Have you got a dream? I mean a gnaw-at-your-brain, tried-to-forget-it, leave-me-alone kind of wishful fantasy that fires your imagination some days, and tantalizes you with its out-of-reach nature on others.

Many of us here in the Northwest, in spite of having seen our share of liquid sunshine, are still drawn to the many lakes, streams, rivers, and salt water frontages that abound in our glorious corner of the world. There is something primal about the urge to live near water- it’s truly a gut level need for many.

I count myself among those who dream of waking to the sight of a sailboat bobbing at anchor outside my own front door, or stepping off the deck of my small fishing cabin, fly rod in hand, for a day on the stream. I alternate between these twin romances and honestly couldn’t choose between them if my life depended on it.

A former client of mine had a term for the dancing flickers of light refracted off water that define the essence of the waterfront experience: He called those flashes and sparkles “free diamonds”. I love the evocative image of that phrase, as it encapsulates for me the dream of finding a “hidden treasure” property, and the deep sense of satisfaction found in a day on the water.

In the quest to fill my own order for waterfront property, I’ve explored from the San Juan Islands to Western and Central Montana, and even looked into fishing properties in Idaho. Thus far, I’ve seen many that got my heart racing, but none that also fit the budget. Which of course is the challenge!

The best part of this adventure for me is the dream of what I might find. So, in the interest of showing some of the options, I’ve taken the liberty of developing a few lists.

As the old saw goes: “Location, Location, Location”, and nowhere in Real Estate is that more clearly illustrated than waterfront properties. A home on Lake Washington – say Hunt’s Point- could easily command a location premium for the dirt alone that would place total value well over $5,000,000. Similarly, Mercer Island waterfront homes are renowned for their stratospheric prices, and exuberant architecture. Parsing the area further, a North Mercer home is prized for it’s access to freeways and the greater Seattle area, vs. the longer commute times but greater privacy of mid- to south island locales.

Travel 2 hours North of Seattle on I-5, and a 40 minute ferry ride puts you in the San Juan Islands. My personal favorite is Orcas, with it’s laid back artist-colony sensibility, as well as offering the highest point in the islands (Mt. Constitution), where you can climb the observatory tower for a view that stretches to BC, and Bellingham. On a clear day, there’s no freer feeling than squinting across the glint of sunshine on whitecaps, and savoring the tang of salt air. Maybe that’s just my Alaska fisherman background talking, but I truly savor every moment spent at the water’s edge. Informal polls I’ve conducted lead me to believe I’m not alone in this.

Getting more down-to-earth, it is possible to find waterfront, or water proximity properties that are well within reach of ‘the rest of us’. Revisiting the old Location idiom again, there is a different cost: one of convenience. However, if you want privacy along with your slice of heaven, it’s a cost many of us are willing to pay. Frequently, the ‘hidden gems’ are on smaller lakes, tucked into out-of-the-way corners, or for the wanderers, the South West Coast of our fair state also offers some stunning saltwater frontage.

In the course of your search, you’re bound to trip over river frontage lots, as well. One caution to keep at the forefront with riverside land is the issue of flooding. While rivers make for great visual and audio, they sometimes don’t make the best neighbors. Remember, we live in the Northwest, and the past several years have seen some record precipitation – both in the lowlands and in the mountains. Even if the snow isn’t falling in your yard, it may end up there by spring! So, check with the floodplain maps, which will include a 100 year flood rating, which can be a pretty good indicator of your risk. Seemingly minor variations in terrain can make a significant difference in how a property is affected by flooding, so do your homework.

While I’m on the topic, it’s worth noting that every piece of property has an accompanying risk: being at sea level may put you in the way of a tsunami, rivers flood, lake drainages can become backed up, and also flood, and/or taint the groundwater. However, this shouldn’t be considered a reason to avoid water properties. With proper due diligence, you can mitigate the risk, and rest easy with your purchase.

As I’ve polished the waterfront dream, (with the growing realization that I’m not alone), I’ve wondered if the investment value justifies the pursuit. After all, it’s one thing to chase a dream, but if the long term value doesn’t hold up, it’s just an expensive wish. And I like the idea of a self-financing dream; I have enough hobbies to suck up my time and resources, but for once I’d love to have one pencil out in the black (at least in the long term). So, I’ve done a little research, and turned up some interesting anecdotal evidence that, at least so far as the tax assessor is concerned, waterfront property is its own reward.

