Posted by: 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.

191 responses to “Claim: Seattle Real Estate Market Suddenly Heating Up”

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  1. Chuck C

    By LocalYokel @ 89:

    This reminds me of the scene from the movie, “Trading Places”,

    Randolph Duke: Exactly why do you think the price of pork bellies is going to keep going down, William?

    Billy Ray Valentine: Okay, pork belly prices have been dropping all morning, which means that everybody is waiting for it to hit rock bottom, so they can buy low. Which means that the people who own the pork belly contracts are saying, “Hey, we’re losing all our “golly” money, and Christmas is around the corner, and I ain’t gonna have no money to buy my son the G.I. Joe with the kung-fu grip! And my wife ain’t gonna f… my wife ain’t gonna make love to me if I got no money!” So they’re panicking right now, they’re screaming “SELL! SELL!” to get out before the price keeps dropping. They’re panicking out there right now, I can feel it.
    [on the ticker machine, the price keeps dropping]

    Randolph Duke: He’s right, Mortimer! My God, look at it!

    So, what I think, “It ain’t cool being no jive turkey so close to Thanksgiving. ”

    Keep your powder dry.

    Awesome!

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  2. One Eyed Man

    RE: Scotsman @ 90

    Dear Mr. Scotsman,

    I’ve been asked to address your recent comment on behave of my client, a Realtor, who desires to remain anonymous. My client would like to remind you that there weren’t any hawks on the last FOMC vote. Given that fact, and Mr. Bernanke’s academic and professional history, don’t you think that we’ll quickly see QE3 If unemployment begins to move materially back up or GDP growth significantly deteriorates as you’ve suggested appears likely? And if the market players sell in May and go away, won’t Ben’s air cav quickly be raining dollar destruction once again as the only weapon left in their arsenal?

    If you think real inflation is already at Shadowstat’s 6%+, what will it be when the Dollar Index drops to a 6 handle or perhaps even a 5. And I believe hourly wages are moving up according to all the sources I’ve seen including BEA.

    If you already think that inflation is at shadowstat’s 6%+ then the lenders are already theoretically paying borrowers to take out a 5% 30 yr fixed. And even 6% inflation will theoretically eat up that forecasted 20% additional real estate price drop in 3 yrs. If all those numbers are true and just hold constant, a current buyer would probably be in the black based upon rent vs own analysis in less than 10 yrs even with a current 200 Gross Rent Multiplier (although I haven’t done the math to check it). And I’m sure my client can cherry pick you a good condition home with a150 (or less) GRM in Kent, Lynnwood or Federal Way if you can handle the social stigma of being in a blue collar neighborhood with mediocre schools.

    Please don’t get me wrong, I don’t mean to suggest that the average housing market participant has considered the above issues in even the rudimentary fashion outlined above. But even if you think it doesn’t currently make fundamental economic sense to purchase real estate, the market lemmings might turn and stampede leaving Jonness’s high IQ constituents wondering why they missed the bottom when we never even reached an historic long term mean in the funamental ratios, much less over shot. I believe the Bay Area and LA both perennially run fundamental ratios that are more absurd than Seattles. But then again, everyone knows that unlike Seattle, they actually are special.

    I’m not saying that the above scenario is what is happening, or what will happen, or that a prospective buyer shouldn’t continue to wait if possible. Of course Jonness might have to buy just to keep from losing his girl to some mouth breather with a house. But notwithstanding that fact, I personally believe the probability is that the anecdotes are just a belated spring bounce and the CS and median will most likely continue to drift down over the next year if not several years. But if you completely discount the possibility that a market turn could happen (whether rational or not), you’re being intellectually dishonest purely for the purpose of promoting what you believe will be the most probable outcome. Black swans may be rare, but chocolate happens all the time without much warning whether the swans are black or white. And the chance of a premature turn in the market might not be as improbable as you make it sound.

    My client therefore requests that you temper the tone of your rhetoric or face the wrath of his minions in both the Federal and State governments.

    So if you meet my client
    Have some courtesy
    Have some sympathy, and some taste
    Use all your well-learned politesse
    Or he’ll lay your soul to waste,

    Sincerely Yours,

    OEM
    Regional Counsel to the Prince of Darkness
    (aka the devil’s advocate)

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  3. Chuck C

    By Jonness @ 93:

    For the most part, there’s nothing but crap on the market. When a decent home lists, low-IQ’d types who think with their emotions instead of their brains jump all over it.

    The problem is….that’s the competition which drives your comps.

    Don’t misunderstand, I’m in the “prices will continue to decline” camp….

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  4. Chuck C

    By David Losh @ 97:

    RE: Macro Investor @ 92

    If you are buying today you need to buy Hard Core, low ball, deals that will last your life time. There are no Pink Ponies. We have shot ‘em, hung them up by the hooves, and mounted the heads above our fireplace. We’re going to jerk the meat in case the going gets really tough.

    Priceless!!!!!

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  5. David Losh

    RE: ray pepper @ 98

    You are usually right, but not in this case.

    Maybe you aren’t seeing the darling little houses in Seattle. They are so cute it takes your breath away. Loans?, Appraisals? Well you have your 20% down to start with, and sterling credit, FICO 800!!! Some people are so smart that they put 30% down to get the best rates.

    Ray, it’s the same tired business as usual. You should spend some time with a “higher” class of real estate agents. They’ll tell ya’ the market is hot, hot, hot.

    Well, I’m glad it was you that beat me to the 100 comment mark.

