NW REporterServing More Than 29,000 Real Estate Professionals in the Northwest

The NW REporter is a joint monthly real estate newsletter from NWMLS and the Seattle King-County REALTORS®.Most content from the NW REporter may be republished or reprinted with attribution. Please inquire by calling (800) 540-3277 ext. 704.

LATEST NEWS RELEASE

Heavy snowfall ices February housing activity around Western Washington

KIRKLAND, Washington (March 6, 2019) - Seattle’s snowiest month in 50 years had an obvious chilling effect on February’s housing activity, agreed officials with Northwest Multiple Listing Service. Statistics for last month show pending sales dropped nearly 14 percent compared to the same month a year ago.

“The winter weather brought the market to a halt,” stated John Deely, principal managing broker at Coldwell Banker Bain. He said last month’s series of snowstorms and frigid temperatures had a negative impact on the typical momentum that builds at the beginning of the year.

“Showing activity dropped more than 41 percent the week of the heaviest snow, and weekend keybox activity was down 80 percent,” Deely reported. “The end of the month picked up as cabin fever weary buyers unleashed themselves on the burgeoning inventory,” he added.

Despite the weather disruptions, brokers added 6,247 new listings to inventory during the month, 1,037 fewer than a year ago. At month end, Northwest MLS members reported 11,275 total active listings, a robust 42.3 percent jump from twelve months ago. Thirteen of the 23 counties served by the MLS reported year-over-year increases in inventory.

Dean Rebhuhn, owner of Village Homes and Properties, described February listings and sales as “very good,” pointing to low interest rates, new jobs, and lifestyle changes as market drivers. “New sales continue to absorb new listings,” he noted.

Northwest MLS figures show about 2.2 months of inventory system-wide, with four counties (Kitsap, Pierce, Snohomish, and Thurston having less than two months of supply. King County was slightly above two months (2.09).

“Snowmageddon notwithstanding, we saw nearly as many homes go pending (6,878) as came on the market (6,247) in February,” noted Mike Grady, president and COO of Coldwell Banker AaBain. “In Snohomish and Pierce counties, the activity was even more impressive for this time of year, with our offices pointing to an uptick in the market.”

It seemed determined buyers were undeterred by nearly inaccessible neighborhoods, based on examples Grady cited.

“A Ballard listing priced at $635,000 went on the market on a Friday and drew a whopping 132 groups previewing it that weekend, yielding 14 offers by Monday. The home sold for 22 percent above listing price,” Grady said. “In Kirkland, we heard about five new listings over $1 million coming on the market during Snowmageddon week two, and all were sold that same week,” prompting him to declare he continues to be bullish on a continued strong market for 2019.

As February temperatures plunged, prices in most counties started heating up, rising from a year ago as well as when compared to January.

Area-wide median prices for the 5,145 sales of single family homes and condos that closed last month were up 5.7 percent from a year ago, rising from $385,000 to $407,000. Compared to January, prices increased 6.6 percent. Single family home prices increased 7.44 percent, while condo prices were nearly flat (up about 1.3 percent).

March 2019

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 2 of 15

In King County, brokers reported a price gain of nearly 2.4 percent from a year ago. The median selling price jumped $14,000 from a year ago, from $590,000 to $604,000. The comparison to January shows a price increase of 6.9 percent.

J. Lennox Scott, chairman and CEO of John L. Scott Real Estate commented on the return of the multiple-offer market. “While the snow in February created a short distraction, the housing market is back on hot as we head into spring,” he remarked, reporting “Dedicated buyers braved the snow. The market is on track for a strong spring.”

“Between January and February, home prices in the tri-county King/Snohomish/Pierce area rose significantly, ending the month-over-month declines that started last May,” remarked OB Jacobi, president of Windermere Real Estate. He called the increase “pretty unexpected and likely a result of the drop in interest rates we saw in December.” Jacobi believes it’s too early to know if this is the start of a trend, but added “It might suggest that the slowing in prices that began last summer has come to an end.”

James Young, director of the Washington Center for Real Estate Research at the University of Washington, said last month’s weather made it difficult to comment on activity, but detected some patterns on prices. “Similar to previous months, prices are moving upwards the most consistently in exurban areas along the I-5 corridor. Look for prices outside the major urban areas to continue rising as the weather improves and the main selling season arrives.”

Areas outside the main Puget Sound urban regions continue to perform well, Young suggested, in part because older households continue to cash out of more expensive markets and move to the outskirts of the cities to areas that still offer good amenities for retirement and lifestyle.

Prices appear to have bottomed out to around year-ago levels, agreed Matt Deasy. Discussions with buyers who are back in the market suggest they believe prices are no longer going down and some feel like interest rates are on sale. House-hunters also seem to be encouraged by the growing selection, he remarked.

Frank Wilson, Kitsap regional manager and branch managing broker at John L. Scott’s Poulsbo office, said the market there has slowed considerably compared to last year when the spring market perked up before the more typical March and April timeframe.

