Real Estate Information

Dwell Realty Blog

Connie Yoshimura

Blog

Displaying blog entries 1-10 of 210

Number of New Housing Units Continues to Decline

by Connie Yoshimura

It seems like I have written this article again and again. The September building report for single family, duplex and multi-family permits clearly demonstrates the continued downward spiral of housing starts.  Through the third quarter of 2018, there have been ten fewer single family starts compared to 2017; twenty-six fewer duplex units started; and twelve fewer multi-family units permitted. The total number of housing starts through the third quarter was 404 in 2017 and 356 in 2018 which is a decline of 11.88% percent. Even with one quarter left, the residential construction season is basically over except for a few brave single family builders who are fighting the November chill and wind to put in a handful of foundations so that they can be ready for the spring market. The average permit value for a new single family home was $403,586 which does not include the cost of the lot.

But, that’s not all the bad news. The total value of ALL construction permits, including commercial alternations, change orders for residential, commercial and government plus any new commercial permits has declined by 8.15% percent. This year to date total is $327,445,809 compared to $356,491,103 in 2017. So does anyone wonder why subcontractors have left Alaska for the lower 48 where the market is better, wages are comparable or better and the climate is at least thirty degrees warmer and they can build 12 months a year? 

However, there is one statistic in these reports that continues to stand out and that’s the number of residential and commercial alterations or in lay man’s terms: remodeling. Just take a drive around mid-town and you can witness older buildings being remodeled with new paint, textures and contemporary facades and entries, the most prominent being the new REI anchor in the old Sears Mall. Residential remodeling is not quite so dramatic. The most common home remodel is the kitchen, followed by the bathrooms. Both require electrical and plumbing upgrades which need permits. Structural additions can include increasing the size of the garage, adding an artic entry or a family room at the back of the home or above the garage. 

Unless you are adding an auxiliary dwelling unit (ADU), which is now allowed with some restrictions in all R1 zones regardless of the square footage of the lot, remodeling doesn’t add housing units which is what our city needs in order to keep its millennial and boomer population. Anchorage has lost 3,000 residents over the past few years. Whether that loss was to our neighbors to the north, Boise Idaho, Tucson Arizona or Palm Springs, doesn’t matter. It has created a loss of circulating income and left a void in our civic and social activities that will be hard to replace without more affordable housing.               

So You Want to Buy a Piece of Land?

by Connie Yoshimura

It looks good.  Has tall trees.  Even a view of the mountains and a peek-a-boo view of the inlet.  But, what else do you need to know?  First, does the current zoning allow for what  you want to do with the property.  Whether it is a potential tract for a new subdivision or an already platted lot, there are zoning restrictions that run with the parcel.   You may want to build a triplex but the zoning only allows for a duplex.  To build the triplex, you would need to rezone the property which would require a rezone application  to the Planning and Zoning Commission for approval as well as to the assembly which has the final approval for all rezones.  That process can take anywhere from six  months to a year depending on the complexity of the rezone and the schedule of P and Z and the Anchorage Assembly. 

Soils may look good initially with natural vegetation but we all know looks are deceiving so the careful buyer will want to have some test holes dug and the sample soils evaluated by professional engineers.  Whether building a subdivision with roads/water/sewer or buying a lot to build a new home on, test holes can give you a good idea of the excavation costs and  costs for the haul off of bad soils and the haul in of dry gravel.  These extra costs do not add appraised value to the vertical structure you are planning on building.   Are the easements for gas and electric on the front or back of the lot?  Easements constrain placement of the structure. You also  want to make sure you have the appropriate square footage available for your footprint. No more than 30% of a lot can be utilized for a two-story home and no more than 40% for a ranch.  That lot coverage ratio includes porches and garages. 

There are a number of infill vacant lots in Anchorage, particularly in the older parts of Anchorage.  However, in most instances, water and sewer pigtails are not thru the right-of-way and so a buyer will need to tear up the street to connect to the water/sewer main.  Even if by chance, the pigtails were extended through the right-of-way, they will most likely not be the right size or type material and will need to be replaced.  Another cost that does not add value.

