It’s not often we get a major national news piece focused solely on Seattle’s real estate market, but yesterday we got just that from the New York Times: Housing Crash Is Hitting Cities Thought to Be Stable
SEATTLE — Few believed the housing market here would ever collapse. Now they wonder if it will ever stop slumping.
…
In the last year, home prices in Seattle had a bigger price decline than in Las Vegas. [Case-Shiller for November: Seattle down 4.7% YOY, Las Vegas down 3.5% YOY]
…
“When I go out and talk to people around town, they say, ‘Wow, I thought we were going to have a 12 percent correction and call it a day,’ ” said Stan Humphries, chief economist for the housing site Zillow, which is based in Seattle. “But this thing just keeps on going.”
Not sure who Stan was talking to, but the vast majority of people I encountered prior to spring 2008 didn’t think Seattle was going to fall at all. Even a 10 percent drop was unthinkable to those outside of the writers and commenters on this blog.
It has been a long, painful slide. At the peak, a downturn in real estate in Seattle was nearly unthinkable. In September 2006, after prices started falling in many parts of the country but were still increasing here, The Seattle Times noted that the last time prices in the city dropped on a quarterly basis was during the severe recession of 1982.
Two local economists were quoted all but guaranteeing that Seattle was immune “if history is any indication.” A market-risk index from PMI Mortgage Insurance gave the odds of Seattle prices dropping at a negligible 11 percent.
I recall that piece well. The front page of the paper was emblazened with a giant chart of home prices going up, up, up. It was thoroughly mocked on these pages:
There’s not a shred of new information in this 1,265-word rant, just the same tired arguments we’ve been reading over and over again—strong local economy, not as expensive as California, etc., etc., etc… The focus of this particular article is the “it’s never gone down before” argument. I wonder if Ms. Rhodes and her lauded “local economists” have heard of the phrase “past performance is no guarantee of future results.”
But I digress. Back to the New York Times…
These days, the mood here is chastened when not downright fatalistic. If a recovery depends on a belief in better times, that seems a long way off.
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Increasing numbers of sellers are simply surrendering.Megan and Ryan Dortch tried to sell their one-bedroom Eastlake condo for $325,000 two years ago. They rejected an offer of $295,000 as inadequate. A year later, they relisted it for $289,000, then $279,000, which was less than they paid. Without a sale at that price, they could not afford to buy a place big enough for them and their new baby.
They have given up on real estate. They are renting out their old apartment at a small loss every month, and living in a rented house. “I don’t expect the market to get better,” said Ms. Dortch, 31, a customer service consultant.
“Better” is obviously in the eye of the beholder. In my opinion, today’s real estate market is immensely better than it was from 2005 to 2007, but for those who bought into the fantasy of easy riches through ever-increasing home prices, the last few years have definitely been sobering.
Redfin, a real estate brokerage firm based in Seattle, says foot traffic began picking up in the last several weeks. Mortgage rates are rising, which could nudge those who need to buy to make a deal now for fear rates will rise even more.
But whenever the market finally does pick up, all those accidental landlords will want to unload, putting another burden on the market. “So many sellers are waiting in the shadows,” said Redfin’s chief executive, Glenn Kelman. “The inventory is going to expand and expand and expand. I don’t see any basis for significant price increases.”
This is the same thing Glenn was saying in his Wall Street Journal editorial last week. It sounds like Glenn agrees with my theory that the pent-up supply will serve to balance out any pent-up demand that might still be lurking out there, putting a damper on price increases for the foreseeable future.
David Leonhardt had a brief follow-up to yesterday’s story in his Economix blog: Seattle’s Foreseeable Housing Bust
Real-estate agents, homeowners and even home buyers can tell a lot of stories to justify the bubble — stories about central cities or good school districts being immune to bubbles — but eventually people will realize that renting is a much better deal and more will do so.
There is no such thing as a market price that cannot fall.
Bingo. If only more people in super smart Seattle would have applied a modicum of critical thinking before diving head first into the market.
00
I’m still waiting for the day when I show up to a cocktail party, someone says “I just bought a house!”, and a random stranger says “Oh I’m so sorry. Probably should have kept renting.” Until that happens, it’s not time to buy.
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Reality-based reporting from the MSM. What a concept! This “foreseeable” bust was only seen by a handful of economists (who were laughed at, at the time) and insightful bloggers like The Tim.
