January Reporting Roundup: C’mon ‘N Ride The Train

Here’s the NWMLS press release that accompanied yesterday’s numbers: Home Buyers Starting to Seize Opportunities in Some Western Washington Areas

“Home buyers in Pierce and Kitsap are starting to recognize the opportunities that exist for first-time buyers and those looking to buy a home in the more affordable price ranges,” said J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “These areas were the first to feel the housing market adjustment, so it’s natural that they would lead the road to recovery,” he added.

MLS director Dick Beeson, broker/owner of Windermere/Commencement Associates in Tacoma, agreed. He estimates one in four pending sales in Pierce County last month were short sales (a sale in which the proceeds are less than the balance owed on a loan; such sales are typical to prevent foreclosure). Beeson attributes the uptick in pending sales to short sales along with low interest rates and a buyer pool that’s “finally waking up to the excellent values in the marketplace.”

“There’s no question that buyers are being educated and coached by agents in how to craft offers within lender approved guidelines that garner good price values along with seller concessions for closing costs and needed repairs to the property,” according to Beeson. Given the pent-up demand, he believes passage of a stimulus package with key elements for housing would spur a housing rebound.

I’m not so sure that Dick Beeson is the best person to be “coaching” home buyers, but maybe that’s just me.

“It’s pretty clear that the real estate train came to a complete stop over the past few months,” acknowledges NWMLS Pat Grimm, owner/broker of Windermere Real Estate/Capitol Hill, Inc. “The good news is that the train was moving pretty fast before and now people have an opportunity to get aboard.” Affordability is the key, according to Grimm. “With interest rates and prices down, dream properties are within reach again and we’re starting to feel the train building up steam.”

“I have heard several reports of a dramatic increase in buyer activity,” said Pat Grimm, owner/broker of Windermere Real Estate/Capitol Hill, Inc. “Buyers are anticipating a window of opportunity where prices are low, inventory is plentiful and financing is both obtainable and inexpensive,” the MLS director noted, adding, “In Seattle, well priced and well positioned properties are getting multiple offers.”

Oh wait, whoops. That second paragraph from Pat Grimm was actually from January 2008. Sorry about that.

So this month’s theme is apparently travel metaphors. We’re on “the road to recovery” and “we’re starting to feel the train building up steam.” If we keep saying it enough, eventually it will become true, right?

Karen Gaudette, Seattle Times: King County home prices down nearly $100,000 from peak

When we’ll hit bottom is anyone’s guess. What’s clear is that the Seattle-area residential real-estate market has fallen a long way from its peak and is still headed down.

The median price of a single-family home in King County has tumbled nearly $100,000 — or 20 percent — from the high point of $481,000 in July 2007, according to figures released Wednesday by the Northwest Multiple Listing Service.

“Do we think the bottom of the housing market will be this year? I believe it will be. But when this year, that’s another question,” [Matthew Gardner] said. “Right now we’re still hit by paralyzing news with monotonous regularity. It’s a very tough economic environment.”

Have I mentioned that I miss Elizabeth Rhodes? Reading the monthly real estate reports in the Times just isn’t fun when they’re so down-to-earth and lacking in blind optimism. Oh well.

Aubrey Cohen, Seattle P-I: King County’s house prices, inventory drop

“I think we’re going to continue to see pressure on prices throughout 2009,” said Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University. That’s because he expects a lot of distressed sales from the many 2006 buyers who used mortgages due to reset to much higher payments after three years.

The drop in the number of homes for sale “is reflecting some stabilization in the market,” Crellin said. “We’re getting some of that excess inventory out of there, which we really need for the market to stabilize.”

I don’t think many of us would mind things “stabilizing” at ten to twelve percent yearly price declines for a while. I say bring on the stabilization!

Mike Benbow, Everett Herald: Home prices in Snohomish County tumble 14%

Prices for single-family homes in Snohomish County dropped significantly in January, news that distressed owners and sent more buyers out looking for bargains.

Bob Maple, broker owner of the John L. Scott office in Everett, noted that the forces driving prices down are short sellers —people whose homes are worth less than what they owe — and banks that have foreclosed.

“Price is the key,” he said. “There are a lot of (bank- or builder-owned homes) and they are priced to sell. They just keep dropping the price to get them off their books.”

“Our pendings were way up … they were the highest they’ve been in six months,” he said. “There’s a new president and a new attitude and people are feeling better about things.”

Are there seriously people out there that base their home-buying decision on who is sitting in the White House? Really?

Kelly Kearsley, Tacoma News Tribune: Pierce County median home price stays stable

Both the shrinking inventory and increased pending sales in Pierce County are signs that the market might be stabilizing, said Glenn Crellin, director of the Washington Center for Real Estate Research in Pullman.

“I’m delighted the numbers are as good as they were, but I’m not sure it’s going to be maintained especially with the national economy in as severe of a recession,” he said.