“The reality is we still have low inventory, homes are going under contract faster than they are coming on the market, we are still seeing strong traffic at open houses, and we are still seeing multiple offers on correctly priced homes that are new on the market.” Wilson commented. “Waterfront homes are still at a premium on the Kitsap mainland,” he continued. “As we continue into the spring market, I think we’ll see a bump in buyers who are enjoying the continued low interest rates, although some may still be frustrated with the limited choices.”

Low and stable interest rates are particularly important to those closing larger mortgage loans, Young pointed out. “Buyers also appear to be responding to stable interest rates over the past couple of months, particularly in the higher priced areas of the region,” he commented, noting interest rates for jumbo mortgages (balances over $484,350) decreased to 4.40% from December’s rate of 4.59%.

As the pace of activity picks up, Scott emphasized the importance of buyer preparation to ensure they can secure the home of their choice. “We recommend working with a qualified broker, becoming fully underwritten by a lender, and signing up for text notifications for new listings to find success this spring.”

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

Statistical chart tables begin on next page.

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 3 of 15

February 2019 activity

SINGLE FAM.

HOMES + CONDOS

LISTINGS PENDING SALES CLOSED SALES MONTHS OF INVENTORY

New Listings Total Active # Pending Sales

# Closings Avg. Price Median Price This month Same mo., year ago

King 2,381 3,744 2,278 1,795 $702,378 $604,000 2.09 0.88

Snohomish 914 1,375 1,029 843 $493,962 $454,995 1.63 0.83

Pierce 1,025 1,486 1,290 901 $388,635 $350,000 1.65 1.13

Kitsap 251 432 313 224 $392,232 $337,969 1.93 1.24

Mason 62 173 91 66 $290,169 $261,250 2.62 2.45

Skagit 142 323 133 117 $361,436 $317,000 2.76 2.07

Grays Harbor 110 273 137 76 $216,104 $209,000 3.59 4.35

Lewis 78 212 90 80 $266,694 $250,000 2.65 3.23

Cowlitz 100 171 147 59 $286,096 $284,000 2.90 1.62

Grant 78 198 81 61 $193,424 $193,200 3.25 5.08

Thurston 329 486 400 301 $336,786 $321,900 1.61 1.38

San Juan 14 147 17 13 $1,154,577 $407,500 11.31 9.81

Island 136 292 136 81 $391,759 $332,500 3.60 1.85

Kittitas 50 147 49 36 $431,040 $322,000 4.08 2.53

Jefferson 31 111 41 31 $372,482 $335,000 3.58 4.26

Okanogan 35 193 20 21 $193,024 $151,850 9.19 10.37

Whatcom 224 510 275 190 $416,434 $373,325 2.68 2.19

Clark 64 144 76 52 $389,804 $347,450 2.77 1.56

Pacific 37 196 40 33 $161,997 $165,400 5.94 9.37

Ferry 8 46 5 1 $165,000 $165,000 46.00 10.50

Clallam 56 201 65 54 $289,509 $256,250 3.72 2.34

Chelan 56 175 75 43 $346,508 $356,000 4.07 3.89

Douglas 31 77 41 30 $363,593 $334,900 2.57 3.27

Others 35 163 49 37 $305,205 $275,000 4.41 4.03

Total 6,247 11,275 6,878 5,145 $501,447 $407,000 2.19 1.43

Tables continue on next page

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 4 of 15

4-county Puget Sound Region Pending Sales (SFH + Condo combined) (totals include King, Snohomish, Pierce & Kitsap counties)

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC2001 4334 5056 5722 5399 5631 5568 5434 5544 4040 4387 4155 3430

2002 4293 4735 5569 5436 6131 5212 5525 6215 5394 5777 4966 4153

2003 4746 5290 6889 6837 7148 7202 7673 7135 6698 6552 4904 4454

2004 4521 6284 8073 7910 7888 8186 7583 7464 6984 6761 6228 5195

2005 5426 6833 8801 8420 8610 8896 8207 8784 7561 7157 6188 4837

2006 5275 6032 8174 7651 8411 8094 7121 7692 6216 6403 5292 4346

2007 4869 6239 7192 6974 7311 6876 6371 5580 4153 4447 3896 2975

2008 3291 4167 4520 4624 4526 4765 4580 4584 4445 3346 2841 2432

2009 3250 3407 4262 5372 5498 5963 5551 5764 5825 5702 3829 3440

2010 4381 5211 6821 7368 4058 4239 4306 4520 4350 4376 3938 3474

2011 4272 4767 6049 5732 5963 5868 5657 5944 5299 5384 4814 4197

2012 4921 6069 7386 7015 7295 6733 6489 6341 5871 6453 5188 4181

2013 5548 6095 7400 7462 7743 7374 7264 6916 5951 6222 5083 3957

2014 5406 5587 7099 7325 8055 7546 7169 6959 6661 6469 5220 4410

2015 5791 6541 8648 8671 8620 8608 8248 7792 7179 6977 5703 4475

2016 5420 6703 8130 8332 9153 8869 8545 8628 7729 7487 6115 4727

2017 5710 6024 7592 7621 9188 9042 8514 8637 7441 7740 6094 4460

2018 5484 5725 7373 7565 8742 8052 7612 6893 6235 6367 5328 4037

2019 5472 4910

Washington homeowners pay 12th highest real estate taxes in U.S.

