Posted by: Timothy Ellis (The Tim)

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

33 responses to “Economy.com: Seattle Definitely Special”

  1. Anonymous

    Why post stuff like this and leave out the Map of Misery, the stats on risky loans here?

    Those are facts. This is the rambling of some deluded half-wit. His graph does not even reflect the (fairly big) drop in median that has just begun in San Diego.

    A person can guess where RE might be in 10 years. But to not even reflect where it’s heading as we speak is a bit disengenuous, don’t you think?

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  2. The Tim

    I agree anon, and I’ve been thinking about the best way to post the “map of misery” as well as the map that came up in the last week or so that shows wage decreases around the country. They’ll probably show up in a post in the coming week.

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  3. Anonymous

    It’s review time at MSFT, that unstoppable engine of meteoric income growth that guarantees the housing bubble cannot fail.

    I’ve spoken to a few top performers in different areas – writing, dev, test; people with words like “Outstanding” and “Exceeded” in their reviews. Their raises? 5%. Right in line with last year…and the year before that.

    Oh well. Maybe it’s the wealthy Starbucks baristas that will save us. After all, everyone needs coffee, right?

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  4. seattle price drop

    That’s great Tim. Thankyou. Both are very very important for people in this area to see.

    The stats on the (inflation adjusted) declining income for this area are alarming, IMO. And offer a counter to those who claim that these homes are affordable to those who live here and that this economy is stellar/better than other areas of the country.

    Detroit was the worst at -12% but WA. was right up there at -8%.

    As to the Map of Misery, which shows the % of new and refinanced payment option loans, only CA and Nevada were higher than WA.

    WA. is in the group that included AZ., FL. and HI.

    Neither of the above are indicators of future health of any of those markets.

    So it’ll be great to see them on this blog and possibly rescue a few potential FB’s.

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  5. baselle

    Its like predicting the temperatures in December from the ones in March through June.

    And what about the disclaimer: “past performance is not indicative of future results”. Cripes, doesn’t anyone think any more?

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  6. Anonymous

    I would think that Forbes is a pretty respectable source. I think they have been around a few years and it looks like they think very favorable of seattle.

    I wonder if the secret formula includes the proximaty to ASIA and the fact that Puget Sound is the 3rd Largest Port.

    Seattle is in a nice spot for globalization.

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  7. sue

    Anon – Forbes was the magazine that, last summer, called Seattle the “Most Overpriced City in the US”!

    Did you read that?!

    At the time, I thopught, yeah that’s a pretty respectable source!

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  8. SeattleMoose

    “Forbes was the magazine that, last summer, called Seattle the “Most Overpriced City in the US”!”

    And since summer of 2005 prices have shot up at an even more torrid pace. Yet when the Forbes list came out this summer Seattle was not even in the top 10……Huh?

    The WA Realtors Assn must have done some lobbying.

    No bubble here folks….move along.

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  9. Christina

    We need a link to Frank Sinatra’s “High Hopes” mp3.

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  10. The Tim

    Your wish is my command.

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  11. Tik Tik

    Does anybody know where I can find listing value of a home over time ( assuming I have MLS # ) ??

    I want to see how some properties that are listed in our neighbourhood are doing ..thanks in advance

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  12. Peckhammer

    wonder if the secret formula includes the proximaty to ASIA and the fact that Puget Sound is the 3rd Largest Port. Seattle is in a nice spot for globalization.

    I wonder if the 3rd largest port will remain in business. The port is interfering with a certain star trek wannabes real estate plans.

    Here’s a hint, if you were wondering: The now-defunct monorail authority, staffed by former vulcan employees, chose to build the route from Ballard to West Seattle because it passed by this person’s waterfront propery holdings.

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  13. sarah

    Tik Tik–If by “listing value” you mean “price” get a Zip Realty account (free) and they’ll give you price reduction info for your MLS#.

    HOWEVER, it is common in WA. to remove properties from the MLS lists and assign a new MLS# if it’s been on the market “too long” or gone through “too many” price reductions. Keeps the property looking !fresh!!!

