Thinking of a highrise Condo in Downtown Seattle or Bellevue?

Hello All,

Condos are an ever more popular choice with today's Eastside & Seattle homebuyers. As baby boomers downsize and first time buyers enter the market, a condo is often the right fit. The following article from the Seattle Times gives some great advice on condo buying, especially if a view is important to you.

As with any real estate purchase, its always best to work with a Realtor to represent you exclusively in the buying process - even in the case of "Pre-Sale" purchases. For more helpful free reports and buying tips, go to www.tk2homes.com and click on the "Free Reports & Information" tab. Numerous valuable reports are available and can be e-mailed to you automatically from the website.

All the best,
Tim


Getting the right floor plans, amenities and views by buying a presale
By Kellie Tompkins
Special to The Seattle Times


Prospective buyers, such as Evelyn and Michael Alphin, line up for a chance to buy a unit in the Moda condominiums, which is planned for downtown Seattle. Most of the units were sold in the first two days. The Alphins live in Tacoma, but she works in Bellevue and he is a Seattle police officer.

Buyers lined up for a chance at the unbuilt Moda condominiums planned for downtown Seattle. Ryan Raffetto and Rosalee McFadden look at sample floor plans at the sales center.
With condo sales going strong, more and more buyers are trying to secure units with the right floor plans, the right amenities and above all, the right views by buying a presale — securing a condo before a building is finished.

About 90 percent of condominiums at 2200, a mixed-use development in Seattle, sold before the sales center was open for business, said Julie McAvoy, sales director.
"It's almost rendering sales centers a thing of the past," said Dean Jones, president of Realogics, a Seattle-based marketing firm for condominiums and mixed-use buildings.
"Even before we have final floor plans, we are approached by homebuyers. Everyone wants to be in the know before the show," Jones said.

Buying a condo sight unseen isn't something to jump into without forethought or research.
Here's a look at how presales work and what issues buyers should pay special attention to:

Tips for presale buyers
Before signing a contract to buy a condo that's not finished — or even started — take steps to ensure you get what you pay for.

Know who's involved: Learn about the reputations of developers, architects, contractors and designers and find out about their performance on past projects.

Check out the options: Check with Seattle's Department of Planning and Development to see who else is building in the area — to see if there are better units available and to be informed about possible view obstructions.

Don't forget the neighborhood: Be sure to check with neighborhood and business associations to see what to expect outside the new unit. Ask them if more businesses, such as restaurants or retailers, are coming to the area or whether there are any annual events, such as fairs or parades.

Real-estate agents are a good bet: If you don't want to spend the time researching, local agents should be able to answer most of these questions. Sometimes buying a unit before a project is finished means signing a contract and forking over a hefty deposit that is nonrefundable. For at least some of the units at the 1521 Second Avenue building, the 5 percent deposit was $50,000.
Depending on the developer, there can be an earnest deposit with a signed contract immediately, or there can be the reservation stage.

The reservation stage, a more forgiving first step, allows developers to gauge interest in a project while it gives buyers a chance to select one of their top choices of units once the presale begins. Reservations often require deposits of $10,000 to $25,000 — not always refundable — and allow buyers to back out before they sign a contract. When individuals find out about a particular condominium plan, they can begin inquiring immediately.

Often in the early-development stage, before the building is constructed and before the developers have drawn up any detailed documents, buyers have a chance to reserve one or two units — deciding later which one they might want. They're put on a priority registration list and may be invited to a preview event. Some deposits are refundable, some aren't.

Many developers are skipping the reservation stage, but buyers still need to know the difference between a reservation deposit and an earnest deposit, said Kari Gran, a condominium specialist for Windermere. A reservation deposit is paid when developers want to gauge buyer interest. It usually comes in the early stages of a the project. Buyers pay a deposit ranging from $10,000 to $25,000 for downtown condos, Gran said. The deposits are usually refundable.
Gran has known people to back out of reservations. When one client found out the barbecue restrictions for the building, he opted out of the deal.

