April Neighborhoods Months of Supply Interactive Update

Here’s your look at March’s “Months of Supply” for the 30 NWMLS areas in King County. For an explanation of what months of supply means, please refer to the original neighborhood MOS breakdown post. Also, view a map of these areas here. In place of our usual boring static charts, this month we are proud to expand our usage of interactive data visualizations from Tableau Software into a new monthly update.

Unfortunately, due to a change in definition by the NWMLS last July, the number of active listings will be lower than a year ago, while the number of pending sales will be higher, causing the months of supply to be lower than it would otherwise have been.

Summary

April MOS for King County as a whole dipped down further into so-called “seller’s market” territory at 4.5.

Here’s a year-over-year comparison for each NWMLS neighborhood. Again, take the below comparison with a giant grain of salt, since the NWMLS has changed the way they count listings and pendings since last year. As an example of how this data may be skewed, if there were 6,000 active listings last year (300 of which—5%—were “subject to inspection”) and 1,000 pending sales, we would have had 6.0 months of supply. However, this year under the new counting method, the same scenario would result in 5,700 active listings and 1,300 pending sales (300 being “pending inspection”), giving us 4.4 months of supply—27% lower.

Year-Over-Year Comparison

Even with the change, most of the Eastside remains above 6 months of supply, while most of the other neighborhoods around King have dropped below 6.

Regional History

Months of supply decreased again in most neighborhoods from March to April, matching the normal seasonal pattern. Just nine of thirty neighborhoods remained in “buyer’s market” territory.

The cumulative MOS for Seattle proper dropped further into “seller’s market” territory at 3.7, while the Eastside as a whole dropped as well, but remained a “buyer’s market” at 6.2.

The three toughest markets for sellers were Enumclaw (300) at 11.3, Downtown Seattle condos (701) at 10.8, and Kirkland–Bridle Trails (560) at 9.9.

The three best markets for sellers as of last month were Central Seattle SW / Beacon Hill (385) at 2.3, Ballard/Greenlake/Greenwood (705) at 2.4, and North Seattle (710) at 2.7.


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.

133 comments:

  1. 1
    biliruben says:

    A suggestion –

    The months of supply trend graph, which I find most interesting, is next-to-useless due to scale issues. Maybe give us the option to break out particular regions or neighborhoods? Do you have historical data back earlier than 2007?

  2. 2
    David McManus says:

    The charts and graphs are all blank for some reason. ?

  3. 3
    biliruben says:

    Yeah – his new fancy software crashed my I-phone. On a computer with a decent processor you should be able to load ’em.

  4. 4
    David McManus says:

    Hmmm…..is 2.6 ghz decent enough?

  5. 5
    biliruben says:

    Huh – maybe you need flash installed?

  6. 6
    Kary L. Krismer says:

    Tim’s changed something again. For me to get the charts to load I had to mess with No Script (Firefox).

  7. 7
    biliruben says:

    I know.

    Ask softwareengineer!

    I’m on the wrong side of Lake Washington to be fielding these issues!

  8. 8
    Kary L. Krismer says:

    It’s not a flash issue. I don’t allow Flash through firefox.

    For others using NoScript, you need to allow Tableau.

  9. 9
    The Other Ben says:

    RE: biliruben @ 7 – He’ll just tell you that overpopulation broke the graphs. :)

  10. 10
    waitingforseattletocool says:

    The Tim,

    Is there anyone on this blog, including you, actually on the street, looking for houses and making offers that has any feedback to market conditions?

    There seems to be this great conspiracy theory in every post for the last couple weeks, but does anyone actually have a pulse on the street regarding the ease or difficulty to acquire a good house in a good neighborhood with all the functional requirements people are seeking?

    I just don’t get a sense as to what buyers and sellers are experiencing in today’s market relative to the past 6-12 months.

  11. 11
    Kary L. Krismer says:

    In IE8 (and presumably 7) your security settings have to have “Scripting/Active Scripting” as allowed, although there are probably other things that could be turned off and affect it too.

  12. 12
    Kary L. Krismer says:

    RE: waitingforseattletocool @ 10 – I’m not sure what you want. There’s more than a fair amount of inventory, most of it that’s not a short sale or bank owned is in better condition than what you would have seen two years ago, but there just aren’t enough buyers to absorb it, so the sellers can be somewhat desperate.

    The sellers I feel sorry for are the ones with some property condition you just can’t change, like being next to a busy road or messy neighbor. In a hot market that can get overlooked, but not in a neutral or buyer’s market.

  13. 13
    biliruben says:

    RE: waitingforseattletocool @ 10

    We bought this spring. We were looking In-city (Seattle), north-end. Big yard. 500-650K. Quiet street. We had some competition. We looked for over a year, and I became pretty adept at pin-pointing what houses would go fast.

    These were pretty specific requirements. There appeared to be much less competition if we were to venture north to Edmonds, LFP, Shoreline, Bothell, Woodinville. Edmonds in particular, there are just no buyers at all, last I checked.

    I can go into greater detail if the market segment is close to what you are interested in.

  14. 14
    waitingforseattletocool says:

    RE: Kary L. Krismer @ 12

    I am just trying to get a sense from buyers, sellers, AND agents as to conditions on the street.

    The agents that post on this blog seem to get hammered for their views due to having a vested interest in the market, but I would argue that the buyers / bears have just as much or more vested interest behind their viewpoints.

    I just don’t get a sense from the buyers / bears as to what they are experiencing real time. Maybe they are all just waiting for that Mercer Island waterfront property to sell for $250K.

  15. 15
    deejayoh says:

    RE: biliruben @ 3 – bili – you can’t crash an iPhone! they are perfect. I read it on the internets!

    /sarcasm

  16. 16
    patient says:

    RE: waitingforseattletocool @ 14

    I don’t think it’s so much waiting for a special price, at least not for me. It’s more about the economy at this stage, it’s in a very. very bad shape and I need to know better where it’s going before even thinking of buying a home. Who knows at this stage $250k for a Mercer island home might be regarded expensive before this is over. We have a huge deficit, banks and consumers are broke and unemployment is high and growing fast. Not a good time to take on big debt.

  17. 17
    Kary L. Krismer says:

    RE: waitingforseattletocool @ 14 – The people that think prices still too high wouldn’t really know what the market is like, because they probably wouldn’t be out looking. Sellers might give you too pessimistic of a view point for one reason or another. Bili’s answer was good, but he might find less competition in that price range than in something under 400k.

  18. 18
    biliruben says:

    Uh. Er. Um. Maybe I mispoke! Wouldn’t want to piss-off the legions of devoted! They can be ugly cusses. Especially on the internets.

    I’ll just say I got frustrated and shut ‘er down.

  19. 19
    The Tim says:

    RE: biliruben @ 1 – I haven’t entered the info into my spreadsheets further back than 2007, although I have all the data in pdf format back through March 2000.

    As far as the ability to break it down into regions or neighborhoods, you can click on a specific area or on a region on the left side of the “Summary” section and the months of supply trend chart will highlight just those areas. Then if you float your mouse over that chart, it will give you the specifics of any data point you float over.

    If you’re looking for something different, could you describe it in more detail? I’m certain just about any type of chart you imagine (within reason) will be possible with these Tableau charts.

  20. 20
    Jon says:

    @14, WaitingforSeattle: The market is picking up, especially in the lower price points. As agents, we see our fair share of Short Sales, but generally speaking it’s a minority in my marketplace (water to water, 85th south to I-190). There are definately better pockets in those areas, such as Queen Anne, Phinney, Ballard, etc). Homes that are priced above $600k, and condos that are priced above $400k are having a lot more difficult time. I am hearing of a multiple offer situation on a daily basis… and a lot of those multiple offer situations involve two or three offers BELOW asking price. However, there are a lot of homes that are selling within 10 days of being on the market.

