Anyhow–I tried both the address and the MLS number, but Estately didn’t show anything. Nothing yet in the county records either. Guess we’ll have to wait and see.

I think you have to have it favorited in “My Estately” to track the sales as I don’t see where you can track any property. And even then I am not sure that the price listed as the “sold” price is real – ti might just be the last asking price (cuz how would they know?). But it is nice to be able to parse “sold” from “delisted”

The above discussion about Estately is the first I’ve heard that we mere mortals (without MLS access, that is) can track of prices of actual sales, before they get recorded by the county. I guess that’s only true if within a limited time, or if you flag a property for tracking while it’s still listed?

http://www5.metrokc.gov/parcelviewer/Viewer/KingCounty/Viewer.asp

The house may have been rented instead of sold. If you don’t see recent sales information in KC records (and the house is in KC) then it wasn’t sold.

Nosy Parker that I am, I’m curious what they finally got for it…All in the name of science for Seattle Bubble, that is. ;)

Anyhow–I tried both the address and the MLS number, but Estately didn’t show anything. Nothing yet in the county records either. Guess we’ll have to wait and see.

But since I’m talking about notable houses in my neighborhood–anyone remember that “Extreme Fixer” in Columbia City? The house had literally been gutted for 15 years, it provoked a bidding war, sold for more than asking? The buyers tricked it out, then put it on the market for $200K more.. It sold too in the last few months, ’cause folks are in there.

Uh, Steve, then doesn’t that mean that prices are going to have to go back to where they were “before the market went nuts for a few years”? How much of a drop is that?

Neighboring houses are like shares of stock in the same company. They have the same fundamentals. There is no economic reason for anyone to prefer one over the other. So of course the prices will track each other.

But even in widely differing neighborhoods, houses have far more in common than different companies do. A house in Wallingford and and house in Kent are like two different cars from GM, not like GM and Microsoft.

Really the only situation where you get houses going up in one district and down in the other is when the latter has neighborhood decline issues. But when you are talking about cyclical changes in RE prices, as we are seeing now of course, all price movements are in the same direction. Not all the same amount, but the same direction.

Anyone who has been following the situation in cities like SD or Miami which are well into the bust will know this. Declines right across the board from the hood to the mansions.

deejayoh: do you know of a way to search recent past sales on estately? I see when you select area info, it gives you the two most recent sales, but that’s it. is there a function that allows you to search all recent sales and not just the last two?

Not that I know of. Estately is nice because you can track stuff between when it’s taken off of the NWMLS and when it’s recorded by the county. I think both Zillow and Redfin both show everything in the county records.

Apologies, it appears I didn’t take my meds. You have been right for the last 3 years and of course will continue to be correct in the next 3 years. It does take a big old pair to post with people like me lurking around like the bitter wanna be buyers we are. ;)

They may go down in price from sellers over inflated expectation but they will sell.

i think we are goling to be just fine over here… :-) a slight correction never hurt anyone.

Matthew, it sounds like he only got the weak kool-aid anyway.

FWIW, Estately has a nice feature that lets you track what happens to your favorites – whether they sold (and if so for how much) or were delisted. I’ve been using this to watch a few places on Magnolia. (I’m a fan of mid-century modern homes, and there are a lot of them there). Of the five I’ve been watching (all $600k – $1mm) – 1 sold (took about 3 months), 2 have been delisted (after sitting on the market over 6 months each), and 2 are still sitting with no price change (30 and 60 days, respectively)

small sample, but doesn’t seem particularly hot in the segment I’m following.

Keep drinking the Kool-Aid buddy… keep drinking!

Walked by a home sold in dec for $450k, its not there anymore they tore it down for a $1 million dollar rebuild. I think spring some people are going to be in for a suprise, homes are going to sell over here. They may go down in price from sellers over inflated expectation but they will sell.

i think we are goling to be just fine over here… :-) a slight correction never hurt anyone.

Just because subprime loans are no longer being handed out like lolipops at the doctors office, doesn’t mean that the effect of past subprime loans are not having an impact on the market.

A good chunk of subprime loans are currenly going into foreclosure, but didn’t default until late summer/early fall. Also, a good percentage of subprime ARMs are going to reset in the next year. More subprime ARMs reset in March, April, and May than in all of 2007.

