Saturday, January 17, 2009
Coldwell Banker Winthrop Realty ~ 2008 Market Analysis
Dear Friends,
At a time when many of us have lost 50-percent (or more) of the value of our stock holdings, it is a reassuring commentary that real estate values in the Methow Valley, although somewhat softer, held up remarkably well in 2008.
That is one of the chief conclusions of our 2008 market analysis, which we just finished.
Sale prices in 2008 dropped an average of only 7.7 percent from the most recent list price, while corresponding sale prices in 2007 dropped an average of 5 percent – a modest difference.*
The average sale prices in 2008 and 2007 were fairly close – approximately $12,000 apart –$236,568 in 2008 compared to $248,531 in 2007.
This relative price stability is a function of three things:
- The types of properties available in the Methow Valley are generally highly desirable and in limited supply.
- The types of owners we have – many multiple-property owners – seem more able to weather economic downturns.
- Methow Valley sellers faced little downward pressure from banks selling foreclosed properties, at highly reduced prices. As of this writing, we are aware of only two Methow Valley properties that have gone through foreclosure and are listed for sale.
Of course, that is not the case, nationally. The chief economist for the National Association of Realtors said 45% of all home sales in November involved distressed sales. A distressed property is one in which the seller faces foreclosure or is forced to sell for less than the value of his/her mortgage.
Widespread distressed properties drive down prices. Clearly, the absence of those conditions puts the Methow Valley in a distinctly stronger real estate position than most of country.
Price stability, however, does not mean the Methow Valley has not been affected by the recession – it most certainly has. Across the board, market activity has slowed substantially. There were only 148 transactions in 2008, a 34-percent drop from 2007, and gross sales reached $35 million, a 37-percent drop from 2007.
As in most sectors of the economy, many buyers have been in “fear” mode: holding cash, not spending, waiting for more economic stability.
As a result, thanks to government incentives, mortgage rates are at historic lows. As of this writing, some 30-year mortgages are available at what were once unheard of numbers – hovering in the high 4-percent range.
Low rates combined with other favorable market conditions have created buying opportunities. Methow Valley property inventories are strong and many sellers are motivated – a combination we haven’t seen for some time!
And remember, it is impossible to predict the exact timing of a market bottom or high – you always find out after the fact. So, the longer a person waits to decide, the more risk they take that prices will begin to firm up.
Bottom line: if you wish to buy a place in the Methow Valley and can afford to do so, it would be hard to find a better time than now to make your move.
And remember, the primary reason to buy a property in the Methow Valley, is not purely for investment, but because you love this place and want to be part of it!
Best Regards,
Linda
* These calculations measure the difference between the most recent list price and the final selling price. These calculations do not measure price reductions that may have occurred during the course of a listing (in either year).
Friday, January 16, 2009
North Cascade Heli Skiing
Enjoying the Power 
Liberty Bell 
The foreground is Peak of Pleasure 
Photo by Dale "Fuzzy" Caulfield
Silver Star Photo by Dale "Fuzzy" Caulfield
30-Year Rates Fall Below 5 Percent
Interest rates on 30-year, fixed rate mortgages averaged 4.96 percent this week, down from a previous week's 5.01 percent.
The low rates have caused a spike in home refinancing loans and a welcome relief to cash-strapped home owners facing a slowing economy and rising unemployment rates.
"The fact that interest rates have dropped to a record low is an important development since more affordable home financing could help bring buyers back to the market and prevent some of these foreclosures," says Lawrence White, professor of economics at New York University's Stern School of Business.
Other rates were mixed for the week:
- 15 year fixed rates: averaged 4.65 percent, up from 4.62 percent.
- 1-year adjustable rate mortgages: fell slightly averaging 4.89 percent from 4.95 percent last week.
- 5/1 ARMs: averaged 5.25 percent compared with 5.49 percent last week.
Mortgage rates have continued to drop ever since the Federal Reserve announced a plan in December to buy up $500 billion of mortgage securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae—the government-sponsored enterprises.
Freddie Mac started recording mortgages in 1971.
Source: Reuters, Julie Haviv (1/15/09)
Friday, January 9, 2009
The 2008/2009 Methow Valley Real Estate Market
Many of you have been asking me if the Methow Valley real estate market is being affected by the 2008 market downturn. Although there are some serious negative factors influencing the national marketplace, the Methow Valley is primarily made up of recreational homes, a second home market, and so far we seem to be somewhat insulated from what is happening in many of the markets around the country.
Make no mistake, 2008 has presented the Methow Valley real estate industry with challenges across the board. There are more homes listed for sale than one year ago, homes are taking longer to sell, prices are softening, and there are fewer buyers investing in recreational property. But as of yet, the Methow Valley has not experienced the significant upsurge in distressed home sales, as in the major markets around the country. Investment in Methow Valley property is, in spite of everything, still a strong venture.
In 2009, Methow Valley real estate market conditions will continue to shift in favor of the buyer. Many buyers will be jumping into the market, taking advantage of greater selection, lower interest rates, special seller financing, softer prices, and less competition. With market conditions stabilizing, first-time buyers will now have the luxury of time in making their housing decision. They also have greater purchasing power than they had one year ago – and their dollar will go much further.
We may be in for some challenges over the next year, but we should see clear signs of recovery in 2009. Now is an excellent time to invest in your Methow Valley dream!
Linda Mills
10 Real Estate Predictions for 2009
· Sellers will continue to face falling home values in the new year because they’ll be competing with banks and builders who are slashing prices to sell off the still-huge inventory of foreclosures and new homes.