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Tim, I think you may have your year wrong. In the Spring of 2008 we’d already seen a median $50,000 of the peak, and given up about 14 points on C-S (although we may not have known the latter depending on when Spring ends and the release date of the March C-S data).
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RE: Kary L. Krismer @ 3 – Nope, I meant Spring 2008. Peak month in Seattle was July 2007, but even though prices were going down through the latter half of 2007, the “Seattle is special” crowd was insistent that it was just seasonal, and when spring rolled around things would pick back up again. Then spring rolled around and things didn’t pick up.
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What the hell, no mention of SB???
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Tim – great post and been linked out to you for a long time on my blog.
I appraise in Manhattan and the NYC metro area and saw this NYT article this morning on my way into work.
One of the things that seems to be missing from the discussion is the lag in reporting time of CS. In other words, the CS’s report is november 2010, which measures september closings, which is based on June July August contracts. I wonder, isn’t this really a discussion about what happened this summer post-tax credit and not what is happening right now?
Here’s a crazy looking chart I made that shows the post-tax credit phenomenon – especially the non-seasonal adjusted. Think the tax credit had an impact on housing demand and prices?
http://www.millersamuel.com/charts/gallery-view.php?ViewNode=1275502049iaeKT&Record=0
While I agree that we aren’t done with housing weakness for a myria of reasons and I don’t know the Seattle market – am I missing something here? Aren’t we debating ancient information?
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Canada’s national – the globe and mail had basically the same story –
http://www.theglobeandmail.com/report-on-business/economy/housing/in-the-us-housing-crash-no-ones-immune/article1905972/
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Bonus question: If the local and national media is now bearish on seattle housing, does that mean we’ve hit bottom?
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It’s Ironic
When we plan our 401Ks and retirement strategy, we hire professionals and go to seminars to make sure we invest correctly.
But…..the pundits somehow think RE investing should be TOTALLY different, the most expensive investment decision in our life suddenly based solely on location, looks and greed. It’s like the RE crowd doesn’t want us to think, just sign and drive.
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So many now shouting “Hey, wait for me- I’m your leader!” And yet none are really out in front of the issues. Old habits and expectations die a hard death.
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RE: The Tim @ 4 – I confirm..I experienced this denial first hand through end of 2007 and well into 2008..I could not believe how confident the people in my circles were that Seattle was special and immune from a price decline..I’m not sure exactly when the attitude changed, but it was only after it was painfully obvious.
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Comparing price/rent ratios across cities can be misleading.
We’ve touched on this in other threads, but in Seattle the price/annual rent is around 20. The typical 400k house can be rented for around 1700. To buy with 5% down the PITI will be around 2300. Factor in around 500 in tax savings and renting vs buying are pretty close.
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RE: Drshort @ 12 –
“renting vs buying are pretty close”
Shouldn’t we include the $20,000 capital loss (5% of $400K) in that calculation? I bet it would make a difference. And just think what a 10% number would do.
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I’m surprised that I haven’t heard anyone mention land use planning as a factor. I always heard a lot of people say that the land use laws in the Pacific Northwest discouraged Phoenix/Vegas-like sprawl, and thus we were immune to the bust cycles. I think there is some truth to this statement (even today), but clearly it was not enough to mitigate the other factors that caused the collapse — too bad… I’d love to scoop up a nice new house right now @ $75/sf here in Portland.
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RE: Drshort @ 12 –
Good thing that replacing a moss laden roof in the northwest is free!
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First of all, the NY Times is hardly a credible source. Remember their absolutely criminal reporting of the last Iraq war? Second, if a myth is repeated long enough, it becomes accepted as truth. Like the “everyone thought home prices never go down” myth. Absolute nonsense to anyone who can read and who was conscious in the late ’80′s. And now this myth, that folks did not know we were in a bubble. Hogwash! It was pretty clear with just the most perfunctory analysis performed from a barkalounger armed with a laptop. The point is, if you were fixated on buying, you had to do the best you could in that environment. In 2003 a friend of mine in Michigan was warning me of the RE bubble, and he sold his house and moved his family into an apartment to ride things out. I am sure his wife thought he was loco. But he was right, just the timing was hard to nail down perfectly.
Adults are not that different from children. They need simple stories that seem to explain thnings nicely so everyone can feel better. Just look at the local nightly “news.” Reading stories to children.