An earnest deposit is usually binding and nonrefundable after the first seven days of receiving the public-offering statement. Earnest money is tied to the purchase and sale agreement. This deposit is almost always 5 percent of the purchase price and goes toward a down payment when the sale is complete. "This is not something to go into lightly," Gran said. "A presale takes more planning."

Some builders attempt to protect views. One of the most important issues to condo buyers in and around downtown Seattle is the view. Developers sometimes drop cameras from cranes at each unit level to give potential buyers the best possible idea of what their view would be from a particular unit. To ensure buyers get what they pay for, they need to check the zoning of surrounding properties and look for any permits or proposals to develop those properties. City and county building departments have permit applications, zoning changes and variance requests on file.

Buyers need to remember zoning doesn't necessarily remain the same, Gran said. If a developer is granted a variance, the zoning changes. Attorney James Middlebrooks agrees. His law practice deals almost exclusively with condominium issues. "Let's say the buyer has a 10-story unit and the building across the street is only four stories when the buyer bought the unit," Middlebrooks said. "But the building gets torn down and a 20-story building goes up, blocking the view and devaluing the property. Just take a drive around Seattle, and you can see where this has happened many times," Middlebrooks said.

To ensure that buyers keep their views, some developers buy "air rights" around their projects. That way if the smaller building is torn down, it can't be replaced with a taller one that would eliminate views. Developers also can buy a "view corridor." In this case, they essentially buy easements that protect views in swaths. For example, a developer might buy the rights to the view of Elliott Bay from owners of several buildings between his project and the water.
If a developer says he has bought air rights or a view corridor, get it in writing, Middlebrooks said.

For Terrence Vasquez, who has placed a reservation at the Escala condominium project, his view was not guaranteed. "It was in that 'not guaranteed forever' range," Vasquez said. But he isn't too worried because he has reserved a unit on the 22nd floor.

Protect yourself — get it in writing. Problems with presales often arise when the unexpected occurs. Marriages, divorces, births and deaths, and more commonly, job transfers, might lead buyers to change their minds after agreeing to a presale. Usually, getting out of the purchase and sales agreement means losing that 5 percent deposit, sometimes more.
The more customized a unit is, the more likely it is the developer will want more compensation.
"These are contracts," said Lee Brettin, a real-estate and business lawyer in Seattle. "It's not like a hotel reservation where you can cancel 24 hours prior to arrival."

Buyers can protect themselves by getting promises in writing and by reading and understanding their public-offering statement. That document — which details restrictions, association rules and other information concerning their building and their unit — is thick and full of legal language, so buyers might want to hire an attorney. "With an expense that large, buyers need to get careful legal review," Middlebrooks said. "If you tell the lawyer that the view is really important to you, then the lawyer is going to say you'd better get that promise in writing."
The public-offering statement is issued to buyers once they pay the deposit.

By law, they have seven days to review the document. If they change their minds within seven days, they get their deposit back. After that, the developer is entitled to keep the deposit.
Advantages to buying early include having first picks for units, locking in today's prices and sometimes having the opportunity to personalize the home. "With a presale, I'm getting into the early price without the dues or mortgage," said Ryan Raffetto, who has reserved a unit with a downtown Seattle condominium project.

"As a homebuyer, you can be your own architect," said Realogics' Jones. Customization may range from choosing among several themes to fully personalizing the unit, with the latter more common among penthouses. Sometimes, buyers looking for larger spaces will buy two units next to each other and ask that they be combined. McAvoy, the condominium-sales director, recommends buyers keep the future in mind before committing to a unit.

"Don't just pick the unit you know that fits you today; pick one that fits you two years from now when it'll be complete," she said. "Look at the bigger picture." The primary attraction for presale buyers is clear. Said Jones: "You're shopping in 2008 at today's prices."

Information from Seattle Times business reporter Bibeka Shrestha is included in this report.