Condominiums are an important part of the housing market, especially for first time buyers. Often buyers have the income and credit score needed to purchase a home but lack a substantial down payment which can make entering the housing market prohibitive.
In an effort to promote affordable homeownership for credit worthy buyers, the Federal Housing Administration (FHA) has issued new guidelines that make FHA condo financing an easier, more streamline process. Once a huge part of the first time buyer market, FHA’s strict guidelines made financing a condo difficult, at best. FHA updated its condominium financing rules, effective October 15th, which will loosen requirements for financing condos.
- Low Down Payment Still Available. Buyers can still purchase a home with as little as a 3.5% down payment.
- FHA Loan Limit. In King County the maximum FHA loan amount is $726,525.
- Single Unit Approvals (“spot loans”) Return. If a condo community wasn’t on the approved FHA list, it was difficult, at best, to obtain FHA financing. New guidelines now make it easier for an individual unit to be approved for FHA “spot loan” financing in a community that doesn’t have current FHA approval.
- FHA Certification and Recertification. Many condo communities have applied for and maintained their FHA certification. Having FHA certification makes a community more desirable to buyers and FHA financing much easier. The FHA condo certification now lasts 3 years vs. 2 and the recertification process has been streamlined.
- Owner/Occupancy Requirements Eased. FHA now requires a condo community be just 50% owner occupied.
- Commercial/Non-residential Space. The amount of permitted non-residential space (retail, commercial, parking, etc.) has been increased from 25% to 35%
These updated FHA loan guidelines will now allow thousands more condominium units to qualify for FHA financing, opening homeownership opportunities to many more qualified buyers. Opening the window to homeownership will encourage more owners to buy and occupy homes resulting in fewer investor owned/rented units, higher owner occupancy levels and stronger communities.
Condominiums are an important part of the housing market for first time buyers. Too often buyers have the income and credit score needed to purchase a home but lack an adequate down payment which can make entering the housing market prohibitive.
In an effort to promote affordable and sustainable homeownership, especially among credit-worthy first time buyers, the Federal Housing Administration (FHA) has recently issued new guidelines making obtaining FHA financing for condominiums an easier and more streamline process. FHA has issued an update to its condo rules, effective October 15th, that will loosen requirements for financing condominiums. Here are some of the more important changes effective this month:
- Low Down Payments Still Available. Buyers can still purchase a house or condominium with as little as a 3.5% down payment
- FHA Certification and Recertification. FHA requires a condominium community to have obtained FHA certification. It is a detailed process and there is an expense to the HOA involved, but once complete, having FHA certification makes a community more desirable to buyers and FHA financing much easier. The FHA condo certification now lasts 3 years vs. two and the recertification process has been streamlined.
- Single Unit Approvals (spot loans) Permitted. In the past, if a condominium community wasn’t on the approved FHA list, it was difficult, at best, to obtain FHA financing. The new guidelines now make it easier for an individual unit to be approved for FHA “spot loan” financing in a community that isn’t FHA approved as long as no more than 10% of the units in the community are FHA insured. (A buyer must use a FHA approved lender.)
- Owner Occupancy Requirements Eased. FHA now requires that a condo community be just 50% owner occupied.
- Commercial/Non-Residential Space. The amount of permitted non-residential space (retail, commercial, parking) has been increased from 25% to 35%.
These updated FHA loan guidelines will now allow thousands more condominium units to qualify for FHA financing, opening homeownership opportunities to many buyers. Homeowner associations are encouraged to obtain and maintain FHA certification. Opening the window to homeownership will encourage more people to buy and occupy homes resulting in fewer investor owned units, higher owner/occupancy levels and stronger communities.
Washington State Landlord-Tenant Laws were revised in July that include new tenant protection laws relating to rent increase and eviction notices and changes to property use. If you currently have tenants renting your condominium (or house), or you’re thinking about renting your condo, here is a quick look at recent changes to the state landlord-tenant laws.
LONGER NOTICE FOR RENT INCREASES
Landlords must now give tenants 60 days written notice for rental increases. Previously 30 days notice was required for rent increases.
LONGER NOTICE FOR ECONOMIC EVICTION
Landlords are required to give 14 days notice (previously 3 days) before evicting a tenant based on overdue rent. That notice must include information on the tenant’s obligations, rights and options along with the total amount due, broken down by type of charge. Tenants can’t be evicted for failing to pay costs outside of rent and utilities (late fees, deposits, landlord’s legal costs, etc.). Landlords can pursue other ways to collect those costs.
NOTICE FOR CHANGE TO THE BUILDING’S USE OR DEMOLITION
Landlords are required to give tenants at least 120 days written notice to vacate if they plan to change the property’s previous use in any way that would displace the tenants (changes to rules/use regarding pets, smoking, etc.).
For additional information and clarification, landlords should refer to the current State of Washington Residential Landlord-Tenant Act to be sure they, and their tenants, are in legal compliance with state law. Landlords should also check with their condominium association manager to be sure they are in compliance with HOA rules and regulations before moving a tenant into a condominium.