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RE: Blurtman @ 16 – your preaching to the choir, but other than the people on this blog…I know of not one person that thought that Seattle’s real estate was going to go anywhere but UP…I know several people that bought at the peak. These aren’t stupid people, they believed the BS that their real estate agents told them. I wish that I tape recorded the person that tried to sell me a house in late 2007 – now that was rubbish
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By Blurtman @ 16:
Perhaps your memory is different from mine, but having run this blog since August 2005, my impression was that the vast, vast majority of observers were 100% convinced that even if there was a housing bubble elsewhere (and some denied even that), we were “special” here in Seattle, and high home prices here were supported by “fundamentals.”
In addition to the September 2006 Seattle Times article mentioned in the post, here are a few more posts that pop to my mind from those days:
Or just drop by the Friday Flashback archive if you still don’t believe me.
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Land use planning was the biggest factor that was used to explain why Seattle was special
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RE: Drshort @ 12 – Your calculations are a little simplistic… At 5.25%, PITI may be closer to $2,750 ($2098 pmt, $400 taxes, $250 pmi). Next, the tax savings are likely half or $250 (i.e., only the benefit of itemizing over the standard deduction, not the full interest deduction). Plus you’ve got the capital costs of maintaining the asset (conservatively, $200 a month). Thus, buying costs $2,700 while renting costs $1,700. To come out ahead (assuming your invest the savings in TIPS or something conservative), your home has to appreciate at a “real” rate of about 3.0% a year (i.e., above inflation). It if depreciates, it will take decades to recover (if ever). While this is itself an oversimplification, it is why I’m renting and not buying.
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Seattle real-estate is still overpriced by about 20% if not more. The only reason it has not fallen even more is because major employers have not made big cut-backs. If Microsoft starts letting people go that will accelerate process.
Most people living in $300k-500k houses are one paycheck away from bankruptcy. They have all money in house payment and lot of them had money taken out during crazy years. There are still lot of people that bought as much house as they can possibly buy while living on peanut butter jelly sandwiches so any disruption to their income will send house prices down. Deservedly so.
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RE: Drshort @ 12 – I rented 2 houses – One in Issaquah Highlands and one in Bellevue from late 2007 until late 2010…I investigated the rental market every 6 months having my first landlord reduce my rent by 20% – I know for a fact that it was much less expensive to rent than to buy during that time, even calculating the cost of moving. This left us flexible to leave with min costs..no commitments – no repairs – no taxes – no HOA fees…I believe that rents will continue to go down in Eastside for the next year or so…many will keep renting their houses out until they face the loss of equity and decide to bail.
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RE: Dawn Glover @ 17 – Speaking of BS, my mortgage broker tried to convince me to take out an interest only mortgage when we bought our home. I could not believe he would propose this, and thought he thought I had just fell off the turnip truck. Of course he did not tell me he made more money by selling one of these exotics loans, the fooker.
The way I look at it, the mess this country is in is not fundamentally due to economic or financial reasons. It is purely due to widespread immorality. And now it is time to pay up. And I am not a religious man.
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RE: The Tim @ 18 – The Tim, I would not know enough to question your assertions, knowledge or track record. I am not worthy. I moved to this beautiful area in late 2004, stayed in corporate housing for a spell and then a B&B briefly. The B&B was just pruchased by an out-of-town couple for around $800k or so. It really only had one room to rent out, but a killer sound view. I remember discussing the RE market with the new owner who matter-of-factly told me that he expected the price of his newly acquired property to double in 5-6 years. When I asked him if he expected folks’ earnings to do the same, he gave me a far away look and did not answer. The underwater home was on the market a few years back, the couple apparently divorced.
I think the real motive is that folks need to believe that prices will go up for various reasons. Some folks need the money. Some folks get caught up in the hype. Hence, massive denial. But one decides to deny.
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Housing prices going up? You would have better luck picking up toothpiks with your ass cheeks. Impossible. Too many people returning their merchandise to the store if you will.
Complete Saturation with all the Buyers buried in their homes. BTW do NOT forget the cost to sell in this State is about 6-10%.
Pray for a flat line and any form of Fed assistance to unload. If you are a Buyer. YOU ARE GOLDEN. Let the prices come down to you and be patient…..they will.
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When I was following RE in LA, 2012 always came up as a likely bottom. Seattle didn’t run up as high as LA but it peaked later so 2012 is definitely reasonable. The wild card at this point is interest rates. If they go up prices will fall.
I get tired of hearing “oh! you better buy now, because rates are going up and when they do you won’t be able to afford as much house.”