Will there by ‘off-site’ costs that you will have to pay to develop the property?   Off-site costs can include a requirement to pave alleys which are common in older neighborhoods like South Addition and Mountain View.  A neighbor may have water/sewer to his property but that doesn’t necessarily mean the main has been extended to your lot line.  The same is true for gas and electric.  The access to the property may look like a road but it may, instead, be a drive-way that will need to be improved road standards before you are allowed to build on your lot. 

Finally, are there covenants, codes and restrictions on the property?  Even if they are forty years old and by all appearances have been violated numerous times over the years, read them carefully.  There is always a pesky neighbor who may not like you building on that vacant lot they’ve used as open space for several years.

So You Want To Buy a Piece of Land

by Connie Yoshimura

It looks good. Has tall trees. Even a view of the mountains and a peek-a-boo view of the inlet.  But, what else do you need to know? First, does the current zoning allow for what you want to do with the property.  Whether it is a potential tract for a new subdivision or an already platted lot, there are zoning restrictions that run with the parcel. You may want to build a triplex but the zoning only allows for a duplex. To build the triplex, you would need to rezone the property which would require a rezone application to the Planning and Zoning Commission for approval as well as to the assembly which has the final approval for all rezones. That process can take anywhere from six months to a year depending on the complexity of the rezone and the schedule of P and Z and the Anchorage Assembly. 

Soils may look good initially with natural vegetation but we all know looks are deceiving so the careful buyer will want to have some test holes dug and the sample soils evaluated by professional engineers. Whether building a subdivision with roads/water/sewer or buying a lot to build a new home on, test holes can give you a good idea of the excavation costs and costs for the haul off of bad soils and the haul in of dry gravel. These extra costs do not add appraised value to the vertical structure you are planning on building. Are the easements for gas and electric on the front or back of the lot? Easements constrain placement of the structure. You also  want to make sure you have the appropriate square footage available for your footprint. No more than 30% of a lot can be utilized for a two-story home and no more than 40% for a ranch. That lot coverage ratio includes porches and garages. 

There are a number of infill vacant lots in Anchorage, particularly in the older parts of Anchorage. However, in most instances, water and sewer pigtails are not thru the right-of-way and so a buyer will need to tear up the street to connect to the water/sewer main. Even if by chance, the pigtails were extended through the right-of-way, they will most likely not be the right size or type material and will need to be replaced. Another cost that does not add value. 

Will there by ‘off-site’ costs that you will have to pay to develop the property? Off-site costs can include a requirement to pave alleys which are common in older neighborhoods like South Addition and Mountain View. A neighbor may have water/sewer to his property but that doesn’t necessarily mean the main has been extended to your lot line. The same is true for gas and electric. The access to the property may look like a road but it may, instead, be a drive-way that will need to be improved road standards before you are allowed to build on your lot.  

Finally, are there covenants, codes and restrictions on the property? Even if they are forty years old and by all appearances have been violated numerous times over the years, read them carefully. There is always a pesky neighbor who may not like you building on that vacant lot they’ve used as open space for several years.

Live. Work. Play. In Downtown Anchorage.

by Connie Yoshimura

Is it a myth or reality that Anchorage citizens want to live downtown? According to the new housing report published this week by the Anchorage Economic Development Corporation “millennials to seniors, want to live close to downtown and in smaller-scale housing.” The AEDC 2018 housing survey composed of 1,114 individuals with a slight over representation of seniors, with 15.7 percent of respondents being over the age of 65. Sixty-three percent of respondents were married or part of a domestic partnership while 18% of respondents said they lived alone. Seventy-three percent of respondents had a minimum of a bachelor’s degree and forty-five percent had a minimum income over $100,000

This survey is an excellent snap shot of downtown buyers—affluent, older and well-educated with a smattering of sophisticated millennial buyers who frequently have migrated north to Alaska from lower 48 urban areas. According to the survey, 83% of respondents preferred a one level single family home while 64% would prefer a single level multi-level home. Forty-eight percent said they would consider living in a townhouse or condo.    

Although Anchorage citizens overwhelming prefer to live in a single family home, a recent change to the Title 21 land use ordinance created accessory dwelling units in an R1 single family zone. According to a recent MOA official, only ten such permits have been issued since the ordinance took place and only 18% of respondents are interested in living in an ADU. Senior housing, apartment living and micro-housing also fell well below the 20% level of interest. Yet, Anchorage planning officials continue to press and encourage higher density development, including mixed-use development which is retail on the first floor with three or four stories of apartments above. Only 9% of residents want to live in an apartment complex with six or more units.

