Condominium Law Changes

An article in the Seattle Times on February 26 written by Mike Rosenberg and Jake Goldstein-Street discusses the Washington State Legislature Bills that could change the current condominium laws throughout the State.  In the late 1990’s the Legislature passed legislation that made it significantly more difficult for developers to construct condominium buildings by allowing the Home Owner Associations (HOA’s) to sue developers for several years after the developer turned the building/complex over to the (HOA’s)  Those developers turned to constructing apartment buildings as the rental rates in apartments soared because of the influx of people to Seattle.

The discussion in the Legislature has been that relaxing the current laws with increase the construction of affordable condominiums.  First, who ever said these developers would construct affordable condominiums.  They’ll charge the highest price possible for every unit they deliver which will not be at affordable prices.  The Legislature is also considering easing the legislation such that an (HOA) cannot sue a builder unless they can prove defect would “cause harm, like an unreasonable safety risk”.  If I’m the owner of a condominium I would like to sue the builder for any defects in their construction of the building, not jus those that could cause an “unreasonable safety risk”, don’t you agree?

If you have any questions about this article, please contact me at smeyers@kw.com or call me at (206) 972-3328.  Steve Meyers, Managing Broker, Keller Williams Greater Seattle

Zestimate – Analyzed

Mike Rosenberg, the real estate reporter for the Seattle Times published an article on Thursday, January 31^st titled “Zillow winners improve Zestimate”.  In that article it refers to information provided by Zillow.  It states that 50% of Zestimates fall between 4.7% too low and, 4.7% too high.  So a home that sells for $500,000 home would have a Zestimate, 50% of the time, anywhere between $476,500 and $523,500.

Zillow also states that 1 in 8 homes will have a Zestimate that is 20% or greater that is too low or 20% or greater that is too high.  So, 12,5% of the Zestimates (1 in 8 homes) will be less than $400,000 or greater than $600,000 for a home that sells for $500,000.

Between 50% of the homes where the Zestimate is within 4.7% of the sales price and the 12.5% of the homes that are greater than 20% of the sales price, that leaves 37.5% of the homes where Zestimates are somewhere between 4.7% accurate and 20% or more, inaccurate.  The middle of that is 12.35%.  So, 37.5% of the time the Zestimate is 12.35% accurate on average for this 37.5%.  For a home that sells for $500,000, the average Zestimate would be $438,250 to $561,750.  However, within this same group the most extreme errors could put the Zestimate at a low of $400,001 to a high of $599,999.

If this is confusing, just understand that the Zestimate has very little to do with the actual value of your home.  That includes the 2016 home sale made by Zillow CEO Spencer Rascoff – who sold his Seattle home for 40 percent less than his Zestimate.