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Connie Yoshimura

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Displaying blog entries 11-20 of 246

Anchorage Lacks Multi-Family Housing

by Connie Yoshimura

National home ownership rates fell in the second quarter of this year, according to a recent report in the Wall Street Journal.  The  rate is currently 64.2%, down from 64.3% a year ago.  Here in Alaska, the most recent statistic shows home ownership rate at  63.7%.  That’s a slight increase from the 2017 rate of 63.5% but still below the national average. 

 

But here’s the bad news.  Anchorage’s home ownership rate is only 60.1%--well below the national and state ownership rate.  What exactly does this number mean?  Anchorage has a population of 291,538.   Therefore, assuming the statistics are correct, there are 116,324 residents who do not own their own home in Anchorage.   So where do they live?  They are renting an apartment or room, sharing a single family home or doubling up in some way  or are even homeless.    

 

People tend to rent when there is instability in an economy—whether on a national and/or local level.  Although Alaska is a wealthy state our inability to adequately and effectively  govern our financial and natural resources has a recurring and negative impact  on our  low ownership rate.  Unfortunately, even low mortgage rates hasn’t moved the needle to  increased home ownership. 

 

Adding to our growing housing problem is the lack of newly constructed multi-family housing.  Over 82,000 of our multi-family units were built between 1990 and 1960.  Even the ones built in the 1980’s are now almost forty years old!  And it wasn’t until 1992 that new building codes began to recognize the need for more energy efficiency. These older units add to the renter’s cost for electricity and home heating.  Many are beyond repair by landlords who lack the knowledge or financial capability to bring them up to a standard of acceptable living conditions.

 

But from 2014-15, there were only  668 multi-family units permitted.  From 2016-2018 that number declined by over 30% to just 400 units.  I would be curious to know if these numbers actually replace the units damaged or destroyed by fire and earthquake.   Much of that decline is also a result of the Title 21 rewrite which required new design restrictions for multi-family units.  Few developers can afford the time and consulting hours to work their way through the 836 single spaced pages of restrictions and requirements for a new build. 

Anchorage needs a reset of its priorities.  We are beginning to look like a worn out community and can no longer hide behind hanging baskets and bike paths.  That beautification is only skin deep.

 

Visit me on Saturday in Heather Wood and Sunday  in WestGate from 1-4 pm or email me with comments and questions at [email protected] 

Take this Real Estate Quiz!

by Connie Yoshimura

1. The cost of living in Alaska has increased by

A.  3%      

B.  4.2%     

C.  Decreased by 1%

 

2. What are the major components of cost of living?

A.  Medical

B.  Transportation

C.  Housing

D.  Energy

 

3. Housing is the largest expenditure for the average Anchorage household.

A.  True

B.  False

 

4. What was the average sales price of a single family home in June 2019?

 

5. According to MLS records, this was the highest average monthly sales price since January 2011.

A.  True

B.  False

 

6. How many single family homes in all price categories were for sale in June 2019?

A.  858

B.  958

C.  1038

 

7.  Is this inventory higher or lower than June 2018?

 

 

8. Has the number of residential sales for the fist six months of 2019 increased or decreased compared to 2018?

A.  Increased by 7%

B.  Decreased by 7%

C.  Remained the same

 

9. Over the past 13 months, on average how many million dollar homes sell in one month?                         

A.  Less than one

B.  One

C.  More than one

 

10. How many homes sell between $400,000 and $500,000 in one month?

A.  20

B.  15

C.  36

 

11. Is the average sales price of an Anchorage condo increasing or decreasing?

 

12. What is the average sale price of an Anchorage condo?

 

13. Name three reasons why you should buy a condo?

 

14. Identify three ‘hot spots’ in the Anchorage market where those MLS districts have beat the average market stats?   

 

15. Including single family, duplex and multi family, how many housing units were permitted through May 2019?

A.  150

B.  250

C.  350

D.  More than 350

 

 

Answer Key: 1. A  2. All of the Above   3. True   4. $390,000   5. A   6. A   7. Lower   8. B   9. C   10. C   11. Increasing   12. $228,195

 13. Excellent Rentals, No Yard Work, Increase in Value   14. Girdwood, DeArmoun/Potter and Spenard   15. A

A Look Back at the 2019 Housing Market

by Connie Yoshimura

The cost of living in Alaska has increased by 3% according to the most recent Alaska Economic Trendsreport. The cost of medical, transportation, energy and housing all contributed to the increase with housing being the major factor. So it’s no surprise that the average sales price for a single family home in June reached $390,000, the highest price from the MLS tracking report since January 2011.  

