summer vacations, Karen Lindsay, managing broker and branch manager of John L. Scott’s Bellevue-Issaquah office, said the market was still good overall. Though her office saw fewer listings come on the market than expected, demand was still strong, especially in the $500,000 to $900,000 price range.

In the luxury market, Lindsay noted that homes priced over $1.2 million are taking a little longer to sell, with some negotiation usually involved. However, she said luxury homes locally are still selling at a good value to sellers.

Looking ahead, Lindsay said the second-strongest selling season of the year is comprised of September and October, so she expects her office to be busy.

“Once the kids are back in school and summer vacations are over, we often see potential buyers come back into the market more seriously,” Lindsay said. “For sellers, this is that last season to sell before things cool off for the holidays. As a result, we will see some additional listings in September.”

Though the local real estate market in Snoqualmie didn’t offer up any major surprises in August, the real estate industry is abuzz with a change to laws surrounding low-down-payment loans for condominiums. The Federal Housing Administration (FHA) announced in August that the U.S. will back more condominium loans, a change that is aimed at helping first-time buyers.

The National Association of Realtors (NAR) and others expressed support for the change, arguing in cities like Seattle, expanding opportunities for first-time buyers to purchase a condo is a welcomed change. Lindsay echoed the sentiments of NAR, saying condos tend to be more affordable and are particularly attractive to millennials in markets close to the job centers.

“Previously, the rules requiring that entire projects have FHA approval before any of the owners could sell to a buyer financing through FHA didn’t made sense,” Lindsay said. “The new rules make much more sense, and I think we’ll see more condo sales as a result.”

According to a new analysis from Attom Data Solutions, homes within a close range of popular food stores such as Trader Joe’s and Whole Foods have high home value rates and investment returns. However, it’s important to remember that correlation does not equal causation. Lindsay said while neighborhood amenities are often valuable to buyers, she isn’t sure which comes first – the chicken or the egg – in this situation.

“Upscale grocery stores, restaurants, gyms and more are attracted to high end neighborhoods for customers, so if the potential customers are there, the retailers and suppliers will open there,” Lindsay said. “Conversely, buyers are interested in neighborhood amenities and ‘walkability’ is attractive in today’s market. I don’t think the high-end stores necessarily add value, but a neighborhood with many available amenities makes it more attractive to buyers.”