Seattle Bubble

There’s lots of blah, blah, blah going on about the latest Street of (Materialistic) Dreams, where every-day commoners like you and I can pay $18 to tour a bunch of over-the-top abodes. The local press seems to have stars in their eyes, and spends most of their time talking about all the low-flow toilets, and Energy Star-qualified appliances and how isn’t it just marvelously eco-friendly that the 4,000 square foot homes are “built green.” Bo-ring.

In a bit of a twist, let’s ignore this year’s dog an pony show, and take a few moments to go back to 2006’s Street of (Materialistic Pink Pony) Dreams, which I actually had the misfortune of personally attending. The first thing that comes to mind when I recall walking through these homes was the surprisingly cheap feel of the finish work. We visited near the end of the run, so by this time, thousands of people had traipsed through the halls of these houses, opening and closing every door and cupboard more times in four weeks than would usually be experienced in a year. In a way it was like an accelerated wear process. Closet doors were jamming, knobs were loose, hallway doors didn’t sit quite straight… in general it was quite unsightly. Plus there were a number of things that didn’t even have to do with wear, such as poorly-painted trim lines and wood trim that didn’t quite match up correctly. I’m sure that they went back through the homes after the tour dates were over and fixed most of these things, but seeing them near the end of the tour was like getting a preview of what things would look like after five years of normal use. For multi-million-dollar mansions, you think they would have sprung for better hinges and rails.

Another thing that struck me as odd was the wine cellars. Not that the houses had wine cellars at all, but just how ridiculously huge some of them were. In the house with the largest wine cellar (Hillcrest Farm), I estimated that there was space for 1,646 bottles of wine. Is it just me, or does that seem a bit unnecessary, even for the Street of (Materialistic Uber-Excess) Dreams?

Also amusing were the houses that had “secret” doors to hidden rooms. I personally think that hidden rooms and secret doors are fun, but wouldn’t the kind of person buying a $3,000,000 home be a bit above such trifles? Besides, what is the point of a secret room when it’s been on display to the (entrance-fee-paying) public for four weeks? Not very secret anymore.

Here’s a random review of the six featured houses from last year’s Street of (Materialistic Gluttonous) Dreams, including square feet, sold status, price, and # of TVs in the staged house.

Verandah Bay
Size: 7,150 sqft on 6.89 acres
Status: Sold October 2006
Price: $3,625,000
Buyer(s): Christopher Wilcox
# of TVs: 8

Kensington Manor
Size: 6,110 sqft on 5.00 acres
Status: Sold May 2007
Price: $3,575,000
Buyer(s): Duane & Heather Baker
# of TVs: 6
Other notes: Builder still listed as the taxpayer. Possibly due to recency of sale?

The Retreat
Size: 9,000 sqft on 5.05 acres
Status: Still Unsold, on the Market
Price: $5,695,000 (asking)
Buyer(s): N/A
# of TVs: 17
Other notes: This was the most extravagant home in the show (pictured above), with an enormous pool, a “secret cave,” and a huge outdoor entertaining area. The builder (Parmenter Homes) is stuck paying $42,000 per year in taxes until they can unload this beast.

Casa Montecito
Size: 6,950 sqft on 5.15 acres
Status: Sold April 2007
Price: $3,400,000
Buyer(s): Scott & Kelly Bingham
# of TVs: 4
Other notes: Builder still listed as the taxpayer. Possibly due to recency of sale? Pictured at right.

Hillcrest Farm
Size: 7,220 sqft on 5.46 acres
Status: Still Unsold, on the Market
Price: $4,395,000 (asking)
Buyer(s): N/A
# of TVs: 9
Other notes: The builder (Design Guild Homes) is presently stuck paying $43,000 per year in taxes on this one. Pictured below-right.

Twin Cedars Lodge
Size: 5,030 sqft on 6.69 acres
Status: Kept by Builder
Price: N/A
Buyer(s): Philip & Jan Bononcini
# of TVs: 5
Other notes: The Bononcini’s were the owners of the entire plot of land that all six homes were built on until they parted it out in 2005 to the individual builders. They paid a total of $1,750,000 from 1998 to 2004 for the land that the 2006 SoD was built on. They made a total of $4,605,000 by parting the other five lots out to the builders. Since this was the least audacious home in the show, with the largest and most private plot of land, I’m assuming that they kept this one as their family home, paid for using the $2 million (plus) profit from the land sales. Nice move.

I’m not particularly interested in taking in this year’s show, certainly not for the $18 cost of admission. But, if anyone out there really wants a Seattle Bubble report on the 2007 Street of (Materialistic Uncontrollable Drooling) Dreams, you can pay my admission with a PayPal donation, and I’ll make the time.

In a Lynnwood Journal puff piece that reads more like a sales ad than a news article I found these interesting anecdotes:

Local lenders, such as Golf Savings Bank, are offering incentives, such as $1,000 off closing costs for certain new home communities, like Edmonds Cascade Cottages.

And local developers, such as Puget Sound Homes of Everett, are extending generous buyer’s incentives for purchases of homes into January, to spur sales activity during a typical slower time of the year. However, as the market heats up again after the 15th of January, these buyer’s incentives may go away.

Realtor Rick Horst, from the Everett office of Windermere Real Estate, represents Puget Sound Homes and Bellrose, a community of 28 single family homes located at the north end of Mill Creek. According to Horst, buyers at Bellrose can choose between a 2007 Ford Mustang, with a $23,000 MSRP, a $17,000 buyer bonus for use in closing costs and/or down payment, or having their first six months worth of mortgage payments paid by the developer.
…
One example of this [builder incentives] is the Acadia community of homes in Silver Lake, currently being offered for presale through John L. Scott Real Estate. Listing Agent Paula Hovander believes builder D R Horton will extend some portion of the buyer bonus offered in December, when the presale campaign was launched for their community of 36 single family homes. A total of seven homes were sold in December, with a $10,000 buyer bonus offered through DHI mortgage as an incentive to quick start presale activity.

Aren’t these the kind of things that builders do when they are having a hard time selling at current prices? If the local housing market is as “healthy” as some would have us believe, why would homebuilders be resorting to bribes to get people to purchase new homes? Not having been shopping for a hew home lately I couldn’t say how common this is becoming, but the fact that it’s happening at all is still more evidence that things are slowing around here.

I kind of wish that we had a local blog that followed new single-family homes the way that Matt over at Urbnlivn follows condos. It would certainly help give us a better idea of how much the market is softening.

(Jolene Anderson, Lynnwood Journal, 01.08.2007)