June 2019 also saw more than a 10% drop in available inventory from the prior year—858 compared to 958 homes so it’s no wonder buyers remain frustrated in finding a new home. Lack of inventory being one reason sales have decreased 7% during the first half of this year.  For the month of June, 36 homes sold between $400,000 to $500,000. Million dollar homes sold on average 1.4 per month over the past thirteen months which remains a surprisingly strong number.

Location plays a significant part of where sales occur. Three locations where sales have bested the prior year include DeArmoun/Potter Marsh, Spenard and Girdwood. Spenard is considered a revitalization neighborhood, particularly with the curvy new Spenard Road with attractive new landscaping (let’s hope the MOA keeps watering it during their heat wave). Spenard is organically the arts and crafts community rather than Mt. View, despite all the public and private money invested in Mt. View. Girdwood is a happening place with contemporary new homes either as second homes or year round retirement residences. And why not?  it has recreational facilities and gourmet dining, including Jack Sprat, and the Bakery as my favorite breakfast spot with its homemade orange marmalade, sour dough pancakes and that dreamy breakfast roll with a touch of orange zest. FYI, you can buy a quart of that orange marmalade and take it home for morning toast.

Southeast Anchorage continues with its popularity both in new construction and the resale market. Huffman Timbers has less than a handful of lots/homes to sell and Hultquist Homes just purchased Bruin Park, on the west side of Lake Otis between O’Malley and Huffman. It has a total of 19 lots with an approved plat already in place and horizontal construction to start early fall. These lots are larger and wider than the remaining lots in the Terraces and Huffman Timbers. But the May builder report still falls way below what’s needed for new housing starts with only 78 single family permits, albeit it is up 6 units from last year. Duplex units have doubled, an increase to 30 units vs. 14 for the same as last year, thanks to the continued growth of WestGate, a popular duplex condo development in southwest Anchorage with ranches and two-story homes.

So that’s the recap for the first six months of this year. It’s hard to predict about ‘tomorrow’ for all the pros and cons over the governor’s vetoes and the state budget woes. But having listed/sold/developed housing during the last two economic downturns over the past thirty years, all I can say is smart investing starts now, particularly with mortgage rates hovering in the 3.5% range and FHA/VA rates even lower, making first time home buying a real opportunity.

Older Alaskans Need More Ranch Homes

by Connie Yoshimura

Alaska’s senior population is growing.  According to Alaska Economic Trends, Alaska has an estimated 87,304 seniors, up from 54,938 eight years before and more are on the way.  Anchorage/Mat-Su added more than 17,000 seniors, representing over half the state’s overall increases.  The report goes on to identify many seniors as well-educated boomers who arrived in the 1980’s and have made Anchorage and Alaska their permanent home. Nearly one in four live alone and 57 percent of those are women.   Eighty-two percent of Alaska seniors live in owner-occupied homes compared to 64% of Alaskans.  Home ownership is an important part of their well-being and lifestyle. An interesting note is seven percent live with grandchildren and about two percent are responsible for their care.

 

The challenge for our housing market, however, is what type of housing is available for them to age in place.  Even the fifty plus year olds I meet at open houses worry about climbing stairs to bedrooms because of their hips and knees.  More buyers are asking about a two-story home with a first floor master, a hillside ranch or a smaller ranch home.  Large lots no longer interest them due to the time and expense of lawn care.  These buyers prefer new so that there is not the unexpected cost for roof, furnace, hot water heater replacement, et cetera. They also recognize the benefits and savings of Alaska’s five star energy rating for new homes because they most likely live in a four star home built in the 1980’s. 

 

In 2018, 2776 single family homes sold in Anchorage and Eagle River and l5% or 440 were single family ranches.  I found that number hard to believe but trust me, we double checked it.  The average price was $252,000.  But, here is the problem.  Today’s new construction ranch  home has a median price of $450,000.  The majority of them are located in the Eagle River/Chugiak area where land is more available and, thus, prices slightly lower lot costs. If Anchorage wants to keep its older population, we need to increase the maximum 40% lot coverage ratio that currently exists in Title 21.  Smaller lots with increased lot coverage ratio for single family ranch homes will bring the cost of home ownership down for Anchorage’s senior citizens. 