Seafair, vacations, weddings, sunny weather, back-to-school shopping – the month of August is filled with distractions that cause buyers to take a break from their summer home search. Local condominium and house inventory is up (though there’s hardly a glut of available inventory), making this a great time to take advantage of having more homes to choose from, less competition from other buyers and the benefit of very favorable interest rates.
Searching for a home always comes with a list of needs/wants. An important thought to keep in mind . . . if a particular neighborhood or manageable distance to work or schools is important, that should be your priority and always at the top of your list, even if inside it isn’t your dream home. Location is everything, and it can’t be changed once you realize your commute is too long. Buyers should be open to making compromises on cosmetic finishes and fixtures. White appliances, a boring back splash or tired bath fixtures are easily updated. The “perfect” home may already have those sexy finishes and fixtures, but they will come at an added expense which may mean compromising on location to stay within your budget.
Keep location and condition (not updates) as your top home search priorities. If you start with the right location, and the home is well maintained (an inspection is always recommended), you’ll be way ahead of the game. Simple compromises on finishes and fixtures (easily be replaced) and maintaining the focus on location and access to amenities and services, will gain you more value and ultimately a better return on your investment. Don’t stretch your budget for stainless appliances, a glass tile back splash or cool pendant light fixtures. That boring white refrigerator will keep food, milk, beer and wine just as cool as a sexy stainless refrigerator and will serve its purpose until you can upgrade appliances, fixtures, etc. to fit your decor and your budget.
Robin Myers is a broker with Windermere Real Estate/East, Inc., specializing in condominium residences.
If you’ve been inspired to do some spring cleaning, this weekend’s recycling event is the perfect place to drop off those items that don’t have any usable life left in them.
Saturday, May 26th 9:00 AM – 3:00 PM
Bellevue Presbyterian Church 1717 Bellevue Way NE
The event is free – accepted items include:
— auto parts (non-greasy)
— appliances (blenders, dishwashers, washers & dryers, microwaves, stoves,
— clean scrap wood (untreated and unpainted)
— electronic equipment (DVD/VCR, cell phones, computer keyboards and mice, copiers, printers, stereos)
— exercise equipment
— lawnmowers (drain oil and gasolines)
— lead acid batteries
— metal lawn furniture
— rigid plastics (buckets, toys, coolers, lawn furniture, PVC pipe)
— styrofoam blocks & packing materials (white blocks and packing peanuts of any color)
There are fees for some items . . .
— appliances and scrap metal (air conditioners $33, refrigerators/freezers $28, water heaters $5)
–mattresses and box springs $15 per item
–porcelain toilets & sinks $15 each – propane tanks ($5 each) – small empty camping tanks ($1 each)
–tires – 6 max ($1/each tire, $3.50/each tire on a rim, $5/each large truck tire, $15/each large truck tire on a rim)
Secure shredding is also available – limit of 5 file size boxes
ITEMS NOT ACCEPTED – containers that previously or currently contain gas, oil, chemicals or paint
For more information call 425-452-6932
In this fast paced, competitive real estate market, it’s common, in an effort to “win”, for buyers to waive contract conditions such as inspection, financing, appraisal, neighborhood review, etc. Buying a condominium is different than buying a house. With condominiums perhaps the most important contract condition in place to protect a buyer is the homeowner association (HOA) resale disclosure documents. The State of Washington requires a seller to provide the HOA resale disclosure to a buyer upon mutual acceptance and the buyer has the right to review and approve or disapprove based on the information contained in the package.
What is a resale certificate? It is a set of documents typically assembled by the condominium’s association manager that includes the summary “resale certificate” which discloses information about the HOA, delinquencies, pending special assessments, HOA reserve account balance, owner occupied vs. rental units, pending lawsuits, etc. Supporting documents will include detailed information about the HOA’s budget and financial statements, reserve study, meeting minutes, rules and regulations, recorded Bylaws and Declaration and insurance.
This is a large package of detailed information which too often buyers glance at briefly or ignore totally. It’s important to understand the health of the HOA and how well it is functioning, how well funded the reserve account is, and what conditions or community rules and regulations could impact a buyer’s planned use of the property.
What should you look for? The recorded Declarations can be hundreds of pages, which is overwhelming. There are major pieces you should review, but it’s wise to spend some time going through all the documents to understand how the HOA is governed and how owner’s monthly assessment dollars are being spent.
Resale Certificate – A 5-7 page document highlighting the major elements of the HOA (owner occupancy, delinquencies, reserve balance, special assessments, lawsuits, etc.).
Budget and financial statements – Review the annual financial statements and current operating budget to see the line-by-line operating expenses. Is the HOA staying within budget? Is the HOA building adequate reserves? Is the HOA financially healthy? Continue reading
Rain or shine . . . there are plenty of events and activities in Bellevue this weekend.