    Does this help answer your question?

  21. 21
    biliruben says:

    Hey Tim –

    My complaint was that the MOS axis goes to 48, which makes differentiating between 4 MOS of supply and 14 months of supply (or smaller changes) difficult with such a huge scale.

    If I were to select a neighborhood and the graph rescaled, it would be perfect!

    Or you could just write off the entire east side as a wasteland of inventory with nobody foolish enough to want to buy there, and we could get to the meat more easily! ;)

  22. 22
    The Tim says:

    RE: biliruben @ 21 – Ahh, so something that acts more like the last chart. Got it. Will run that by the Tableau folks and see what we can do. Thanks!

  23. 23
    Ellie Fields says:

    @billruben, thanks for the comments. What you request is quite possible, if I understand you right. What displays depends on how you build the graph.

    Take a look at this alternate version:
    http://seattle-bubble-tableau-online.blogspot.com/

    Ellie

  24. 24
    Greg Perry says:

    RE: waitingforseattletocool @ 10

    OK, here’s a field report:

    I have put together 3 deals in the last 3 weeks. Two buyers and one seller.

    Buyer 1. W Seattle. Original LP was around 420, List at time of purchase was mid 340’s. Buyer offered in the area 310-315 and got it.

    Buyer 2. offered 12k off a house listed for 280k (after a large price reduction) in Lynnwood and got it.

    Seller had a home listed (estate sale) for 245k in the Shoreline area. We had a few short sale comps and REO comps right at the 200k area and a clear comp at 245. We had 14 offers and a considerable escalation in price. Buyer came with cash.

    I’ll be writing an offer on Friday for a home in Bellevue priced in the upper $400k range.

    I just got off the phone with a friend who has put 5 deals together in the last 2 weeks on the Eastside. Two of these were buy/sell clients (4 deals) and the 5th was a listing. Interestingly enough both were in the 2nd price tier. He received 2 offers on 2 of the listings.

    Weekend open house traffic has been brisk. On Mother’s day, my partner had 8 parties through an Eastside home priced in the upper $300k’s. This is typical of good inventory on the eastside right now.

    You can see the hot spots from Tims graphs. I prefer to call a Seller’s market when there is less than 3 months of inventory. By that definition, MLS 705,710 and 385 qualifiy. Most of the rest are improving to balanced markets. (3-6 months). Lower price ranges are hot. Upper price ranges are not.

    Now I can’t wait for the inevitable few to jump in and say it’s all a conspiracy.

  25. 25
    biliruben says:

    Yeah! Nice, Ellie.

  26. 26
    singliac says:

    sexy charts, man.

  27. 27
    patient says:

    RE: Greg Perry @ 24 – It’s a concspiracy. Seriously Greg that wasn’t that bad, it seems slightly inconistent though to say that the lower price range is hot and in the same comment include to low price purchases where the buyers got offers below listing accepted on already reduced prices. Why would the sellers do that if that market is smoking hot?

  28. 28
    Esol Esek says:

    I’ve been sitting on enough money to throw down a 30-40% down, but in this environment, why? We dont know if roral economic armageddon is just around the corner, or if Boeing might leave (seems like it would cost them a fortune to do so, but who knows..). Plus, the weather around here, ya know, it just gets a bit old sometimes. Maybe a place in the Sierras, N cal, or Moab would be better, if job location isnt an issue…

  29. 29
    Magnolia44 says:

    Greg,

    Let me get it started ” you are lying”

    Lol, these guys here…. Too funny.

    Oh and the crowd concerned about my bitterness level, if I was really distraught would I visit a real estate website? Would I have said before it happend I expected 12-15% declines?

    Like I said time and time again, life is good my only concern is the overall economy.

    I have family in so calif where its pretty bad, guess what even in the 40% off areas life goes on for some people and walking away is not an option some stick it out.

    According to people like software engineer the whole country will be defaulting and foreclosing anytime now.

    Yes… Perry and Harry are the crazy ones we get it.

  30. 30
    Magnolia44 says:

    Did I say Harry.. I meant Kary, sorry for the butcher.

  31. 31
    David McManus says:

    Ok, the charts finally loaded. I think the FlashBlock addon was doing something behind the scenes and not notifying me. Everything works fine now that seattlebubble.com is whitelisted.

    Look at those pretty colors! :)

  32. 32
    Greg Perry says:

    By patient @ 27:

    RE: Greg Perry @ 24 – It’s a concspiracy. Seriously Greg that wasn’t that bad, it seems slightly inconistent though to say that the lower price range is hot and in the same comment include to low price purchases where the buyers got offers below listing accepted on already reduced prices. Why would the sellers do that if that market is smoking hot?

    Fair question.

    The first law of negotiation is “Time is the enemy of the seller”. No matter what, no matter the market — if excessive market time builds, the seller gets whacked.

    In the my first 2 examples the seller started waaaaay high for market conditions and then chased the market down, really never catching it. If they would have priced correctly to begin with, they would have made more money and sold quicker. In the example of my listing, we purposefully priced on sharp side and gained a quick, escalated cash sale after receiving several offers.

    At this time movement on the low end is hot. I am just starting to see signs that prices are stabilizing in the close in lower price ranges. 705,710,715,720,140 will stabilize first, then the best eastside areas next IF the sales continue. Price patterns follow sales ratios. We saw it going down, we’ll see it going up. Competition (multiple offers) are being reported throughout the region, which means sellers will likely start to get their asking price, or more.

    2nd tier is actually still pretty slow. High end is slow. Prices will likely continue to slide in these ranges.

    This is important. When you see county numbers decline. IT DOES NOT MEAN prices in Seattle are declining. They may be climbing! On the Eastside, for example, Area 600 could soon be seeing positive 3-5% appreciation under $500k, yet losing 3-5% in the $500k-$1mil range and losing 12% or more in the +1 mil. range. Area 600, as a whole could still show declining median prices while this is going on.

    If the current trend continues, we’ll be having market compression discussions..

  33. 33

    RE: waitingforseattletocool @ 14

    My two cents:

    I’m a whole lot busier than I was last May. Whether that’s due to a change in market conditions or just that people have realized that I’m smart, funny, good looking, and humble, I don’t know.
    In some neighborhoods like the top of Queen Anne, for example, there aren’t a lot of old Craftsman homes in nice shape for sale, and those that are haven’t come down in price nearly as much as the overall Seattle area.
    I wouldn’t say that any areas have been immune to the downturn, but some areas have held up much better( QA, Greenlake, Phinney, Wallingford, N. Cap Hill) .
    People have different definitions of what makes a neighborhood good. Ballard is a sought after, fairly expensive neighborhood, but has a lot of post WWII “chocolate boxes” and one of the highest crime rates in the city. But people talk about Ballard like it’s the be all and end all.
    Yet neighborhoods like Bryn Mawr and Earlington, not much further to downtown Seattle than Ballard and closer to Bellevue, with mountain and lake views, a lower crime rate, and easy accessibility to shopping and restaurants, have nice homes for sale just sitting there lingering because they share a zip code with Skyway, often thought of as one of the worst neighborhoods in the Seattle area.

  34. 34

    YOUR CUMULATIVE CHART AT THE END SAYS IT ALL TIM

    A mish mash regression analysis showing “flat basically unimproved data”; assuming the pending, etc data wasn’t monkeyed with as you first stated.

    Seattle’s housing supply should have been flat since 1970 actually, as the mountains to the east and the sound to the west makes this real estate area TOTALLY trapped, unless you build everything new on postage stamp cul-de-sac lots [they have], on hills that landslide [they have], in valleys that flood [they have] and/or mow down what few green areas we had left in 1970 [they have]. Another way to increase the real estate in Seattle is build condos mixed in with over built SFHs [see description above] pouring even more cars onto the 40 year old freeway access streets already clogged in 1970 [they have].