So Why Buy a Condo?

by Connie Yoshimura

 

Because you won’t need a lawn mower! Or a snow shovel! Exterior maintenance and lawn care are done for you by the Homeowner’s Association and property management company. Yes, there is a fee for all that worry free living, that ‘lock and leave’ mentality but it’s a small price to pay for your freedom from every day outdoor maintenance. I hear those comments more and more from boomers but also from many millennials who would prefer to climb flat top on a sunny afternoon than mow the lawn.   

And now is a good time to buy a condo. It is one area of the market that has held steady over the past two years for sales and average price.  One reason for that stability is because there have been very few new rental properties built since the last real estate recession of 2008. Plus, the majority of Anchorage’s apartments were built between 1970 and 1990 and unless you own hundreds of units like one or two investors do, most small investors who own a four-plex struggle to keep up with maintenance and repairs let alone cosmetic renovations. So, for buyers a brand new condo looks very attractive with white cabinets, wood laminate or vinyl plank flooring and painted white trim with lever door handles. Plus it’s more energy efficient with lower utility bills. Many older apartment owners require tenants to pay for their own gas and electric so the increasing costs for utilities adds to their average $1,250 per month rent for a two bedroom, one bath flat.  Might as well buy something brand new that will hopefully appreciate in value while creating a more attractive and carefree lifestyle.

The average sales price of a condo is $203,113 according to the June MLS statistics. That price is a 3.35% decline from last year’s $209,116, making it a good time to invest. So how much does it cost to buy one of these condos?  FHA offers a 3% down payment. On a $205,000 condo that’s $6, 150. And some builders, looking to get rid of their summer inventory before putting in fall foundations, are offering as much as $8,000 in closing costs.

Today’s 30 year fixed mortgage rate is as low as 3.50%, depending on your credit score. That makes a buyer’s payment your payment as low as $1,543, including principal, interest, taxes, insurance, and condo dues which will cover some of your utility costs. Hardly any more than what a renter pays for a a 30 year old apartment! And it’s fresh and modern! 

Entry level condos are a worthwhile investment at today’s value, whether as a first time buyer or as a modest investment. Inflation, tariffs are all going to pull up condo prices. Smart buyers buy at the bottom of the market. And you won’t have to buy a lawn mower!     

So Why Buy a Condo?

by Connie Yoshimura

Because you won’t need a lawn mower! Or a snow shovel! Exterior maintenance and lawn care are done for you by the Homeowner’s Association and property management company. Yes, there is a fee for all that worry free living, that ‘lock and leave’ mentality but it’s a small price to pay for your freedom from every day outdoor maintenance. I hear those comments more and more from boomers but also from many millennials who would prefer to climb flat top on a sunny afternoon than mow the lawn.   

And now is a good time to buy a condo. It is one area of the market that has held steady over the past two years for sales and average price.  One reason for that stability is because there have been very few new rental properties built since the last real estate recession of 2008. Plus, the majority of Anchorage’s apartments were built between 1970 and 1990 and unless you own hundreds of units like one or two investors do, most small investors who own a four-plex struggle to keep up with maintenance and repairs let alone cosmetic renovations. So, for buyers a brand new condo looks very attractive with white cabinets, wood laminate or vinyl plank flooring and painted white trim with lever door handles. Plus it’s more energy efficient with lower utility bills. Many older apartment owners require tenants to pay for their own gas and electric so the increasing costs for utilities adds to their average $1,250 per month rent for a two bedroom, one bath flat.  Might as well buy something brand new that will hopefully appreciate in value while creating a more attractive and carefree lifestyle.

The average sales price of a condo is $203,113 according to the June MLS statistics. That price is a 3.35% decline from last year’s $209,116, making it a good time to invest. So how much does it cost to buy one of these condos?  FHA offers a 3% down payment. On a $205,000 condo that’s $6, 150. And some builders, looking to get rid of their summer inventory before putting in fall foundations, are offering as much as $8,000 in closing costs.

Today’s 30 year fixed mortgage rate is as low as 3.50%, depending on your credit score. That makes a buyer’s payment your payment as low as $1,543, including principal, interest, taxes, insurance, and condo dues which will cover some of your utility costs. Hardly any more than what a renter pays for a a 30 year old apartment! And it’s fresh and modern! 

Entry level condos are a worthwhile investment at today’s value, whether as a first time buyer or as a modest investment. Inflation, tariffs are all going to pull up condo prices. Smart buyers buy at the bottom of the market. And you won’t have to buy a lawn mower!     

