Many/most brokerages required amendments to the listing agreements, which would have brought out the distressed status of the listing. Either the agent or the broker could have decided to not list the property if distressed, or the owner could have decided to not sign the amendment.

The article in the Seattle Times RE section yesterday was very good. Congrats to Jillayne, she was quoted in several places. Looks like the ST is finally quoting people that actually are a bit more honest and knowledgable.

I’ve seen something I have never personally seen before, but maybe it isn’t all that uncommon elsewhere. I picked up a flyer of a new house that is still under construction and it featured interior spaces that are as yet unfinished! There is a nice picture of the unfinished living room, unfinished kitchen, unfinished entryway, etc. I guess Pullman realtors are not real big on “staging”.

I’ve seen something I have never personally seen before, but maybe it isn’t all that uncommon elsewhere. I picked up a flyer of a new house that is still under construction and it featured interior spaces that are as yet unfinished! There is a nice picture of the unfinished living room, unfinished kitchen, unfinished entryway, etc. I guess Pullman realtors are not real big on “staging”.

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Oil’s on its way back up too [and if gas went down 10 cents the last week, big friggin' deal]:

http://www.bloomberg.com/apps/news?pid=20601087&sid=aSnq6oyJGCB0&refer=worldwide

I need to write a separate post to answer all your questions! (or try to).

“Is FHA not leveraged that its loans have to fit in a budget?” Are you refering to a borrower’s budget? Typically the back ratio for FHA is around 45% of gross income (high I know, I’m just giving you the stats).

“From what you see, how much has loan volume dropped this year vs last year?” Personally, so far this year is pretty similar to last year. Neither of which have been typical in my 8 years in the mortgage industry (or my 14 years in title/escrow before that). Last year, at the end of July, my business stopped when the Jumbo market seized up. I happened to be doing more jumbos than ever at that time–partly because of the higher priced homes and I was working with more people relocating to WA from out of state (generated from my blogs and referral). The rest of the year was pretty darn slow.

Just recently I’m experiencing a little bit of a slow down and then spurts of business. (other than that, the rest of the year has been pretty solid for me). A part of the reason of why I’ve been keeping my plate pretty full is because there are fewer loan originators around so I don’t think that my volume of business is reflective of the amount of purchases or refinances taking place–just less LO’s to take care of them.

Full disclosure, there are two of us!

check out my photo on http://www.425realty.com

All the best,

Interesting to read your postings, I really enjoy reading your postings as well as Rhonda Porter, thank you for coming and hoping to read more educational material…
Ron..

What I don’t understand is where are the SOLD properties? If “sales” are “pending/in escrow properties” then where are the ones dropping off because they sold?

If they were start they would just turn them over to a realestate orginization and let them take care of it….On the other hand …If they were smart….They would not be in this mess.

I do enjoy my outlook. I’m not negative. I’m objective. Big difference.

I will go to Candy Lane and enjoy myself with nothing meaningful to say.

I hope that you enjoy your outlook on the world. Call it reality whatever you want. It is these comments that keep people coming back to this site. Your outlook is negative, cup half empty kind of person.

But before you pull your data out. Please make sure that it is relevant.

Actually The Tim does a nice job laying out his take the Seattle Market.

In that case, if they stay put it represents a decrease in demand and is negative for the market.

“Some people try to be optimistic and others are pestmistic”

looking past the misspellings (I don’t really care)

Ahhhhh…the power of positive thinking. Yeah…I know plenty of people that think like that. They lost their asses in the dot-com boom and are losing them in RE in places all over the country.

So where’d you move from TC?

What’s this delightful So Cal locale that was unaffected by the downturn?

Where in Seattle did you buy a condo?

In declining markets, sellers face the phenomenon of “Chasing the market”. They start high and reduce and reduce never really catching the market. In declining markets sellers must get ahead of the market so when normal market times build they find themselves “in the market” not “on the market”.

Which is why it’s critical agents understand AR’s and have the ability to communicate them. Along with a traditional CMA and other market information, help a seller position correctly to the market.

Sniglet @ 103 summed it up nicely. Granted, Real Estate will probably be worth more in 50 years if you don’t sell your house. In the mean time, it will drop considerably, ruin financial situations, and shatter the lives of people who choose to buy right now (assuming they can’t afford to ride it out 20+ years or need to sell for other various reasons). See FL, CA, AZ, NV, OR, MA, and more. New homeowners have lost EVERYTHING.