    You get the picture. Welcome to the Hawaii sized real estate area called the Seattle area.

    I’ve lived here all my life and watched it all go to “Hades in a hen basket” since 1970. I just wrote my King County Councilman a survey response: “deal with the Seattle area chronic overpopulation [depopulate] turning us into a “California II” basket case budget and then I’ll rate you above inadequate”.

    Raising taxes for more insane growth is like throwing more gasoline on the fire. And these bozos call themselves environmentalists…LOL

  35. 35
    patient says:

    RE: Greg Perry @ 32 – To me it looks more like a scenario where sellers in the low end are starting to accept reality that prices will continue to decline and are now starting to seriously lower their prices to a level where you can find willing buyers. I would not see this as sign that prices will stabilize rather the opposite and taken the state of the economy into the picture, no I don’t believe in any price stabilization in the coming year or two or three or…?

  36. 36
    The Kid says:

    My wife and I have been looking at houses in the south end, Maple Valley, Covington, Federal Way, Kent, Auburn Etc. What we’re seeing is anything that’s below about $250k is A)A total freaking dump. and B) Having overpriced offers put on it left and right. I don’t know how useful this input is to anyone else, but we’re backing off and waiting another year or so. The market still sucks.

  37. 37
    Greg Perry says:

    By patient @ 35:

    RE: Greg Perry @ 32 – To me it looks more like a scenario where sellers in the low end are starting to accept reality that prices will continue to decline and are now starting to seriously lower their prices to a level where you can find willing buyers. I would not see this as sign that prices will stabilize rather the opposite and taken the state of the economy into the picture, no I don’t believe in any price stabilization in the coming year or two or three or…?

    You may be right, and I may be wrong.

    And if you are right, then the law of supply and demand will have to be rewritten.

  38. 38
    One Eyed Man says:

    RE: softwarengineer @ 34

    Who says Emmett Watson’s dead?

  39. 39
    patient says:

    RE: Greg Perry @ 37

    “And if you are right, then the law of supply and demand will have to be rewritten”

    Not at all, supply can very well be spurred by increased short sales and reos + spill over from other tiers. Demand is highly fragile due to employment and cost of money uncertainties. We’ll see.

  40. 40
    Scott Weitz says:

    Waiting for Seattle to Cool @14

    Here is a field report:

    I’m an attorney, and I have never seen more BKs than are currently being filed…its off the charts!!

    Banks are SWAMPED with loan modification requests, and foreclosures have hardly begun. I have 3 clients that should have been foreclosed on months ago and are still in their homes. By the time its over, I have one client who will have been in their home for over a year before they finally get foreclosed upon. The worst in yet to come around here…I guarantee it.

    As for me: I’m still happily renting with no prop. taxes, and no risk of depreciation. Granted, I’m “wasting” money, but my mortgage would be 3x+ what I’m paying rent….the numbers just don’t add up to buy yet.

  41. 41
    One Eyed Man says:

    RE: Greg Perry @ 37

    Greg, I may be wrong and I can’t speak for Patient, but I think Patient is inferring that general economic conditions will continue to deteriorate, and destroy demand at the current price equilibrium. Furthermore, increased foreclosures may cause increased low end supply and price competition. His premise is that the current levels of supply and demand are not static, but rather that supply will increase and demand will decrease with future economic deterioration. I think your difference with him, if any, is not over the mechanics of the law of supply and demand but rather on the validity of that premise.

  42. 42
    patient says:

    RE: Scott Weitz @ 40 – I’m with you. I have a strong feeling that all this delaying by lenders and meddling by the gov. in the foreclosure issue is going to come crashing down pretty soon. There is just to much force and to much money to be able to control. Laws of nature and economics can be a dog if you bet on beating them.

  43. 43
    patient says:

    RE: One Eyed Man @ 41 – Exactly, on the money.

  44. 44
    Greg Perry says:

    By patient @ 39:

    RE: Greg Perry @ 37

    “And if you are right, then the law of supply and demand will have to be rewritten”

    Not at all, supply can very well be spurred by increased short sales and reos + spill over from other tiers. Demand is highly fragile due to employment and cost of money uncertainties. We’ll see.

    My original premise, and what I thought we talking about is IF the trends remain consistent on the low end, ratios will continue to tighten and prices will stabilize. (I even capitalized IF in the comment)

    In this comment you changed the equation. If supply increases and demand falls, in that case prices, obviously prices won’t stabilize.

    You need to better define your argument. Are you by any chance a politician?

  45. 45
    David Losh says:

    RE: Greg Perry @ 32

    Congratulations on your good fortune. There is a bounce.

    A comment was made about a drop in consumer confidence and that seemed to pass on by. Another report today showed oil at $60 per barrel, after that was a 20% decline in the supply of winter wheat.

    From personal experience there are more people out of work than I’ve seen since the 1970s. Banks seem to be on th attack to claw out some profits.

    My sense is that as you have shown here in your comments today that the housing market is in the process of normalizing. Buyers need to make low offers to get the price of a property in line with value. The CMA approach would take years to sort out.

    Buyers need to set the market place and remember every house is for sale at the right price. There is no need to out bid anybody. You’re doing a home owner the favor of taking over a depreciating asset.

  46. 46
    Greg Perry says:

    By One Eyed Man @ 41:

    RE: Greg Perry @ 37

    Greg, I may be wrong and I can’t speak for Patient, but I think Patient is inferring that general economic conditions will continue to deteriorate, and destroy demand at the current price equilibrium. Furthermore, increased foreclosures may cause increased low end supply and price competition. His premise is that the current levels of supply and demand are not static, but rather that supply will increase and demand will decrease with future economic deterioration. I think your difference with him, if any, is not over the mechanics of the law of supply and demand but rather on the validity of that premise.

    Yeah, I caught on to that, as well. See 44

  47. 47
    Gene says:

    Personally I think homes that are priced well and in good shape will sell to people who have to move and who really want to own (or owe) than rent. This is true in most markets, good and bad.

    I plan to continue to sit on the sidelines because I feel the latest stock market rally is just a bear market rally (one that may have ended already). The Alt-A loans reseting this year have not really hit yet, and as things continue to be slow, more people will fall behind on their payments unfortunately (for them). As has been mentioned by Tim and others, there also seems to be some “pent up supply” that will likely start coming on the market now that people have heard things are selling.

    The first time buyer incentive is helping prop things up right now, but I don’t see that last ing all that long. Prices may trend up for the next few months, but I’m pretty confident we’ll be testing new lows during the winter.

  48. 48
    patient says:

    RE: Greg Perry @ 44

    “You need to better define your argument. Are you by any chance a politician?”

    You are too quick to draw conclusions. I never said “if”, you did. You are the one that sets ifs without putting your belief behind it. Do you believe in your “if”? If not why are you even bothering mentioning the impact (price stability)? I said from the get go that I don’t believe in price stability due to the economy.

  49. 49
    Greg Perry says:

    By patient @ 48:

    RE: Greg Perry @ 44

    “You need to better define your argument. Are you by any chance a politician?”

    You are too quick to draw conclusions. I never said “if”, you did. You are the one that sets ifs without putting your belief behind it. Do you believe in your “if”? If not why are you even bothering mentioning the impact (price stability)? I said from the get go that I don’t believe in price stability due to the economy.

    This has become a circle jerk.

  50. 50
    Eastside Westside Its All Good says:

    Hi Greg,

    Despite my comments, I’m happy that there is some activity. I did have a question – of all the deals that are happening for you right now, what are the circumstances of the buyers/sellers?

    Buyers – selling a home? Renting? Moving into area? Company paid relocation? Buying distressed?