How 'Silly' is This?

by Connie Yoshimura

The photo below is an example of the current required driveway width in residential single family subdivisions.  According to Title 21: Land Use Planning, page 7-133, the “total width of driveway entrances to a residential lot from a street shall not exceed 40 percent of the frontage of the lot or 33 percent of the frontage if the platting authority or traffic engineer finds that conditions warrant it”.  

The intent of these limitations is to provide adequate space for snow storage within the right of way, to have space for on-street parking where appropriate, and to discourage the majority of the front area of a lot from being paved and/or used for vehicle parking.”

All this sounds reasonable until it’s put to an on the ground application. For example, under these regulations a fifty foot wide lot is allowed only a 20 foot wide driveway.        Most garages for new homes are a minimum of 22 feet wide which thus requires an indentation at the street curb and property line as seen in the photo in order to be compliant. Driveway width compliance on cul-de sac lots which are very popular with home buyers is even more challenging.  Many of these lots have only a 30 or 40 foot street frontage. Accordingly, the driveway at the mouth of the street can only be twelve or 16 feet wide.  

Although unattractive, builders have found a clever way around this requirement which allows them to widen driveways to the width of the garage.  But, unfortunately, the frustrated homeowner ends up with the problem. Some owners elect to pave the area after the certificate of occupancy has been issued; other fill in the space with gravel or lawn.  They cannot, however, add trees, shrubs or rocks because that prevents the snow plow from doing its job.  The final result of this requirement is an unattractive streetscape as well as traffic congestion in cul-de-sacs.     

Covenant, codes and restrictions for a subdivision can easily address the ‘parking lot’ appearance resulting from wide driveways used for car storage.  They can also address on-street parking restrictions.  This policy, although well-intended, is an overage of MOA requirements and has done the opposite of its intended purpose which was to create a more attractive street scape in new home communities.  

The idea of appealing to the platting board or the traffic engineer is not a reasonable alternative for a builder or individual homeowner as it creates time delays and extra costs in an economic environment that continues to face increasing material and labor costs for new homes.

Take This Real Estate Quiz

by Connie Yoshimura

1. MLS reports that sold volume, when compared to last year at this same time is

A. Up by 10%

B. Down by 13%

C. About the Same

 

2. Over the past five years has the 

average sales price

A. Increased by 8%

B. Decreased by 2%

C. Remained Unchanged

 

3. How many homes over $800,000 have sold in the last 16 months?

A. 28       B. 48       C. 68

 

4. MLS active inventory for the first four months of 2019 compared to 2018 has

A. Increased by 128

B. Decreased by 128

C. Stayed the same

 

5. For the same time frame, sales have 

A. Decreased by 77

B. Increased by 77

C. Stayed the Same

 

6. In the last six months, identify three events that have influenced the 

Anchorage housing market 

 

7. In the last six months, the final sales price is what percent when compared to original list price for single family?

 

8. How would you describe condo sales when compared to last year?

A. Stable     B. Declining     C. Increasing

 

9. Why are condos the best buy in today’s market?

 

10. What is the difference in value between a brand new 2,000 SF home and a resale built between 1975 & 1990?

 

11. What is the value of a brand new single family lot with public water/sewer and on a publicly dedicated municipality maintained road?

 

12. How many single family homes were built in 2018?

A. 193       B. 243       C. 293

 

13. How many housing units, including all housing types, does the MOA report they need built per year?

 

14. Name three new single family subdivisions

 

15. Name the top three home builders in Alaska

 

16. Should sellers remodel their kitchen and bathroom before putting their home on the market?

 

17. Identify the top real estate brokerages in Alaska


Answer Key: 1. B   2. C   3. B   4. B   5. A   6. Government Shutdown, Earthquake, State Fiscal Dilemna   7. 94.5%   8. A   9. Excellent Rentals, Valued Below Replacement Cost   10. $50,000 - $75,000   11. $140,000 - $180,000   12. A   13. 900   14. Braendel Creek, Mountain Meadows, Heather Wood   15. Owner Builder, Spinell Homes, Hultquist Homes   16. No   17.  Keller Williams, Re/Max, EXP, Jack White, Real Estate Brokers, Herrington and Company, Dwell Realty


