I would have posted the reporting roundup on Saturday, but I was out of town for the weekend, and my only Internet access was dial-up (*shudder*). The tone of this month’s reporting isn’t too much different from last month, except that we’ve got a small dose of optimism thanks to a slight spring improvement. Of course, we’ve got still more bottom-calling as well, so that’s fun.
Also, Seattle Bubble gets yet another mention on TV.
Chris Ingalls, KING 5 News: A tale of two first-time Seattle home buyers
Real estate agents say that now is the time to buy in Seattle, especially for first-time home buyers.
But others say the latest data on home sales in the region suggests home prices could fall even more.
…
A recent report on the month of March says that home prices are stable — not dropping — and that means maybe they’ve hit the bottom.The Northwest Multiple Listing Service, sponsored by the realty industry, says housing prices have stabilized for six months — a signal of the end for falling home prices.
…
But [potential first-time homebuyer Brendon] Duran isn’t convinced that the price drop is over.“I think we’re content to wait and see what happens,” he said.
Analysts outside the real estate industry aren’t either.
Seattle Bubble, a real estate blog site, uses multiple listing service data to conclude the stabilization in home prices now is seasonal and that “now is not a good time to buy a home in Seattle.”
You can watch video of this report here. It would seem that Seattle Bubble is becoming a go-to source for King 5 News on the local real estate market. It’s good to see at least one news outlet getting quotes from someone other than real estate insiders. Thanks, King 5!
Click below for the rest of this month’s reporting.
Elizabeth Rhodes, Seattle Times: Home sales dive in King County, but prices don’t
Last month King County saw 37 percent fewer houses sell and prices fall 3.3 percent compared to March a year earlier. The real-estate market was no stronger in surrounding counties, the March sales-activity report released Friday by the Northwest Multiple Listing Service shows.
But here’s the riddle: With buyers edgy and more homes for sale, why aren’t prices dropping more? In fact, after being essentially flat since November, King County’s house prices actually ticked up $10,000 from February to $439,900.
The reason for the relatively modest year-over-year price decrease, real-estate economists say, is sellers’ unwillingness to cut prices. Economists call it “stickiness.”
It seems that “stickiness” is Ms. Rhodes’ angle this month, as she spends nearly the entire remainder of the article going on about it. The feeling I got from the article is that her message is “home prices won’t fall much, thanks to this amazing ’stickiness’ thingy, and anyway we’re practically at the bottom.” Low on substance, high on wishful thinking.
Jennifer Langston, Seattle P-I: Home prices remained steady in March
Seattle single-family home prices in March were unchanged from the previous month, but sank 2.2 percent from the same time a year ago.
The median price for in-city condominiums was 4.9 percent higher than in February with a 4.1 percent increase from the same period in 2007, according to figures released Friday by the Northwest Multiple Listing Service.
The numbers reflect continued pickiness on the part of buyers, who are benefiting from an abundance of homes on the market and slower sales.
…
The local market “has reached bottom — or pretty darn close” and although inventory continues to grow, so does optimism among buyers, Northwest MLS director Dick Beeson said.
…
But Ashley and Brian Yarno, who both work for Boeing and have been looking for a fixer-upper around Green Lake for six months, think the window to buy might be smaller.“If we don’t buy within the next five months, we’re stupid,” said Ashley Yarno, whose aunt is a real estate agent and advised the couple, in their mid-20s, that the time to act is now, before prices start climbing again.
I love it. That “we’re stupid” quote is priceless. I also notice that we’ve got another bottom-caller this month. I am going to start keeping a list of all the local real estate agents that call the bottom, so I can put them on a graph of declining home sales and prices.
Mike Benbow, Everett Herald: Home prices continue to tumble
Home prices dropped nearly 7 percent in Snohomish County in March, the biggest fall so far in the area’s slipping market, according to the Northwest Multiple Listing Service.
The combined median price for single-family homes and condominiums in March fell to $335,000, down from $359,950 a year ago.
The March market was similar to that of previous months, with a strong increase in home listings and drops in pending sales and completed sales.
It’s not surprising that we’re seeing the real softness in the market showing up in Pierce and Snohomish counties first. This is great news for people like me, that would like to eventually buy further out.
Rolf Boone, The Olympian: Real estate agents say drop in home prices not a worry
The median price of a single-family Thurston County home fell last month compared with the same period a year ago, but South Sound real estate agents said they were not worried about it.
Combined sales of single-family homes and condominiums dropped nearly 21 percent last month compared with the same time a year ago, while median sale prices held steady. Single-family home prices fell 1.71 percent to $250,585 from $254,950 in March of last year, the Northwest Multiple Listing Service reported.