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  6. David Losh

    RE: One Eyed Man @ 102

    See you in court counselor.

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  7. ;

    By ARDELL @ 87:

    RE: fubarrio @ 53
    I had a few calls from people who are not my clients who bought a house in March and April “to catch the tax credit” who HATE their homes or where they live.

    i suspect at least some of the people buying now will have the same sentiment in a couple of years.

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  8. Justin Bowers

    i just can’t believe that nobody else is frightened of an impending doom to come. maybe i missed the good news about the shadowed inventory that’s still lingering…i’m told it’s just my age, but it can only be a couple more decades before the most desired urban amenity is that the rooftop deck and/or fitness center has been converted to a pea patch right? yeah. stuff is selling but we’re all just pretending things are grand aren’t we? did that reporter say, “the market has changed drastically in the last couple months?” i enjoy the news almost as much as i enjoy watching peter popoff and don stewart.

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  9. Scotsman

    RE: ARDELL @ 96

    Let’s look at the evidence- starting with the $6 trillion the collective of “real estate always goes up” has lost over the last few years. And continue on to the $3 trillion or more likely to be lost between now and the bottom. Is that the work of geniuses? Who knows. But let’s forget past mistakes, even yours. The important question is, given what we know now, what should people decide going forward? We can chart the results. I have long expired memberships in Mensa and Intertel, would love to own a house, but very much doubt that I’ll allow myself to buy one for a couple of years. That supports Jonness’ point. On the other hand there’s a large group of people who are convinced I’m a total idiot, and they may be right. But most of them own houses. Or used to.

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  10. Scotsman

    RE: David Losh @ 97

    Clarity and wit- you’ve been on a roll lately. ;-)

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  11. ARDELL

    RE: Scotsman @ 109

    Scotsman,

    Why wouldn’t people hedge their bets by buying with the lowest possible down instead of everyone pushing for 20% down or more? If the market is going to go down, why not buy the insurance (PMI) against the loss? Wouldn’t that be the smarter move?

    Also, the lowest downpayment mortgage also has an assumable interest rate, a hedge against loss of value due to rates increasing.

    I had a client who bought minimum down FHA end of September 2009 (short sale) who did a refinance in Summer of 2010 with a high enough appraised value to dump the PMI in less than a year. He has very little money invested, no PMI and an assumable low rate in case he wants to sell at a time when interest rates are higher.

    I have no idea what his IQ is, but he clearly handled his desire to own that place vs renting very well. I’m sure IQ has very little to do with who is buying and who is not. He is a very young man by the way…even younger than The Tim. :)

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  12. ARDELL

    RE: David Losh @ 6

    David Losh said: “When the offer comes in the listing agent gets on the phone with other interested buyer’s agents. That’s what a good listing agent is supposed to do.”

    I only do that if I’m getting a crappy offer. If it’s a good offer I don’t play games with it.

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  13. Scotsman

    RE: One Eyed Man @ 102

    Oh gawd. Cabernet or Chablis?

    OK, in four sentences or less: I actually think we’ll see QE3, etc. (out of .gov necessity, and perhaps in a less direct form) but the result will surprise all for decades to come. Deflation will continue in large often discretionary asset classes while necessities inflate. The resulting loss of the wealth effect, coupled with a squeeze on discretionary consumer spending and a tightening of .gov expenditures will result in stagnation for years to come. The situation will be compounded by capital flight (thanks to low interest rates and continued currency destruction) and a redirection of what profits remain from R+D and recapitalization to debt service and ever increasing energy (imported) costs.

    Tell your client real estate as a vice is dead, but the opportunity to rule over 20 years of domestic hell is just around the corner. But he probably already knows that.

    On the bright side I ate at one of the downtown Seattle clubs the other night and had the best piece of prime rib of my life. I’m still thinking about it. So we can still find a little bit of heaven here on earth.

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  14. Scotsman

    RE: ARDELL @ 111

    If I did buy, it would be FHA or other very minimum down non recourse for the very reasons you mention. It might work out, but if everything went south one could walk. Smart?- yes. Moral?- what is moral these days seems to depend on who or what you are- bank, government, individual, poor or wealthy. Life’s a lot harder now than when I was a Boy Scout.

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  15. Lurker

    RE: Chuck C @ 103

    True, and for now while comps for the few well priced & quality listings stay level (and may even get the spring bounce) the rest get left behind and forced to lower price further which ultimately corrodes the comp base for everyone. Wouldn’t it?

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  16. Lurker

    RE: ARDELL @ 112

    Really? If a good offer came in for your listing you wouldn’t call up other interested parties to give them an opportunity to compete?

    Like what David said, from my shallow experience by visiting open houses I many times got the push from listing agents to “make an offer, any offer” not that the seller would accept it but so they could actually tell other parties they had an offer. It’s a leg up from that very common line “Oh, there has been a lot of interest on this home and we’re expecting an offer in later today. If you are interested you better move fast!”

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  17. Kary L. Krismer

    By Lurker @ 116:

    [Ardell,]
    Really? If a good offer came in for your listing you wouldn’t call up other interested parties to give them an opportunity to compete?

    It really should be the client’s call, and I suspect that’s Ardell’s position too. But if you get a good offer in you don’t necessarily want to stir the pot to see what comes up. When I say “good offer” (and presumably Ardell says it too) remember offers are not evaluated solely by the price offered. It can be many factors. I once had two good offers come in and the deciding factor was the house one of them currently lived in (and neither offer was contingent on the sale of their existing house, since it would be hard to call a contingent offer a good offer).