More foreclosures could be on the way in Pierce County as adjustable-rate mortgages continue to reset. The real estate market was still chugging along in 2006, meaning people were still getting loans. Those rates will likely reset this year, translating into higher payments, Crellin said. (The foreclosure rate is much higher in other parts of the country, such as California, where prices fell farther and faster.)

I love the parenthetical addition. True, but totally unnecessary and useless information.

Rolf Boone, The Olympian: Deals boost home sales

Year-over-year Thurston County home sales rose for the first time in nearly two years in January as South Sound buyers took advantage of bargain prices for single-family residences and condos, according to home-sales data released Wednesday by the Northwest Multiple Listing Service.

Real estate agent Andrew Oczkewicz said business picked up right after Christmas. One of his listings, a house on 3.69 acres in Olympia that had been on the market since June, suddenly received renewed interest in the form of 12 showings and three offers.

“Mortgage interest rates are low, great bargains on houses are still out there and they decided to come to the table,” he said about his prospective deal.

Oh, well if Andrew Oczkewicz’s listing in Olympia got twelve showings and three offers, we must have hit bottom! What more evidence could you need?

(Karen Gaudette, Seattle Times, 02.04.2009)
(Karen Gaudette, Seattle Times, 02.05.2009)
(Aubrey Cohen, Seattle P-I, 02.04.2009)
(Mike Benbow, Everett Herald, 01.07.2009)
(Kelly Kearsley, Tacoma News Tribune, 02.05.2009)
(Rolf Boone, Olympian, 02.05.2009)


About 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.

27 comments:

  1. 1
    The Tim says:

    Sorry about the slow loading on the blog and forum today. My new host is apparently experiencing some technical difficulties.

  2. 2
    The Tim says:

    Looks like everything may be back to normal…

    *fingers crossed*

  3. 3

    HI TIM

    Yes, your website was definitely anomalous today, albeit, your not the only one, other webs are acting strange/slow today too….I hope it wasn’t that worm the ITs were talking about lately and our anti-virus couldn’t sift out.

    I imagine a lot of the RE folks figure if Seattle has a strong global economy; it will eventually be the pink pony city of America, with its alleged economic reliance primarily on its ports. I saw on channel 13 yesterday a RE type exageration on Buy American provision in the stimulus bail out, the globalist bent news cameras showed the ports and that explains why Buy American is bad for the economy and RE….lol, why didn’t they show pictures of trains and trucks [they bring American made stuff from the midwest to Seattle] or more importantly, pictures of all of Seattle closed domestic factories.

    But a lot of RE folks have lost their pragmatism and common sense reguarding the “globalist clown” caused depression and it isn’t change they want, no, not at all.

    We need to keep them honest and educated Tim. Let’s hope President Obama keeps his campaign promises on Buy American too, our futures clearly depend on it.

  4. 4
    Teacher_Greg says:

    The only train is Terry Tate’s “Pain Train”….

    http://www.youtube.com/watch?v=yvgkl-3ze4k

  5. 5
    Ray Pepper says:

    Andrews 12 showings and 3 offers are more then proof enough for me. All is GOOD! Does this mean I’m gonna here that horrid commercial again from The Chapter 11 Shane Company?

  6. 6
    Colin says:

    Sorry to be threadjacking, but I’m in the market for a fee-for-service agent who can get me in to see some houses — like an afternoon of driving around, six houses, that’s it. I already have a RE lawyer.

    So far, in the Seattle area, I’ve found RT Brokerage, which asks $160/hour, and America-at-home, which asks $200 for the first hour and $50 for each additional hour.

    What am I missing? Or is there a prior discussion on this site anyone can point me to?

  7. 7
    Interloper says:

    It’s nice to see the Times reporting, well, *reality* for a change.

    Maybe they *are* equipped to be the only newspaper in Seattle.

  8. 8
    Saul says:

    Are there seriously people out there that base their home-buying decision on who is sitting in the White House? Really?

    Are you kidding? Especially in the city of Seattle, I think we would have lost about 2.3% of our residents to B.C. if McCain had won.

  9. 9
    EconE says:

    http://www.urbanashley.com

    I had a 3 hour tour that was $200.

    Money well spent.

  10. 10
  11. 11
    Scotsman says:

    My uncle’s step-son told me that his sister’s hairdresser heard that a neighbor knew a guy who had four offers on his property over the weekend!

    The best offer was a lease-purchase for 65% of the asking price, but hey, it looks like we’ve turned the corner!

    Buy now, or be priced out forever! /sarc

  12. 12
    pfft says:

    “With interest rates and prices down, dream properties are within reach again”

    Just think, during the bubble years did they ever tell you they were pushing you to buy your non-dream home or your non-gem?

    these people are simply biased salespersons. do not listen to them anymore than you would ask a stockbroker if you should buy stocks.