That’s partially true, but the rest of the story is that as rates climb affordability falls, and, barring a sudden rise in incomes, prices will have to fall.
I wish the Fed has raised rates instead of lowering them and mortgaging our nation’s future. What people can afford per month and interest rates determine how much people will pay for a house, and that drives prices.
Monthly payments being equal you’re always better with a lower principle, but the RE industry doesn’t want that.
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I can’t remember when I first started posting here- perhaps The Tim can find it. Best guess it was sometime in late 2006. What I do remember is that bears were very few and far between, and openly ridiculed. While the general public probably lags the group here in terms of understanding and attitudes there has none the less been a pretty dramatic shift in expectations. Very few expect home prices to rise any time soon, but a similar minority also believe they can’t continue to fall. It’s been interesting to watch the transition in attitudes.
Now we’re faced with a similar situation on the national stage as the federal budget crisis plays out. A majority just can’t accept that the country is broke and needs major fiscal reconstruction to get back on track. Too many think a little tinkering here and there will fix huge problems that took decades to develop. I’m amused by those who claim it was impossible to see either the housing or budget crises coming. Neither was hard to see if you were willing to look and accept what you saw.
Still bearish- but enjoying life.
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RE: Drshort @ 12 –
I’d Make It a Lot Simpler
Your numbers work with a 50% down payment on a $400K loan IMO….for every $100K you borrow figure on about $1000/mo approx costs buying vs renting. Now you have a lid on lost equity [prices are still going down], maintenance [pay me now or pay me later], escalating property taxes at 8% a year while homes go down in value that much, insurance, water/sewer [it's usually free if you rent] and add in extra heat and air conditioning costs because you bought an energy pig McMansion when you moved out of your smaller apartment/condo.
If you use my numbers Dr Short, you won’t come up short.
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RE: luke @ 20 –
The calculations get worse when you add in the cost of selling. As soon as you buy you are 9% in the hole after commissions and taxes. So if prices stay flat you have to actually be saving money by owning vs renting in order to dig out from that hole. If prices drop then you’ve got a bigger hole to dig out from. Only after prices rise ~9% are you breaking even to where raw monthy figures are comparable.
As to the tax break, I look at that as the cost the government has to pay me in order to give up my ability to move, whether for a better job or to a house that just better suits my needs, whenever I feel like it. The interest deduction is a proxy for the “price” of agreeing to potentially be stuck in a place where you may not want to be later on. If there wasn’t such a cost associated with owning then the government wouldn’t have to bribe people into owning. Maybe for some people the government’s price is right, but it shouldn’t be viewed as “free” or “bonus” money in the rent vs own equation since you have to earn it by giving up flexability.
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RE: Scotsman @ 27 –
I Agree Scotsman
It took many administrations since 1990 to get us in this uncontrolled growth mess, so Obama and Bush too, aren’t the only two to blame.
What quick magic wand trick could fix the over growth debt mess with mitigated household incomes we’re in right now? Denial won’t work anymore, we’re all mostly on to the lies. How about more interest rates decreases? We’re pegged as low she goes, 0% short term federal treasuries, we’d have to use the federal deficit to lower interest rates more than they’ve bottomed out to today…..that isn’t going to happen.
Have you ever seen the movie, The Matrix? There’s the answer, put us all in cannisters and make reality a computer generated dream….then we’d all have imaginary money to pay for our imaginary McMansions….LOL
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RE: Scotsman @ 27 – Right on, Brother. Life is too short to worry too much about things beyond your control. Take care care of yourself, family, and closest friends. And have fun.
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RE: Jonathan Miller @ 6 – Yes, the Case Shiller index is telling us ancient information from last summer, but the trend has not changed since then. The most forward looking information available around here are the trends showing up in closed sales and inventory of homes for sale. Ever since the tax credit expired, closed sales have been decreasing year over year, and inventory has been increasing year over year in King County’s single family home market. This suggests that prices will continue to decrease for the forseeable future. We will need to see sales increasing and inventory decreasing year over year for a while before stable price appreciation returns.