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  18. David Losh

    RE: ARDELL @ 112

    This goes back to, “it’s not what you know it’s who you know.” You talk a lot about transparency, but Real Estate is still a very small, closed community.

    As Kary points out a good offer is more than just full price, it also needs to be closable.

    OK, so let’s open that can of worms, and see where it goes.

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  19. Dirty Renter

    RE: LocalYokel @ 89
    BRV to the Dukes – you sound like a couple of bookies to me.
    My favorite comedy of all time.

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  20. Ira Sacharoff

    David Losh said:
    “You should spend some time with a “higher” class of real estate agents.”

    What do they call that? A contradiction in terms? Mutually exclusive?

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  21. S-Crow

    RE: ray pepper @ 100 – “Red Fin is a real estate company and they must sell to survive.”

    I disagree. They just have to provide better service, better unique offerings and provide a better mechanism than the other brokers to get eyeballs. They do it better than anything I’ve seen. In other words, while commissions are earned on sales, no commission is guaranteed if you don’t serve the customer. That is a principle for any business.

    How does a small independent shop like our escrow company survive in a world of far lower volume? I’d say it is because of the principle outlined above. Why do I take my Honda to a specialized shop in Monroe vs. the dealerships (aka Title Companies).

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  22. Dirty Renter

    RE: David Losh @ 97
    “If you are buying today you need to buy Hard Core, low ball, deals that will last your life time. There are no Pink Ponies. We have shot ‘em, hung them up by the hooves, and mounted the heads above our fireplace. We’re going to jerk the meat in case the going gets really tough.”

    Best golly paragraph I’ve read on SB in years.

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  23. ARDELL

    RE: Scotsman @ 114

    Since when is it “immoral” to utilize insurance you bought against loss of value? That’s what people don’t “get”. During the past brief period in history, the lenders decided to be self insured and replace insurance with risk based pricing. They gambled…they lost. The borrower paid a higher interest rate instead of buying insurance at the lenders direction.

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  24. Kary L. Krismer

    RE: ARDELL @ 123 – Ardell, PMI isn’t insurance against declining market values, it’s insurance against a buyer default. And it’s not obtained by the buyer, it’s obtained by the bank, but the bank effectively requires the buyer to pay for it.

    If it were insurance that the buyer obtained to protect against declining market values, then a buyer with PMI could default and have no worries at all about a deficiency, even if they were extremely wealthy.

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  25. ARDELL

    RE: Lurker @ 116

    Lurker asks: “If a good offer came in for your listing you wouldn’t call up other interested parties to give them an opportunity to compete?”

    Define “interested parties”. Generally you don’t want to *golly* around with the buyer that “stepped up to the plate”. Why drag a donkey into the horse race that has to be dragged in on a rope?

    Never would I call to give a buyer “the opportunity to compete”. If I do call…it would not be for that reason. The opportunity exists, I don’t “create” it. The buyer either steps up to the plate or doesn’t.

    There are exceptions and reasonable time frames. While I don’t like the “who you know” line David Losh throws around, what buyers and sellers don’t realize is agents do a whole lot of talking between things actually happening. Often the Agent for the Seller is sizing up the Agent for the Buyer and choosing what to do based on that agent’s behavior and skill level.

    I’m not going to call up an agent with an “interested buyer” who had sufficient time to write an offer and whose agent has whined to me that their client has been looking at houses for a year and can’t seem to pull the trigger.

    Most often what an agent does when they know their buyer client is interested is call the Listing Agent to find out if there are offers in hand. If another offer comes in within 24 hours of that call, yes I MAY call that agent back and give them a heads up. But if 3 or more days has passed…a week…NO. “Reasonable Timeframe” is generally 48 hours. Some exceptions.

    As to your experience at Open Houses…an experienced agent can hear the tone of BS from a mile away, no matter how hard the other agent tries to seem “genuine”. You either have an offer in hand…or you don’t. If the property has been on market for more than 30 days and there was REALLY a lot of interest, as in agents actually writing an offer but it isn’t in yet, the agent would not likely be standing around in an Open House telling you to hurry.

    If the house has been on market for only a couple of days, I likely would call the agents who showed it to determine how hard to push on the offer in hand, not to give their buyers “an opportunity to compete”.

    On Listing 170811 closed about a week ago I had a lot of buyers circling and not landing. Dropped the price slightly based on the immediate factors at hand and got a full price offer. Yes, there were at least 3 agents talking about maybe making an offer. No I didn’t call them. That wouldn’t be fair to “the buyer that stepped up to the plate” and the offer in hand was likely $10,000 higher than any other offer that might come in, based on the conversations I had with agents during the listing term of 71 days.

    On Listing #155063 I did not call the 40+ buyers who had seen it, I dropped the price as soon as the “noise” of a low offer was coming started, giving other buyers 48 hours or so to react to the lower price. No, I didn’t “call” any of them.

    If you have a good offer, you take it. If you have a low offer, you drop the price as soon as you are entertaining it. Some exceptions. But standing around calling people trying to “make them” do stuff is not usually the best course of action.

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  26. ARDELL

    RE: Kary L. Krismer @ 117

    No…that’s not my position. You know it isn’t. Do you think if you say that often enough you will convince me to work and talk the way you do? LOL! It’s been almost 5 years that you’ve tried, and it’s not working. You may want to rethink your wasted efforts to convince me to be like you.

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  27. David Losh

    RE: ARDELL @ 125

    So instead of direct contact you would lower the price on a low offer. Rather than keep in touch with interested agents you are waiting for a buyer to “step up to the plate.”