Don’t think that the subprime issue is behind us. It’s going to linger for most of 2008 and into 2009. A lot of the repricing going on in the mortgage/bond market is not due to inflation but due to pricing in added risk. Lenders want to be compensated for the additional risk of giving someone a mortgage in our current market, and therefore are pricing it into rates.

That said, I think you are a little pessimistic this year, and a little optimistic for the next few years. Personally, I expect 8-12% declines this year. Your number is a bit higher 10-20%. I’m just curious what you think needs to happen for Seattle to be close to that top number in the range.

2009 and beyond, I think we’ll probably see 5-7% declines, with 2-3% declines in 2010, before things finally start to stabilize. I guess if you add it all up, we come up with pretty similar numbers.

I think to make a metaphor, you are predicting a rock slide. Prices don’t move much, then they move violently, and then it’s all over. I’m predicting more of a slinky, which has a more measured pace before finally slowing to a stop.

RCC: (with DC holding up better than most).

This comment caught me off guard since parts of the DC Metro area as covered by C-S are in fact seeing the fabled 50% haircut already. 30% off peak isn’t even noteworthy anymore.

Ditto. I was just pointing out that since the credit markets have seized up, it looks like the decline in DC (and Portland actually) is smaller than anyplace else. Approximately 2-3% if I’m reading the right lines on that really cluttered chart. We’re down about 4% since then like Boston, and the FL/CA/NV cities are all off closer to 10%.

Seems like Seattle and Portland are lat to the party, so I don’t know what it means, but it definitely looks like Boston and DC are holding up ‘better’ than other major cities.

Also…he is still clinging to the “subprime” issue which in fact it is not.

He beats his chest and claims that he “NEVER” did a subprime loan. How about stated income? Neg-Am? Was anybody ever qualified for a loan at the introductory ARM rate and not the fully amortizing (adjusted) rate?

I applaud Steve for his participation here and find him to be pretty on point with his forecast and rationale.

Read his blog before calling him out. It’s all there in black and white pixels…

I don’t happen to agree with his latest prediction, but he’s really the only MSM friend bubble-heads have (though Aubrey seems to have started coming around a bit). Cut the dude some slack.

I happen to think we will see more of a long, slow decline lasting 3-5 years 5-15% each year. As someone who is impatient to move up however, I hope you are right Steve. After I see 20%, I’ll start shopping, and I’d rather that be 2009 than 2010 or 11.

per your 100% correct track record, can I safely assume that you told your clients in 2006 and 2007 that their houses would fall in value in the coming years?

didn’t think so.

What is your background?

I have a record of publicly published predictions that have turned out to be 100% accurate.

What’s your track record?

For one thing, you missed some of points in earlier posts where I actually agree with some of what you are saying.

Your “RANT” is misguided.

Subprime/ARM resets are not the primary cause of foreclosures, overextended borrowers and falling home values are. This has been shown repeatedly and is a reason why the ARM bailouts are not likely to save much of anything. ARM resets certainly do not help, but they are not the real culprit.

Fed: Foreclosures not primarily due to high loan payments
What causes foreclosure? Countrywide’s claims

When the inflation rate goes up, long term bonds and mortgage securties drop in value. That’s why investors try to protect against that risk by raising interest rates now to make sure they are not caught with low interest rate notes in a high inflation environment.

Inflation does not affect home prices. Real estate is a supply and demand market, pure and simple.

When there is low supply and high demand (as we had during the boom) home prices go up, when there is high supply that outpaces demand (as we have now) home prices go down.

That’s all there is to it.

All of the statistical analysis in the world won’t change that.

In fact, I don’t conside the Case-Shiller stats to be accurate.

The housing market in the Greater Seattle area peaked in the Fall of 2006, there has been virtually no appreciation since then, I don’t care what their stats say.

I’m basing my analysis on real home sales and watching the market.

As a real estate broker I have access to the MLS computer system and I watch what is happening in the real world, I don’t base my prediction on other people’s
statistical analysis.

In fact, I had a long discusssion with “The Tim” about using statistical analysis alone vs. my “gut instincts” method.

My record speaks for itself. I have a very good feel for this real estate market and it’s not all about looking at numbers on a graph.

I read your post and sort of threw up a bit in my mouth. You have no clue as to what is actually going on out there or being deliberately disinformative. Please allow me to tear apart your post, point-by-point.