Homeowners in the state of Washington pay the 12th highest real estate taxes per year, according to an analysis by the National Association of Home Builders. The federation, whose members construct about 80 percent of the new homes built in the U.S., found property tax rates differ substantially across the United States.

Using data from the 2017 American Community Survey, NAHB compared average annual real estate taxes on owner-occupied homes, average effective property tax rates (Washington ranks 28th), and real estate taxes paid as a share of total property tax revenue (Washington ranks 6th).

New Jersey retained its dubious distinction of having the highest average real estate tax bill per homeowner, at $8,485, as well as the highest effective tax rate (2.13 percent).

NAHB said the figures include real estate taxes levied by state and local governments, “but the extent to which each level of government depends on property tax revenues is vastly different.” Whereas only two percent of state tax revenue comes from property taxes, the comparable figure for local goverments is more than 70 percent.

continued

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 5 of 15

How Washington Compares

Average Real Estate Taxes Paid per Year (owner-occupied homes)

STATE RANK AVERAGE PAYMENTNew Jersey 1 $8,485

Alabama 50 $678

WASHINGTON 12 $3,569

California 8 $4,623

Oregon 15 $3,291

Effective Property Tax Rates

STATE RANK AVG EFFECTIVE PROPERTY TAX RATE

AVG EFFECTIVE PROPERTY TAX RATE PER $1,000 OF VALUE

New Jersey 1 2.13% $21.34

Hawaii 50 0.30% $3.03

WASHINGTON 28 0.85% $8.53

California 35 0.70% $6.99

Oregon 23 0.91% $9.11

Researchers note low rates combined with extremely high home values results in middle-of-the-pack per-homeowner property tax bills. In Hawaii, for example, the average home value of $692,938 is the highest in the country, and about 50 percent higher than New York’s average of $60,075. New Yorkers pay an effective annual rate of 1.32% and $13.16 per $1,000 of value, placing it 14th on the list.

Real Estate Taxes Paid on Owner-Occupied Homes as a Share of Total Property Tax Revenue

STATE RANK SHARENew Jersey 1 60.2%

Wyoming 50 16.1%

WASHINGTON 6 55.7%

California 10 50.1%

Oregon 9 51.4%

A comparison of real estate taxes paid as a share of total property tax revenue shows stark differences, ranging from 16.1% in Wyoming to 60.1% in New Jersey.

In its 9-page report on property tax rates, bills, and role in state budgets for HousingEcnomics.com, NAHB researchers found property taxes accounted for nearly 40 percent of state and local tax receipts, on average. Moreover, they noted the data illustrate that states rely much less heavily on property taxes as a source of revenue than do local governments.

Washington is one of 11 states where property taxes account for greater than five percent of tax collections. Other states are Alaska, Arizona, Arkansas, Kansas, Kentucky, Michigan, Montana, New Hampshire, Vermont, and Wyoming. In three of these states, New Hampshire, Vermont, and Wyoming, property tax collections make up more than 15 percent of their total tax receipts.

Researchers also looked at residential property taxes in the context of all property taxes collected by state and local

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 6 of 15

governments. That analysis helped provide insight into the tax burden borne by homeowners as opposed to owners of commercial real estate and personal property. They found that homeowners in New York pay some of the highest property tax bills in the country, and that other property tax payments make up three-fifths of state and local property tax collections. By contrast, homeowners in New Jersey pay similarly high RET bills but, unlike New Yorkers, they pay three-fifths of property taxes collected in their state.

NAR launches new branding campaign to distinguish REALTORS®, reinforce members’ pride, and demonstrate value to consumers

Informed and inspired by a Code of Ethics that dates to 1913, the National Association of REALTORS® unveiled a new campaign centered on the theme, “That’s Who We R®”.

In announcing the integrated campaign, NAR said it “aims to reinforce the value of Realtors® as advocates for property owners, engaged community members, and trusted advisors with in-depth knowledge of the industry.”

NAR officials said the campaign will encompass “strategic media placements and engaging creative” to put the organization’s 1.3 member REALTORS® and their ethics, not properties, front and center. Digital ads, 15- and 30-second TV spots, online video, and social media posts will be part of the media mix.

Three goals will drive the campaign:

• Demonstrate the value of a REALTOR® to consumers • Distinguish REALTORS® from other real estate agents, and listing apps • Deliver members a sense of pride in being a REALTOR®

To accomplish this, the campaign features “compelling stories about humans helping humans find homes and property, build communities and turn business dreams into realities.”

The iconic Realtor R membership mark is featured prominently in the creative work.

The campaign budget has not been disclosed, but it is being funded by an annual assessment of $35 per member. The special assessment for consumer advertising has been levied for 21 years and has remained at the same $35 level since 2009. NAR said last year’s campaign achieved 2.71 billion impressions.