If you feel like taking the time to read more into it, this post is full of the latest data: http://seattlebubble.com/blog/2011/02/04/nwmls-prices-inventory-fall-sales-slowly-climb/
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I really wish you’d share your bust with Vancouver, BC. Still blowing teflon bubbles up here in the land of the “Canadians are SO PRUDENT” delusion. How this is believed in a city where you pay a million bucks for a SFH teardown, where the median family income is $70K, our savings rate is negative, and credit card debt is skyrocketing, I don’t know. Plus – our industries are leaving, head offices relocating, people moving…
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RE: LA Relo @ 26 –
Add to the interest wild card all the bank owned property in the pipeline. I’d like to sell my condo at $170K, which I think is a fair price in this market. However, a bank owned unit in the same building was just listed at $130K. That will put enormous downward pressure on my price.
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By Absinthe @ 33:
(I live in vancouver.)
This house of cards will fall as well.
I remember a funky conversation with an American a few years back. I tried to describe differences in mentality between Germany (where I am born) and Austria (where I lived at the time). I joked that Austria would be a quite good place to live if they did not imitate German mistakes with a 5 year delay. He smiled and claimed Canada did the same with relation to the US, and he named some examples. While these examples were not convincing, looking at the RE situation and the debt load in Canada it will take a miracle for that bubble not to burst.
Don’t get me wrong: I love Vancouver. At the same time I am sick of most things being 1.5 times the price compared to Seattle. My wife rented a beautiful 4 bedroom house in Brier for 1350$ during the bubble years (who said a 400k house costs 1700$ to rent? OK we are aware this was under market price.). We now rent a 2 bedroom basement apartment less than half the size and without a dishwasher for 1250$. On our street everyone rents out their basement, otherwise they could not afford their mortgage payment. Just a few months ago, two old houses in our neighborhood were bought for unbelievable prices and instantly torn down. they are now replaced with construction that I better not talk about in detail: Mike Holmes would fall over dead instantly.
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I used to have a coworker who was roughly my age, made about the same income, and we were both looking at houses a few years back. He pulled the trigger in the spring of 2007 and thought I was a fool for not jumping in. I remember him confidently saying, “The time to buy is NOW.” He had to be one of the biggest chocolate talkers about my choice not to buy. Haven’t heard from him for a couple of years now.
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By Ross @ 8:
Cramer being positive on Seattle, and that being picked up nationally, was the top! So the bottom will be when Cramer says something negative about Seattle.
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I looked at a bank owned house this morning. It’s next door to a house that sold as an REO in October. Just a few doors down there’s notices taped to the front door on another house. Pent up demand and increased open house traffic don’t seem to be stopping the dominoes from falling up here in Snohomish County.
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By Dave0 @ 32:
Not quite. December 2010 was off of 2009 by only 4 units out of over 1,400. January 2011 was more than January 2010 by 61 units.
I don’t track inventory, but I’m not sure there’s been that significant of a change there either. In any case, to really compare them I’d want to back out the short sales, which can’t be done at this point in time.
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RE: Scotsman @ 27 – Sadly, I agree, every time I hear someone say “now that the recession is over” or we are in recovery” I know it can’t possible be true. It’s the same common sense that told me the housing madness was unsustainable. I feel like I must not be the only one who is holding their breath and wondering what’s next.
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whatever happened to that female realtor who used to come here and rail against the ‘silly bubble heads’ who didn’t understand the new paradigm. LOL. Is she still in business?
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Mish weighs in:
http://globaleconomicanalysis.blogspot.com/2011/02/housing-crash-bites-deeper-economic.html
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RE: betamax @ 41 –
Which one? ;-)
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By Yaj @ 42:
“Few believed the housing market here would ever collapse. Now they wonder if it will ever stop slumping”
dare we say that sounds like a bottom? maximum pessimism and seller surrendering? all the makings of a bottom.
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hey mish, the cycle in seattle just started later that’s all. I give him credit though, he stopped bashing unions long enough to write about something else!
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RE: Ross @ 8 –
Ross,
One good turn deserves another. The time between 1st bull article and peak = the time between 1st bear article and trough. No?
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1st the Egypt Revolution, now this? This is one of the best weeks I’ve had in a very long time!
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Tim, thank you. Every time a man tells me that I should buy a house, I say, “no.” When he says that I should, I invoke your name. The man stops.
Thank you, Tim, for giving me the courage not to buy a house.
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RE: pfft @ 45 – Dare I say that I agree with you. And his union bashing is tedious.
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RE: TheHulk @ 51 – RE: pfft @ 52 – Guys, take it to the Global Economic Open Thread please.
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By Blurtman @ 49:
it’s funny you say that because I haven’t read him i months. still up to his same old tricks.