A Mother’s Day Thank You

by Connie Yoshimura

This Mother’s Day has given me pause to thank all the mothers who work at Dwell Realty. I am not a mother except to two poodles, Hapa and Peaches. They require feeding, bathing, walking, grooming and playful attention. But, I’ve been free to work long hours without worrying about child care and missing teacher meetings, dance recitals or basketball games. I have great respect, if not always empathy, for the women in my office who succeed in balancing all of those family needs while still doing exemplary work that continues to make Dwell Realty a success. So on this Mother’s Day, THANK YOU Becky Baird, Carole Marvel, Janis Tolbert, Debbie Moore, Anna Sovitsky, Andrea Senn, Jennifer Bohannon, Katie Adkins, Maggie Gray, Rowena Pediangco, Shelly Vogel, Starr Marsett, Teri Hensel, Trina Kindred, Janet Daley, Ruth Barndt, Pat Robinson, Andrea Gribbin, Tammy Stewart, Elizabeth Heynen, Lindsey Johnson, Silvia Engeloch, Natalie Travers-Smyre, all women Dwell realtors who are mothers.


According to national statistics women make or influence between 85 to 92% of all home buying decisions so it’s a natural fit that more women are realtors than men. It also explains some of buyers wants and needs when it comes to making a home purchase.  Is it any wonder that on top of the wants and needs list is a big laundry room instead of a washer/dryer stuck in a hall closet? Women also want mud rooms with shelves and hooks. Forget the bi-fold doors because they just get in the way. A mother with children wants four bedrooms up when they are young but once they become teenagers, mothers start shopping for a basement or flex room above the garage.

 

For many, the type of plan takes precedence over quartz countertops in the master bathroom or the free standing tub. Women tend to focus more on the inside of the home and how the family can relate to one another. A good example is the open kitchen/great room concept and the big kitchen island where kids and parents gather for meal prep at the end of the day. Over the past five years that kitchen island has grown to over seven feet in length. I can remember when it was no bigger than a large cutting board!

 

More and more families are ‘blended’ and/or multi-generational which creates the need for flexible spaces and privacy corners. One area of the home which has actually shrunk is the master bedroom. Some of that space has changed into an open loft or a larger master bath with separate his and her vanities.

 

Women care more about how it feels inside rather than how it looks on the outside. I don’t know many women buyers who want a 1,000 square foot garage or a roof over the deck so that they can BBQ rain or snow. But more on men’s wants and needs on Father’s Day. So for now, Happy Mother’s Day to all women who fulfill the multi-faceted role of motherhood.

 

How to Avoid Higher Property Property Taxes in 2020

by Connie Yoshimura

In a recent ADN  article, city officials stated that without any continued  state assistance to help pay down school bond debt, single family property owners could expect an estimated $630 property tax increase on a $350,000  home.  Already that home has a $5,740 tax which is 1.64% of its estimated value. An increase of $630 will raise that to 1.82 percent. According to a Multiple Listing Service report dated April 4th, 2019, the average value of a single family has declined by 6.14 percent so far this year when compared to the 2018 average.  Adding an additional tax burden on residential property owners at this time is a sucker punch.

 

Buyers qualify for a mortgage based upon their ability to pay for a fixed mortgage amount including principal, interest, taxes and insurance. Depending on their debt ratio and credit, anywhere from 25 to 40% of their gross income can be calculated as qualifying for the mortgage. Six hundred and thirty dollars divided by twelve months is an additional $52.50 per month in taxes but a prospective buyer would need to make approximately $200 more a month to qualify for the same purchase price.   


Higher property taxes are a national trend, according to ATTOM data solutions which analyzes national property taxes, so Anchorage is not alone in its dilemma. U.S. property taxes levied on single family homes in 2018 increased four percent. But, the average property tax was only $3,498. New Jersey, Illinois, Texas, Vermont and Connecticut posted the highest property tax rates so we should be happy we live in Alaska. My favorite vacation spot, Hawaii, had one of the lowest and Honolulu had only a 0.36 percent increase.

 

However, the Municipality of Anchorage is unique because unlike most of the communities identified above, we have no sales tax, not even a seasonal one. All other Alaskan boroughs, with the exception of Fairbanks, have a sales tax which varies from 2.5% to 7%.  Is it any wonder then that our state legislature and administration wants to cut the MOA revenue stream?

 

Residential and commercial property owners share too much of the cost of Anchorage’s operating budget. The majority of the MOA’s revenue comes property taxes. When you travel to the lower 48, your destination is not determined by the amount of the local sales tax. Total visitor industry spending in 2017 was $2.2 billion in Alaska. Granted, that’s state wide and includes air and ferry travel. However, a 3% seasonal sales tax from May to October would help generate revenue to give all property owners some relief from their disproportionate  contribution to Anchorage’s $526 million operating budget.      

Displaying blog entries 11-20 of 246

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