Monthly sales prices generally have been rising during South Sound’s housing boom of the past three years, but real estate agents said they were not concerned about last month’s slight price drop.
“I would classify it as unusual, but I’m not alarmed by it,” Northwest MLS area services manager Jerry Wilkins said. “I continue to be fairly positive about our future. Those that price their properties appropriately are seeing a fair amount of (buyer) activity.”
…
South Sound broker Jeff Crandell said he isn’t sure prices will continue to drop, but he acknowledged that the housing market has slowed.“We’re not going to set any sales records in 2008, but I don’t think it will be a bad year,” he said.
Meanwhile, Thurston County home sales fell more than 20 percent on a year-over-year basis in March.
Meanwhile, local real estate agents continue to work against themselves by making unrealistic optimistic predictions.
I couldn’t find a story this month from the Tacoma News Tribune. If anyone saw one, shoot me the link and I’ll include it.
Update: Apparently Ms. Wells was on vacation this weekend as well. Here’s her story in the Tribune.
Devona Wells, Tacoma News Tribune: Pierce County home prices keep falling:
Median home prices in Pierce County continued a year-over-year slide in March as nearby counties also saw price declines.
Pierce County’s median price for houses and condos was $258,405, amounting to a 6.02 percent decrease from March 2007, according to figures released last week by the Northwest Multiple Listing Service. Prices declined for the sixth time in the past seven months.
Price drops here, however, pale in comparison to areas around the country seeing double-digit decreases, including communities in Florida, Southern California and the Midwest.
I suspect we’ll be seeing more of this as the decline continues here. We’re always going to look good compared to Southern California and Florida. Duh.
(Chris Ingalls, KING 5 News, 04.04.2008)
(Elizabeth Rhodes, Seattle Times, 04.04.2008)
(Elizabeth Rhodes, Seattle Times, 04.05.2008)
(Jennifer Langston, Seattle P-I, 04.04.2008)
(Mike Benbow, Everett Herald, 04.05.2008)
(Rolf Boone, Olympian, 04.05.2008)
(Devona Wells, Tacoma News Tribune, 04.08.2008)
Seems like we’re a long, long way from arriving at a point at which the full, tax-adjusted costs of owning a single family home are anywhere near the costs for renting an equivalent house..
So long as the aggregate choices made by those around us continue to elevate value of the intangibles associated with owning a home to anything more than about 10% over the price of renting – I’ll personally be happy to keep renting irrespective of whether the market has bottomed or not.
But JayB, that is entirely too rational. :-)
Really interesting paper for the Center for Economic and Policy Research titled “The Cost of Maintaining Ownership in the Current Crisis, Comparison in 20 cities”.
http://www.cepr.net/index.php/publications/reports/the-cost-of-maintaining-ownership-in-the-current-crisis/
I can’t get over the irony of everybody calling a bottom, when all that has happened is the roller-coaster of Seattle prices has just rolled over the top, and is hanging in that short period of equilibrium before it begins to accelerate down the backside of the slope. A crested top is now a bottom? Must be some kind of “new-speak.”
Even some of your jaded souls will not believe this one:
‘Anytime is the best time to buy’, says guess who
…through gritted teeth, presumably.
That is a very funny ad Ira’s got on the sidebar.
Wow AndyMiami ,
Those are some pretty scary negative equity numbers listed in that report.
Of course RE agents will always say – “Buy now! It’s a wonderful time to buy!”. Sharks.
Scotsman // Apr 7, 2008 at 1:15 pm
I can’t get over the irony of everybody calling a bottom, when all that has happened is the roller-coaster of Seattle prices has just rolled over the top, and is hanging in that short period of equilibrium before it begins to accelerate down the backside of the slope. A crested top is now a bottom? Must be some kind of “new-speak.”
It’s the Kool-aid that RE agents want would-be knife-catchers to drink. They deserve each other.
Everett_Tom // Apr 7, 2008 at 2:00 pm
Wow AndyMiami ,
Those are some pretty scary negative equity numbers listed in that report.
I would venture to guess that now is not a good time to buy. And I hope that the local media reports what this study is saying…but they probable will not..how sad for those who buy today, or over the last two years.
I see the media obsession with YOY stats remains unchanged. Here’s the thing; prices continued to climb last year well into summer. That’s when things started to go to hell in this market. But don’t expect the media to give the straight poop. After all, they’ve got advertisers to please!
And prices do not seem to show a YOY pattern anyway! Certainly not like sales and inventory does! So why do they focus on YOY changes in prices?
I’ve posted an image on my blog of percent declines of SFH and condos in King, Sno, and Pierce since the peak in each.