I recommend you go live in Candy Cane Land where unicorns and rose pedals line the streets. Your blind optimism, coupled with zero worthwhile arguments is nauseating. Please say something other than: ‘if it’s right for them, it’s the right time to buy’. You should move to Fremont, buy an 8 ft bong, and live happily ever after.

How you are possibly write for so long, yet say absolutely NOTHING is beyond me.

The calendar is conspiring against the housing market. We are moving out of the traditionally hot selling season and into the fall slowdown.

And in the middle of the best time, seasonally, to sell a home, people were pulling out.

All things point to lower prices/values over the next 6-9 months.

You seem to want some magical time to buy. However I am sure that you will miss that time as you will be spending your time here.

Hmmm… So the only way to tell if it was a good or bad time to buy is only after the fact (i.e. when we see what prices do several years after the purchase)? This is kind of like Greenspan’s comments about how you can only detect bubbles after they popped.

In fact the median “asking” price rose! I posted this above in #87. In the data I have access to, I can see OLP (original list price) LP (list price a the time of sale) and SP (sold price).
http://www.workingforyou.typepad.com//realestate/2008/04/nwmls-area-530.html

The prefect time to buy is always the past tense IMO as few of us can truly predict the future. But it is obvious right now is not that time, and bubble heads here are just arguing when that time will be again. Real estate price is not a "golly" 15 minute window, if the time is right, it will be right for a while…

The irony TC is that you have no data – prices go down, inventory goes up and you still talk fantasy….

I have a family member in the industry (just like you??)….he is happy his wife has “a real job” (how he puts it).

And….nope. I am a homeowner since 1997.

Again, if you are trying to sell your investment property, good luck and I am truly sorry you find yourself in this situation. If you want to move back to California; well, it seems that by December most of those markets will be even lower than Seattle. So hold on until Jan-Feb 09. Otherwise, stick around, and remember: “no matter the weather, true Seattlelites never carry umbrellas.”

Pestmistic: A bearded lady with supernatural powers that specializes in the prediction of future events involving insects and/or vermin.

What I am saying that people make the best decisions at the time. I didn’t say that 3 years ago was a great time to buy. RE markets change all the time. People make their decisions and then make the most of them.

I used to ask when is the best time to buy a house. The answer I got was when you are ready. I agree that there is not much logic in that however back to point people buy when they are ready.

You seem to want some magical time to buy. However I am sure that you will miss that time as you will be spending your time here. Where you will ge engaging in the same types of conversations for some time to come.

Guess what you might miss that “perfect” time to buy.

You have the same old tired thing as well. The economy is in a tailspin that has been stated over and over again.

However you like to point how bad things are. You can quote all the stuff that you want I understand your logic in that.

RE market come and goes in cycles and that has been stated before.

Buecri I am sure that you are a renter. You can watch the markets all you want. I have read things over and over again and thoughts and opinions change all the time. The economists are making their predicitions. You are right things might get worse. I do have a place and I am sure that it has gone down in value, however it will go back.

Some people try to be optimistic and others are pestmistic.

The economy comes in cycles of growth and then recession that does is clear.

According to your logic, was it a “good” time to buy in southern California 3 years ago? If potential price declines don’t factor into a purchase decision then I suppose the decision to buy is a purely personal one (e.g. do I like the house or region, etc).

Still, I find it hard to believe that there are many people who bought homes in Sacramento 3 years ago who are happy that they did so.

Tim, I think it would be interesting to see if the median *asking* price also took a corresponding drop. If so, that would indeed indicate that a lot of of the over-priced “like to sells” are gone, and now we’re left with the remains.

TC – there is a guy called the Treasury Secretary, that I believe he knows a thing or two about money. Last Tuesday he said:

“U.S. Treasury Secretary Henry M. Paulson, Jr., offered a pessimistic view of the country’s housing slump Tuesday as he called for help for hard-pressed homeowners and new mortgage regulations.

But he urged Congress not to overreact by passing excessively harsh measures.

“Let me be clear: Despite strong economic fundamentals, the housing decline is still unfolding, and I view it as the most significant current risk to our economy,” Paulson said in a speech at a Georgetown University law forum. “The longer housing prices remain stagnant or fall, the greater the penalty to our future economic growth.”
——————————————

Please keep in mind these were the words of a guy that must keep cool, so the markets don’t react.