“Our story is a century in the making as we began to set NAR members apart from the rest by establishing a Code of Ethics in 1913. This code is as relevant now as it was one hundred years ago; it’s our pledge of honesty, integrity, professionalism and community service as a true partner for buying or selling a home, or property,” said John Smaby, 2019 President, NAR. “’That’s Who We R®’ reinforces that partnering with a Realtor®, delivers the peace of mind that can only come from working with a real person who is committed to their clients’ futures and neighborhoods just as much as they are.”

The national branding campaign was developed by Havas, one of the largest integrated marketing communications agencies in the world. The firm partnered with Director X, a BET award-winning music video director who has worked with well-known hip hop and pop music stars.

NAR is also partnering with multi-channel content makers Vice Media, Apartment Therapy, The Atlantic magazine, streaming

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 7 of 15

video platform Hulu and others in an attempt to capture audiences that consume media through different platforms than traditional cable television.

“Our society has created trusted symbols from ‘Verified’ Instagram accounts to the Good Housekeeping Seal,” said Karen Goodman, group creative director at Havas Chicago. “As we dug into this brand, we knew Realtors® were the real deal and needed to find a way to telegraph that to everyone. We needed to turn the ‘R’ into the trusted symbol you should look for when buying and selling property.”

“The video advertisement and involvement of Director X further shows that NAR is eyeing millennial home buyers more with its outreach,” suggested Inman in a report about the newly-launched campaign.

Victoria Gillespie, NAR’s chief marketing and communications officer, said the campaign was designed not only to educate consumers on the benefits of working with a member of the National Association of REALTORS® but also to highlight all the ways Realtors go above and beyond to help and improve the lives of their clients, neighbors and communities. “We want this campaign to serve as a rallying cry for Realtors and inspire pride in the work they do every day to benefit their clients.”

Realtors can access campaign materials to use in their local markets by visiting www.ThatsWhoWeR.realtor. Print and banner ads, posters, social posts, and links to TV and radio spots are available. Social content will be published on an ongoing basis and may be accessed and shared by following @REALTORS across Facebook, Twitter, and Instagram.

The National Association of REALTORS® is America’s largest trade association, representing more than 1.3 million members involved in all aspects of the residential and commercial real estate industries.

Consultants ponder merits of social media for homebuilders

In a recent “New Home Insights” podcast, the senior VP at John Burns Real Estate said he believes most builders are effectively using social media to drive sales, but added, “I believe that social media has become a major reason that buyers are not purchasing a new home.”

Will Wehrli, from the Burns firm, framed his comments around statistics showing the new home industry’s market share accounts for only about 10 percent of total home sales, down from the historical norm of around 15 percent. He then introduced guest podcaster Will Duderstadt, VP of digital marketing at M/I Homes, the 14th largest homebuilder in the U.S.

Duderstadt said he believes builders can do more to increase sales via effective social media, and then proceeded to outline several strategies that work, ranging from creating awareness and generating referrals to applying knowledge about potential customers to enhance their buying experiences. “The industry has huge opportunities to improve what customers say about them online, which will almost certainly result in increased new home sales.”

Effective social media starts with understanding that it is not just a cheaper means of broadcasting a message, according to Duderstadt. It requires actively interacting and engaging with the audience. Stories resonate well on social media, he noted, adding, “Consumers increasingly want to interact instantaneously with local businesses, and social media provides a great platform for that interaction.”

The guest podcaster also outlined five major platforms and urged builders to learn from metrics.

Will Duderstadt

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 8 of 15

While Facebook, Twitter, and Instagram are recognized as the three most successful platforms for conveying online information and content, Houzz and Pinterest — “where consumers go for ideas and inspiration” — can yield results over the long term, the speaker suggested.

Metrics can also be beneficial, but the speaker expressed a preference for engagement rate, rather than “likes,” saying he monitors messages to identify those with highest engagement rates and replicates those strategies. With regard to platforms with low engagement, he discards those into his “social media graveyard” to avoid wasting time on them in the future.

“Social media can help astute builders get happy customers to generate sales for them,” Duderstadt said. “Happy customers also love to share their experiences with their network.”

Social media is also clearly where unhappy customers go to destroy new home sales, noted a representative from John Burns Real Estate. Citing data from one of its surveys, they reported 52 percent of home buyers shop for their home extensively online, with 32 percent using search engines, and 15 percent using social media to find the home they want. The consultants recommend builders to a self-search of their business to see what consumers see. “We suspect an even higher percentage do research on the builder before signing a sales contract,” JBRE noted.

Guest podcaster Duderstadt oversees online marketing campaigns, lead generation, SEO, PPC, social media and content strategy for M/I Homes and its 16 divisions in 11 states.

The New Homes Insights podcasts, released bi-weekly by John Burns Real Estate Consulting, are available on various platforms. Visit the firm’s website to register for notices on new installments.

House hunting pet owners place high priority on spaces for pets

Real estate brokers are keenly aware of the priority home buyers and home owners give to their pets.

Recent Realtor.com research showed 89 percent of millennials who bought a home own a pet. Of this demographic, 79 percent of pet-owning buyers who closed on a property said they would pass up an otherwise perfect home if it didn’t meet the needs of their pets.

A recent pet parent who purchased a home said she even picked her Realtor® for her pet-friendly attitude, having learned the broker she chose had worked with several volunteers at a local animal shelter.