One builder in Anchorage, Hultquist Homes, has made a commitment to lower density development in downtown Anchorage. Since 2009, Hultquist Homes has built, is building or committed to building over 40 housing units, including townhouses, duplex flats, lofts, small single family condos and luxury one level units about to come out of the ground on Coastal Place, directly behind Petersen Towers. These new housing units begin as low as $350,000 upwards to $1 million plus. It’s a commitment to the redevelopment of downtown Anchorage and the Live. Work. Play initiative that I am proud to be a part of. These homes are being built without subsidies or tax abatements that are frequently provided to larger residential developments which according to its own AEDC report, less than 50% of respondents want to live in.  

For more information on downtown properties for sale, contact me at 907-229-2703. I look forward to hearing from you.

Live. Work. Play. In Downtown Anchorage.

by Connie Yoshimura

Is it a myth or reality that Anchorage citizens want to live downtown? According to the new housing report published this week by the Anchorage Economic Development Corporation “millennials to seniors, want to live close to downtown and in smaller-scale housing.” The AEDC 2018 housing survey composed of 1,114 individuals with a slight over representation of seniors, with 15.7 percent of respondents being over the age of 65. Sixty-three percent of respondents were married or part of a domestic partnership while 18% of respondents said they lived alone. Seventy-three percent of respondents had a minimum of a bachelor’s degree and forty-five percent had a minimum income over $100,000

This survey is an excellent snap shot of downtown buyers—affluent, older and well-educated with a smattering of sophisticated millennial buyers who frequently have migrated north to Alaska from lower 48 urban areas. According to the survey, 83% of respondents preferred a one level single family home while 64% would prefer a single level multi-level home. Forty-eight percent said they would consider living in a townhouse or condo.

Although Anchorage citizens overwhelming prefer to live in a single family home, a recent change to the Title 21 land use ordinance created accessory dwelling units in an R1 single family zone. According to a recent MOA official, only ten such permits have been issued since the ordinance took place and only 18% of respondents are interested in living in an ADU. Senior housing, apartment living and micro-housing also fell well below the 20% level of interest. Yet, Anchorage planning officials continue to press and encourage higher density development, including mixed-use development which is retail on the first floor with three or four stories of apartments above. Only 9% of residents want to live in an apartment complex with six or more units.

One builder in Anchorage, Hultquist Homes, has made a commitment to lower density development in downtown Anchorage. Since 2009, Hultquist Homes has built, is building or committed to building over 40 housing units, including townhouses, duplex flats, lofts, small single family condos and luxury one level units about to come out of the ground on Coastal Place, directly behind Petersen Towers. These new housing units begin as low as $350,000 upwards to $1 million plus. It’s a commitment to the redevelopment of downtown Anchorage and the Live. Work. Play initiative that I am proud to be a part of. These homes are being built without subsidies or tax abatements that are frequently provided to larger residential developments which according to its own AEDC report, less than 50% of respondents want to live in.

For more information on downtown properties for sale, contact me at 907-229-2703. I look forward to hearing from you.

 

Test Your Real Estate Knowledge!

by Connie Yoshimura

1. What is the average rent for a two 

bedroom apartment in Anchorage?

A.   $800     

B.   $1,000   

C.   $1,200

 

2. Does the landlord include utilities in 

the above rental amount?

 

3. What does a three bedroom single 

family home rent for in Anchorage?

A.   $1,849  

B.   $2,149     

C.   $2,349

 

4. What is Anchorage’s vacancy factor?

A.   6.2%       

B.   4.2%       

C.   7.75%

5. What is the vacancy factor in the Mat-Su Borough?

A.   7.3%           

B.   8.3%          

C.   4.6%

 

6. When my son or daughter grows up, I want them to earn a good living by becoming:

A.   Lawyer     

B.   Chef          

C.   Carpenter

 

 

7. Have Anchorage condos increased or decreased in value in 2018 and by how much?

A.   Increased by 3.2%     

B.   Decreased by 1.6%        

C.   Stayed the same


8. How many million dollar homes have sold in Eagle River in 2018?

A.   One     

B.   Three    

C.   None

 