    Sellers – moving up/down?Going to rent? Leaving area? Company paid relocation? Short sale?

    As a follow up to my post on a previous thread, the nature of the transactions, combined with the level of activity, should tell quite a bit about the state of the market right now.

  51. 51
    David Losh says:

    RE: One Eyed Man @ 41

    increased foreclosures may cause increased low end supply and price competition

    People assume this Real Estate market is a correction having to do with poor people buying properties they could not afford. It comes up a lot.

    Last week a buddy of mine was saying he is trying to hold on until next year. I know he is. I know a lot of people are. There are a lot of people who have lost jobs. Many people are trying to figure out how to survive.

    In the next three years more people will default out of good homes. More upper end homes will look ridiculous. People who had good jobs will settle for less. You may settle for less. That van by the side of the river may be the new middle class.

    With the amount of change that is needed to over haul our economy three years may be a tight time line.

  52. 52
    Scotsman says:

    A couple thoughts come to mind:

    Spring bounce

    Sucker’s rally

    Fundamentals headed over a cliff

    There is nothing so bad that the government can’t make it worse.

  53. 53
    Greg Perry says:

    RE: Eastside Westside Its All Good @ 50

    On my buyer transactions, both were first time buyers with good jobs. Both liked the tax credit. Neither were short sales.

    The buyer I’ll be working with Friday will be paying cash for an investment property.

    I also got a calls from two other investors today. One will be putting 1/2 down and another will again be paying cash if we can get the specific property he wants (this one is a short sale).

    I am very picky about the investors I work with. It’s really easy to get sucked in by investor “wanna be’s”

  54. 54
    Greg Perry says:

    RE: Eastside Westside Its All Good @ 50

    I would add that anecdotally, most of the activity I’m seeing in the office is with the first time buyer crowd. Most in town (not transfers in).

    As I mentioned, my buddy did have two sell/buy in the same week. Lucky him! I’m not seeing much in the way of the sell/buy as in the past.

  55. 55
    Eastside Westside Its All Good says:

    re: Greg@53

    Thanks for the added details!

  56. 56
    Greg Perry says:

    Eastside Westside,

    I was wondering and asked you last night (on the other thread) if you had any insight on home builders. I’ve been told that for new construction by and large we’re currently working on existing inventory. If this is correct sometime within the next year we’ll be running out of NC inventory.

    Do you agree with this? And if so, will there be a lag for replenishment? I’ve been told to expect an 12-18 month hole in NC because there are so few starts (in fact properties have not been purchased).

    Any insights?

  57. 57
    Groundhogday says:

    By Scotsman @ 52:

    A couple thoughts come to mind:
    Spring bounce
    Sucker’s rally
    Fundamentals headed over a cliff

    My thoughts exactly. But let me edit your last line to say:
    “there is nothing so bad that the government or Wall Street can’t make it worse.” Of course Wall Street runs the government these days so we are really saying the same thing.

  58. 58
    TheHulk says:

    I have a theory that explains why the Eastside MOS is still so high.

    Based on recent data, houses on east side typically command a premium of around between 50 and 100K based on exact location (as opposed to other houses in Puget Sound/King county NOT in seattle that have similar lot size / house sizes). I would assume that most of these houses were either purchased by relatively high income earning persons (annual salary > 90K) OR by move up buyers who made anywhere between 50-150K on the sale of their older townhome / house.

    First Time Buyers: Anyone who purchased any time from 2005 onwards is screwed. You are going to lose money if you try to sell your house now. That also depends on how much you put down of course (if you have an interest only ARM with 0% down, you can party away till your loan recasts/resets). As Kary has mentioned before houses that have stuff that cannot be changed (street noise, bad schools etc) will suffer a lot more than other places.

    Many many of these people would give an arm, a leg and maybe something more to sell their house at the price at which it was purchased. On the other hand, if they are still employed and continue to earn at the same level, they can still make their mortgage payments. What they fail to understand (or willingly block out) is that they are putting money into a sinkhole. The huge MOS reflects the fact that people are not even willing to pay 2005 prices. These people seriously need to get out now. Every single mortgage payment that they make today is money they are losing tomorrow (since the loan was taken less than 5 years ago, it is safe to assume that almost all the money is going towards paying off interest). It is a bitter pill to swallow that the biggest financial decision of your life is also the biggest mistake you ever made. Some of these souls have been brave enough to actually list their houses for sale (but at 2006 prices). No one is touching that with a 10 foot pole. Hence, no sales and hence the high MOS.

    Move up buyers: Depending on how much they “moved-up” these people currently are sitting on the proverbial knife’s edge. Most of them say oh my house dropped 60K in value from peak, but I made 75K from the sale of my previous house, so I am still in positive territory. If you take into account the transaction costs, right now you are actually in negative territory, more so if you “moved up” and took out a HELOC to add granite countertops etc. These people havent listed their houses (yet) but I am sure they monitor redfin sales like crazy. Another 5-10% drop in Case Schiller (which will be coming in the next year or so) and these people will be in the same boat as the people in category 1 above.

    Conclusion: Prices on the east side are still in la la land. The 8K bridge loan is not significant for the high income earners and anyways not significant enough to move any buyers off the fence at houses that are 400K or higher (and still at ridiculous levels). Most people continue to make mortgage payments (because they are still earning well), in the hope that prices will go back up. Reality is prices will continue falling until we hit 2001/2002 prices a couple of years from now. If you dont believe me, take a look at recent sales in redfin to see how comparable houses are doing in the past 3 months. Do not look at current list prices, take a look at what has actually sold.

  59. 59
    Scotsman says:

    RE: Groundhogday @ 57

    GASP! You are such a cynic!

    It’s ALL Bush’s fault. ;-)

  60. 60
    jon says:

    RE: TheHulk @ 58 – I have a different theory. The owners there see

    1. a big carbon tax coming: higher gas prices mean higher prices for close in areas
    2. coming increases in income tax make mortgage payments lower relative to rent
    3. budget deficits at four times the level under Bush means lots of inflation, and houses are good inflation hedges
    4. the recent treasury sale showed difficulty. falling dollar means strong exports, and Washington is an export state.

    All of this takes time, but they are willing to wait it out.

    Some fraction of recent buyers are underwater, and with other assets they can’t just walk away. Even so the rest of the market is holding tight.

  61. 61
    Greg Perry says:

    RE: TheHulk @ 58

    Or it could be something so incredibly simple like there were 1041 properties on the Eastside priced over $1 million dollars and sporting a 30 + MOS in this range.

    On the other hand, properties under $500,000 have <4 MOS.

  62. 62
    mukoh says:

    Had lunch with a big title company owner, their activity is 25% up from March.

  63. 63
    David Losh says:

    RE: TheHulk @ 58

    Bellevue has lake front property with western views and exposure, that’s the attraction. Other than that Bellevue is a strip mall community of low end housing that got pushed way beyond any reasonable value.

    The wage scale climbed on tech sector research salaries.

    With tech and financial sectors struggling I don’t see a job base to support high prices on the Eastside.

  64. 64
    Kary L. Krismer says:

    RE: mukoh @ 62 – How do you have lunch with a large corporate entity that isn’t even based in Washington? ;-) Did you mean escrow company?

    Seriously, probably most of that is refinance activity, unless they specified otherwise.

  65. 65
    David Losh says:

    RE: mukoh @ 62

    How big is it?

  66. 66
    David Losh says:

    RE: Scotsman @ 59

    Dick Cheney helped!!!