Thank you for sharing you just moved up from California. It helps to understand your situation.

Just like the other bulls, you probably have a unit for sale or make a living in this industry. I am truly sorry, and hope things turn around for you.

The point is this THE whole RE market ACROSS the NATION was fueled with cheap, easy to get (no doc) loans — IT WAS NOT FUNDAMENTALS.

How many times does this need to be stated. To return to the fundamentals when people actually did not look at the house as an ATM will take sometime and it will cause some pain BUT it WILL happen.

The point is that if someone who pulls their house off the market was going to buy a similarly priced property, it makes no difference because he’s just playing musical houses. His house won’t be sold but he won’t be buying either.

What makes a difference to the market is when someone changes their exposure. That is, moving from a renter to an owner-occupier (or vice versa), or up- or downsizing. Or buying or selling an investment property.

I’m amazed you caught that 5am… :)

I guess it depends on how you view the market, I find Greg’s assertion that there are “multiple” markets (as expressed in one his comments above) compelling. Following that. I’m assuming the person selling would be buying a higher priced house (since they’d be using their equity). I’m sure that’s not always the case, but I believe it’s true most of the time.

The two (so a very small sample size!) sellers we actually talked with about this were looking to go from a 3 bedroom to a 4 bedroom place.. I’m assuming that means they’d be in a higher price range. We heard of other sellers moving for these reasons, only though our Realitor (R).

Captain Kirklnad your point is weak. You are comparing other places to Seattle.

Southern California had one of the largest run up in prices in the nation. Southern California is a very desirable place for people to live, at least the part that I lived in. So just like when an area such as California sees such a larger run up and then they see large fall. California will come back. I know many people who have homes in that area and they are not worried. In fact they have been having homes sell again. However they have been creamed with foreclosures and short sales. There are some great bargins and people are scooping them up.

Your house is what it is worth when it is sold. I am sure that people in California lost money just people have lost money all over the country,

Seattle had a run up but not as much as some of the other places.

I remember your remark awhile back about somewhere in Arizonia.

I am sure that you think Seattle is doomed. If is it it will come back. There are some great bargins in this area. Many you should go get one and buy it below market value and then keep it for a awhile.

Right now is not the time for you to buy great for you.

Back to point many people make decisions that are right for them. Just as you are deciding not buy at this time.

You can be a side chair speculator all you want. I am sure that you will have some comment to come back with.

That is your opinion, I think that many people buy when the time is right for them. You have no idea if those people are informed,

Many times entry level is buying a condo and staying in it for awhile then moving up. I did that and now many other people that have done that. The price you are quoting is for a SHF and that number will be different in different places.

You can say don’t buy, your opinion. Things work out in the long run and you make money some things and may lose moeny somewhere else.

I am sure that if ask most people that their investments have gone up and down over the years, that is why people diversify their investments.

Some people have real estate and some people have other investments.

The areas you are taking about have lower home prices and people move to those areas. Seattle is growing and people are still moving into the area. There are many great things here and people will keep coming. Home prices will go back up.

Everything I said is my opinion and everything you said is your opinion.

RE prices will be different in different places as these areas have their own things going for them.

I have not read anywhere that now is not the time to buy. Many the people that are buying are busy living their lives and try to make the best decision at the time.

With regards to entry level, I know everyone is different. But 9 out of 10 times, entry level is someone young with not much to put as a down payment.

“However I think that people will still buy whenever the time is right for them” – Sure; but if those people were informed, they would never buy now. But economic news are “boring”.

They could be forclosures and short sales. Also the seller could be asking way too much for the property or they really have to sell it.

Also the information that receive from the media about the banks and lags behing what is currently happening. It seems like that has been discussed on this site.

Seattle is not that different than other places. It will probably or has already experienced some drop off. However I think that people will still buy whenever the time is right for them.

I guess that is my 2 cents.

I think that entry level is different to each person. It depends on their situation and what they have for a down payment.

Some people start off smaller with a condo and then bump up to a house in a few years.

Still the beginning homes in this area are still less expensive then other places.

No, the buyer who left is the same person who gave up selling the house.

Wait I minute, I misunderstood you. “Left” vs “is left”. :-)

The point is that if someone who pulls their house off the market was going to buy a similarly priced property, it makes no difference because he’s just playing musical houses. His house won’t be sold but he won’t be buying either.