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RE: The Tim @ 50 – RE: Jonathan Miller @ 6 –
This kind of post only attracts people like Jonathon Miller. These guys are all dependent on, have spent money, time, effort, and energy on promoting the idea that people should buy housing units.
No rhyme, or reason, just buy, buy, buy. Buy my product, my graphs, my book. Pay me to consult, because I have charts, graphs, and the inside track on Bloomberg, Inman, or Case/Schiller. More people, more products, more reasons to pay attention, so when you buy, you buy with confidence.
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RE: The Tim @ 50 – Okay I warned you guys and you didn’t listen, so I have moved all the comments to the Global Economic Open Thread, starting with the first one that veered off the topic of this post.
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RE: Drshort @ 12 –
I’m not seeing any $1700 rentals on $400k houses that would be worth renting and I’ve been looking around for 3-4 months. Most of those homes are north of that for monthly rent.
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http://www.oftwominds.com/blog-photos/bubble-decline2.gif
http://www.oftwominds.com/photos07/mtg-resets-IMF.jpg
Hat tip to CHW:
“Prices are determined by supply and demand. The current illusion of “recovery” has been fueled by two massive manipulations of the market: the supply has been artificially limited by the withholding of distressed homes in the “shadow inventory,” and the demand has been artificially juiced by stupendous “socialist” government pumping via subsidies, guarantees, backstops and purchases/ownership of “private” markets.
The next phase shift down will be triggered by market forces responding to the asymmetry between supply (high and rising) and demand (low and falling). It doesn’t take any more houses coming on the market to trigger the next leg down; it will only take a decline in demand as the pool of bottom fishers is exhausted and potential buyers realize the “recovery” was purely government-orchestrated illusion.
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RE: Scotsman @ 55 –
Scotsman…Great Post.
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I think it was Losh that commented on this story about a big developer moving into the area.
http://seattletimes.nwsource.com/html/realestate/2014178499_realpulte13.html
I don’t view that as a good sign for future prices in the area–at least if you think good is up or even stable.
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By The Tim @ 53:
This is not Global Economics: It is US economics, so it is kind of the wrong thread. I guess you just want to kill discussion cause that is all moving it achieves. A little thin-skinned today, eh?
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RE: Daniel @ 58 – Give me a break. The comment rules (you know, the ones linked in bold text just between the comment box and the “Submit” button) clearly state the following:
Comments that rehash the same tired discussion about the recession and recovery do not belong in posts about other topics. It’s as simple as that.
If I wanted to “kill discussion” about that stuff I would just be deleting comments and banning users. Instead, I created a place for those discussions and have asked people to have those discussions there. When people ignore my requests, I’ll enforce the rules that I set up.
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RE: Kary L. Krismer @ 57 – I just hope that when this developer Pulte is allowed to punch in as many hundreds of homes as is being reported that they also put in the “golly” roads that need to go with them.
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So I read an article the other day from a local “independent” housing expert (cannot find the link if anyone else remembers reading that please post) said it is likely that locally mortgage payments are not going to get any lower, because of the amount that house prices would have to drop to keep up with the expectation of higher interest rates probably would not happen. I also think that if you can find the right house at the right price it is not a terrible price to buy; for example if you buy a foreclosure at 10% to 20% less than market value, a future drop in local homes values is “covered”. I am not sure I agree with the statement that Ive heard about built-in equity when you purchase a forclosure, but I do believe that there is a little bit of wiggle room if house prices continue to drop.
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My property taxes(Seattle proper) in 2011 are 50% what they were in 2006. Not exactly appreciating at 8% a year.
50% down sounds about right though. That’s what I did on a 400k house in 2005. Mortgage + tax/insurance was around $1300, comparable rent would be $1700 or so.
There’s the opportunity cost on the 200k downpayment, but my other investments are only now making up for the bloodbath of the last few years.
By softwarengineer @ 28:
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By Scotsman @ 13:
And let’s not forget to tack on maintenance fees and mortgage insurance.
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By The Tim @ 18:
OMG! Did you have to remind us of the famous, “house prices can’t considerably decline because Seattle is forever locked in an upwards stairstep pattern” argument.
The only argument I despise more than that one is “house prices can only go up because Seattle is surrounded by water, and there are no more empty building lots in King County.”
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By betamax @ 41:
LOL! I’m hoping you are referring to Ardell, because the stuff coming out of her mouth back in the day was simply astonishing. I can’t imagine anybody putting their foot in their mouth worse than that. :)
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By The Tim @ 59:
Which is the best way to kill discussion: move them somewhere no one ever looks or posts, where any real discussion would quickly be unmanageable.
