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.

43 responses to “Poll: When do you think active King County single-family inventory will get back above 4,000?”

  1. David Losh

    It’s a zombie market with very little incentive to buy, or sell.

    If you sell you go into another home, with a new mortgage, or rent which is now at par with the mortgage you have. You’re only doing lateral trades that may, or may not have financial benefits.

    If you buy at today’s prices you have lower payments, but it’s a puzzle if you will get a benefit from home ownership.

    I personally think people are smarter today, and want to run some numbers about financial benefits of buying, and selling. For sellers I don’t see much motivation. In 2005, 2006, even 2007 people could sell, rent, then buy back in for a reduced price for property.

    Where’s the seller’s motivation today? They are competing with short sales, bank owned, and foreclosures. Buyers may be making multiple offers, but your property needs to be pristine, priced well, and you take a chance that yours is the property every one wants.

    My opinion is that people will stay put until the market clears out.

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  2. Ira Sacharoff

    RE: David Losh @ 2
    I mostly agree with David here. If you’re a home buyer and looking for a house in Sammamish or Phinney Ridge or Ravenna or Ballard, etc, you’ll see a lot of competition for houses and it will seem like a hot market. If you’re an agent representing buyers in those areas, you’ll often be encountering multiple offer situations on the same house, and it will seem like a hot market. But it’s really illusory. In 2006, the market was hot. Sales were significantly higher than they are now, there were many, many more listings and many, many more sales. Right now there are a lot less buyers, but because there are even less sellers, it gives the impression of being a hot market. That all doesn’t matter much if you’re looking for a house. The result’s pretty much the same, whether the market is really “hot” or not. In many parts of the Seattle area, houses are going pending quickly, and there’s very little to choose from. However, the fundamentals for a “healthy” real estate market aren’t there. The median home price to median household income ratio is still way out of whack. Wages are stagnant or falling for many people. At some point, listings will increase. It may be a while before we’ll see the number of listings we saw in 2006, as people get greedy when prices are way up, but the low number of listings can’t stay that low for that long. Something’s got to happen to shake things loose, whether it’s higher prices, or more foreclosures listed, etc.

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  3. Blurtman

    RE: Ira Sacharoff @ 3 – All RE is local, no?

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  4. Ira Sacharoff

    By Blurtman @ 4:

    RE: Ira Sacharoff @ 3 – All RE is local, no?

    All real estate is not local. Back in 2006, I was arguing that Seattle area real estate prices were destined to fall significantly. People looked at me like I was nuts, and said things like ” Impossible, we’ve got Microsoft, we’ve got Amazon, we’ve got Boeing, bla bla bla.”
    I argued that these companies sell their products all over the world, and would very much be affected by whatever happens globally.

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  5. ARDELL

    As of today I am working on 3 new listings that will be on market. A 4 story townhome with 3 bedrooms up in the U-District for $400,000 give or take. A 2,800 sf Burnstead built single family home in Issaquah’s Brookside for $550,000 to $600,000 or so. A large one story in Champagne Point for $550,000ish.

    I like to think that there are at least 300 agents of the many thousands of agents doing what I’m doing right now, and not only have 3 they are working on today, but more to come during the next 30 to 45 days. That assumption would add a minimum of 1,000 homes or so by end of February or mid-March.

    BUT, and I have asked this question many times with no response. Two of those three will sell in a week or two at most. The last one I listed and sold went from active to pending in one day. IF you only count inventory at the end of the month. The didn’t sell in 30 days “standing” inventory. Of what value is that?

    Why aren’t the homes coming and going in 20 days or less not relevant when calculating inventory?

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  6. Howard

    In a non scientific study..

    My Redfin notifications are way way way up of new listings. 3-6 a day in Kirkland. I wasn’t seeing 6 a week in November or December, and probably October.

    I think that we will see the listings trending up significantly

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  7. Blurtman

    At Crazy Eddie’s, the prices are insane!!!!!!!!!!

    http://www.zillow.com/homes/232-210th-Place-NE-sammamish-wa_rb/#/homedetails/232-210th-Pl-NE-Sammamish-WA-98074/2114973891_zpid/

    One of the more bizarre pricing schemes I have seen in quite a while. I walk the dog past this house every day. What the listing omits is that this lovely manse looks directly into its mirror image across a shared driveway. Perfect for identical twins, or very close families.