What makes a difference to the market is when someone changes their exposure. That is, moving from a renter to an owner-occupier (or vice versa), or up- or downsizing. Or buying or selling an investment property.

Indeed, there was going to be a point where the “voluntary” sellers were going to give up, leaving the “must sell” out there. It starting to play out.

And as far as pricing, there is no “leveling”. Entry level means entry level and a $250K-$300K loan is not “entry level”. I know; in Seattle we don’t know any different; but that is changing. My daily e-mails from Redfin and Zip show a ton of “reduced price”.

………………………………………………………………….

Now for the morning ritual – open Yahoo Finance and read the headline that confirms the economy is recovering, and as RAL claims, the bottom was in Jan-Feb!!!!!

“Citigroup reports 2Q loss of $2.5B as more consumers fail to make their loan payments”

NEW YORK (AP) — Citigroup says it posted a $2.5 billion loss and laid off more employees in the second quarter as it struggled with surging loan defaults.

On 10/23, I wrote this on the 3rd quarter 2007 market changes. To date I know of no other local RE professional that called this: http://blog.seattlepi.nwsource.com/realestate/archives/124285.asp

On 1/21, I encouraged Sellers not to take a “Spring Mark Up”. Others called out for other ideas.
http://blog.seattlepi.nwsource.com/realestate/archives/129941.asp

In April I wrote a piece on a study that I did on Bellevue 530. This study showed the relationships between OLP (original list price) LP (list price) and SP (sales price). This showed the result of Sellers trying to take the spring mark up.

http://www.workingforyou.typepad.com//realestate/2008/04/its-finally-cle.html

and the 2nd part

http://www.workingforyou.typepad.com//realestate/2008/04/nwmls-area-530.html

On June 2, I wrote this piece about “Chasing the market down” I don’t think any other RE professional has come close to approaching this subject.: http://blog.seattlepi.nwsource.com/realestate/archives/140217.asp

And many, many posts and comments on the proper use of absorption rates in analyzing markets.

A common myth and misconception is that there is only one market. The real market for a buyer or a seller depends on location, price, and even house style, and can be quantified by absorption.

So no, it’s not rosy. Some areas and price ranges are holding up better than others. Some areas and price ranges are very challenged.

Thank you for asking the question. I detecting sincerity in it. This thread started as a very interesting topic and degenerated into a petty school yard name calling mess.

If you take the time to read and study some of these studies and conclusions, at the very least, they’ll give you some food for thought, whether you agree with them or not.

“In 1965, the Federal Housing Administration became part of the Department of Housing and Urban Development (HUD). Since 1934, the FHA and HUD have insured over 34 million home mortgages and 47,205 multifamily project mortgages. Currently, the FHA has 4.8 million insured single family mortgages and 13,000 insured multifamily projects in its portfolio.[1] The Federal Housing Administration is the only government agency that is completely self-funded. It operates solely from its own income and comes at no cost to taxpayers. This department spurs economic growth in the form of home and community development.

During budget planning for 2008 HUD had been projecting $143,000,000 budget shortfall stemming from the FHA program. This is the first time in three decades HUD had made a request to Congress for a taxpayer subsidy. Even though FHA is statutorily required to be budget neutral, the GAO is projecting taxpayer funded subsidies of half a billion dollars over the next three years, if no changes are made to the FHA program.”

I think that answers my question.

Earlier in the year when conforming jumbos were approved, at the time the Congress expected Fannie/Freddie to pick up the loans and securitize them(thus saving the market), no?

I’m not quite sure about the difference between FHA vs Fannie/Freddie. Is FHA not leveraged that its loans have to fit in a budget?

From what you see, how much has loan volume dropped this year vs last year? If the dropoff is sharper than the sales volume drop, I expect the difference is people w/ cash buying houses.

Thanks again. Your perspective is very informative.

I don’t see Fannie or Freddie saving the markets. And FHA won’t pick up everything either.

I did factor in how many transactions I can’t do right now…I’m turning away more people than I’m getting approved.

Then I’d know whether or not FHA will end up lile Fannie/Freddie, w/ potential trillion dollar cost. Your number that 50% of your loans are FHA really scares me. Of course, maybe the portion of FHA loans in the entire current market may be much smaller.

It’s kind of funny and sad to see how Fannie/Freddie were supposed to save the market and then need saving themselves. How do I really know if FHA is in the same bucket?

Thank you for your professional perspective.