1. The subprime market is gone- Why yes, yes it is. Is this something that will help keep housing prices appreciating? Why no, no it isn’t. Without all those idiot buyers out there anymore you don’t have as much demand.

2. Mortgage business is up-Okay, its up. Why is it up? Are you referring to the recent glut of refi’s because of the temporarily lowered rates? Btw, since your in the mortgage business you must have noticed that they’re climbing again. Don’t expect them to go back down as long as Bendover Bernanke and the gubermint keeps on mucking around with things. The stories that I hear indicated that the mortgage business has already started to tank again after that little pump.

3. The remaining fallout will be the foreclosures from the people who got in over their heads on subprime loans or “liar loans” (stated income) and can no longer make their mortgage payments.- WRONG!! So god "golly"ed wrong it makes my teeth hurt! 30% of recent foreclosures came from PRIME loans. Add to that the fact that we won’t even hit the peak for sub-prime foreclosures till March/Apr ‘08! The foreclosures we’re seeing now are from people who defaulted in freakin’ July 07.
Whats going to happen to the market when theres still a huge amount of foreclosures hitting the market in Feb ‘09?! What then Steve?!

4. Most of those people will be washed out this year.- See above.

5.BTW, if you are waiting for mortgage rates to drop this year, don’t count on it!-Thank god you got this one right.

6. Inflation is a huge concern. -Why yes it is. For now. Wait till the deflation hits. People just don’t understand what inflation really is. Inflation = expansion of monetary base.
What do you call it when money is destroyed because a bank has to sell a house for 250k that they loaned someone 550K for? You call that destruction of the monetary base. You call that DEFLATION. Get used that word people, you’re going to hear a lot more of it.

RANT!

I said 2008 would be a bad year for foreclosures.

I did not say it was over NOW.

I said the worst will be over by the end of this year because the people who can’t afford their mortgage payments are going into foreclosure now.

By the end of the year, most of those people will be washed out of the market.

You have to understand that there is ALWAYS a certain percentage of mortgages in foreclosure. We are just seeing a temporary blip that is the result of about 3 years of crazy lending practices.

Some people on this forum, including “The Tim”, refer to me as a “mortgage company owner” … which is true.

But that is only a small part of my background.

I am also a licensed real estate broker. I’ve been a licensed real estate agent since 1988.

I am also a paid columnist for the Everett Herald. I have been writing a weekly real estate column the the Herald and other newspapers since 1990.

Again, let me emphasize that I am a PAID columnist. They don’t pay me to be a real estate or mortgage industry advocate, they pay me for my honest objective information and advice about real estate and mortgage issues which is exactly what I provide.

The reason I started wriing a real estate column way back in 1990 is precisley the same reason that many of you laugh at the Seattle Times real estate writer: they don’t know what they are talking about!

I’ve been working in the real world for over two decades, I know what’s really going on.

Prior to that, I was a TV reporter for 12 years. So I have been a professional writer and journalist for my entire adult life.

Believe me, I have taken some grief from people in the real estate industry for “talking down” the real estate market. In the fall of 2005, I stated in my Herald column that the Puget Sound real estate market was peaking and that appreciation would some come to a halt. In the fall of 2006, I stated in my Herald colum that appreciation was over and that 2007 would be a “flat” year with no appreciation and possibly even some price declines. In the fall of 2007, I stated in my Herald column that I think average home prices will fall 10-20% this year. That one really caused some people to get upset with me.

But as you can see, I was right on every “prediction”

I have been actively involved in real estate for 20 years in this market, and I’ve done a lot of research becuase I used to publish a paid newsletter for real estate investors back in 1989-1991.

So don’t think of me as just a “mortgage company owner.”

As for the questions about the credit crunch being over, the mortgage business is up this year after a very slow 2007, with both refis and purchases. Last stats I saw said refis make up about 65% of the mortgage market right now.

S-Crow confirmed this in his post above.

At my mortgage company we NEVER did any subprime loans, so the loss of the subprime market did not hurt us at all.

As I said above, we are back to a “normal” mortgage market where people have to qualify for loans. You can’t get a loan with crappy credit and/or lie about your income — which you could do for a few years when the mortgage industry had a period of temporary insanity.

Today, we are back to the kind of mortgage market that we have had for most of the 16 years that I have been in the mortgage business.

