Redfin: Real Estate Limbo Drags On…

Full disclosure: The Tim is employed by Redfin.

Last Wednesday Redfin released their May market data. Here’s an excerpt from the narrative (which I also wrote):

For the most part selection around Seattle continued the unseasonal shrinkage we’ve been pointing out all year. However, there may yet be some hope on the horizon as we move into the summer. Redfin Maple Valley Agent Lori Bakken is seeing a shift in the attitudes of potential sellers as they put aside their expectations of a quick price recovery. “Sellers are ready to be realistic, they’re accepting the loss,” said Lori.

Sales are picking up just as they do every year as we head into the summer, but they’re still quite a bit below where they were last year (as the tax credit was ramping down). Redfin Eastside coordinator Christine Golborne attributes the continued slump in sales to an ongoing sense of unease among potential buyers. “I think there’s a lot of distrust in the marketplace,” explained Christine. “People think that pricing is still going to go lower.”

It’s basically the same story we’ve been repeating all year so far: Slumping sales and sagging inventory. I suspect the market may linger through this kind of malaise for quite some time to come…

You can download the full spreadsheet from Redfin here, and as usual, I’m going to map the data here.

In the map below each zip code with enough sales in May is shown as a dot, with the size of the dot determined by the number of sales in that zip code in the month. Each dot is color-coded based on whichever measure you select below the map. You can view the month-over-month or year-over-year changes in inventory, sales, median prices, or median prices per square foot. There is also a county selector that allows you to narrow, expand, or modify the view to your liking.

Sales volume is still slipping in most places, but continues to rise in a few. The biggest winner in King County was Des Moines (98198), where sales shot up from 15 in April to 27 in May. King County’s biggest decline was in Snoqualmie (98065), where sales fell 59% from 17 in April to 7 in May.

Here are the zip codes with the most SFH sales in May in King, Snohomish, Pierce, Thurston, and Kitsap County:

  • King: 98042 — 54 sales.
  • Snohomish: 98012 — 62 sales.
  • Pierce: 98391 — 77 sales.
  • Thurston: 98503 — 43 sales.
  • Kitsap: 98366 — 30 sales.

Inventory continued falling in most places in April, declining month-to-month in 41 King County neighborhoods, flat in 3, and rising in 28. Year-to-year continues to come in worse: 12 neighborhoods saw inventory increase, 2 were flat, and the remaining 59 are all lower than a year ago.

The median price fell from a year ago in 51 King County zip codes, and rose in just 14. The median price per square foot was down in 56 zip codes and up in just 9.

Anything stand out to you about your neighborhood in this month’s data?

  

About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

28 comments:

  1. 1

    Tim, Does This Zipcode Data Include Distressed Sales?

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  2. 2
    Lo Ball Jones says:

    Home page of today’s Seattle PI website.

    Polygon homes…starting at $139,000 !

    I’ve never seen anything below $179,000 for a new polygon or quadrant home, and the price is usually is above $200,000 (back in the day, a “starter” home from those guys was $299,000).

    Now it’s $139,000…yeah, I know it’s not the creme de la creme location…but we’re talking entry point for a brand new home…the kind of thing that a low income renter would be foolish not to buy!

    http://polygon.localplacement.net/polygon/communities/ThisCommunity.aspx?Community=TheHeightsatRidgeview39

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  3. 3

    By Lo Ball Jones @ 2:

    Now it’s $139,000…yeah, I know it’s not the creme de la creme location…but we’re talking entry point for a brand new home.

    Wow, a brand new home in North Everett! ;-)

    It would be interesting to look at the history of the parcel. Who bought it originally as a larger tract and then what it sold for when Polygon bought it to build on (and how recently that was). Without being familiar with the operations of Polygon, my guess would be those parcel were picked up very cheap in 2010, assuming they bought them already platted.

    Edit: Aren’t those condos?

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  4. 4
    Blurtman says:

    Limbo is better than Hell, isn’t it?

    Rate this comment: Thumb up 0

  5. 5
    Scotsman says:

    “People think that pricing is still going to go lower.”

    Why would they think that? Don’t they know that L.A. Port shipments are up?

    Rate this comment: Thumb up 0

  6. 6
    David Losh says:

    RE: Scotsman @ 5

    That’s what I’ve been waiting for! Solid proof the recovery has taken hold! China is shipping again!

    The dollars stores will be filling up, and consumers have a price point that is managable.

    Rate this comment: Thumb up 0

  7. 7
    David Losh says:

    We have our first redfin client on the books for tomorrow morning. The photographer is coming in the afternoon, carpets were cleaned today, and they will be on the market by the end of the week.

    Normally I’d make fun of this whirl wind of activity as proof that when you hire a discount brokerage you get less service.

    However I also have a full service Brokerage of one of the top Seattle Real Estate companies that has nothing but the Broker’s Open scheduled. The home owners are nowhere near being ready for anything, but they are also on the books for tomorrow, delayed from today. Broker’s Open on Wednesday.

    This month we have had six of these mad dash phone calls from sellers that have to get the house on the market immediately or the day before immediately.

    Only one agent this month has been prepared. He is always prepared, and really brings a lot to the Real Estate experience.

    The best part is that I have seen some really nice houses in the low $300K range, and a couple at about $250K. It depends on what you want from a property, but to me it seems there are some good properties out there. It really seem sellers want to move on.

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  8. 8
    Jonness says:

    By softwarengineer @ 1:

    Tim, Does This Zipcode Data Include Distressed Sales?

    While distressed sales do bias the price data, the effect in the Seattle area has been pretty minimal compared to most other markets (although the bias has most like increased somewhat since this study was performed).