“It’s heartwarming to find that people will put their pets’ needs first, even when it comes to one of the biggest financial decisions they will ever make,” says Nate Johnson, chief marketing officer for realtor.com. “This survey shows that we really do consider pets part of the family—and that their needs are a critical part of finding the perfect home.”

While dog owners typically desire homes with large yards, cat owners have different space considerations, ranging from where to place to litter box to find ways to satisfy the feline’s curiosity and craving for exercise and environmental enrichment.

Cat owners on the move face an “indoor/outdoor” dilemma, according to Cynthia Chomos, who teaches classes for real estate brokers on various topics including “feng shui for buying and selling” and “color appeal for a quicker sale.” A few years ago, she started applying those skills to her other passion: creating safe, enriching outdoor enclosures for cats, sometimes known as catios or cat patios.

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 9 of 15

“Cats, whether living mostly indoors or allowed outside, are naturally drawn to the stimulation of the outdoors, but responsible cat owners know a variety of outdoor hazards lurk, especially for free-roaming cats,” according to Chomos. Veterinarians can confirm the consequences of unprotected outdoor time can be traumatic and expensive.

Having a safe and stimulating environment for beloved pets is paramount, but home buyers who search for pet-specific amenities also care about aesthetics.

“You can have a beautiful house and a pet, too,” says Julia Szabo, pet columnist for the New York Post and author of Animal House Style: Designing A Home To Share With Your Pets.

Chomos, who founded Catio Spaces in 2014 and is a licensed contractor, agreed, stating, “Rather than looking like an unsightly cage, catios can resemble outdoor rooms. She builds custom catios around Puget Sound and offers downloadable plans for DIYers who prefer to construct their own or hire their own carpenter.

Cat enclosures and protected perches come in a variety of shapes, sizes and styles. (Editor’s note: a Google search uncovered more than 4 million results for the keyword catio!) PETA describes catios as being akin to “a vacation beach house for your feline friends.”

Escape-proof materials and components are essential, according to those who build them. Additional elements often include shelves for vertical and horizontal movement, perches for lounging, toys for enrichment, cat safe plants, seating and space to decorate.

From small and simple to large and luxurious, the enclosures can be an attractive addition to a home while ensuring the health and wellbeing of cats -- as well as cat owners, birds, and other wildlife. Large catios provide outdoor space for feline and human bonding while enjoying the benefits of nature.

As a pet lifestyle expert, Chomos helped found “Catio Tour Seattle,” a showcase of local catios, and collaborates with others to promote the benefits of catios. The annual catio tour, is organized by PAWS as part of its Safe Cats, Healthy Habitats project and sponsored by Catio Spaces, The Humane Society of the United States, Oskar & Klaus and Seattle Audubon. This year’s event is scheduled for Saturday, July 13.

Building confidence rising despite worries around affordability

Ongoing drops in mortgage rates coupled with continued strength in the job market are boosting confidence among builders, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI).

Robert Dietz, PhD, chief economist at NAHB, reported builder confidence rose four points to 62 in February, which marked the second consecutive month in which all HMI indices posted gains. The other metrics track sentiment on current sales conditions, expectations for the coming six months, and buyer traffic.

In the aftermath of the fall slowdown, many builders are reporting positive expectations for the spring selling season, according to Dietz.

WINa DIY catio plan

for your beloved cat,or your client’s.

The successful bidder at the April 18 REALTOR® Wine & Spirits Auction in Bellevue

will receive a certificate for a Catio Spaces DIY Catio Plan

(bidder’s choice of style).

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 10 of 15

NAHB members say affordability remains a critical issue. “Rising costs stemming from excessive regulations, a dearth of buildable lots, a persistent labor shortage and tariffs on lumber and other key building materials continue to make it increasingly difficult to produce housing at affordable price points,” Dietz stated.

The HMI gauges builder perceptions of current single-family homes sales and sales expectations for the next six months using ratings of “good,” “fair,” or “poor.” For traffic of prospective buyers, builders rate it as “high to very high,” “average,” or “low to very low.”

Scores for each component are calculated on a seasonally adjusted index, with any number higher than 50 indicating more builders view conditions as good than poor. The most recent feedback had three components as “good” with scores of 62 and higher. The index for buyer traffic improved but was lowest, scoring a metric of 48.

NAHB has conducted its monthly Housing Market Index for 30 years.

Real estate researchers reveal “secret sauce” of top selling master planned communities

Developers of the top 50 master-planned communities work hard to create “the perfect combination of attractive amenities, proper product segmentation, and creative, targeted marketing,” according to researchers at John Burns Real Estate.

Jody Kahn, senior VP and Devyn Bachman, senior research analyst, identified four “must-haves” for successful masterplans:

• A range of home sizes, types, and prices and a variety of builders (with rare exceptions for especially large and well-segmented communities);

• Consistent themes, such as signage, landscaping, lighting, street names, mailboxes, etc. • Shared or reciprocal amenities and activities for a variety of lifestyles; • Branding and marketing that give the community a unique and well-recognized identity.

