I’M NOT IN DEBT ARE YOU?

Where’s the jobs for all your growth…..you two have optimistic attitudes, BUT NO JOBS and you want more population growth. And I’m negative, because I’m for real global warming protection and debt reduction?

I’m a nuclear engineer and not an economist, but it doesn’t take a rocket scientist to figure you can’t create jobs out of no where. Even if your new technologies started hiring 5-10 years from now, how much is going to be insourced/outsourced? Little good that does “We the People” right now. But tax payers really don’t matter?

When your “pie in the sky” unemployment rate agrees with your optimism, then I’ll listen to you.

Enjoy your debt, you two sound like you signed mortgage papers a couple years ago and are bitter.

I feel if I bust my butt I will always have money, and every year including this one I have continued to make more money. But I am relentless in how hard I work to build my client base, and do not let up.

“pre-existing domestic Seattle families shacking together to survive, leaving even more empty foreclosed units, won’t matter at all?”

You may be right, buy how many people do you know that are in this situation. Everybody I know that has been foreclosed on had multiple properties, so I can’t comment about “shacking up” but I have not heard about people I personally know that are in this position, I know they are out there, but how many do you know personally?

RE: jon @ 22 –
Assuming the jobs outlook stays chronically unsolvable without an immediate industrial base surge and we’re tapped out borrowing for “Growthfriend”

Jobs will come back once inventories have dropped. The more population there is, the faster inventory will drop.

Besides just a resumption of ordinary commerce, there are immense new markets opening up. We will be completely converting over our automobile base to electric, huge chunks of our electrical system, a whole new airframe, paper thin computer monitors connected to wireless controllers, huge changes in health care at all levels, it just goes on and on. So there is going to be tremendous opportunities for lots of people.

THE POPULATION INCREASE WE CAN EXPECT?

Assuming the jobs outlook stays chronically unsolvable without an immediate industrial base surge and we’re tapped out borrowing for “Growthfriend”….maybe this hypothetical “population growth” in Seattle you’re refferring to won’t need homes, how about cardboard shacks and tent cities?

Perhaps I’m being too pragmatic; assuming the new “population growth” get’s here and subsequently displaces higher income workers for lower wages, then the subsequent growth of pre-existing domestic Seattle families shacking together to survive, leaving even more empty foreclosed units, won’t matter at all?

Let’s drink this weekend to “Growthfriend”?

Seems to me that the relevant comparison is the growth rate over the time period in question

Housing Units (OFM) = 12.1%
Population (OFM) = 9.9%

Housing stock has grown quite a bit faster than population.

There is a big difference between the average size of a household between a single family and a multi-unit structure:

http://www.ofm.wa.gov/researchbriefs/2007/brief047.pdf

In 2000, it was 2.77 for a single family and 1.92 for a multi-unit. The shift has been towards more multi-unit: 37% in 2000 in King County in 2000, 39% in 2009. That will bring down the average household size, and thus require more housing units per person. The result will be an apparent excess of housing units, if you hold household size constant.

That doesn’t account for the full 2.2% difference in relative growth of population to housing units, but it does take a chunk out of it.

I’m not claiming there is not an excess of units now, I’m just looking to quantify how big that excess really is relative to the annual increase in population we can expect.

IT COULD BE THE 70% LEARNING CURVE ON NEW HOME CONSTRUCTION

Everytime the builder makes a cookie cutter house, and the quantity doubles [2, 4, 8, ect, etc. units]; the labor costs go down 30%. That’s why custom homes cost an arm and a leg, they’re all unit #1.

I saw this phenomena during the mid 80s bubble, sales collapsed, but new cookie cutter houses kept getting built in developments already with 100+ units….it gets real cheap to slap them together after a while, even with prices collapsing they can make a killing.

Add in glueboard and 2×6s selling for fire sale prices with the depression we’re in, you get the gist…

Housing Units (OFM) = 12.1%
Population (OFM) = 9.9%

Housing stock has grown quite a bit faster than population.

Here’s a comparison between the Census Bureau’s accounting of total Housing Units for 2000-2007 and WA OFM.

Year | Census Bureau | WA OFM
2000 | 744,846 | 742,239
2001 | 755,382 | 752,799
2002 | 764,140 | 763,615
2003 | 773,727 | 773,303
2004 | 782,529 | 783,631
2005 | 793,246 | 793,777
2006 | 804,298 | 802,878
2007 | 816,764 | 812,590

Fairly similar. However still population != households.