ROCK GARDEN PLANT SALE
Saturday, April 14th 10:00 AM – 2:00 PM
Bellevue Botanical Garden – 12001 Main Street
Saturday April 14th 2:00 PM – 3:00 PM
Mercer Slough Environmental Education Center – 1625 118th Avenue SE
Be prepared to get a little muddy and investigate the world of insects
Admission: free – open to all ages
Pre-Register at MSEEC@bellevuewa.gov or 425-452-2565
LIVE JAZZ MUSIC AT CYPRESS
Friday April 13th 8:00 PM – 11:00 PM
Cypress Lounge & Wine Bar/Westin – 600 Bellevue Way NE
GET CRAFTY SATURDAY
Saturday April 14th 1:00 PM – 3:00 PM
Bellevue Arts Museum – 510 Bellevue Way NE
Admission: free ($4 material fee per child)
No reservation required/first come first served
BELLEVUE LIBRARY GRAND OPENING – ideaX Makerspace
Saturday April 14th 10:30 AM – 3:00 PM
Bellevue Public Library – 1111 110th Avenue NE
A place to learn new skills – create electronic circuits, make a robot, craft with a 3-D pen
10:30 ribbon cutting
11:00 ideaX Makerspace opens
11:30 activities and demos
MASTER GARDENER’S URBAN DEMONSTRATION GARDEN WORKSHOP
Saturday April 14th 10:30 AM
15500 SE 16th Street
SEATTLE RESTAURANT WEEK
The last week for Seattle Restaurant Week – 165 participating restaurants with 13 in downtown Bellevue.
3 course meal/$33
For participating restaurants and more information https://srw.seattletimes.com
It’s no secret – 2018 property taxes have increased substantially over last year. While rising taxes are a tough pill to swallow, Washington’s property taxes rank in the lower half nationwide, coming in at 29th. New Jersey is #1 and surprisingly Hawaii is the lowest.
Did you know property tax exemptions are available for seniors? State law provides property tax exemption and deferral programs for senior citizens and disabled persons. You or someone you know may be eligible for a tax exemption or deferral. The application process is fairly simple; there are income and other qualifications:
- annual household income of $40,000 or less
- own and occupy a house, condo/co-op or mobile home
- 61 years of age by December 31st of the previous year, or
- retired because of disability, or
- veteran with a 100% service-connected disability
- you are a widow or widower or state registered domestic partner whose spouse or domestic partner had an exemption at the time of death
Many seniors and disabled persons are not aware of these tax exemption and deferral programs. Taking advantage of a tax savings could offer long term financial relief and make it possible to stay in a home for a longer period of time.
For more information or to apply for a 2019 property tax exemption contact King County at 206-296-3920 or visit the taxpayer assistance website at
Living in communities close to workplaces, shopping, dining and other amenities is becoming increasingly important to buyers when searching for a home. A recent survey conducted on behalf of the National Association of REALTORS® found over half of the respondents preferred to live in a community that offered smaller or no yards but was within walking distance of local amenities and offered shorter work commutes.
Buyers no longer look at just the house – equally, or even more important, is the community and access to workplaces, shopping, dining, transportation, schools, health care and parks or open space. Women tend to put more importance on walk-ability and public transit than men but overall nearly 40% said having public transit nearby was important. Sixty percent of those surveyed would be willing to pay more to live within walking distance of parks, restaurants and shops.
In Bellevue the popularity of urban living was recently confirmed when the One88 condominium residences celebrated the grand opening and sales event. Over 80% of the homes sold in just weeks with buyers committing to reservations to purchase homes that won’t be available for two years. Several new Bellevue townhome communities have experienced the same robust sales activity with buyers committing to pre-sales for homes not scheduled for completion until late spring or summer. Resale condos and townhomes throughuot the eastside, walk-able to urban amenities and workplaces, are experiencing the same high level of buyer interest.
If you’re not a fan of college basketball tournament play, there are interesting and fun local events for adults and children this weekend.
BELLEVUE BOTANICAL GARDEN SPRING BULB LECTURE
SATURDAY MARCH 24th – 10:00 AM – 12:00 PM
Slide show and walking tour through the botanical gardens to learn about the best spring bulbs for our area and how to get the most from your spring bulbs. $25 BBG society member/$35 non-member
Pre-registration required www.bellevuebotanical.org or 425-452-2750
BELLEVUE YOUTH THEATRE PERFORMANCE OF “THE LAST UNICORN”
Friday 3/23 @ 7:00 PM
Saturday 3/24 @ 2:00 PM and 7:00 PM
Sunday 3/25 @ 2:00 PM
16051 NE 10th Street/Bellevue
Tickets and additional information at 425-452-7155 or
FROG HOP – FRIDAY MARCH 23rd 7:00 PM – 8:30 PM
Learn about the life cycle of these amazing amphibians and the kinds of frogs native to Western Washington. Explore Lewis Creek using your ears to guide the way. Bring a flash light or head lamp, wear warm/waterproof shoes and warm clothes. Recommended for children age 5 and over. Event is free.
Information and registration at 425-452-4195