9. How many have sold in Anchorage?

A.   Five         

B.   Eight          

C.   Twelve         

D.   Sixteen

 

10. Averages are only indicators.  Has the average sales price for single family homes increased or decreased recently?

 

11. What is the average sales price of a single family home in Anchorage?

 

12. How many single family building permits have been issued through August 2018?

 

13. What was the average price of a hillside lot that sold in 2018?

A.   $140,000      

B.   $185,000         

C.   $220,000

 

14. What is the largest issue facing the real estate market today?

A.   Lack of inventory         

B.   Affordability            

C.   Alaska’s aging inventory

 

Answer Key   1. C   2. Yes   3. B   4. A   5. A   6. C   7. B   8. C   9. D   10. Increased   11. $377,000   12. 114   13. B   14. All of the Above


Tell Us What is Special About the Place You Call Home

by Connie Yoshimura

Before I was a realtor, I was a writer.  Writing and reading has always been a part of my life.  Perhaps, it was because I had to learn the alphabet at a very young age in order to spell my name—Constance June Yoshimura. Over time, reading became a way of exploration new worlds as I read my way through the children’s section of the Andrew Carnegie Library in Wester City, Iowa. And, then, ultimately writing became a time for personal reflection and way of making sense of the world. 

 

As a young woman, the journey from Iowa to Alaska was awe inspiring. After all, Iowa didn’t have mountains, oceans or bears! My first home in Anchorage was an apartment on Barbara Street in Spenard. I’ve also lived on the hillside, east Anchorage, Petersen Towers and Campbell Lake. Each has provided many memories and offered an opportunity for personal reflection. Between everyone’s four walls there are always tears of joy and sadness. 

 

Today, I’m proud to announce Dwell Realty’s second annual creative writing contest for elementary school children with ‘Tell Us What Is Special About the Place You Call Home.” Last year, over 150 essays (some with hand drawn pictures) were submitted. I read every one. They were both heartwarming and heart breaking. If you know an elementary school student, please encourage them to submit an essay. The written word still remains one of the most influential tools of communication we have in our society.  

 

Eight winners and their teachers will each receive a $100 cash price presented at the Anchorage School Board meeting on October 22. I look forward to reading them all in the coming weeks.

A Perspective on the Anchorage Housing Market

by Connie Yoshimura

Despite Alaska’s three years of economic recession, the Anchorage housing market has remained stable with no noticeable decline in values except in isolated circumstances. So, unlike our neighbors to the south where both Portland and Seattle have seen recent rapid appreciation above 30%, Anchorage remains an affordable place to live with an average sales price of $365,000. Anchorage’s housing problem is not really affordability but rather what a buyer can purchase for the average sales price. Anchorage housing stock is aging and not like a fine wine which gets better with age. Seventy-five percent of our housing was built between 1970 and 1990 making it not just cosmetically but functionally obsolete.

The 1970’s was the decade of the split entry or the ‘breeder box’ as it was called by some. It had a small entry and a set of stairs going up to the living/kitchen area and two or three bedrooms. Down the stairs was a family room and extra bed/bath. Then came the more luxurious two story homes of the 1980’s which had a larger first floor entry with a nearby powder room for guests. These homes had a formal living and dining room on the first floor. The back of the home had a kitchen, breakfast nook and family room. Upstairs was three or four bedrooms. The oversized master bedroom became the parents’ hideaway and was frequently as large as 16 x 20. Over time, these homes grew in size from 2,000 square feet to over 3,000.  

The nationwide real estate recession of the 2008 to 2010 changed the way not only people thought about home ownership but how they wanted to live. Something changed in the American psyche and it was reflected in the homes that were built. Gone was the formal living and dining rooms. Instead, it became all one great room. Home offices became important as more people chose to work from home. So did flex rooms—that added extra space somewhere whether off the entry or a loft upstairs for a quiet space. The kitchen grew larger—even though food take-outs grew in popularity. The kitchen was no longer the heart of the home but the heartbeat. It was no longer a galley or U-shaped configuration but an open concept with a view of the entire first floor. And the islands grew even larger—whether bi-level, flat or curved, it was where the family gathered not just for meals but homework and storytelling at the end of the day. Paint colors changed along the way as well. From white to beige, to gray, to grayish and back to white again. Master bathrooms have become home spas and are almost as large as the master bedroom. Today’s spa bath no longer has a built-in jacuzzi or soaking tub but a sleek freestanding tub.    