  67. 67
    S-crow says:

    Mukoh,

    Big title company owner? Are you in California or Texas? You mean local affiliate or office of a big title co? Just teasing ya. ;)

    Did you ask their close ratio for refi’s vs. sales? Our “activity” is up. Will that translate into actual closings? We’ll see. The past six months our close ratio’s (I’m guessing) were probably under 50%. Worse for purchases. Looking better now. 90% of our office closings are refi’s. We did get a couple short sale approvals in. One of which is just blowing the sox off me. The loss is staggering for the lender.

  68. 68
    TheHulk says:

    RE: David Losh @ 63RE: Greg Perry @ 61

    In my explanation above, I typically refer to houses that are within shooting distance of the first time buyer. These would be houses ranging from 400K (conservative purchase for someone earning close to 100K and has at least 10% down payment) to 600K (very risky purchase for the same person).

    David, the lake front properties are a little unusual and probably command another 10% markup (since presumably there are people willing to pay for waterfront, I am not someone who is interested in that). The rest of the city like you said is wildly overpriced with salaries vastly out of touch with housing prices.

    Greg, ha ha ha. I dont care how many houses are listed for more than a million. The main thing to note is a high MOS (even using the dubious pendings) implies these prices are out of touch. As people start bringing million dollar homes down to 800K to sell them, 800Ks will have to follow to 650Ks and so on. Someone who just purchased a couple of months ago a “great deal” at 700K would be pretty pissed to see the house across go at 600K a year later.

    It is the exact inverse of the bubble phenomenon. People chased homes prices on the way up and outbid each other. We will see the same phenomenon on the way down, Ever time a supposedly million dollar house at the height of the bubble purchased for say 300K in 1995 sells for 800K today (because the owner just wants to move on with life) it affects comps and appraisals for all houses that are similar.

  69. 69
    mukoh says:

    RE: S-crow @ 67 – S, affiliate based in Everett.

    RE: David Losh @ 65 – Believe it accounts for 25-40% of Snoco’s business, so definitely not huge, more then some Windermere agents with no activity for 7 months that I have seen around lately.

    RE: Kary L. Krismer @ 64 – Kary, I am sorry he didn’t specify of course and I wasn’t interested, cause its just not important to anyone I think. I wasn’t there to have lunch with him for any other reason then to just discuss the local weather patterns, and our fishing trip to Canada.

  70. 70
    David Losh says:

    RE: mukoh @ 69

    No, really, how big is it?

  71. 71
    Eastside Westside Its All Good says:

    RE: Greg Perry @ 56

    Hi Greg,

    Apologies for not answering on last thread. I do not have specific insights on state of residential construction biz in SEA – been out of the game two years and this metro has always been particularly fragmented, with less NC concentrated in the largest builders (which means calculating the state of this market requires understanding circumstances of about 10-14 builders).

    I know that no one is moving enough inventory and that many big builders have been trying to dump lots for some time. Since SEA’s response to the downturn lagged other cities, prices will be dropping longer and I would not be surprised to see some national players pull out for a couple of years. Without the influx of people from California, population growth drops to nothing here. No growth means no new households and that means NC is only replacing inventory. Such market conditions do not support many builders.

    All builders who continued to finish houses into the downturn took huge losses to unload the inventory. Would be surprised to see anyone jump into starting homes that are worth less when finished.

    Hope some of that was helpful.

  72. 72
    Greg Perry says:

    RE: Eastside Westside Its All Good @ 71

    Much what I was thinking. Few realize just how many small and medium sized builders were working the area. Thanks for the answer. If you hear anything noteworthy about the NC market, let me know.

  73. 73
    what goes up must come down says:

    Greg I get a feeling you are trying to point out no NC will be built and therefore the market will get tighter and prices will rise. But just to point out one thing — NO NC = less jobs = higher unemployment, etc……. To get back to the old idea when you talk about RE you talk about location, location, location but when you talk about the economy the engine running the show it is jobs, jobs, jobs.

  74. 74
    Greg Perry says:

    By what goes up must come down @ 73:

    Greg I get a feeling you are trying to point out no NC will be built and therefore the market will get tighter and prices will rise. But just to point out one thing — NO NC = less jobs = higher unemployment, etc……. To get back to the old idea when you talk about RE you talk about location, location, location but when you talk about the economy the engine running the show it is jobs, jobs, jobs.

    Is it a tingly feeling running up your leg?

    Ask a question of someone who has experience in an area….respond to an answer ….and get the knee jerk negative reaction and comment. You did yourself proud. First class.

    It’s a conspiracy. Darn conspiracy.

  75. 75
    S-Crow says:

    RE: Eastside Westside Its All Good @ 71

    I’m keenly aware of some the smaller builders getting absolutely creamed. Tough to discuss when you are surrounded by them in your neighborhood and they ask me what’s going on. I never bring the market up, they do. We can see why Frontier, CityBank, Sterling, Banner & others have problems. I’m guessing they just didn’t’ have any idea what type of lending was being utilized to buy up their developer/builder inventory. I was talking with the VP of Banner in very late 06 about the insanity of it all and I got the “new paradigm, Northwest immune” type of response. Oh well, what does the escrow guy know.

  76. 76
    David Losh says:

    RE: TheHulk @ 68

    The wage base out to Issaquah has got to be low.

    When Microsoft was churning out geniuses with million dollar stock options people flocked into that area to set up shop.

    Then the anti trust suit, dot com bubble burst, Renton Boeing Plant cut backs, and now the financial market crash have got to be straining the high income wage earner base. Remember at one time a few years back there was speculation Bellevue could become a Financial Center?

    Today, especially with all of the building, and all of the dirt that is still available for development, I doubt that there could ever be the type of demand that pushed the prices up as high as they are today.

  77. 77
    David Losh says:

    RE: S-Crow @ 75

    There is a little group of builders in my area. Nice guys I’ve known for years. They have been using our services to get properties ready for rent and sale pretty steady for the past few months.

    They are scrambling to stay ahead of the game and keep payments on projects current. As one of them says it’s hard to watch all these years of work, our savings, just slip away.

  78. 78
    Alan says:

    These would be houses ranging from 400K (conservative purchase for someone earning close to 100K and has at least 10% down payment) to 600K (very risky purchase for the same person).

    That is insane risk. Someone earning $100k with 20% down should be considering a $360k place.

    Unless they aren’t saving for retirement…

  79. 79
    what goes up must come down says:

    Greg for a salesman you certainly have a thin skin. I thought earlier in this thread you had mentioned something about supply and demand and how it worked, hmmmm, and then you ask a question about supply. Yep, your right my earlier comment came totally out of left field — yeah right.

  80. 80
    truthtold says:

    paper thin skin…
    but so many keen ‘realtor’ insights.
    Just wish the guy could stop selling and reconsider the condescending method.
    Imagine that would be beneficial for all.

  81. 81
    Kary L. Krismer says:

    Thin skin? That’s laughable. People here took offense at Greg’s claim that people here would prefer more conservative numbers. And somehow Greg’s the one with thin skin?

    Some of you are seemingly just making stuff up. I haven’t seen anything in any of Greg’s comments that would support any of your claims. But whatever–Greg has thin skin. Right.

  82. 82
    what goes up must come down says:

    Kary who again here took offense at Greg’s claim that people here would prefer more conservative numbers? Where is that comment Exactly?? Can you reference one by number? I mean from what I read Greg mentioned Circle Jerk and who is a politician etc….

  83. 83
    patient says:

    RE: Kary L. Krismer @ 81

    Here’s the thing, Greg comes over here pushing an idea of a hot market backed by a very narrow market segment without giving a RA about banks (sorry Ardell this one will stick ) or the economy. When he is challenged the way ideas,data and info are on this site he reverts to tactics as redicoule and name calling. It’s suprising for someone who represents not only his own business but also the company that uses his services. You might not have followed the comments but there is a good amount of arrogant laughing, accusations of conspiracy paranoia and name calling ( politiican ). I see how this can be perceived as thin skin.