· The Obama administration will act on its plan to crack down on abusive lending practices.
· Mortgage holders in danger of losing their homes will receive more assistance from a variety of programs since the Senate's Joint Economic Committee has predicted two million foreclosures in 2009.
· Banks' restructuring should bring increasing calm, making loan modifications and short sales easier to obtain. Eventually this will lead to a decrease in the number of bank-owned properties on the market.
· Mortgage applications will continue to receive a comprehensive review, requiring borrowers to provide extensive income and debt documentation. Those with the best credit will get the best rates.
· The foreclosure crisis has created wiser consumers, with a deeper understanding of real estate, mortgages, and credit enabling better decision-making going forward.
· Green is good with increasing numbers of buyers opting for smaller homes that are within walking distance of school and work.
· Buyers and sellers will be more and more tech savvy, relying on tools like video, webcasts, and mobile search. Consumers and practitioners will benefit from being ahead of the curve.
· Prices will be low as will interest rates, creating great buying opportunities, and likely, inspiring reluctant buyers to make their move.
· The recession will end and buyers will regain confidence in the market.
Source: Frontdoor.com (12/03/08)
Saturday, December 27, 2008
Twisp's History
The Methow Valley literally has its roots in Twisp, whose origins stretch back to two short-lived gold booms in 1858 and 1880. But it wasn't until August 5, 1897, that Henry C. Glover established Gloversville (now Twisp) as the first recorded town plat in the Methow.
Five months later, on January 22, 1898, Twisp was officially a name on the map, just nine years after Washington Territory became the 42nd state.
The word Twisp is a modification of the native-American word, "T-wapsp", which means "yellow Jacket", and "Twistsp", which means "sound of the buzzing wasp". The sunflower capital of the state and the eastern gateway to the North Cascades National Park, Twisp was largely dependent upon logging until the mid-1980s. In 1941, Otto Wagner established the Twisp-Wagner Lumber Company in Twisp, which eventually employed 400 people. Today, the principal industries include lumber, cattle ranching, agriculture, and tourism.
One of the most influential natural events to occur in Twisp was the flood of 1948, which caused more than $4 million in damages and completely destroyed three state highway bridges as well as extensively damaging six others. Another significant natural event which forever changed the Methow Valley was the great freeze of 1968, when temperatures were recorded at 50¼F below 0. That freeze killed many of the Valley's orchards, most of which were never re-planted.
Other significant dates in the history of Twisp are:
1903 - Joshua Risley opens the Twisp Opera House.
1911 - The eight-room Twisp High School, now the Community Center, is built with bricks made locally from red clay found on the hillside near the Loup Loup Highway Junction of Hwy. 20 and 153.
1911 - The Methow Valley attempts to form its own county with Twisp as the county seat, but the legislative bill never makes it out of committee.
1941 - An addition is made to the Twisp High School.
1972 - The North Cascades Highway (Highway 20) is completed, connecting the Methow Valley to the west side of the state. Tourism becomes a major industry for Twisp and the neighboring towns in the Methow.
July 4, 1997 - Twisp celebrated its centennial birthday.
Winthrop's History
For 9000 years Native Americans lived along the banks of the Methow, Twisp and Chewuch rivers, digging camas root, picking berries, fishing and hunting. The first white men to visit the valley were trappers in the 1800's.
But it was in 1883 when the lure of gold brought the first permanent white settlers, three of which were James Ramsey, Ben Pearrygin and Guy Waring. Waring stopped at the forks of the Chewuch and Methow rivers in 1891 where he and his family settled into the "Castle" (now the Shafer Museum).
Although Waring is the acclaimed founding father, the town is named after Theodore Winthrop, a Yale graduate, adventurer/traveler and gifted 19th century author. The town was rebuilt after a devastating fire in 1893. Waring's original Duck Brand Saloon (considered the best run saloon in the country by numerous church publications) was built in 1891.
It survived the fire and is now Winthrop's Town Hall. Waring's "Methow Trading Company" operated for 49 years beginning in 1897.
Owen Wister, Waring's Harvard roommate, wrote The Virginian, American's first western novel, after honey-mooning in Winthrop.
In 1972, when State Highway 20 was nearing completion over the North Cascades, several business people began planning for travelers passing through the town. Mrs. Kathryn Wagner and her husband Otto came up with the idea of a western restoration. All of the local merchants pitched in financially and Mrs. Wagner paid the balance for the reconstruction, painting and new signs.
The architect and designer was Robert Jorgenson of Leavenworth, Washington who wanted "to make the design as authentic as possible in order to preserve the spirit of the valley". The original signs were created by Chet Endrezzi.
Cattle drives, medicine shows, pack trains and the mystique of the old west are still part of the Methow Valley experience. Almost completely surrounded by National Forest, State Game Range and Wilderness areas, Winthrop and the upper Methow Valley beckons adventurers of all kinds.
Friday, December 26, 2008
First-Time Buyers
My "First-Time Buyer" pick for December. Enjoy!
As I entered the home below, it reminded me of the tree house you dreamed about having as a kid. No, it's not in a tree, but has many, many levels to it and it is set in a beautifully treed lot. Even the bathroom is on a separate level on its own. It will be sold furnished (sweet!), and the entry way is perfect for several mountain bikes, skis, or backpacking gear. This is a first-time home owners Methow dream come true!
Saturday, December 13, 2008
First Snow
A Close-up of the Ying Yang Symbol.
Wild rose hips after the first snow. 