The need for more car storage also grew over the decades from a carport in the 1960’s to the single car garage in the 70’s and the mandatory double in the early 80’s. The 90’s brought the big triple and many of today’s giant garages of over 1,000 square feet. Alaskans love their toys and not only do they want to ride, fly, kayak and fish but want to keep them covered in their own garage as part of their home. 

The August issue of Alaska Economic Trends has confirmed what we’ve known all along and that is home prices haven’t dropped during Alaska’s three year recession. However, they do have a good take on why that hasn’t happened. As previously discussed in their July issue, Alaska migration patterns with Anchorage at the epicenter has helped keep prices stable. Plus, some job losses, particularly in the oil industry, have been among nonresidents who don’t own homes in Alaska. If you’re a frequent flyer on Alaska Airlines chances are you’ve probably sat next to some of these itinerant jobbers who may live as far away as Florida and commute to and from the North Slope.  

Interest rates still under 5% for a 30 year fixed rate mortgage has also helped keep our market stable although I maintain the five basic reasons people buy and sell homes have nothing to do with interest rates but changing factors in an individual or family’s life. Those are marriage, birth, death, divorce and job change. Obviously job change is a dominant factor—both positive and negative as most buyers need a verifiable and steady source of income in order to qualify for a mortgage, although I am continually amazed at the number of cash sales that occur in all price ranges. Alaska has a lot of quiet wealth.  We are also seeing some equity extraction from the stock market as investors turn to real estate. With uncertain and changing economic policies, many investors, large and small, turn to the old time staple of real estate investing.

The report used the term ‘controlled’ building as one reason for our housing stability. “Controlled’ requires me to ask the questions of who and why is doing the controlling. I would not want to think this market is being deliberately controlled by forces unknown to me or others in our industry. Instead, we have a lack of home building due to the continued high cost of development, lack of land and an unwillingness of our local government to loosen the oversight requirements for vertical home construction and horizontal residential development which go far beyond the need for protective health and safety regulations. 

The reality is that our lack of new home construction is hitting a crisis point. The six month building report recently published by the MOA shows more than a fifty percent drop in new housing starts compared to last year’s six months report. Only 121 housing units were permitted compared to 300 in 2017 for the same time period.  That number includes permits for single family, duplex and multi-family. Less than one hundred single family homes were permitted.  Only twenty-eight duplex units and not one multi-family permit had been issued through June. Alaska’s population is projected to stabilize and may even have slow growth as a result of increased births. But, what happens if and when Alaska comes out of its three year recession?  Where will an influx of population or growing families live in Anchorage?  

Come Learn Everything there is to Know about Condos

by Connie Yoshimura

A condo can be a single family home, a flat or a side by side duplex.  You can’t always tell by looking at the structure what it is and how it is defined. Do you own the air space around the building or only the interior  space between the walls?      What is a limited common area and who maintains it? Who pays for water and sewer and what if a water pipe breaks in the building?  Is it your responsibility or the homeowner’s association? What is the responsibility of the HOA management company? Does your board of directors have insurance?  How to find out about upcoming special assessments before you buy a condo?

 

Find out answer the answers to these questions and more by  attending this Dwell Realty sponsored class “A Condo Is a Condo or Is It?  It’s open to the public  and if you’re a licensee will provide you with three hours of elective continuing education. I’ll be there along with Natalie Travers-Smyre who has over ten years of home owner’s association management experience and Jim McCollum, attorney at law.

  •     Friday, August 10th
  •     9 am - 12 pm 
  •     First American Title
  •     Breakfast Provided
  •     Free Admission!
  •     Sign Up Today 646-3600 

 

Call in your questions to the new INSIDE REAL ESTATE show on 650KENI every Thursday at 2 pm. This week we will be with Anita Bates talking about the various roles that the Alaska MLS, Board of Realtors & the Real Estate Commission  play in the real estate industry.

Displaying blog entries 1-10 of 210

Share This Page

Contact Information

Photo of  Real Estate
Dwell Realty
561 E. 36th Ave., Suite 200
Anchorage AK 99503
907-646-3600