OTM: Price Reduced! Great Neighborhood

onbroadway May 7, 2008

I still can’t wrap my head around today’s prices, but this looks nice, and much better than many we’ve seen that have had flip-touches and cheap windows foolishly added.

TPL shows that the Tacoma Daily Ledger 9/12/1909 has an illustration of this and other homes: “…six fine little homes”

Dave May 7, 2008

Knock it down to around $189K, and we can talk. Much more than that and it is grossly overpriced.

Aretha May 7, 2008

There’s 3 houses in a row on N. Oakes for sale.

620 N. Oakes $215,000 MLS 28075610
622 N. Oakes $166,000 MLS 28075640
624 N. Oakes $225,000 MLS 28075661

They’re fixers and a conventional loan might be tricky but the price and location is great!

I'm for Change (for tacoma) May 7, 2008

I am not in the real estate business, live on a boat, have no problem with condos, don’t understand the American Dream of owning a house/yard, and am a transplant to Tacoma. Now that I’ve lost probably 2/3rd of the people who started reading this response….

Isn’t it attitudes like “way overpriced” and “houses used to cost X” lead to Tacoma always being perceived as the poor, red-headed step-sister to the rest of the West-side of WA (trying to avoid naming the dreaded city to the north because I think we need to look beyond Seattle (oops))?

Just because a home cost X before doesn’t mean it should always cost that. If that was true, I’d bet there’d be a lot more people living on Fox Island.

I’m not trying to come down on this home and earlier comments specifically. It just seems like anytime real estate comes up on this site, most comments turn negative. For people looking to move to Tacoma, this can be perceived as it would take a fool to buy this thing so why move to Tacoma when there are other options.

amy May 7, 2008

I personally think not having a garage is a bonus. I’d much rather have the nice backyard and social contact with neighbors because I’m forced to walk to the street to get in my car (or ride my bike).

amy May 7, 2008

Re: I’m for change in Tacoma
The problem with rising house prices in Tacoma is that many people’s wages are not rising relative to the price of homes. Basically, it’s very difficult to enter the housing market in Tacoma while earning a modest income. This is especially challenging for families, as there is much more to consider in a home when children are involved. Unfortunately, a modest home in North Tacoma is very expensive! I would be happy to live in high density housing with my children, as long as parks and green spaces for the children are nearby. Otherwise, a backyard is really necessary. Seattle’s market is also very difficult to enter, but there are also many more corporations in the Seattle area that pay high wages.

Squid May 7, 2008

Amy@6: you don’t think this same phenomena is at work everywhere. Tacoma is by no means unique in this regard. Somebody can run the numbers but I have $1 that says that the ratio of Tacoma median wage:median home cost is better than the same ratio in Seattle. Tacoma housing has got to be way more affordable as compared to wages. I’m just too lazy to actually run the numbers. Somebody prove me wrong.

If you don’t think that even the North End is about as affordable as you can get for a quality neighborhood, then you simply aren’t getting out much. My Santa Cruz friends come up and can’t believe how much house they could get here. Of course then they visit in January and understand.

Old Timer May 8, 2008

Personally IMO the northend is overrated and overpriced. I can’t tell you how many people I know have had their car windows smashed out in the northend. Just yesterday one northender told me she just leaves her doors unlocked now because she has no garage. I don’t pay for perception unless im buying in Hilltop.

OriginalCin May 8, 2008

I used to post to the SeattleBubble real estate site, but it’s hard to relate to the Seattlites when I’m in Tacoma. They get snooty and want to know the MLS numbers of houses that I, personally, have made offers on (and haven’t always been successful in the ongoing bidding wars taking place on some homes), and if I mention that it’s ANYWHERE other than a 5-mile radius around downtown Seattle, they just say…“Well, that figures.” Tacoma is way more affordable than Seattle (obviously), but is still overpriced when compared to other similar metropolitan areas in America, I think. I’m staying here in the Tacoma area because I have a great job, great friends that I’ve come to know, and my kids are happy here. However…my recent (past 6 months solid) real estate buying experience here has really made me stop and think about maybe taking my quarter of a million somewhere else (say, back East in Virginia where my parents are urging me from) and getting so much more. The house in question here is on a lot that is less than 4,000 sq. feet! That’s tiny. Yes, the house is lovely inside, has very adequate space inside, but…wow. My prediction is that it won’t go far very fast in today’s market. And that’s unfortunate. It wouldn’t be the first time I’ve been wrong, though. :)

Dave May 8, 2008

Hey “I’m For Change” (comment #4)… I can only speak for myself, but here is why I feel the way that I do:

I make OK money… not big bucks, but I have a family wage job. I should be able to afford a house, particularly in a city that is at the low end of the price spectrum.

But I am single. I only have one income to work with. Ten years ago, houses that sold for around $125K-175K would have been within my reach, easily. Today, those very same houses are going for $300K+, and there is no way that I could buy one. This is a little frustrating, to see houses that I could once afford double in price while my income stays the same.

I understand that sellers are going to charge what the market will bear. My beef is that market value is WAY out of line with intrinsic value. Yes, you can get $300K for that two-bedroom craftsman. But as far as I’m concerned, the real value is less than half of that.

jamie from thriceallamerican May 8, 2008

Dave…I’m with you at least somewhat. It is frustrating to see housing values outpace wage increases. And it’s highly likely that house values have bubbled up a bit, too. However, at the same time you have to look at Tacoma over the past 10 years, and realize that for many it has become a more desirable place to live, thus driving demand, and in turn price… My south-of-Sixth Craftsman that I bought in 2001 at the time was considered somewhat undesirable simply because “it wasn’t in the North End”, yet know it’s likely doubled in value because “it’s close to all of the restaurants” (most of which didn’t exist in 2001). Other economic changes have happened around town in that time, and I think there’s a sense of increased “spirit” in the town that has become evident in watching the blog scene. Sure the Seattleites still look down on us a bit, but I think prices have somewhat rightly risen. This is all not to say that I don’t wish that people who have good family wage jobs could easily get a good (non-fixer) house in a good neighborhood, but I think there are some valid reasons that house values have shot up so much in a short time and we need to deal with the reality of that.