    You have a long response indicating that you play the same games, in other ways. The game is to get the property sold with the best offer for your clients best interests in mind.

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  28. David Losh

    RE: S-Crow @ 121

    An escrow office needs to make sales.

    Escrow is best in a small office. An independent small, local office with experienced closing staff is always, well in most cases, the best choice for buyers, sellers, and agents.

    There is absolutely no comparison between your escrow office and redfin.

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  29. Kary L. Krismer

    By ARDELL @ 126:

    RE: Kary L. Krismer @ 117 -No…that’s not my position. You know it isn’t. Do you think if you say that often enough you will convince me to work and talk the way you do? LOL! It’s been almost 5 years that you’ve tried, and it’s not working. You may want to rethink your wasted efforts to convince me to be like you.

    Sorry, I was just giving you the benefit of the doubt, because it never occurred to me that you wouldn’t think it wouldn’t be the client’s call.

    Sorry, I’ll never assume you’re somewhat reasonable or that you understand what the role of an agent is ever again.

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  30. ARDELL

    RE: David Losh @ 127

    David, I would not presume to know who all the “interested” buyers may be. Some may be buyers without an agent who have the listing “saved as a favorite” on Redfin. It is more likely that an interested buyer is someone who has not revealed their interest, than someone who looked at the house a month ago.

    It’s a fine line we walk when we have an offer in hand. On one I knew for fact that the other “interested” buyer liked a different house better. Creating a bigger spread between the two was necessary. On the other I was 99% sure price was not the issue, but the house itself, so I lowered the price just in case, but I was correct. The price being lowered did not “peak the interest” of the other buyers, as it wasn’t price holding them back.

    You have to play all of the factors and you have to pay very close attention so as to actually know all the factors. It’s not a game…but you do have to “play” it well. Clients best interests are rarely served by monkeying around with a good offer in this market. 3 years ago…you always had another buyer in the wings. Today…that’s not a safe bet for the seller.

    I’m also factoring in the seller’s holding costs. On one they were low so I played it through to the full price offer. On the other they were very high, so *gollying* around would cost the seller at least as much in carrying costs as a potential higher offer.

    How much it is costing the seller per month to carry the house (both were vacant properties) is a big part of the equation.

    On a side note…it is getting much harder to insure a vacant house. Liability issues on vacants is not a small consideration as well.

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  31. ARDELL

    RE: Kary L. Krismer @ 129

    I’m gonna save this for when you do it again. :) My clients don’t pay me the big bucks to pass paper around and ask them what I should do. YMMV But then, we’ve had this conversation more than once before.

    On the last one I reserved $1,800 of “my money” to address the inspection. When the inspection request came in I told the seller to sign it, as they would receive $500 by doing so after the buyer also got everything they wanted. No, I didn’t leave room for the buyer and seller to argue over a $300 item. You call that “wrong”…my clients call it “great!”. :)

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  32. Kary L. Krismer

    RE: ARDELL @ 131 – I’m not sure how totally changing the question and fact pattern changes what you’ve already said.

    The issue was when you get an offer in do you want to take any action to try to generate a second offer. IMHO there’s no way that’s not the client’s call, and that whether to do that is not affected by the quality of the first offer.

    But in your world, who knows what the result is. Do your clients even get to decide whether the price is acceptable to them, or do you decide that for them too? :-D

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  33. David Losh

    RE: ARDELL @ 130

    Long comment about the same thing. Multiple offers happen because listing agents are creating activity. I think the word is a “buzz” about a property.

    However we have this same conversation every year about this time, I mean at the end of the school year.

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  34. Macro Investor

    By ARDELL @ 96:

    RE: Jonness @ 93

    Really? Are you seriously inferring that people who buy a house must have a low IQ and anyone who doesn’t has a high IQ? Is there some public record showing County property recordings and their relationship to the buyer’s IQ?

    I bought a house and I’m not stupid. Suzanne crunched the numbers and said I could make it work.

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  35. ARDELL

    RE: Macro Investor @ 134

    Well that’s a whole different issue. I”m OK with it if he’s saying “Stupid is as Stupid Does” ala Forrest Gump. But to relate it directly to an IQ level…as if…not credible. Let’s assume he was meaning it in the Forrest Gump version.

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  36. Scott Weitz

    - Catching a falling knife

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  37. ARDELL

    RE: David Losh @ 133

    David, if agents could “create” it….it would happen in October and November. An agent may be able to stoke the embers…but you have to have something to work with.

    Rarely does an agent “create” multiple offers on a new listing. I would say at least half of all sellers would rather have one really good offer quickly than 30 offers.

    Maybe there are a lot of agents who play “chicken” and list it low to get multiple offers. It’s too easy for the seller to get beat at their own game for that to be in the best interest of the seller in most cases.

    If it’s “worth” $405,000 I’ll usually go with $399,950 than $409,000. If it’s worth $412,000 I may still go with $399,950 vs $409,000 or $419,000. It depends on the seller’s needs vs wants. But that’s not about trying to “lure” multiple offers.

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  38. ARDELL

    RE: Kary L. Krismer @ 132

    That’s decided before we list the house, not at time of offer.

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  39. Kary L. Krismer

    By ARDELL @ 138:

    RE: Kary L. Krismer @ 132

    That’s decided before we list the house, not at time of offer.

    You’re really being unusually dense today. Assuming you’re talking about the amount of an offer, are you really saying that is determined before the property is even listed? It’s somehow written in stone?