  84. 84
    Greg Perry says:

    By what goes up must come down @ 79:

    Greg for a salesman you certainly have a thin skin. I thought earlier in this thread you had mentioned something about supply and demand and how it worked, hmmmm, and then you ask a question about supply. Yep, your right my earlier comment came totally out of left field — yeah right.

    Here’s a hint. If you want to know what is on another person’s mind, ask a question. You’ll be amazed at the cooperation and information you’ll get from someone one else.

    Your commentt in 73 had nothing to do with furthering discussion.

    Further, you should know that as a professional, working with clients, I don’t put up with “Jackassery”. . I’ll go to the ends for someone with sincere concerns and questions, no matter how trivial, but when they start to exhibit signs of jackassery, and they’re out. Life is too short.

  85. 85
    Kary L. Krismer says:

    RE: patient @ 83 – See post 165 in the Pending thread, referencing his post 146.

    Also, it’s possible we have two Greg’s here because of the different avatars. If you look, two of the posts above (53 & 54) were within minutes of each other, so using a different computer doesn’t seem to be the reason for the different avatars.

  86. 86
    Greg Perry says:

    Here’s the thing, Greg comes over here pushing an idea of a hot market backed by a very narrow market segment without giving a RA about banks (sorry Ardell this one will stick ) or the economy. When he is challenged the way ideas,data and info are on this site he reverts to tactics as redicoule and name calling. It’s suprising for someone who represents not only his own business but also the company that uses his services. You might not have followed the comments but there is a good amount of arrogant laughing, accusations of conspiracy paranoia and name calling ( politiican ). I see how this can be perceived as thin skin.
    RE: patient @ 83

    King County had another good week in pending sales at 561 for the previous 7 day period ending 5/13.

    Eastside pendings are the best YTD with 170
    Metro pendings came in at 202

    Again most of the activity was under $500,000.

    As promised I’ll also start to report weekly closed/sold counts which came at at 175 for the week.

    The gap between pendings and solds actually widened this week.

    Would you rather not see these numbers?

  87. 87
    patient says:

    RE: Kary L. Krismer @ 85 – There’s a mix of anonymous consumers and people in the business commenting on this site. You would expect a higher standard of expression from people who has a reputation to be concerned about than people like me who prefers to let the comments stand by themselves. It’s surprising that’s all.

  88. 88
    Greg Perry says:

    RE: Kary L. Krismer @ 85

    No, I’m constantly switch browsers between chrome, IE and firefox. I have a different email loaded on one that I forget to fix.

  89. 89
    patient says:

    RE: Greg Perry @ 86 – What I like or not is not important but I think most would find it more interresting if you allowed others to analyze and if found applicable challenge your analyzes or data without getting your knickers in a knot and start with insults. Just a tip.

  90. 90
    Kary L. Krismer says:

    RE: Greg Perry @ 88 – Oh, so you’re that one person in the state who uses Chrome. ;-)

  91. 91
    deejayoh says:

    RE: Kary L. Krismer @ 90 – he mist like google to know everything he does…

  92. 92
    what goes up must come down says:

    Greg so you start the name calling and then YOU say what is “Jackassery”.

    Okay as you requested Greg here is a question for you — you have a vested interest (JOB) in people buying and or selling real estate am I correct?

  93. 93
    Kary L. Krismer says:

    RE: what goes up must come down @ 92 – Do you have something prior to the posts I referenced in post 85 above?

  94. 94
    what goes up must come down says:

    And Greg to get back to my comment in 73 I was trying to point out — even though your data shows this incredible market jump — the economy is in the crapper and for some reason I think that will affect RE in a negative way.

  95. 95
    what goes up must come down says:

    Kary I don’t know if you are trying to slam me or what but when you say PEOPLE who do you mean exactly you quote two posts one a response to Greg? I never said anything about Greg’s conservative numbers, I am sure others asked since there was a disconnect with the NWMLS numbers and what he quoted — in my mind I guess that is a misunderstanding that needs explanation.

    It is interesting though in the one post you quote responding to Greg it starts out basically asking if Greg is starting the “Jackassery”.

  96. 96
    Kary L. Krismer says:

    RE: what goes up must come down @ 95 – I’m not sure what post of mine you’re referencing, but no, I wasn’t intending to single you out.

  97. 97
    what goes up must come down says:

    RE: Kary L. Krismer @ 96 – I didn’t understand 93 and 85 but lets just drop it because it doesn’t really matter.

  98. 98
    Kary L. Krismer says:

    I agree it is a side show.

    But realize it also gets tiring as an agent for people to make certain assumptions about agents. The best example was over in the Seattle P-I forums where someone asked who was the busiest buyer’s agent, and in my first answer I suggested someone at Redfin probably did the most transactions. Then a couple of days later somebody from here (I don’t remember who) joined in and cited to a link that showed it was a Redfin agent, and then added something to the effect: Of course the agents here wouldn’t want you to know that.

    Edit–here’s the link:
    http://www.seattlepi.com/forum/boards/viewtopic.asp?topicid=134504

    Anyway, I view this entire pending discussion as being somewhat of a side show. Per the NWMLS published numbers, they were up in April to 2114, from 1683 in March and 1159 in January. Clearly they are increasing, the only debate is really over the YOY comparisons. Also, I’m not convinced any of the explanations that the NWMLS has given about the pendings is accurate. I still think it’s month end pendings, but I’ll be able to track that better in the future. But the fact they gave Tim a wrong answer a year ago doesn’t really give me a lot of confidence in the new answer either. But whatever, using whatever they do, the numbers are increasing.

  99. 99
    Greg Perry says:

    By what goes up must come down @ 92:

    Greg so you start the name calling and then YOU say what is “Jackassery”.

    Okay as you requested Greg here is a question for you — you have a vested interest (JOB) in people buying and or selling real estate am I correct?

    Well, yes since you ask, I make my living helping buyers and sellers in real estate.

    I think this is a good time to summarize a few of my thoughts in comments that I’ve made lately.

    1. Weekly pending sales, which where coming in under 200/week in January and February started to rise in March. The last week of march these pending sales jumped 25%. Since that week, the weekly pending sales have continued to increase. This week (period between 5/7 and 5/13) had the highest pending count yet for KC at 561. In my time as an agent, we have not experienced a time where the market turned “ON” so quickly. These are somewhat uncharted waters for contemporary market observers.

    2. The majority of these pending sales are weighted in the under $500,000 inventory. There is a much higher percentage of pendings in this range than in years past.

    3. Second tier homes and high end homes still quite slow.

    4. Tim posts have focussed some of my attention on the gap between current pendings and closed sales. I decided to include this in my weekly snapshot.

    5. I stated a belief that much of the gap will start to close and I believe we’ll see 2000 closed in June 2009. On this, we’ll have to wait and see.

    6. By watching the trends, I’m thinking we’ll be facing unprecedented market compression issues. IF trends continue and a significant portion of these pending close, the low end will stabilize and start to appreciate, high end and 2nd tier will continue to decline in prices. I do believe in the law of supply and demand. Again, in those areas and price ranges that are quickly absorbing, prices will stabilize.

    7. Area new construction is finite and will substantially sell through. If the current rate of sale continues, this looks like it could be 8-12 months. Area builders are going out of business and many are giving up lots that they had. We may have an 18-24 month lag after construction starts on the next wave. This will affect supply and to what extent and the affect to absorption rates is unknown. If this does happen, the majority of all activity will shift strictly to the resale market.

    8. I have said many, many times that there are many potholes in the market landscape. Anything can pop up to change the market dynamics virtually over night.