  13. 13
    Andy says:

    Pfft,

    I agree completely; and many of them should be thrown in prison
    Mortgage brokers, appraisers, and Real Estate Agents pushing homes are worse than cold-calling brokers in a Sweat Shop in New York

    Digusting profession!

  14. 14
    Ray Pepper says:

    Colin——-You must be kidding. FEE FOR SERVICE AGENTS? I have 4 Agents that will gladly open all the doors you want at 60.00 an hour! Why the heck would you pay so much for door openers?

    You must be joking!

  15. 15
    shawn says:

    What, a Realtor ripping off people, no, no, no, shocker!?!?!?

  16. 16
    Colin says:

    Thanks EconE!

    Ray. I came across your site in my wanderings and didn’t see that service listed, so thanks for mentioning it here. (It’s also possible, if you don’t mind the suggestion, that a less annoying website might attract more customers.)

  17. 17
    Ray Pepper says:

    Colin….Were working on it!….New one should be rolling out after the Seattle Home Show! C U THERE!

  18. 18
    Ray Pepper says:

    BTW Colin……….Didn’t you see the Homepage? “WE NEVER CHARGE FEES TO TOUR HOMES?” Why would you pay anyone on an hourly basis? A 3 hour tour for 200? Good Lord! For Door Opening? My wife and I are RN’s making 40.00 an hour. I can’t imagine paying a Realtor for this more then we make as nurses. Please explain.

  19. 19

    Colin,
    Depending on where the houses you want to see are, I’d be willing to do it for free, and not try to get you to change your mind about using a lawyer instead of an agent.
    What’s in it for me? You can say nice things about me to your friends and relatives, and maybe buy me lunch.
    I’m out of town until Feb 12th, but anytime after that? Let me know.

  20. 20
    David Losh says:

    The problem with fee for service in the State of Washington is the agency agreement with the Brokerage.

    The person driving may or may not make comments during the tour. Those comments or ommissions can end up in a transaction.

    We may see independent consultants outside of Brokerages doing fee for service, but they will not be opening doors. The key box is tied to the Broker.

    I would want an agent showing a listing of mine, for both the security of my seller and the the integrity of any transaction that may follow.

    It would be worth exploring how every one can be served. Jim Stacey brought us the Buyer’s Agent business model, now there is a lot of money thrown at the web 2.0 idea.

    When you are a seller how should you be served? When you are a buyer are you being served by having the internet determine your perception of a property? We have already seen sites like craigslist exploited by real estate agents.

    What serves the consumer best? What should the business model look like? Attorneys have uses if you know what to ask for. There is a lot to know, but it’s very hard to know who to trust.

    My dream business model is a team approach that pays a salary plus bonuses. There would be departments for research, home showings, legal counsel, transaction coordinators, staging, prepping properties, home maintaining, and other services related to real estate like property management. The shared income would be paid in salaries plus bonuses for customer satisfaction and growth of the business model.

    BTW real estate agents and brokers are resistent to the idea, even though it would function very much like a traditional brokerage.

  21. 21
    Ray Pepper says:

    Colin I would take Ira up on it. When you hop in the car with one of us 500 Guys you will hear relentless pumping of our Business Model, the demise of the conventional real estate profession, the impending collapse of the MLS as we know it, and you will be required to take home a 500 shirt.

    Save yourself the headache and buy Ira lunch. He is a truly nice guy. So is David Losh but I’m afraid you may get an earful as well.

  22. 22
    Chet says:

    Realtors are sales people. Sales people do not receive $60.00 or even $6.00 to educate potential buyers. Particularly in the current climate, the skilled agent will not hesitate to provide this “marketing’ with the hope of future business or referral. Besides, with sales slow, what else is the sales rep to do with their time? In all areas of sales, visiting and cultivating future clients is the trend…when sales are down, the sales rep has plenty of time to talk. Now they can inform and educate or blither on self indulgently suggesting: NOW is a GREAT time to buy or pay me consult $$ to do what is actually the role of a good agent who seeks any sort of future in sales.

  23. 23
    mukoh says:

    I am seeing properties granted only 1-3% of them in the 99s levels which is great.

  24. 24
    Colin says:

    Thanks for the offers and comments!

  25. 25
    David Losh says:

    Washington state is an agency state. The agent has a responsibilty for a transaction. It should be a fiduciary responsibilty to act in a client’s best interest, but the law, as I read it skirts that demand.

    Your agent is for sure an advocate for the client. The salesman model you are talking about is a cliche.

  26. 26
    stephen says:

    RE: Colin @ 6

    my electrician charges $160 for the first and $85 an hour after, the number don’t seem that outa whack…

  27. 27
    stephen says:

    RE: Colin @ 6 – nothing those are good numbers. My electrician charges similar rates.

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