    But the issue raised as a joke wasn’t the amount of the offer, it was whether you decide if the amount is acceptable, or your client makes that determination.

    Let’s try to stay on track. The original discussion was whether or not a second offer should be sought/encouraged when one comes in. I said that would be the client’s decision, and should be based in part on the quality of the first offer. You disagreed with that in a somewhat extreme manner.

    So I’m just trying to decide how much control you think you have your your clients’ decisions. At this point I’m thinking you probably think you control their entire lives! ;-)

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  40. ARDELL

    RE: Kary L. Krismer @ 139

    You’re going too far off topic, Kary. I already answered that. Yes. We run through acceptable scenarios before we pick the list price. A “good” offer is one that “fits” that initial expectation established and agreed upon before the property is listed for sale.

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  41. Aaron

    RE: ARDELL @ 130

    Not terribly important, but it’s “pique the interest”, not “peak the interest”.

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  42. Pegasus

    RE: Kary L. Krismer @ 139 – If you could change the past it would have been interesting if you and Ardell had married. You could start your own reality show.

    “Ardell…get me a brewski”

    “Get your own beer Kary”

    “When will dinner be ready Ardell?”

    “When you fix it Kary”

    “That’s not fair Ardell. You know I cooked dinner every night for the last month except when we ate at Target”

    “Let me check my charts Kary. Nope. Last time I was wrong was when I called the real estate bottom back in oh eight. Still your turn to cook. Besides I am working on creating a multiple bidding war on that double wide that I listed”

    ” Maybe we should just buy it Ardell and have a roof over our heads?

    “Don’t you like living in our truck camper, Kary?

    “You’re really being unusually dense today, Ardell.”

    “Maybe we should buy a new truck first, Kary”

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  43. David Losh

    RE: ARDELL @ 137

    You are creating activity at all times, some times it catchs.

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  44. ARDELL

    RE: Aaron @ 141

    Thanks Aaron. I was going to look it up after I typed it, as it didn’t look quite right. Appreciate the heads up on that.

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  45. ARDELL

    RE: Pegasus @ 142 -LOL! You know that’s not all that far from the truth! …except I have never listed a double-wide…or even a single-wide.

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  46. Kary L. Krismer

    RE: Pegasus @ 142 – LOL, but it’s not quite realistic because you have Ardell staying on topic.

    It would be more:

    Me: Ardell, get me a beer!

    Ardell: I fixed dinner all last month.

    Me: What’s that have to do with beer?

    Ardell: I want to go to Target.

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  47. ARDELL

    RE: Kary L. Krismer @ 146

    You know how this always ends, Kary. I say Black so you can say White and feel like a big man.

    Black.

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  48. Jason

    Realtor Ron Sparks “now is a great time to buy frontman” from the video saying the same thing in 2008. Broken records repeat until the record player dies. Nothing new here.

    http://www.canada.com/vancouversun/news/story.html?id=cf8af409-8b37-4afe-a0da-e2c9d75f648e

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  49. Scotsman

    I’m not gonna read all of it- just tell me who’s ahead- Kary or Ardell. Did Ardell call a bottom? How many hairs has Kary split? TIA.

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  50. Scotsman

    More on the big spring recovery:

    “2010 was the perfect opportunity for housing in desirable areas to turn up. Instead, price declines accelerated to the downside despite record-low mortgage rates and a supposedly “firming” economy. It looks as if home buyers are voting on the “recovery” story with their feet.”

    http://www.oftwominds.com/blogapril11/housing-recovery-4-11.html

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  51. Kary L. Krismer

    RE: Scotsman @ 149 – It’s pretty simple. Ardell mis-read what I wrote in post 117 and responded in post 126. Then she’s not addressed the topic since then and gone off on irrelevant tangents. I still suspect she doesn’t disagree w/ post 117. How could an agent possibly not agree with the position that it’s the client’s decision as to what to do when an offer comes in?

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  52. Kary L. Krismer

    By ARDELL @ 147:

    You know how this always ends, Kary. I say Black so you can say White and feel like a big man..

    I respond to your posts because you are frequently 100% wrong and I don’t want others to be mislead by your advice. Most recently it was how you claimed that as a buyer’s agent you can simply give the escrow the inspection response form 35R and get your client’s money back from the escrow without the seller signing anything. And in case you’ve forgotten, that’s form 21, paragraph b which covers that, not Form 35R.

    You sound convincing, so I don’t want others to be mislead.

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  53. ARDELL

    RE: Kary L. Krismer @ 152

    Kary…”There Are a Thousand Stories in the Naked City”…mine are apparently not the same as yours. You want your buyer clients to go through holy hell to get their Earnest Money back if they need to cancel on inspection?…go for it! I choose not to subject my clients to unnecessary delays when it comes to getting their Earnest Money returned. Is that right according to Kary? I really don’t give a RA. Works for me and my cleints. That’s all I need to know.

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  54. ARDELL

    RE: Scotsman @ 149

    Apparently there no bottom. Just a big hole that goes as far as it wants to. :)

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  55. GrizzlyBear

    I’m calling bullsh!t on everything. Sure, a few people are making great money. The rest, not so much. Housing is in the sh!tter. It will be for a long, long time.

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  56. Scotsman

    RE: GrizzlyBear @ 155

    Hey, while you’re here- I’ve always wanted to ask- does a bear sh#t in the woods?