    9. Also, for the record, I have stated that I don’t think putting the $8,000 in the hands of buyers for a down payment is a wise idea. This could super heat the segment of the market that is already moving toward hot and have negative unintended consequences. It is my belief that the current rise in pending sales in caused in a large part by the current tax credit offering combined with low interest rates and homes 25% off their high.

    10. Watching the market weekly gives us a look at current activity and market TRENDS. Looking at past months and years gives us perspective. It is my belief both are important.

    11. Many (good) discussions have been waged regarding the change in pending reporting and the gap between pending and closed. While we all have opinions, no one really knows the full impact until we cycle thought some time. “Time will tell”.

    12. Based on some of the constructive debate, I’ve changed a few opinions, and have “guarded” opinions about other issues. No one can tell for certain exactly what is going to happen. The best that anyone can do is look at trends, filter them through the lens of historical perspective, add a dash of economics opinion, then wait and see.

    13. There are some who comment who confuse reporting hard numbers with cheerleading (seemingly pretending they don’t exist, hinting at conspiracy or denying they exist). For me, the numbers are the numbers. When the market receded in 2007, I was on it every step of the way and reported the numbers as they existed during the decline. To take you down memory lane, here’s a post I did over on SREP: http://blog.seattlepi.com/realestate/archives/124285.asp Many subsequent posts dealt with the declining market and how sellers should position for success.

    (For what it’s worth, this is what those heat maps look like for the last 3 months: http://www.workingforyou.typepad.com//realestate/2009/05/the-color-of-the-market-king-and-snohomish-county-months-of-supply-heat-maps.html

    I really don’t care who agrees with any of these conclusions and opinions. They are mine, based on observation, research and perspective. I enjoy the debate and constructive conversation on any issue. It seems, however that there are a few here who delight in taking a sliver of information, completely dismiss it and then castigate the profession behind it, especially if it happens to be written by a real estate agent. Discuss yes and debate YES! Play in a childish battle of internet debating wits and will, sorry not for me.

    So if you want to continue to take shots at me for being a real estate agent, rock on. I’ll engage with those who want honest discussion and debate.

    And yes, I like Chrome better than IE. I wonder if I would use IE if I didn’t need to access the MLS.

  100. 100
    patient says:

    RE: Greg Perry @ 99 – Here’s another tip, if you don’t care do not respond, especially not with insults. You’re doing it again by calling the challengers childish game players while your own personal attacks are ok? This is not the PI blog where you have your whole team backing you up, get used to it.

  101. 101
    truthtold says:

    We have never met but I imagine…
    a condescending sales representative with a view that is not subject to question: a walking bore.
    Fellow may have valuable contributions to make but should regret (if not cease and desist) ridiculous hotheadedness as this is a foolish tone for one with an agenda to sell.

    The above is only intended for constructive purposes.

  102. 102

    “And yes, I like Chrome better than IE. I wonder if I would use IE if I didn’t need to access the MLS. ”

    I know in Firefox you can get an IE Tab, that’s what I use when looking at the MLS, don’t know if there’s an IE Tab for Chrome.

  103. 103
    Mikal says:

    RE: patient @ 100 So you are going to dispute his numbers or just continue to whine about his profession?

  104. 104
    Greg Perry says:

    By Ira Sacharoff @ 102:

    “And yes, I like Chrome better than IE. I wonder if I would use IE if I didnâ��t need to access the MLS. ”

    I know in Firefox you can get an IE Tab, that’s what I use when looking at the MLS, don’t know if there’s an IE Tab for Chrome.

    Good tip. I’ll look in to that.

  105. 105
    patient says:

    RE: Mikal @ 103 – Your a bit late Mikal, we have already had that discussion. Check comments between 32-39 for a quick update.

  106. 106
    waitingforseattletocool says:

    RE: patient @ 100

    Greg Perry’s views in his listed items 1-6 are consistent with how other bubble cities areas / have behaved, namely San Diego.

    Just take a look at any of the San Diego data. The low end of inventory in San Diego is at less than 2 months supply of home, based on closed sales, not pending sales. Multiple offers and price increases are occurring quite significantly in the less than $500K range in San Diego. This started last spring.

    Why can’t this occur in Seattle, shifted by the one year timeline that is so often used in comparing Seattle to San Diego?

  107. 107
    Civil Servant says:

    Kary @ 81 and What Goes @ 82, it is I to whom you are referring. I did not object to a “claim by Greg that people here would prefer more conservative numbers.” I objected to a suggestion by Greg that people here would prefer artificially low, “lopped off” numbers to accurate ones, the implication being that the former numbers would suit our bias. (I also object to the articial imposition of a herd/cult mentality on readers of and commenters at this site, but that’s beside the point.) This is an important distinction. The appeal this site has for many people is that its statistical orientation and clear, consistent presentation of time-series data allow us to do our own analysis and draw our own conclusions. As a renter who thinks prices have further to fall, yes, I like it when medians decline, supply is up, etc. But to imply that I would be intellectually incapacited if trends in these data did not support my hypothesis or indeed if I were proved wrong is to malign my integrity. And that makes me, however temporarily, livid.

    Patient @ 87, well put. I share your amazement.

  108. 108
    patient says:

    RE: waitingforseattletocool @ 106 – I didn’t say it can’t but I don’t think it will of the reasons I have stated. The economy is really, really bad and worsening, unemployment is raising, forcelosures are building and the consumer is tapped out and the banks are broke. To me that is not an environment for price stabilization in any market segment..

  109. 109
    waitingforseattletocool says:

    RE: patient @ 108

    You didn’t state anything I didn’t just hear on CNBC.

  110. 110
    patient says:

    RE: waitingforseattletocool @ 109 – Does that make it less or more likely to be valid? I didn’t say I invented those statements. I’m not really getting what your point is? Are you saying that I can’t use them as arguments for my predicitions since I did not invent them?

  111. 111
    waitingforseattletocool says:

    RE: patient @ 110

    You can use it as an argument, the macro-economic conditions are just one of probably six factors that contribute to the direction of home prices.

    The poor macro-economic conditions are not stopping lower tier home prices in San Diego from moving up, which is I think what Greg Perry is saying may be happening in Seattle.

  112. 112
    patient says:

    RE: waitingforseattletocool @ 111 – That’s how I understand his argument too, I just don’t agree with it being the dominant driver. For me it’s the economy that is the driver of mid and longterm price evolution. I think temporary swings in supply and demand will at best lead to temporary price changes but I don’t even see that as particulary likely. As long as the trend for the economy and jobs are going down so will the price trend imo. So again I do not believe the current market conditions will lead to price stability.

  113. 113

    RE: Civil Servant @ 107
    Aha, so it was you who caused all this ruckus:)
    At some point, Greg made a comment that could have been interpreted to mean ” I know the facts, and you people can’t handle the facts.You people have your minds made up already, there’s almost no point trying to communicate with you peons.”
    Greg probably did not intend to come off that way, but people rightfully took umbrage, and the sparks flew.
    Real estate agents come in all stripes. Most of them are diplomatic and tactful. I’m in that group. Some of them are even honest. I’d like to think I’m in that group.The last thing I’d ever want to be known as would be an obnoxious and lying real estate agent.
    I do appreciate that people here at most times can remain respectful while disagreeing with each other, and wish it were like that all the time.