If you have good credit, you can get a loan to buy a house. That has never changed.

As for the questions about inflation, that has nothing to do with wages. Inflation measn increasing prices.

Inflation is now higher than it has been since 1981, so it is a very real concern for investors — which is why mortgage rates have jumped almost a full percentage point in the last month.

I hope that answers your questions and gives you a better idea of my background.

It certainly started out higher, but the salaries here are also higher. When comparing percentages based on CS, the overall index rise is very similar, I think the bay area was around 215 and Seattle is 190ish. I would venture to say that home prices here should fall less than Seattle if things were based on the ethereal “fundamentals” that realtors use (location, jobs, density, everyone loves it here, blah blah blah). The fact that none of this is saving our area should make Seattlites think twice about their market. I would venture to guess a lot of the “investors” who were buying in Seattle over the last year are my coworkers and neighbors, and they are not going to be buying up there anymore.

If Bendover B(ernanke) thinks he can inflate the housing market by lowering rates to spark an inflation then he has some surprises coming to him. On bloomberg today some economist was saying that the FED has pretty much falied at reviving the housing market by lowering rates. Because mortage rates are going up and not down because investors want to be compensated for the acceleration of inflation (such as the PPI figure released yesterday). Now as long as average Joe don’t get significant pay raises, he will have to spend more on food, energy and everything with that same pay check, BB thinks such a person would make a purchse of houses when RE prices have not been reduced to a reasonable level? In his dreams…..

Yeah, but Silicon Valley also started out with far higher absolute prices in the recent runup. Housing prices have been berserk on the peninsula since at least the early 90s.

I think you’re referring just to CPI – that’s “A” measure of inflation, but it’s not the definition of inflation.

- Tighten underwriting
- Increase pricing going forward, beginning in March
- Expecting doubling in default rates in 2008

So looks like thing are going to get worse. Also, it’s not just a subprime problem.

If a recession occurs, then all bets are off of course.

Goldman Sachs Adjustable Rate Resets
BOA Reset Chart

Is the worst over?

people are wondering “who” is purchasing and refinancing in today’s lending environment, I can tell you that the current pool of borrowers credit worthiness is of a much higher caliber than what I encountered a couple years ago. Money & high FICO’s. It is very good to see.

Thanks for the info Tim – what’s your feeling for new mortgage orgination and refinancing volume as compared to last year?

Evidence of “Walking Away” In WaMu Mortgage Pool
Banks Freezing HELOCs
MBIA CEO Recommends Split
Loan liquidator: CRE values in for steep drop
FDIC Bracing for Bank Failures

During the last 7 years wages have gone down; but it was compensated by throwing cheap money to people in the form of helocs; 1-4% credit card interest loans to good borrowers, etc. Now that the easy money dried up, I can’t see how inflation can continue. Bernanke hinted at another cut (there goes my savings account rate!!!); but I am not sure people can keep on borrowing. Just like with homes; no matter how cheap money is, eventually you run out of salary to pay back that debt.

This comment caught me off guard since parts of the DC Metro area as covered by C-S are in fact seeing the fabled 50% haircut already. 30% off peak isn’t even noteworthy anymore.

Do you have any evidence of wage inflation becoming a huge concern? Prices are going up, but are wages?

Is it technically still “inflation” if wages don’t go up?

I live in in Silicon Valley, so I really get a kick out of people on this blog who claim the water+mountains+tight regulation+tech combo platter will limit the downside potential in Seattle. We didn’t inflate here much more than Seattle did percentage-wise (a little more than 2x compared to a little less than 2x), yet most people expect this area to tank (and it is currently doing so).

Currently, I can tell you that our office is very busy right now with work, both refinancing and purchase business. It’s my belief that people are taking advantage of the softness in the market and low interest rates. Going forward into the Spring months we will know whether or not the very recent upward move in interest rates (around 6%) will be enough to confirm what many argue is a “temporary” scooting of rear ends off of the fence. per se. I use the term temporary because of the swift drop in interest rates in January was enough to spur healthy refinance activity. Whether that translates into meaningful and long-term purchase activity throughout 2nd qtr of this year remains to be seen.

If people are wondering “who” is purchasing and refinancing in today’s lending environment, I can tell you that the current pool of borrowers credit worthiness is of a much higher caliber than what I encountered a couple years ago. Money & high FICO’s. It is very good to see.