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  57. Lurker

    RE: ARDELL @ 125

    Thank you for your reply, Ardell, It was informative. Yes, when I said “interested parties” I meant parties you felt might be serious in buying. Not just anybody that perhaps liked the place.

    RE: Kary L. Krismer @ 117

    Thanks, Kary. Yes, afterwards I realized it would likely be a call made by the client. The type of market (buyer or seller) could also affect the decision on whether to “stir the pot” or not.

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  58. Mikal

    RE: Ira Sacharoff @ 99 – I thought you were talking about me, but we didn’t go to school together.

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  59. Kary L. Krismer

    RE: Lurker @ 157 – The “interested parties” would likely be limited to those agents who have either recently viewed the property or have viewed the property multiple times.

    I’ve had offers that really stunk up the place, typically because the agent clearly didn’t know what they were doing. For a seller that’s a bad situation because you don’t want to turn down an offer with a good price, but you don’t want to take your property off the market for a transaction that is not going to close. Sometime though the seller has no choice. I had one situation where just paying the utilities was a challenge and we got in that stinky offer. Having no choice we held our nose and fortunately it only required a one week extension to close, but it did close.

    On the other hand, if the offer looks good in all regards, I’d be unlikely to suggest the necessity of calling other parties through the property recently unless perhaps I’d had a conversation with one of the agents and felt that would be prudent. Some clients though are going to expect that, and I’m fine with that–it’s their call.

    Finally, I would say nothing comes of such calls far more often than something, unless there was that prior call from an agent asking to be called if an offer came in.

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  60. Kary L. Krismer

    RE: ARDELL @ 153 – Your escrow is going to care when they get sued for improperly returning the money. That’s who you are placing at risk.

    It’s interesting how often your analysis is based solely on what is best either for you (e.g. need to disclosure of short sale status, deficiency on second mortgage, etc.) or your client (this earnest money situation), while at other times you’re willing to throw your client under a bus for no good reason, even if you’re virtually the only person who thinks that’s what needs to be done.

    Compare your analysis:

    http://raincityguide.com/2011/01/20/short-sales-the-new-mortgage-fraud/

    To mine:

    http://www.trulia.com/blog/kary_l_krismer/2011/01/real_estate_agents_are_not_licensed_to_practice_law–part_iii_arm_s_length_transaction_notices

    In the thread that started that discussion there were over 100 posts, no one agreed with your analysis, but in your blog you ask: “Am I right or am I right.” Classic.

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  61. ARDELL

    RE: Kary L. Krismer @ 160

    No…I don’t think helping a client commit fraud is part of my agent duties. No, I don’t care if every agent in the Country disagrees with me on that. I guess I never bought into “the herd mentality”. If that works for you, great!

    If you’re playing the “How Far Off Topic Can I Go? game…you won.

    Black.

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  62. Ira Sacharoff

    By Kary L. Krismer @ 146:

    RE: Pegasus @ 142 – LOL, but it’s not quite realistic because you have Ardell staying on topic.

    It would be more:

    Me: Ardell, get me a beer!

    Ardell: I fixed dinner all last month.

    Me: What’s that have to do with beer?

    Ardell: I want to go to Target.

    Ardell will get Kary a beer when hell freezes over.

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  63. ray pepper

    RE: S-Crow @ 121
    Good God! Kary and Ardell. I stopped reading your posts. I didn’t even know what the topic was anymore.

    ” That is a principle for any business. ”

    It goes without saying customer service for virtually any business (unless its funded by another entity) must be good. However, if Red Fin doesn’t sell they go down. If their product is NOT used by enough customers they go down. Red Fin must answer to the investors that funded their business. If they are given no return their life span will be short lived.

    All real estate companies and Yes you, Title/Escrow, must have closings to survive. In this long period of deleveraging we have coming I hope its not earth shattering news to anyone that Red Fin and many others simply will NOT make it in their present form. Many title and escrow companies will continue to suffer and also close their doors.

    Just entering 3rd inning Tim..

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  64. David North

    I’m surprised that the original topic couldn’t hold a more prominent share of this discussion. The anecdotal evidence seems compelling, that multiple offer situations are widespread and frequent in the current Greater Seattle real estate market. The degree to which some folk don’t want that to be the case because it doesn’t fit their model of what should be going on in the market is interesting, as is the widespread assumption that multiple offers inherently translate to escalating prices.

    Multiple offer situations can be common in a declining (prices) market, which is exactly the scenario I am seeing. The market can be hot (activity) and still be declining (prices), and it is. This is why the phenomenon hasn’t impacted the statistics, though it has been going on for several months. There aren’t dramatically more sales or dramatically higher prices, just more scurrying for the sales that are likely to be made whether there is only one offer or multiple offers.

    Overall quality of inventory is extremely diverse in this market, adding complexity to market valuation and activity. There are segments of the market that are stone cold (activity and prices) with good reason, and others that are very active, also with good reason. The segmentation cuts across multiple dimensions, such as location, price brackets, property types and property quality.

    While the multiple offer phenomenon is true and current, equally true and current is the fact that a majority of qualified buyers are still cautious and patient in this market. For every legitimate motivated buyer I am serving with reasonably short finite timeframes, there are at least 8 legitimate buyers I am also serving whose timeframes are indefinitely long. There’s nothing wrong with either the reasonably short or indefinitely long timeframes, provided that they are based on the matching of good information and honest advice to the goals and situations of the buyers, which are extremely diverse.