Of course you are free to ban those not caring about the rules but I surely will not waste my time actually reading them =)
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By Daniel @ 66:
Yeah nobody ever looks or posts there. That’s why this month’s thread is up to 248 comments already.
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By The Tim @ 67:
Apparently, macro economics is not a “tired discussion.”
I think some people tend to get ticked off because they believe you don’t understand the integral relationship between macro economics and local house prices. In any serious conversation about house prices you cannot separate the two.
I believe you fully understand this, and you are simply trying to target a popular and manageable scope of discussion and stick to it. I’m guessing this is due to time and energy constraints in your life and your understanding that most people aren’t intellectually set up to understand the big picture (or they just don’t have the time, patience, and or interest to take it on). Therefore, you need to dumb down the discussion in order to not lose the more mainstream portion of your reader base. (i.e. less effort = more readers, which is a good blogging strategy for a guy with a day job and is fully understandable)
I could be wrong though. But I would recommend that the macro-inclined readers not interpret your perceived censorship as a lack of intelligence on your part or a direct attack against their mindset.
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RE: Jonness @ 68 –
Nah, he hates it, all that negativity is hard on what sales remain. Now that The Tim works for The Man (i.e. Redfin) and has a paycheck that is directly dependent upon the sales of homes he has to walk a fine line between his corporate masters and the hard truth. I can see him, wide awake, staring at the ceiling at three in the morning wondering about his conscience and the ultimate fate of his soul. Or something like that.
In fact, there’s a rumor going around that Pfft is actually The Tim trying hard to give what few buyers remain a few good arguments to use with their spouses, co-workers, and others intent on dissuading them from buying. It’s part of the compromise he worked out with Redfin’s management. It’s all about balance, kind of a FOX/MSNBC type of thing, or something. Or so I heard, from my sister’s cousin. . . …
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RE: Jonness @ 68 & Scotsman @ 69 – You guys crack me up. I don’t really understand what is so heavy-handed about requesting that comments on posts be on-topic for the specific subject matter discussed in the post, but whatever.
And once more, for the record: I am not against having the macro economic discussion. The on-topic rule isn’t about “killing discussion” or “dumbing down discussion.” It’s about letting people discuss the specific topic at hand without every single discussion turning into a conversation about the so-called recovery or the continued massive debt binge.
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RE: Scotsman @ 69 –
Good stuff. My sarcasm detector is broken though, are you actually being serious?
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RE: The Tim @ 70 – I understand that by separating the discussions that deviate from what your blog was intended to be about but since you do allow off topic discussions of things other than real estate in separate threads I wish you would allow those posts to be seen in your recent comments section. Since you stopped doing it, it has become most difficult in following any off topic discussion. I think I understand why you did it(to focus on your own blog items and get more attention paid to your blog agenda) but it really does distract from other items of interest that drive viewers here that make a good blog. I generally post relevant real estate stories under the weekly threads. For example I was first to post the recent NYT article about Seattle real estate. It received no responders. A day or two later you decided to feature the story with your own twist that has seen many responses many of them not relevant to the discussion. My point is that by censoring recent posts from your recent post list that are on off-topic lists you are stifling many other discussions that would occur here at SB. Just a thought….
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RE: noob @ 71 –
” are you actually being serious?”
No. Well, I am about the Pfft part. ;-)
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By The Tim @ 67:
It would be nice if you would have quoted the full sentence:
“Which is the best way to kill discussion: move them somewhere no one ever looks or posts, where any real discussion would quickly be unmanageable.”
I listed two different possibilities and should have separated them by “or” to make this clear. (I actually avoided it as I had used the word or and even this would have had two possible meaning.) 248 posts are merely a fraction of the economy posts found also elsewhere (often in the open threads). If everyone adhered to the rules browsing them would be unmanageable.
Just to make sure: I do not intent to buy a house in the near future and I have absolutely no interest in real estate. I still like most of your blog posts for many other reasons.
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RE: The Tim @ 70 – But Tim. What’s going to happen to house prices this June when Bernanke quits funding the $1.6 trillion fiscal deficit?
Just kidding. Take it with a grain of salt. You’re doing a great job. :)
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[...] 2,851 pageviews, 02/14: New York Times: Seattle Sellers Simply Surrendering [...]
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