“For a rare few, success is simply the right product in the right location at the right time,” they wrote in a recent report.

Each month the firm ranks the top 10 regions for their research clients. New home sales and pricing strength, job growth, and other fundamentals are used as criteria.

For January, the Northwest placed 6th, with only one project, Tehaleh, on the top 10 list. Annie Radecki, Northwest VP at the Burns firm, said that project has “experienced a volume upsurge due to the combination of its maturity and its affordability relative to the Seattle MSA.” Located in Bonney Lake, about 40 minutes south of Seattle, Tehaleh boasts Puget Sound’s largest collection of homebuilders and floor plans.

The top three regions in the JBRE rankings for January were the Southwest, North Florida and South Florida. According to the Burns company’s research, the 50 top-selling masterplans combined for more than 28,000 new home sales in 2018.

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 11 of 15

“INSPIRES DOING THE GREATEST GOOD”

“Thoughtful, transformative, phenomenal” - Seattle University president who “always shows up” named 2019 Seattle-King County First Citizen

BELLEVUE, Washington (March 12, 2019) – One organization executive described this year’s Seattle-King County First Citizen as a “selfless leader” who “shows up” and praised him for his deep commitment to community building. A company president lauded his “obvious heart of a servant.”

Seattle University President Stephen V. Sundborg, SJ will be celebrated as the 81st recipient of the prestigious Seattle-King County First Citizen Award at a civic banquet on May 23. The not-for-profit event will honor his multiple noteworthy contributions and initiatives for the betterment of his university plus a wide-ranging list of professional, charitable and civic organizations.

Now in his 22nd year as president, Father Sundborg is known as a tireless advocate for marginalized residents and for nurturing the Jesuit university’s growth and high rankings “for academic rigor, sustainability, community service and social justice.” He plans to retire at the conclusion of his current five-year term as president.

Sabey Corporation president David A. Sabey, a member of Seattle University’s Board of Trustees, described Sundborg as “a phenomenal leader who has given much to his university and to his community and asked for nothing in return.”

“I have been consistently impressed with his dedication to students, faculty, and staff, his tempered and collegial leadership abilities, and his obvious heart of a servant,” Sabey remarked.

During Sundborg’s tenure, enrollment has grown about 30 percent, to nearly 7,500 students. Concurrently, the university has added two colleges and a law school, built a student center, new library and Learning Commons, and elevated its athletics programs from a D3 to a D1 school. Building projects also include new residential housing and a Center for the Performing Arts, as well as a groundbreaking this May on a new Center for Science and Innovation that is scheduled to open in 2021.

Seattle University has earned several top rankings for its programs, including being on the U.S. News & World Report “Top 10” list of the West’s best regional universities for 18 consecutive years. For 16 years, The Princeton Review has recognized the university as one of the best colleges in the nation for undergraduate education. The values-oriented university also achieved Top 10 recognition in the Sierra Club’s magazine and its annual list of “Coolest Schools” for being eco-friendly by “mastering the art and science of campus sustainability.”

In addition to his responsibilities as Seattle University president, Father Sundborg is involved with numerous professional, charitable, cause-related, and civic organizations. He currently serves on the boards of United Way of King County, the Independent Colleges of Washington, Association of Jesuit Colleges and Universities, University of San Francisco, the Seattle Nativity School, Lakeside School and Fulcrum Foundation, to name a few. Past board affiliations include Fred Hutchinson Cancer Research Center, YMCA of Greater Seattle, City of Seattle Committee to End Homelessness, and Georgetown University.

“Father Steve has provided leadership, mentorship, and service to thousands of young people pursuing an education at SU and thousands more during his 20 years as Seattle U’s leader,” stated Diane Douglas, senior advisor at Uncommon Partners. “He has always struck me as a selfless leader keen on doing more than his part to make this region the best it can be.

Douglas praised Sundborg for his visionary leadership, which she observed for 11 years in her prior position as executive director at Seattle CityClub. “He speaks out on issues of social justice, he encourages active and engaged citizens, and he

Seattle University President, Father Stephen V. Sundborg

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 12 of 15

shows up at community events and models his deep commitment to community building. I’m grateful Seattle U is allowing the community to borrow him so much!”

This year’s First Citizen, who grew up in the Territory of Alaska, was ordained a priest in Seattle in 1974. After completing his doctoral studies in spirituality at the Pontifical Gregorian University in Rome, Sundborg taught theology at Seattle U from 1982-1990, and then served as Provincial of the Northwest Jesuits until 1996 before becoming the university’s 21st president.

Sundborg joins a distinguished group of First Citizen honorees, including his predecessors Rev. Albert A. Lemieux, S. J. (1956) and Rev. William J. Sullivan, S. J. (1990), Past recipients include individuals, couples, families, and organizations whose vision, leadership, volunteerism, compassion, and generosity have benefited “the greater good.”

About the First Citizen Award

The Seattle-King County First Citizen Award salutes “giving back” whether by “time, treasure or talent” and civic engagement that enhances the region’s quality of life. Past recipients hail from both the public and private sectors, ranging from humanitarian groups, corporations, charitable, health and educational institutions, to various arts, environmental, and civic organizations. (see complete list on last page).