    Any apparent attempts to spin the multiple offer wave into publicity hype don’t really bother me that much, because with the currently high ratio of patient buyers to impatient buyers, I think any multiple offer hype is more likely to push far more buyers to the sidelines than to push more buyers to impulsive action. There’s a lot more fear in the market that the bottom (prices) hasn’t yet been seen than there is fear that the bottom (prices) might be missed. Let any hypesters continue to accumulate their credibility deficits, as they’ve been doing for several years now. It mostly serves to build the businesses of those who serve information and advice that is unbiased, in either direction. Believe it or not, there are honest brokers appropriately advising clients to remain patient, and not pushing for the quick sale.

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  65. Lurker

    RE: David North @ 164

    Thank you for your perspective, David, I enjoyed reading that.

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  66. Julie Lyda

    RE: David North @ 164

    Very well said David. A voice with reason and common sense, how refreshing.

    “Let any hypesters continue to accumulate their credibility deficits, as they’ve been doing for several years now. It mostly serves to build the businesses of those who serve information and advice that is unbiased, in either direction. Believe it or not, there are honest brokers appropriately advising clients to remain patient, and not pushing for the quick sale.”

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  67. Peter Witting

    RE: Scotsman @ 149 – Just a lover’s quarrel.

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  68. Kary L. Krismer

    By ARDELL @ 161:

    RE: Kary L. Krismer @ 160 -No…I don’t think helping a client commit fraud is part of my agent duties. No, I don’t care if every agent in the Country disagrees with me on that. I guess I never bought into “the herd mentality”. If that works for you, great!If you’re playing the “How Far Off Topic Can I Go? game…you won.Black.

    It’s just part of your pattern of not being able to understand relatively simple legal terms in contracts and statutes, insisting repeatedly that you do, and disagreeing with everyone else about it. Again, that Arm’s Length piece of yours was classic Ardell. Being the only one who thinks something and insisting everyone else is wrong.

    BTW, the situation was described in those links was clearly not fraud. At best it would be a breach of contract term, assuming an inability of the judge to understand simple English.

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  69. David Losh

    RE: ray pepper @ 163

    redfin is a rebate Brokerage that can put money into escrow. It surprises me that more Brokerages haven’t adapted the business model.

    Zillow for all it’s faults got to be a larger platform for a National Real Estate Listing system which I think was the stated goal of all internet Brokerage models.

    There are a lot of sites we don’t look at because redfin did emphasis being a user friendly place to search for homes, in more market places. In time though the over all business model of redfin is a Real Estate sales site, with the rebate.

    In my opinion redfin was built on the McDonald’s business model. Products sold quick, and easy so you can saturate a market place. The problem with Real Estate is the transactional commissions are few, and far between. You would have to dominate a market place in order to have it pay off. You would have to make strategic partnerships, which they are trying to do.

    redfin has a reputation problem amonst Brokerages, and a stigma, that would need to change. You nailed it with:

    “Bryon (the Red Fin Agent) looked like a Buyer or someone walking down the street. The Coldwell Banker Agent looked like THE REAL DEAL commanding respect from the viewer of King 5 thereby producing more believability of the story.”

    Real Estate is a small community. Ray, you fit in better than redfin does. You adapted to a niche. You saw the opportunity, and you made the transition.

    redfin would need to become more inclusive with the Real Estate community in order to survive. They are, as you point out, a corporate structure backed by venture capital. Some consumers may take advantage of that, but more buyers, and sellers need a full set of services that are already packaged into the commission price point.

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  70. Kary L. Krismer

    By Scotsman @ 149:

    I’m not gonna read all of it- just tell me who’s ahead- Kary or Ardell. Did Ardell call a bottom? How many hairs has Kary split? TIA.

    BTW, you should be aware this isn’t the only site I deal with Ardell. Here’s the other one going on currently:

    http://www.trulia.com/voices/Home_Selling/If_staging_items_on_a_vacant_listing_are_not_remov-286342-p_1-recent?answerId=1056613#left_content

    There after another agent from out of state posted the correct result, Ardell took the position that a buyer of a house could simply dispose of staging property left after closing and that the stager could only sue the seller.

    And you Mack McCoy fans will also like the link because he’s there too! It’s like old times on SREP. ;-)

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  71. David Losh

    RE: Kary L. Krismer @ 170

    Which is exactly why I never go to Trulia Voices.

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  72. Kary L. Krismer

    By David Losh @ 171:

    Which is exactly why I never go to Trulia Voices.

    Trulia voices has plenty of good examples of why real estate agents are not legally allowed to give legal advice or explain the terms of a real estate contract.

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  73. CMDCMF

    Searching West Seattle three months – competitively priced properties in good condition sell quickly. That’s probably 5% to 10% of properties for sale. The rest just moulder and grow stale. I can’t believe some of the absolute garbage homes that are for sale. There are sweet blossoms among the turds, though.

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  74. CMDCMF

    After searching West Seattle three months – I find competitively priced properties in good condition sell quickly. That’s probably 5% to 10% of properties for sale. The rest just moulder and grow stale. I can’t believe some of the absolute garbage homes that are for sale. There are sweet blossoms among the turds, though.

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  75. mukoh

    RE: Lesley @ 41 – I know which house you are talking about. Heard from the listing agent it was a battle for buyers on that one.

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  76. Voight-kampff

    RE: ray pepper @ 163

    RAY PEPPER,
    Im slightly off topic, but Ive read your posts for years and
    I already know that the answer to life the universe and everything is 42,
    but what I don’t Know is what constitutes a “GEM”?
    Is it a simple answer, like it pencils for rent?
    would you have to kill me if you tell me :-)

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  77. The Desponder

    Dear The Tim,
    Please approach TLC about turning seattlebubble.com into a reality TV show. I would pay seriously leveraged $$$ to see what happens when all of your commenters have to work in the same realty office/home financing counseling office. Perhaps it could replace “Flip that House.” I will donate my underwater condo to be sold/foreclosed/demolished/recycled on the first episode.