    Realtors are the only ones who have access to MLS number changes – and they do not want to share that info with the consumer as it would hurt their sales and commissions.

    If you mean historical values, or previous sales prices, go to the King County website with the address of the property.

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  14. synthetik

    Read “The Economist”… almost no advertising, which means it costs a lot more $139/year – but you don’t have to worry about their bullchocolate adjenda.

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  15. Anonymous

    (1) even making a leap by assuming those numbers are correct, appreciation will lag inflation over the 10-year period.

    (2) Boston is in Maryland?

    (3) forget the graphs, did you see the reporter?

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  16. john_law_the_II

    in 2000 you could have said that the dow would be next higher than it is now if you factored in a “historical” average gain each year. but here were are, still haven’t gotten to 12,000 after the burst.

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  17. The Tim

    (2) Boston is in Maryland?

    Whoops, typo. Sorry about that. Corrected.

    Thanks for pointing that out.

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  18. Anonymous

    The problem with this is the problem any economist has with abnormal situations. You can’t forecast the future looking in the rearview mirror when the present is in an unusual state. The voodoo financing and huge runup make past comparisons irrelevant. The past 9 recessions in the US were not predicted by the majority of economists before they started. Crashes are abnormal by their very nature, if they were predictable they wouldn’t happen.

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  19. dash_point

    Well, that forecast is definitely toned down from all that talk of double-digit appreciation in many coastal areas.

    Problem is: affordability is already severely stretched in many areas, where even a flat market may be wishful thinking. Remember that chart of option-ARM loans for WA?

    And, does anyone recall those earlier Fortune articles pushing coastal real estate investment? Just like many other “wealth” rags, they were huge chearleaders of RE. By now, anybody trumpeting houses has their blinders on, or their “hand in the pie”.

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  20. Anonymous

    I am pretty sure that the median price of housing in Seattle is already more expensive than in NYC. NYC includes five boroughs, not just Manhattan.

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  21. seattle long term owner

    actually the prediction for where we will be in 2016 doesn’t sound too outlandish…

    I just don’t agree it’s a steady 4% growth… most likely there will be 0 or negative growth in some of those years compensated by near double digit growth in some years ahead (8 or so years from now)…

    Life is a cycle… we’re at the top of one, it’s going down, but it will go back up…

    just pray you can survive the short term and get to the long term…

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  22. Anonymous

    You are skeptical of anything written that suggests the Seattle market is healthy. If this same “intricate formula” determined that Seattle was going to crash and burn, you would have treated it as gospel. That is why I don’t think you have much credibility.

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  23. uptown

    Well of course prices will continue up – until they go down and Forbes writes a completely different article.

    Seattle is not the only city or port around here. Tacoma’s port is booming and has better (less congestion) access to trains and roads leading south and east. Vancouver’s port land access will get you to the east and the midwest.

    All we need is one major employer going out of business, or being bought out and moving, and things will slow way down. Can you say WaMU??

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  24. The Tim

    You are skeptical of anything written that suggests the Seattle market is healthy.

    That’s true, because so far no one has satisfactorily proven to me that this is the case. Articles that make the assertion of a healthy market in Seattle generally fall into three categories:

    - Articles that just declare it to be so, without backing it up at all.
    - Articles that claim some secret formula backs them up.
    - Articles that provide weak arguments to back it up.

    The first two types can’t really be argued against, since basically all they do is assert a statement without backing it up. The third type rarely comes up, and the times that I have come across such articles, I have refuted them at length.

    If this same “intricate formula” determined that Seattle was going to crash and burn, you would have treated it as gospel.

    I don’t think I’ve taken anything as “gospel” with regards to what will happen to the housing market in Seattle. I’ve said over and over again that we don’t know what will happen, but I personally think prices will decline. I’m very up front about the fact that what is stated on here is my opinion, and my opinion only. I have never tried to claim that any prediction about Seattle’s housing future is “gospel truth.”

    That is why I don’t think you have much credibility.

    Luckily for you, nobody is forcing you to read this blog.