Mofo from the Hood May 8, 2008

What’s notable about this house is the living space at 2100 sq.ft., even though the lot size appears small and the adjacent houses are close. Compared to many new townhomes & condos the price seems like a value.

There are hundreds of homes of this style from the North End to the South End. Many of them have been maintained and many are in need of maintenance. Because there are so many options, the buyer is still in the best position to bargain.

Squid May 8, 2008

There is only one kind of value of a house and that is EXACTLY what somebody is willing to pay for it. That is the real value. Not a penny more, not a penny less. And not the asking price.

There is no such thing as “intrinsic value.”

Aretha May 8, 2008

Mortgage payments for a $150,000 house purchased 10 years ago, at 7% interest, would have been about $1000 a month.
Today the payment on a $300,000 house, interest rate 5.5% would be about $1700

Based on a quick look at AVERAGE wages… in 1998 your payment would take 36% of your monthly income and in now it would take 46% of your monthly income.

NSHDscott May 8, 2008

I’m surprised to read all this. I thought it’s a pretty fair price for a nice old house of decent size in a good neighborhood. And I don’t feel like Tacoma is overpriced at all. Underjobbed, now, that’s a different matter.

Squid May 8, 2008

Aretha, I know it seems unfair, but median wages and median housing prices are out of whack everywhere in the country, Tacoma is not unique in that regard. In fact, we are probably in better shape in this regard than many other communities. Home ownership is constantly taking a bigger percentage of household income everywhere. In areas of costal California it is not uncommon for people to be paying up to 60% of takehome pay on their mortgage. Until recently banks would actually allow that.

There are surveys that compare cost-of-living with wages. Places like Minneapolis, MN and Des Moines, IA always win those contests. Then again, those areas have other aspects that make them unpleasant places to live (weather, Lutherans, etc.)

You play the game, you make your choices.

aretha May 8, 2008

Hi Squid,

I think the price is fair. Houses cost what they cost. I drive an old car, were last year’s fashions, pack my lunch, and don’t have cable TV. so I can own property. It’s worth it to me.

jamie from thriceallamerican May 8, 2008

Then again, those areas have other aspects that make them unpleasant places to live (weather, Lutherans, etc.)

Now THAT’s funny.

Squid May 8, 2008

Aretha, just one small correction to your otherwise spot on post – Houses cost what someone will pay. It’s a concept that seems to elude a lot of people. You get it though.

The other elusive concept is that they are lousy as long-term investment vehicles. A house is primarily a place to live. Unlike a stock, you sell your house and you still have to find another place to live – you never really get to pocket much of that difference between what you paid and what you got. Not until you decide to downsize or move to Des Moines.

But I think you get that too.

jamie from thriceallamerican May 9, 2008

That would be Des Moines, Iowa. Des Moines, WA, would probably cost a lot more than Tacoma…

Squid May 9, 2008

“Is this heaven? No, it’s Iowa.”

scott May 9, 2008

I’m surprised nobody has mentioned the sales history for this home:

Jun 28, 2000 $207,085
Jun 14, 2002 $210,000
Sep 16, 2004 $291,500
Dec 19, 2007 $299,699

Must be very “motivated” seller as they are taking a huge hit.

I purchased a home in Tacoma almost exactly a year ago and you couldn’t find a home in the North end under $300k that didn’t need a ton of work.

Rents usually start at around $1500+ a month for a similar 3-bed home in this neighborhood. I think it’s competitively priced and if you can get a good rate on a loan your mortgage would be almost equal to renting.

I still see people pricing their homes waaaay too high but IMO, this house would be a good deal for someone looking to get into a very desirable area of Tacoma.

Old Timer May 9, 2008

Scott,
I think you mean the bank is taking a big hit. From what I noticed minus a few exceptions most property currently listed for sale are either bank owned or are in a preforclosure situation (i.e. lender approval required). If your selling now its because you have too not want too. Prices imo are resetting back somewhere in the neighborhood of what they were in 02-03.

OriginalCin May 9, 2008

Yes, very misleading.
Short sales (Subject to lender approval) are taking over the sales market. I would bet money that at least 2/3 of the homes on the market are in that status. The first home I put a bid in on back in January (50 somethingth block of Tacoma Ave. S) was listed for tens of thousands less than it actually was approved for. The deceptively low price is to crank out offers and then everyone sits in limbo while the bank takes its sweet time (it seems like, anyway) choosing from however many bids they’ve managed to get up to. I think there ended up being 8 offers on the table and I was bought out by a measly 2K (after the assinine listing agent decided that for all of his HARD work, he needed an extra percent or some crap). Anyway…long story made short…you can see a really awesome price tag on a nice looking home, but if you think to yourself, “Wow, that looks too good to be true”, it probably is. Check with an agent before getting too excited and they can find that out for you right away. Short sales (and out of state lenders!) NOT recommended! From me, anyway. :)

Old Timer May 10, 2008

OC,
You young whipper snappers always need to have it now. Don’t you know patience is a virtue.

25 comments