But there’s more: it seems there’s an interest on the part of academics, to help our friends in the ‘Other Washington’ recognize the impact of water quality issues on property values. As you’d expect, regional factors can play a dramatic role in pushing property values up or down. In fact, I’d go so far as to say that waterfront is probably more sensitive to ‘micro-economic climates’ than landlocked properties; due to a generally cleaner and longer line of sight, it’s easier to see blemishes in a waterfront property. And as the above link indicates, even water clarity can have a significant impact on perceived value.

But what about actual value? With all the talk about declining housing markets, longer sale times, and financing woes, I’ve got to wonder just what all that pricing pressure is doing to my dream. If the prophets of doom are right, I should be in line to realize my hopes much sooner than expected. The logic being that all real estate follows the same trend line. With a few caveats, that’s generally true. The softer market is making it easier to negotiate on waterfront properties too, but there’s no fire sale. As they say, “They’re not making anymore waterfront” (except in Dubaii ). The scarce nature of waterfront property keeps a premium in place that seems nearly bulletproof, due to the fact that buyers who are able to take advantage of the softened market typically are generally better financially insulated from the daily economic news. And while they may be able to negotiate a price down somewhat, percentage-wise waterfront property is it’s own best hedge.

So, who’s buying up the waterfront? According to a report done last year on Canadian recreational properties, the aging baby boomer population represents the largest single demographic that will be snapping it up over the next 5- 10 years. While it may be too soon to say definitively if this trend is playing out similarly on our side of the border, or if it’s being affected by the current lending challenges, and market anomalies, I would be willing to bet that a similar statistic could be applied. After all, they’ve lived long enough to know a good thing!

Whether we are representing a buyer or seller, as Realtors it is our job to keep on top of what is going on in the mortgage industry. There has been a lot of press about the changes occurring within the lending arena, but even the news has a hard time keeping up with the extremely fluid nature of lending today. I think it would be safe to say that the mortgage brokers themselves have a real challenge in “knowing” what is going to happen from day to day.

First, let’s get this out of the way: “Zero Down” loans are no longer in existence. “No Income Verification/No Asset” (NINA) loans with small down payments have gone the way of the dodo bird and dinosaur. Fogging a mirror will no longer qualify you for a mortgage. While this makes getting a loan more difficult, perhaps it’s all for the best. Lenders actually should want to be sure that their borrowers can afford to pay them back. If you would like to hear a very interesting commentary on exactly how we ended up in this mortgage crisis, click HERE.

In fact, let’s not forget, it wasn’t all *that* long ago that 20% down was expected when purchasing. No fancy financing; just 20% down and a 30 year mortgage.

Does that mean you will need to have 20% down? And what about all those first time homebuyers? What can they do?

For the first time homebuyer there are still FHA programs out there that will allow as little as 3% down. First-time homebuyer or not, if a buyer isn’t in a position to put 3% down, they might want to explore a Gift Funds Program. The most common of these are known as Nehemiah and My Community programs, but they only apply if the seller agrees to pay 6% to the Gift Funds Progman and if the home qualifies for an FHA loan or a Conventional loan that allows gifts from charitable foundations. Considering that the FHA limit for the greater Seattle area is $567,500, these programs are realistic options for most buyers without large cash reserves. You can learn about these programs HERE.

Another often overlooked option is the USDA home loan. USDA provides very favorable interest rates and low down payment options, but there are limits, largely in regard to income and the “rural” location of the home. Loosely defined, a “rural” home in Snohomish County would be any home east of highway 9. You can learn more about USDA programs HERE.

So what if the purchaser or the home doesn’t qualify for FHA or USDA? There are still some programs out there where you can put down as little as 5%. In order to qualify for a loan with the minimal down payment, the borrower will have to provide full documentation of steady employment and all assets. And for the Self Employed, you can expect to have to put down at least 10%.

A good credit score will certainly help someone in search of the best rates and lowest down payment. If you haven’t done so lately, you may want to check your credit report to make sure there are no errors. Even if you aren’t considering a home loan in the near future, it is always a good thing to keep on top of what your credit report looks like. I have been using www.PrivacyMatters123.com and www.AnnualCreditReport.comto keep tabs on my credit score/report from the 3 reporting agencies. I’m sure there are many other online companies out there that can provide a similar service, so do your research.

Let’s not forget, probably one of the most important factors in getting a great home loan that fits your particular financial picture is to have a fantastic mortgage broker in your corner. With so many lenders and lending institutions dropping out of the industry, maybe you aren’t sure who you can call. No worries, just pick up the phone, call one of us at Pickett Street and we would be happy to refer you to lenders we know do a great job for our clients.

In short, the landscape has changed. It’s still possible to get a good loan with a good interest rate, but be prepared for the paper shuffle. Make sure you have your documentation ready, and if you’re thinking of buying a home in the next year, start putting money aside now.