The ironic thing is that even if prices stay flat from here until summer, the change in YOY prices will get worse and worse as we get closer to the one-year anniversary of when the market peaked. I think they’d be better off if they just got the hard part out of the way right now and focus on price declines from peak.
Ugh, I gave a link to the post from last month. Here is the update using Mar data from NWMLS.
House prices – at least for the neighborhoods I have an eye on – have fallen in March/2008, as compared to February/2008.
I think the same is true all over King County, but the NWMLS doesn’t capture this data because:
1) Houses sold in March are more expensive than the ones that sold in February;
2) Houses sold in March are better (more square footage, better maintenance, newer, more bedrooms) than the houses that sold in February;
I wish point (2) above could be captured in comparison data. What is the average square footage of all houses sold in Feb vs. March? How about avg # of bedrooms? How about avg year-built? I bet that if we chart this data over the last few months, we’ll see price declines reflected from another angle – people getting more house for the same money.
It might help if we could track sales in $/sqft.
AndyMiami said
Couldn’t agree more. My wife and I actually had started looking when we got up to the area mid last year, and since doing some more research.. we’ve moved to renting while building up a larger down payment.
Alan, that’s a good point. I think that the Case-Shiller index takes into account $/sqft, but I don’t know for sure.
Plain vanilla “median price” doesn’t say much about the market as a whole.
Case Shiller compares sale prices on the same properties across time. If house A sold for $400k in 2000 then sold for $500k in 2005, CS would say the price was increasing 4.5% a year.
Update from Pullman, WA:
Good to hear the Seattle area is finally cracking because greater fools from the coast buying “investment” homes are the primary cause of our bubble. California bubble begats the Seattle bubble which begats bubbles in Yakima, Walla Walla and Pullman (to give a few examples).
But don’t worry, I’m reassured by local real estate agents that, you guessed it, “Pullman is different, Pullman is unique and Pullman is special.” What is happening nationally has nothing to do with us, and it was just a coincidence that Pullman homes appreciated at double digit annual rates from 2003 to 2007.
We are up to 163 single family and condos on the MLS right now, 60 more than last year’s peak. Needless to say that doesn’t even include our new condo developments (condos are the future in Pullman, didn’t you know, as there just isn’t enough land around here and everyone moves to Pullman for the edgy, urban nightlife.)
What amazes me, though, is that people are still BUYING and builders are still BUILDING! Sales are way down YOY, and the local population is largely boycotting real estate. With median home price approaching the high $200k range in a town with a median income of $50k, there are few local salaries sufficient to afford current prices. But we are still seeing folks come in from outside with a bucket of money and box of stupid.
There is an sweet new heatmap for foreclosures at hotpads.
http://hotpads.com/map/cities/WA/Seattle.htm#lat=47.6251869170292&lon=-122.263137817383&zoom=18&areaBorders=heatMapForclosuresPerCapita&listingTypes=foreclosure&bedrooms=1,2,3plus&pricingFrequency=once&loan=30,0.0642,0
Hey Groundhogday,
Glad to see you visit. I hear Pullman real estate will be supported by all of those double income families that work on campus. (They all make 6 figures each, you know.)
I’ve also heard that Pullman has an especially unique breed of pink pony, one that is suitably adapted to the harsh Pullman winters and declining home prices.
Yep TJ, You must be right about the double income thing… as recently as 4-5 years ago we didn’t have any double income families in Pullman which explains the $160k median home price in 2003. :-) But we can add that to the list of Realtor rationalizations… Never mind that two WSU incomes often add up to $50k/year (our median household income).
Grounhogday -
My significant other’s widowed mom sold her 3 bdrm 2 bath Pullman home on Yates Street for $219,000 in Sept 2006. I think she caught the very peak.
Do you have any more Glenn Crellin stories you want to share? :) We haven’t heard much from him lately.
Alan and AI in #14 and #16 –
Take a look at Radarlogic. They track the market based on $/sqft.
I was looking at this earlier today. According to them, the market peaked on 6/26/07 @ $236/sqft. As of 2 months ago, it was at ~$211. I was interested in the annualized rate of drop – which is sitting at about 17% a year for Seattle!
I’ll post something later. maybe a blog post.
I’m done…this freakin city is officially oblivious and delusional. I’ve been looking at the Mosler Loft condos…unit 1003 was taken off the market a month or so ago, and has relisted at $25,000 more than before.
How can this be possible?! I have been amazed and confused that with over 30 units available, and nothing moving, the units have not been dropping, but this is either complete arrogance… or stupidity.
http://www.johnlscott.com/propertydetail.aspx?IS=1&ListingID=31704762
Given how many people were using equity to make mortgage payments, the period of declining equity is going to feed on itself for some time.