  114. 114
    patient says:

    Ira, you are the only reason i would even contemplate using a traditional agent when I do decide to buy. Well Ray you are pretty cool as well :-)

  115. 115
    Greg Perry says:

    I’ve had a busy day. I had a chance to sit down to digest the weekly numbers:

    King County 9909 Active/ 561 Pending / 175 Sold / 4.0 MOS

    This was the best week of the year so far for King County pending sales. Last week there were 545 Pending sales @ 4.1 MOS

    Eastside 3772 Active/ 170 Pending / 45 Sold / 5.1 MOS

    This was also the Eastside’s best week of the year. Last week there were 156 pending sales and 5.6 MOS

    Metro Seattle 2657 Active / 206 Pending / 63 Sold / 3.0 MOS

    Last week Metro Seattle also had 206 Pending sales @ 2.97 MOS

    Pendings over $1 million:
    Eastside:
    T/W = 26 L/W = 26

    Metro Seattle
    T/W 11 L/W=6

    Percentage of Pendings under $500,000
    Eastside: 75% (129 out of 170)
    Seattle Metro: 91% (187 out of 206)

    Definition of pending: All pending statuses with a pending date between 5/7 and 5/13

    Statistics compiled from NWMLS, but not verified or published by NWMLS

  116. 116
    Scott Weitz says:

    Greg @115-

    just an observation: if your day has been so busy, how do you have time to write two incredibly long and cumbersome posts?

    For what its worth, the number of pendings in Seattle is worthless. As a whole, Seattle area residents are certainly not a great collection of economists. The business section of the Seattle Times (our only relevant paper) is a disgrace to journalism.

    My take: once this group cycle of buyers taking advantage of their once in lifetime ‘low interest rate, tax credit, huge selection’ opportunity, all classes will continue to fall until prices reach 3 to 4 x income. Fundamentals will prevail over salemanship and attempted govt intervention.

  117. 117
    David Losh says:

    RE: patient @ 112RE: waitingforseattletocool @ 111

    An article today indicated that immigration of people of Asian and Hispanic decent has slowed considerably. The speculation was that many people are returning to their country of origin. The numbers pushed back the time line of when whites will become the minority in this country by a decade.

    Now that’s a flame starter for sure, but the fact is that demand for housing will also go down.

    Little things like that never make it into the data. Boeing being lured by North Carolina is not in the data. China cutting production, interest rate hikes of a 1/4% to 1/2% due to appraisal rule changes, or even something simple like massive foreclosure inventory set to hit the market, can make all the statistics useless information.

    For the past year I have paid more attention to international news. In my opinion had I done so earlier my perspective of the credit crisis would have been clearer than just watching what Seattle was doing compared to the rest of the country.

  118. 118
    David Losh says:

    RE: Scott Weitz @ 116

    Better said than my comment.

  119. 119
    waitingforseattletocool says:

    RE: Scott Weitz @ 116

    “The number of pendings in Seattle are useless”

    “Pending, Pending, PENDING”

    “Pendings should be taken with a grain of salt”

    This basically summarizes the bears stance the last two weeks. I’ll go back to the American Idol blog now.

  120. 120
    Kary L. Krismer says:

    RE: waitingforseattletocool @ 119 – It is somewhat amazing how much better received the Case-Shiller information is than information regarding pending sales. Even though it tells us what we already knew for an area too large to be of use to anyone, a lot of people here go goo-goo-gaa-gaa over Case-Shiller data. But forward looking data like pendings, that’s rejected as something worthless.

    I’ll agree the YOY comparisons of pendings are possibly messed up by an indeterminate amount, and I think Greg is being overly optimistic thinking this pending data gets us to 2000 sales by June, but this information is more on the very useful side than it is on the worthless side. We’ll know more in 2-3 months (or 5-6 if you want to wait for Case-Shiller).

  121. 121

    RE: patient @ 114
    Thanks, Patient. I suppose being called a traditional agent is better than being called an obnoxious lying one.
    In reality, I’m about as traditional as ham at a bar mitzvah.

  122. 122
    Greg Perry says:

    RE: Kary L. Krismer @ 120

    Kary, I met with 3 agents and 2 lenders today and we had a “think tank” today comparing notes and chatting about the market. We spent some of time discussing the pending/sold lag. Both lenders are reporting more incoming purchase business. They feel that their transactions appear more secure (buyer confidence) than just a few weeks ago. I’ve looked at the incoming (pendings) and solds from every angle, including past periods lag catch up.

    I agree Kary, on the surface it looks improbable that we’ll see 2000 solds in June. The pending / sold gap actually spread this week. However, the sheer numbers now of new pendings coming in will have to come out in the form of higher solds with significance, taking fallout into account. We really are in uncharted waters here.

    This is one of the most interesting charts I’ve seen in some time. Check it out
    http://www.workingforyou.typepad.com//.a/6a00d83451cc6269e201156f8c9bd0970c-popup

  123. 123
    Scott Weitz says:

    Waiting @ 119 and Kary @120-

    Do you honestly think a a big month of pending sales provides the framework for a lasting recovery?

    What about job loses, foreclosures, and lack of financing?

    The game has changed. Adapt or get steam rolled. Ie. I know a guy that bought 6 houses in Phx when the market was down 15%….since then, the market has fallen anoth 35%. He foreclosed on all of them. Take note Seattlites. We’re not that special.

  124. 124
    Kary L. Krismer says:

    RE: Scott Weitz @ 123 – I don’t think anyone is saying that they indicate a lasting recovery. I always say pendings tell you the story about 1-3 months out at best, and even then they’re sometime inaccurate. For example, if you looked at the median pending price for King County in March, it would have told you that the median sold price for April would be below March’s median sold price. It wasn’t.

    That’s the thing about leading indicators. They’re sometimes wrong. But in any case, they don’t predict the future too far out.

    BTW, lack of financing is only an issue for the upper end of the market.

  125. 125
    waitingforseattletocool says:

    RE: Scott Weitz @ 123

    One month of data does not make a trend, so I am not making too much of it.

    But I don’t think one should use pending data to make an argument when it is to their advantage and count them as “useless” or as “a grain of salt” when they run counter to their position.

  126. 126
    patient says:

    And that’s why I always deemed pendings of little value and focused on closed sales. As for others that have changed opinion you can;t really blame them since pendings has gone from being close to 90% accurate as a predictor to next months closings to less than 60%. I would say that’s a fair reason to change your opinion of the usefullness.

  127. 127
    waitingforseattletocool says:

    RE: patient @ 126

    I have heard from people in the mortgage business that underwriting time has moved out several weeks due to increased scrutiny in the underwriting process and additional workload due to layoffs of the underwriters.

    Could this contribute to a lag time between pendings and closings?

  128. 128
    waitingforseattletocool says:

    RE: patient @ 126

    This question posed to anyone who has access to MLS data: Is there a way to track the number of listings that fall out of “PENDING” status, either back to “ACTIVE”, “OFF THE MARKET”, “CANCELLED”, or “EXPIRED”?

  129. 129
    patient says:

    RE: waitingforseattletocool @ 128 – if you follow closed instead of pendings you don’t have any of those problems or question marks. When something becomes complex, unreliable and inconsistent it’s better to use the reliable alternative even if it’s a tad later.

  130. 130
    waitingforseattletocool says:

    RE: patient @ 129

    Fine by me, use April closing and March inventory to get your “MOS” if you want … it will be as useful as Case-Schiller to track the market.

  131. 131
    patient says:

    By waitingforseattletocool @ 130:

    RE: patient @ 129

    Fine by me, use April closing and March inventory to get your “MOS” if you want … it will be as useful as Case-Schiller to track the market.

    Exactly. To me something is only useful when it’s reliable and measures what I want to know. C-S fulfills that criteria and so do closings. And for the delay, there’s no hurry in housing. And I am patient :-)

  132. 132
    Scott Weitz says:

    Kary and Waiting-

    Thanks for the level headed responses.

  133. 133
    Kary L. Krismer says:

    By waitingforseattletocool @ 128:

    RE: patient @ 126

    This question posed to anyone who has access to MLS data: Is there a way to track the number of listings that fall out of “PENDING” status, either back to “ACTIVE”, “OFF THE MARKET”, “CANCELLED”, or “EXPIRED”?

    Not that I’m aware of.

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