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  25. Housing Boom Gone Bust

    Why do I look at that graph and feel like I am on a rollercoaster taht is slowly approaching the top. tic tic tic tic tic tic…

    AAAAAAAhhhhhhhhhhhhhhhhhhhhh!

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  26. Anonymous

    RE: 9;03
    median in the borough of New York a/k/a Manhattan as of 4Q 2005 is somewhere between 620K and 880K, depending on whether you believe the self-serving REBNY or any one of the the even more self-serving brokers.

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  27. Anonymous

    Luckily for you, nobody is forcing you to read this blog.

    Ahhh the “if you don’t like it — leave!” retort. But when you say that about Seattle, folks on here rip you a new one! Funny.

    I’ve said over and over again that we don’t know what will happen

    I’m glad to hear you admit you don’t know what will happen! So you realize that your predictions might very well be way off. And yet you mock people who disagree with you.

    I enjoy reading this blog — I guess I find the fringe thinkers kinda interesting. I wonder what these folks are going to do if their wrong and their Queen Anne dream home isn’t available for $150,000 by this timei next year.

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  28. dash_point

    All we need is one major employer going out of business, or being bought out and moving, and things will slow way down.

    You know, all the Puget area may need is a serious slowdown on sales activity, coupled with worsening affordability and credit tightening. How’s that looking already?

    As a bit of perspective, I closely follow the CA market to predict events for the greater W. coast. If you follow the trend line for Seattle, and know that “prime” parts of CA are literally tanking as of now, you may concur that Seattle will be affected by these macro events. Of course, it may not look that way from a regional scope, but one has to stretch to see a bigger picture to get any local understanding. I guess my point is: “prime” spots around SF bay are seeing reductions of as much as 25% over last fall, and that’s without any catastrophic job downturn. Can the same happen in inflated areas around Seattle? Don’t discount the possibility.

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  29. PepeDaniels

    Anonymous said…

    Luckily for you, nobody is forcing you to read this blog.

    Ahhh the “if you don’t like it — leave!” retort. But when you say that about Seattle, folks on here rip you a new one! Funny.

    I’ve said over and over again that we don’t know what will happen

    I’m glad to hear you admit you don’t know what will happen! So you realize that your predictions might very well be way off. And yet you mock people who disagree with you. and so on…….

    While Tim is certainly capable of stating his position and has, it’s worth pointing out that the media pattern (and typical response) here in Seattle is one that has played itself over and over in many parts of the country. If you go back and look in newspapers, radio etc in the unarguable bubble zones you’ll see the same kind of blind cheerleading that you see here in Seattle. Many of these places have great job opportunities, “asking prices” are off the charts and the media seems to do little more than play analytical grab ass with the local RE industry.

    There are many reason why this might occur, the most obvious being that the media has a vested interest in pimping their own market for their own profit.

    The reason people come here is not, as some weakly suggest, that it’s an “anti-Seattle” blog but rather there are is so little info out there with any real critical thinking going on.

    It’s the same reason the web is alive with many blogs and sites that raise issues and concerns not covered by mainstream media.

    If you’re so concerned about it, take two minutes and get an ID for Christ’s sake.

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  30. Christina

    Your wish is my command.

    Thanks, the tim!

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  31. Anonymous

    To : Anonymous said…

    It’s review time at MSFT, that unstoppable engine of meteoric income growth that guarantees the housing bubble cannot fail.

    I’ve spoken to a few top performers in different areas – writing, dev, test; people with words like “Outstanding” and “Exceeded” in their reviews. Their raises? 5%. Right in line with last year…and the year before that.

    hey, you are not MS insider. how many persentage of those top performers at review? picking a word without context is wrong….

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  32. Friday Flashback: Seattle’s Housing Bubble All-Star Team • Seattle Bubble

    [...] with these types of numbers.If you’re curious, here’s my 2006 post on these charts: Economy.com: Seattle Definitely SpecialJon Ribary at Rain City Guide, February 16, 2007: Housing sales fall in 40 states; but not in [...]

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  33. Eleua

    Driving down a twisting and turning mountain road by looking in the rear view mirror.

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