There is no way that any of the metro areas with high use of speculative financing are going to just level off when the ability to refinance has been restricted.
off topic, I’m sorry…but I can’t get over Ira’s ad either…I may have to hire Ira for marketing! :)
Ira–that is the best ad, ever!
Thank You! You guys are too kind. It takes almost no effort on my part to look insane.
WaMu exists the wholesale mortgage business
Post 21… You have to have pink ponies!!!
I love the ad, Ira. It’s an absolute riot. I hope it serves you well. :)
Whenever I finally decide to jump in the market, I’ll give you call. You’ve proven your honesty and integrity here.
Great ad Ira.
geez ira, is this what it is come down to for you…..a starving realtor??
youd do better to go out and knock on doors.
AP
Pending Home Sales Hit New Record Low
Tuesday April 8, 10:21 am ET
By Alan Zibel, AP Business Writer
Pending Sales of Existing Homes in US Fall to New Low
WASHINGTON (AP) — The National Association of Realtors says pending U.S. home sales fell to the lowest reading on record in February, signaling the housing market distress is not yet over.
The Chicago-based group’s seasonally adjusted index of pending sales for existing homes fell to 84.6, which was 21 percent below year-ago levels.
Wall Street economists surveyed by Thomson/IFR had predicted the index would inch higher.
An index reading of 100 is equal to the average level of sales activity in 2001, when the index started.
DID YOU BLOGGERS READ TODAY’S SUBPRIME MESS WORLD BANK NEWS?
It seems our “insane growth” glueboard housing demise was simultaneous to our American industrial base collapse [that's coming back soon I predict, it has to, to pay the interest debt], as we brainlessly felt that we didn’t need an American industrial base, if we could borrow foreign money to build homes and buy their stuff.
Cheer up bloggers; the party’s over. Our industrial base is coming back soon and we will be buying less abroad….we have to.
See the AFP proof:
“…US mortgage crisis costs global economy 945 bln dlrs: IMF
9 minutes ago
WASHINGTON (AFP) – The International Monetary Fund said Tuesday the worldwide losses stemming from the US subprime mortgage crisis could hit 945 billion dollars.
ADVERTISEMENT
The IMF, in a particularly stark biannual report, said that falling US housing prices and rising delinquencies on the residential mortgage market could lead to losses of 565 billion dollars.
Combined with other categories of loans originated and securities issued in the United States related to commercial real estate, the consumer credit market, and corporations “increases aggregate potential losses to about 945 billion dollars,” it said.
“The crisis is spreading beyond the US subprime market — namely to the prime residential and commercial real estate markets, consumer credit, and the low- to high grade corporate credit markets,” the IMF said in releasing its Global Financial Stability Report.
While the US remains the epicenter, “financial institutions in other countries have also been affected, reflecting the same overly benign global financial conditions and to varying degrees — weaknesses in risk management systems and prudential supervision.”
It was the first time the multilateral institution has made an official estimate of the global losses suffered by banks and other financial institutions in the credit squeeze that began eight months ago in the US, amid rising defaults on subprime, or high-risk, home loans.
The IMF cautioned that its loss estimates were imperfect and could go higher….”
Interesting read, Software Engineer.
So, if our industrial base is coming back, is it going to be like we’ll be the cheap labor force producing manufactured goods for export?
local Realitor: Three words- Sense of Humor. It might help you personally and professionally if you had one….Believe me, I’m not starving. My doctor says I should lose 40 pounds. And if knocking on doors works for you, by all means continue doing it!
Knock, knock
Who’s there?
Ira
Ira who?
Ira want to sell your house!
Ira, thank you for putting a smile on my face everytime I see your ad ;) It’s nice to know there is a Realtor that will be around thru thick and thin times. U R A HOTTIE!
Ira’s ad is completely brilliant – superb mockery of all the agents who have their photos taken at Glamour Shots.
Way to stand out from the crowd…
I’ve never been all that concerned about losses in manufacturing jobs. I think it is a falacy to think that manufacturing jobs are somehow “sticky” and that it is difficult to re-build plant capacity once it is lost. If anything, the last couple decades have proven just how EASY it is to move plants and jobs from country to country as the needs dictate.
When economic circumstances become favourable again (i.e. attractive currency exchanges and labour rates) manufacturing jobs will pour back into the USA faster than anyone can imagine.
I liked Ira’s ad so much I looked at his Bio, and sent him an email offering him a job. We need an Agent with his determination but can he maintain his professionalism and get paid less per transaction. I suspect not! Either way Go Ira!!
Ray Pepper
http://www.500Realty.net
Layoffs at WAMU, 3000+