    If it’s possible to easily separate the distressed from the non-distressed, the bias could easily be tracked through time using the linked indicator.

    http://www.sandiego.edu/business/documents/REO_Bias_sept_4-Ed.pdf

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  9. 9
    David North says:

    Welcome to the new normal, more or less.

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  10. 10
    Scotsman says:

    If you are one of the 48% why would you want to buy or sell a home now?

    “CNN: 48% believe a Great Depression is coming within a year”

    http://hotair.com/archives/2011/06/08/cnn-48-believe-a-great-depression-is-coming-within-a-year/

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  11. 11
    MichaelB says:

    By Scotsman @ 10:

    If you are one of the 48% why would you want to buy or sell a home now?

    “CNN: 48% believe a Great Depression is coming within a year”

    http://hotair.com/archives/2011/06/08/cnn-48-believe-a-great-depression-is-coming-within-a-year/

    Selling makes sense as cash is king in a depression.

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  12. 12
    David Losh says:

    RE: Scotsman @ 10

    Because we are seeing a devaluation of assets, most notably housing. It makes sense to sell right now if you are going to buy something else. You could rent for a year, or two to add to your down payment. There is a lot of opportunity if you intend to pay down a principal balance on a property or pay it off within 10 years.

    Tim is a good example. If you do, in fact, applaud his decision to buy at a low per cent of his income with the idea he can pay the property off then now would be a time you could do that.

    As an example, a property I looked at last week end was $349K. It was a cross the street from a place that was a “fixer” some years ago at $199K. It’s a better house, better condition, great updates, while being original. It’s a good solid deal for a family home, on a corner lot, fenced yard, big detached garage, and close in, or close enough.

    If you bought this property with the idea you would get cheap mortgage money, and pay the house off, it is a very good move to make today.

    What I suspect is that when prices continue to come down the selection will be weeded out. Even if you pay 20% more today, if you buy below your means you could recoup that by interest payment savings by paying it off.

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  13. 13
    Scotsman says:

    RE: David Losh @ 12RE: MichaelB @ 11

    We all agree, but from a seller’s perspective why sell when there are few buyers, and you are less likely to get your price?

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  14. 14
    toad37 says:

    A friend just emailed this to me- looks like a bank bailout in disguise.

    $1 Billion in Homeowner Aid Offered

    http://community.nasdaq.com/News/2011-06/1-billion-in-homeowner-aid-offered.aspx?storyid=81588

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  15. 15
    toad37 says:

    I’m going to go check this out today. This will be interesting to see what it goes for. I might put a low ball offer in, we’ll see. Is it just me or does that stove look like it’s blocking the cupboard under the sink from fully opening?

    http://www.redfin.com/WA/Bellevue/1326-98th-Ave-NE-98004/home/250830

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  16. 16
    The Tim says:

    RE: toad37 @ 15 – Well, it’s a short sale and if I’m reading the public record correctly it looks like they owe in excess of $1 million on it, so good luck getting the seller’s bank to accept a low-ball offer. I’m not even sure they’d take the $625k list price, considering that they’ll only see about $563k once everything’s said and done at that price.

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  17. 17
    ChrisM says:

    RE: toad37 @ 15 – Check out the excellent stove/cabinet installation in the sixth photo. Can you actually open that right cabinet door under the sink? Looks like you’d hit the stove!

    Also, I like the comment : “Pictures are accurate. ” — has the agent been following the photo stories on this blog?

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  18. 18
    toad37 says:

    RE: The Tim @ 16 – Good find, thanks Tim. May I asked where you found that?

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  19. 19
    toad37 says:

    RE: ChrisM @ 17 – I know, I saw that. :-) LOL.

    Rate this comment: Thumb up 0

  20. 20

    RE: The Tim @ 16 – I can’t comment on active listings, but in general I really doubt the banks take into account how much they are going to lose. That would be like a buyer always wanting to offer 80% of list. I would hope that banks try to determine what the property is actually likely to sell for. Maybe that’s too much to hope for.

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  21. 21
    toad37 says:

    RE: Kary L. Krismer @ 20 – My guess is it goes for 550-575ish. I’ll post when it sells.

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  22. 22
    Blurtman says:

    RE: toad37 @ 14 – It is in everyone’s interest to bail out the consumer as he drives GDP and therefore job creation. Don’t get caught in the house slave trap, complaining about them golly field slaves.

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  23. 23
    Jonness says:

    By toad37 @ 21:

    RE: Kary L. Krismer @ 20 – My guess is it goes for 550-575ish. I’ll post when it sells.

    It’s pending as of today. Not that this has anything to do with it, but I’m reluctant to post links to homes I’m interested in on public sites. Why help advertise the home to other potential buyers who might end up bidding against you?

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  24. 24

    RE: Jonness @ 23
    That’s good thinking, Jonness. But if someone else links to a house you’re interested in, you can always comment that you’ve been inside, and saw the mold on the walls and the rat carcasses.

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  25. 25
    David Losh says:

    RE: Scotsman @ 13

    In Seattle there is a lot that is selling, and for what I think are premium prices. In my opinion you have your best chance to get any price this year rather than wait.

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  26. 26
    toad37 says:

    RE: Jonness @ 23 – I thought about that, and if I thought it was something I was excited about I wouldn’t have posted it. That being said, you have a good point.

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  27. 27
    MacroInvestor says:

    Lori Bakken’s comment was the most interesting part of this post. I’d like to hear more about what she’s seeing. Are sellers giving up on their delusions of a quick recovery, or are buyers getting impatient from the wait and just paying what they need to pay? We seem to be hearing both.

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  28. 28

    I think the biggest thing that stands out is that even though inventory has dropped below 6 months and into a seller market in some areas prices keep declining due to economic factors, negative equity and the high number of foreclosures.

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