Since its inception in 1939, the First Citizen Award (believed to be this region’s oldest such recognition) continues to celebrate community leadership, volunteerism and public service. The civic banquet to honor the annual recipients is a not-for-profit celebration of civic engagement presented by Seattle King County Realtors® and partners from the real estate community. This year’s partners for the May 23 event at the Fairmont Olympic Hotel in Seattle are John L. Scott Real Estate and Windermere Real Estate.

About the Seattle King County REALTORS®

The Seattle King County Realtors® is a nonprofit professional trade association whose goals include promoting ethical business practices and supporting policies that preserve and expand real property rights and housing affordability. Based in Bellevue, SKCR has more than 7,200 members and is a local board of the National Association of Realtors®. The term Realtor® is a registered collective membership mark that identifies a real estate professional who is a member of the National Association of Realtors® and subscribes to its strict Code of Ethics.

List of past recipients follows on next page

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 13 of 15

PAST RECIPIENTS, SEATTLE-KING COUNTY FIRST CITIZEN AWARD

1939 Richard Eugene Fuller1940 Dr. Wendell Fifield1941 William O. McKay1942 Kenneth Colman1943 Phil Johnson1944 Children’s Orthopedic Hospital1945 W. Walter Williams1946 Royal Brougham1947 John H. Reid1948 Ernest Skeel1949 Dr. Raymond Allen1950 Thomas M. Pelly1951 George Gunn, Jr.1952 Henry Broderick1953 Frank E. Holman1954 William M. Allen1955 Deitrich Schmitz1956 Rev. A.A. Lemieux1957 Gordon N. Scott1958 Nat S. Rogers1959 Mrs. A. Scott Bullitt1960 Michael Dederer1961 Ben E. Ehrlichman1962 Joseph E. Gandy1963 George F. Kachlein, Jr.1964 H.W. McCurdy1965 Edward E. Carlson

1966 Milton Katims1967 Mrs. Henry B. Owen1968 James R. Ellis1969 William B. Woods1970 Norton Clapp1971 Glynn Ross1972 John D. Ehrlichman1973 Dr. Dixy Lee Ray1974 Ned and Kayla Skinner1975 Dr. Wm. B. Hutchinson1976 Rabbi Raphael Levine1977 W.J. “Jerry” Pennington1978 John M. Fluke1979 Gordon H. Sweaney1980 James M. Ryan1981 C.M. “Mike” Berry1982 Dr. Dale E. Turner1983 T.A. Wilson1984 Victor Rosellini1985 Fredric A. Danz1986 Robert W. Graham1987 John W. Ellis1988 Samuel Stroum1989 R.C. “Torchy” Torrance1990 The Rev. Wm. J. Sullivan, S.J.1991 Buster and Nancy Alvord1992 Lester R. Sauvage, M.D.

1993 Constance W. Rice, Ph.D.1994 Phil M. Smart, Sr.1995 Mary Gates & Family1996 Stanley O. McNaughton1997 Walter B. Williams1998 Jack A. Benaroya1999 Paul Brainerd2000 The Bullitt Family2001 Herb M. Bridge2002 Scott and Laurie Oki2003 Dan and Nancy Evans2004 The McCaw Family2005 Jeffrey and Susan Brotman2006 Dale Chihuly2007 James and Sherry Raisbeck2008 Paul G. Allen2009 Gerard Schwarz2010 Hon. Slade Gorton2011 Jamie and Karen Moyer2012 Rotary International Dist. 50302013 Lenny Wilkens2014 Hon. Norman B. Rice2015 Theodor “Ted” Baseler2016 Phyllis Campbell2017 Bill and Jill Ruckelshaus2018 The Pigott Family

News In Brief

The number of homes available for sale in Seattle is increasing at the second-highest rate in the country as the red-hot real estate market of the past few years begins to cool, says a new report. The report, by real estate marketing site Zillow, found that there were 3,324 more homes on the market in Seattle during January than there were at the same time in the previous year - an increase of 36.9 percent. That’s the second-highest increase in the nation, behind only San Jose, Calif., which saw an increase of 42.9 percent in for-sale home inventory. San Diego saw the third-highest increase, at 31.9 percent, Los Angeles was fourth at 29.1 percent and San Francisco was fifth at 25 percent. Across the nation as a whole, there were 1.2 percent more homes for sale in January than there were in the previous year - a much smaller increase than in Seattle, but still the first time in more than five years that the nationwide for-sale home inventory has grown in January. The rising number of homes for sale is good news for buyers, who now have more selection than

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 14 of 15

they have had in years and less competition from other buyers. Mortgage rates just over 4 percent also remain very reasonable by historic standards. The bad news for buyers - home prices are continuing to go up at an average year-over-year rate of 7.5 percent nationwide. And the inventory of homes for sale is still 20 percent less than the recent high of more than 2 million set in July 2014. The study also found that rents are rising at an average rate of 2.1 percent over the same time last year.