If you use the Census Bureau’s 2007 estimate for average household size in King County of 2.60 then you still get housing unit growth in excess of household growth, even for 2008-2009:

Year | Housing Units | YOY Growth | Households | YOY Growth
2000 | 742,239 | N/A | 668,095 | N/A
2001 | 752,799 | 10,560 | 676,274 | 8,179
2002 | 763,615 | 10,816 | 682,428 | 6,154
2003 | 773,303 | 9,688 | 684,346 | 1,918
2004 | 783,631 | 10,328 | 687,808 | 3,462
2005 | 793,777 | 10,146 | 695,500 | 7,692
2006 | 802,878 | 9,101 | 705,885 | 10,385
2007 | 812,590 | 9,712 | 715,885 | 10,000
2008 | 821,935 | 9,345 | 724,692 | 8,808
2009 | 832,396 | 10,461 | 734,346 | 9,654

That adds up to 23,905 more housing units constructed in King County since 2000 than new households.

According to their description of their methodology (http://www.ofm.wa.gov/pop/annex/process/overview.pdf), the reason they collect the housing unit data is that it is one of several methods for estimating the population. So while it is not the greatest way to estimate population, one would expect their data to be computed with units in mind rather than structures. They do break it down by type of structure so that they can apply different ratios of people per unit, but the numbers themselves appear to me to be units. The title of the graph is “April 1 Housing by Structure Type by County, 2000-2009″, which to me implies it is housing units, not structures that are counted.

They have housing unit data as well. King county picked up 10K new housing units in each of the past few years, while population went up 25K last year.

Actually if you download their full dataset (available here in Excel format) you will see that they’re not counting “housing units,” but rather “structures.” So a 500-unit condo building counts as just one.

They break down their data into one-unit structures and “two+” unit structures, but don’t get any more detailed than that, so it’s difficult to obtain useful information from this data about the actual number of housing units added.

Also, it doesn’t make sense to compare raw population to housing units, since every single person doesn’t take up a housing unit. That’s why we use the number of households instead.

In short, comparing the number of housing structures to the number of people is not the same thing as comparing the number of housing units to the number of households.

http://www.ofm.wa.gov/news/release/2009/090629.asp

They have housing unit data as well. King county picked up 10K new housing units in each of the past few years, while population went up 25K last year.

Since 2000, King County population when up by 170K, while the housing increased about 10K each year. It looks like that while housing did grow faster than population from 2003 to 2005, it has since reversed.

http://www.ofm.wa.gov/pop/april1/cocmpch2009.pdf
http://www.ofm.wa.gov/pop/april1/huchange.xls

i do wonder how many people will still come here to get away from the rest of the country’s nightmare. We have got one of the better climactic futures.

For March the NWMLS was about .018 less than the C-S numbers, as a percentage of being off the peak (e.g. C-S was 0.7744232 of the peak and the NWMLS median was 0.7564449 of the peak). The next month it .014 the other direction. The NWMLS numbers are more volatile, in part because of the 3 month average C-S uses.

Absolutely. The NWMLS counts Seattle as everything with a Seattle mailing address. That includes everything in the West Hill and North Highline unincorporated areas. That’s a big swath of land, and a combined population of 50,000 plus. The West Hill goes from the southest border of Seattle down to the Renton city limits, and includes Skyway, Lakeridge, Bryn Mawr, parts of Earlington.
North Highline includes White Center, some of South Park, and extends south to the Burien city limits.
Most of the unincorporated areas with a Seattle address would have a larger concentration of lower tiered housing prices.

“Those eggs were a lie, Steven… a LIE!”

The larger factor in the difference is that the CSI is a three month average. The March NWMLS median is an outlier and so the rise sharp rise from March to April was offset by the sharp drop from February to March. The difference between the 3 month average NWMLS average and the CSI was only .5%.

I suspect that the shift in the mix is not so much geographic as it is the price range that buyers are interested it. The available inventory then determines the shift in prices in individual houses as measured by sales pairs.

If it does hold true, then the current trend of the low end representing a lower percentage than that of 2003-2007 would seem to be a correction to the mean.

And if that’s the case then the recent increase in the median is not so misleading as some on Seattle Bubble might hope.

That said, the median and its trendline is only one tool prudent buyers and sellers should look at when making their own decisions.

This post may be deja vu to you, but I still found it interesting. Tim comes up with some creative ways to represent data. Mostly, I appreciate the fact that I can steer people to this site when they ask me about whether or not they should buy in this market.

@Patient

Tim may be preaching to the choir here, but the reason he has to keep bringing this up is to counter the media reports. When the median price rises, it is reported “seattle home values rise.” This is a great primer for people who are just learning about real estate statistics.

So short sales, in a round about way, are increasing the median….