Rare opportunity to own a top-floor, end-unit condo in the Wildemere condominium complex. Ample in light, this home has two large bedrooms including a master with walk-in closet and continental bathroom. Large galley kitchen has breakfast bar and opens to dining room with garden window. Living room has wood fireplace and access to balcony with additional storage area. No trips to the Laundromat – there is a washer and dryer in the unit, and like the rest of the appliances, they stay! Forced air heating and security system, all within walking distance to shopping plaza. Close to I-5 and Lynnwood Park and Ride.

UPDATE: Under contract after only 30 days on market!
UPDATE: Sold on 8/28/2008 for $180,250!

List Price: $175,000
MLS#: 28094972
Address: 4118 212th Street SW #C302, Mountlake Terrace, WA 98043
Bedrooms: 2
Bathrooms: 1
Square Feet: 926
$/Square Ft: $188.98
HOA Dues: $268 / month
Year Built: 1981
Taxes: $1,117 (2008 tax year)
School District: Edmonds

Listing Flyer: Click HERE (PDF – will load in new window).

Call Jesse Moore 425.876.0766, Lisa Bender 425.770.4438, or Dennis Pearce at 206.931.9945 for more information.

I just returned from a trip to my hometown, Miles City, Montana. A friend of the family’s had just made an offer on a home, which they had come across thanks to the ability of their agent. In Miles City there is no MLS as we know it, no catalogue of listings, either bound or online. There are only a few websites with listing information, and these are not comprehensive. Things truly are done more word of mouth around here, which means that if a consumer wants information on a home for sale, going online isn’t going to help them.

This obviously isn’t the case for us in the Puget Sound. Not only can we not find a single-family residence on four city lots for $92,000 (as my family friend did), but new listing information is available on several thousand websites. Since most of the general information is the same on all of these sites, the real issue involves usability: which site is the most intuitive? The least invasive? The most informative? The fastest?

Which brings us to PickettStreet.com. After months of comprehensive searching , we came across the holy grail in the property search engine realm. The solution we had found spent years incubating in California, where agent and consumer feedback had evolved the technology to a form well beyond anything we had seen in the Northwest. When we came across them they were in the process of coding their tool for use in our local NWMLS, with aspirations to roll out at the first of 2008.

We also began to make preparations. As badly as we wanted this technology, we couldn’t use it without our broker’s involvement, and it was about four times more expensive than their current, but inept, search property tool. Without our broker’s blessing, we had to decide how important this tool really was for us – securing the search tool would mean that we would have to leave our brokerage. There was the cost of the technology alone, never mind the additional expense of all the new signs, business cards, and other marketing materials already developed.

Like any good committee, the Pickett Street Team members spent some time in “analysis paralysis.” Cost vs Reward ratios were speculated, redacted, and redrawn on almost a daily basis. In the end, and perhaps on a caffeine high, we decided that we are responsible for our own success, and those that fail to adapt are bound to fail. So adapt we did.

We left our brokerage and signed on with Keller Williams Realty in Bothell, where they encouraged us to spearhead the transition to the new property search tool. The new Pickett Street Property Search is now up and running, and we’re winning advocates every week. The new search engine not only allows visitors to conduct map-based searches, but it also allows you to enter in your search criteria and save the search. The search engine will then email you new listings that match your search as they come on the market – no more sorting through a few hundred listings that you’ve already seen to try to find your elusive dream home that just came on the market today. The new tool also loads on one page, so even if you do have a slower internet connection you aren’t going to be brewing a new pot of coffee while the results load on the next page. Visitors also have the ability to view larger, multiple pictures of each listing, which load in a slideshow upon selection.

Curious about the neighborhood you’re shopping? Our mapping tool will give you neighborhood statistics – from average size of home listed for sale, average size of lot listed for sale, to population density and the crime index for the area. If you happen across a listing that you might want to look at again, you can save the listing as a “Favorite”, and it will be available to you on your next visit to our website. And perhaps one of the more advanced features of the site allows you to chat with one of us at the click of a button, allowing you to have almost immediate answers to any questions you might have about a listing.

There are many more features that we encourage you to uncover on your own. What we want you to know is that we’re adapting and advancing for the benefit of our clients. Try out our new Pickett Street Property Search tool to look for your next home, to keep tabs on your own neighborhood, or just to see what we’re up to. In the meantime, tell all of your friends that there’s a new Search Tool in town! If you need an opening, tell them they could buy a home on four city lots for $92,000 in Miles City, MT. Opportunities like these exist in every market – PickettStreet.com just makes it easier to find them.

Click HERE to check out the new property search for yourself.