Three cities in the South Sound have been named among the most culturally diverse in America, according to a study by WalletHub. Kent, Renton and Federal Way all made the list, which compared 501 of the most populated U.S. cities across three key metrics: Ethnoracial diversity, Linguistic diversity and Birthplace diversity, the study’s authors wrote. The research was limited to just 10 cities from each state. Kent ranked 10th most diverse, while Renton came in at 20th and Federal Way at 24th. Other Washington cites on the list: Bellevue at 42nd, and Everett at 131st, Tacoma and 133rd and Seattle and 138th. The most diverse city was Jersey City, New Jersey while the least diverse was Miami suburb Hialeah, Florida --96.4 percent of their population identified as Hispanic or Latino, the study found. The study also peered into how many people in each state were born there, or are transplants, and if so, where did they come from? In Washington, less than half of its residents were born in the state -- just under 47 percent, according to WalletHub. 14.4 percent were born out of the United States and 19 percent were born elsewhere in the West. Just under 4 percent were born in the Northwest, while nearly 8 percent are from the Midwest and 6.4 percent from the South.

Washington lawmakers have proposed a carbon fee as part of a transportation funding package, the third major attempt at limiting the atmosphere-warming gas through such a policy there since 2018. If passed the measure would be the first of its kind in the nation, but similar proposals in the state have failed in recent years. At $15 per ton, the fee would raise about $7.9 billion over the next ten years, part of a $17 billion fee-and-bond package. The package also includes a 6-cents-per-gallon fuel tax increase, and would fund projects including highway maintenance, the state ferry system, and court-mandated culvert replacement projects.

Best Neighborhood, a neighborhood analysis and data visualization website, analyzed incomes and home prices across the country and found that as of 2019, 27 percent of homeowners would not be able to safely afford their same house today. That number combines the about 14.2 percent of homeowners who would definitely not qualify for a mortgage loan and the 12.8 percent who may or may not qualify but would be financially stretched if they did. In Seattle, that number jumps to 52.8 percent. But it doesn’t get much better outside the Emerald City -- Washington as a whole ranks among the states where most homeowners would not be able to afford their house today. Though Washington is not the worst. There are five states where homeowners are even less likely to be able to afford their current homes in today’s market. When looking at cities, all of the worst 25 cities are located in California -- though two states are worse overall than the Golden State. Compare that to 1990, when over 50 percent of homeowners would be able to afford their homes in that market -- and just 4.3 percent of homeowners would definitely have not qualified for a mortgage. So why the change? Nationwide, wages are not increasing as quickly as home prices -- not even close. For all but the top 10 percent of earners, wages have largely stagnated, according to Pew Research Center. “If wages do not continue to rise to match home prices, our analysis provides evidence that current real estate price increases are far from sustainable,” Best Neighborhood said in its analysis. The analysis cites a 2015 Harvard study showing that homeowner rates among young adults has been falling and is expected to continue falling.

It now takes $105,367 annual income to buy a median home in the Seattle-Tacoma area, according to HSH.com, a mortgage resource company based in California. A median home in the Seattle-Tacoma-Bellevue market was priced at

NW REporter March 2019

Serving More Than 29,000 Real Estate Professionals in the Northwest Page 15 of 15

$489,600 as of the fourth quarter of 2018 (National Association of Realtors). One catch, that’s the income you’ll need if you can afford a 20 percent down payment, nearly $98,000. If you can only put down 10 percent, you’ll need $122,484. Seattle is the seventh most expensive city in they U.S. to buy a home. Of the 50 largest metro areas in the country, Pittsburgh is the least expensive. It takes just $37,660 in income. The median home price there is $141,625. No surprise, San Jose is most expensive. You need a quarter of a million dollars to buy the median home there ($1.25 million). Portland clocked in at 10 at $85,173.

Seattle isn’t cheap to live in, and raising a child is a surefire way to dramatically decrease your spending budget, so it may make sense that Washington has some of the higher childcare costs around the country. A new study from Haven Life, an online life insurance agency, broke down the cost of childcare in each state and the percentages parents take out of their incomes, and ranked each state. Washington fit into the top 10, along with other states that line the coasts of the country. Midwest and southern states rounded out the bottom 10 states, mostly. But what’s most significant about the study isn’t how much childcare costs in each state, but the strain they put on households. For example, while Washington on average has a higher cost of childcare than Illinois, it takes out about 57 percent of a minimum wage income compared to 78 percent in Illinois. The study also answered the most important question: Is it affordable? What they said is that for couples with dual incomes, which the study describes as “married-couple family incomes,” only two states have affordable childcare: Alabama and Mississippi. It said no states were affordable for single-parent incomes or minimum wage incomes.

Calendar of Events Through February 5, 2019

DATES EVENT TIME LOCATION CONTACT

Seattle—King County REALTORS®

For updates visit http://www.nwrealtor.com/events

2 / 18 / 2019 Holiday—Office Closed

3 / 6-7 / 2019 NAR Region 12 Cedarbrook (SeaTac) 425-974-1011

3 / 13 / 2019 Board of Directors 9:30 am - 12:30 pm SKCR 425-974-1011

4 / 2 /2019 Government Affairs Committee 10:30 am - 1:30 pm SKCR 425-974-1011