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  78. DeeDee

    RE: lost buyer @ 84 – can’t believe some people STILL think that price range is affordable..to refer to a decent house at reasonable price (range from 600K to 1M) is insane…I can’t wait for the reality check ahead, because I have security and a great job…but also have common sense and would never settle with a DECENT house in that price range. I have no doubt there are buyers thinking they had better scoop up these deals, but the fundamentals have not changed..these prices are not affordable to people with great jobs…

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  79. Colby Boles

    Just a data point for you:

    We listed our Capitol Hill home using a flat fee MLS service for $1.35M on 4/28, had instant interest from many parties, and had signed an offer 3 days later. From our perspective, there are surprisingly a lot of well qualified buyers hiding in the woodwork for the right house in this price range. Buyers were very specific about the criteria they were looking for, had been looking for a year or more, and were ready to make an offer right away for the right house. Here is our listing for reference:

    http://www.redfin.com/WA/Seattle/337-17th-Ave-E-98112/home/144024
    http://337.17thaveeast.com/

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  80. ARDELL

    RE: Colby Boles @ 179

    WOW! Good job on that.

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  81. Jake

    Who are we to believe? The realtors who tell us the market is heating up? Or, the non-partisan analysts and watchdogs who tell us “The Seattle area is seeing prices declining faster than other places…” and “..prices in the Seattle area were the lowest they’ve been since June 2004″???

    Read more: http://www.seattlepi.com/realestate/article/Home-prices-continue-to-slide-nationwide-more-so-1353033.php#ixzz1LUIsFgg1

    Read more: http://www.seattlepi.com/realestate/article/Home-prices-continue-to-slide-nationwide-more-so-1353033.php#ixzz1LUIlbWIs

    http://www.seattlepi.com/realestate/article/Home-prices-continue-to-slide-nationwide-more-so-1353033.php

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  82. Kary L. Krismer

    RE: Jake @ 181 – Neither?

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  83. David North

    RE: Jake @ 181

    Both. But “heating up” is a pretty ambiguous phrase, which along with its many variations gets misused and misinterpreted a lot.

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  84. D. in Ballard

    Is it just me, or is that the same link repeated 3 times?

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  85. David Losh

    RE: D. in Ballard @ 184RE: Jake @ 181

    Yeah, it’s the same link, but the point is well taken. All of a sudden, like I think every year, the National Association of Realtors cranks up the hype machine and off we go!!!

    Multiple offers!!! better buy now. It’s a complete farce that adds to the side show Real Estate agents put on.

    It’s absolutely disgusting what Real Estate sales, sales, sales has become. It’s like putting spinners on a Cadillac to sell it to the hip crowd. It’s still grandmas daily driver, but a little more chrome and sound system makes a better buy.

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  86. Jake

    Sorry about the multi-paste. Dunno what happened. I had to move cross-country for a job but still have a house in Ballard so I am starting to keep an eye on where the market is moving. Luckily, I have it rented! I do not plan on putting it on the market until next Spring/Summer so I like getting a sense of where we, collectively, sit. Completely agree that realtor ‘spin’ on the market is less than helpful, so figuring out the balance between agnostic reporting and realtor rah-rah is the challenge. Any insight you folks can lend is greatly appreciated!

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  87. David North

    I’m involved in another eastside multiple offer situation today, representing a buyer.

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  88. David North

    By Jake @ 186:

    …so figuring out the balance between agnostic reporting and realtor rah-rah is the challenge. Any insight you folks can lend is greatly appreciated!

    It is true that multiple offer situations are rampant, much more so than at any time since 2007. It is absolutely true, as some here point out, that this is in part due to the season. But it’s not just the season. It’s due to a shortage of reasonably priced quality inventory among a sea of overpriced junk. It is also absolutely true that market values are not being driven up, generally speaking, by these multiple offer situations. Although in some cases prices are escalating above listing prices, that is still the exception rather than the rule. As the poll in another thread here indicates reasonably accurately, a majority of buyers react adversely to any pressure to escalate. As a Realtor, I agree with most of the anti-Realtor sentiment here that market values are still headed lower. That doesn’t mean multiple offer situations aren’t cropping up. Both are true.

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  89. annon

    RE: ARDELL @ 111
    YOU are the REASON the country’s real estate is in the toliet!

    Let’s see…

    Why wouldn’t people hedge their bets by buying with the lowest possible down instead of everyone pushing for 20% down or more? UMMM, BECAUSE a. they can’t qualify and b. that is IDIOTIC and is what got us into this mess MORON!!!

    If the market is going to go down, why not buy the insurance (PMI) against the loss? Wouldn’t that be the smarter move? WHY is that SMART????? AND WHY would you put the loss on someone else????

    YOU are a MORON…STOP giving ANYONE advice

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  90. Seattle Bubble • Top 10 Most-Commented Posts of 2011

    [...] 189 comments, 04/29: Claim: Seattle Real Estate Market Suddenly Heating Up [...]

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  91. Seattle Bubble • Top 10 Most-Viewed Posts of 2011

    [...] 3,676 pageviews, 04/29: Claim: Seattle Real Estate Market Suddenly Heating Up [...]

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