    This is insane pricing.

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  8. Howard

    By Blurtman @ 8:

    At Crazy Eddie’s, the prices are insane!!!!!!!!!!

    http://www.zillow.com/homes/232-210th-Place-NE-sammamish-wa_rb/#/homedetails/232-210th-Pl-NE-Sammamish-WA-98074/2114973891_zpid/

    One of the more bizarre pricing schemes I have seen in quite a while. I walk the dog past this house every day. What the listing omits is that this lovely manse looks directly into its mirror image across a shared driveway. Perfect for identical twins, or very close families.

    This is insane pricing.

    You must be from the East Coast?!? Probably just like Crazy Eddies where have the inventory got sold out the back door, taxes weren’t paid and the CEO got away pretty easy http://en.wikipedia.org/wiki/Crazy_Eddie

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  9. Blurtman

    RE: Howard @ 9 – New Joisey, originally. Ahh, the days when folks who committed financial fraud actually went to jail. Even Bush, the war criminal, has a much better record of putting financial criminals in jail than Obama, sadly.

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  10. whatsmyname

    RE: ARDELL @ 6 – In fairness to Tim, he counts the inventory once a month, on the same day, and in a consistent way. He counts what he can verify is available on that day. This makes historical comparisons factual and reasonable.

    He cannot know or quantify what is about to become listed. In equal share, he cannot know and is not counting as sales, the properties that will sell in the very near future.

    And he does it for free.

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  11. ARDELL

    RE: whatsmyname @ 11

    But if there are 1,000 listed and sold in that 29 days in between the strike points…aren’t they inventory for the month too? If sales are up 20% and 10% of those are quick sales that are pending by month end, isn’t inventory up vs down?

    The net result can be the complete opposite of the “headlines” if more “inventory” is going pending faster, which in areas where I work is generally the case.

    That makes the whole message incorrect. Fairness? How about truth?

    Given the significant number of homes going pending in less than 30 days….30 day strike points simply become an invalid form of measuring. It only measures everything EXCEPT what people want most and is priced well. Clearly that is not an accurate picture of the housing market to only count “don’t want its” and “stale listings” as a large % of the whole, and eliminate ALL of the “prime” inventory. that moved in less than 30 days.

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  12. ARDELL

    Adding some real info in case my point is a bit cloudy.

    My most recent closing

    http://www.redfin.com/WA/Bellevue/4998-163rd-Pl-SE-98006/home/240771

    Listed on the 29th of Dec and had multiple offers that went pending on 1/4. The winner of the multiples cancelled and it went back to Active Status on the 8th and we had it in pending by the 9th. If the strike point was December 31 it would have been counted as inventory. But if you counted inventory on the 25th of each month, it would not.

    My closing before that one

    http://www.redfin.com/WA/Bellevue/12430-SE-25th-St-98005/home/508315

    Listed on 12/12 and had 10 offers and went pending on 12/17. Clearly that was a highly coveted piece of inventory. But if the strike point was before the 12 or after the 17th…it would not be counted at all.

    The one before that

    http://www.redfin.com/WA/Kirkland/10304-NE-123rd-Pl-98034/home/458470

    Listed on 10/25 and went Pending on 10/26. 25 buyers viewed it in that 18 hour period. It would not be counted as “inventory”.

    The one before that would have been counted in inventory 3 or 4 times if the strike point is month end.

    http://www.redfin.com/WA/Seattle/8028-Brooklyn-Ave-NE-98115/home/108747

    The one before that would have been counted as inventory for many months BUT…

    http://www.redfin.com/WA/Sammamish/20508-NE-23rd-Ct-98074/home/262400

    The house directly across the street from it that sold at the same time would NOT have been counted as part of the available inventory

    http://www.redfin.com/WA/Sammamish/20507-NE-23rd-Ct-98074/home/263505

    As it listed on the 13th and sold on the 18th.

    The one before that would not have been counted as inventory

    http://www.redfin.com/WA/Seattle/3608-47th-Ave-SW-98116/home/329742

    Listed on the 20th and went pending on the 25th.

    Point being, with real transactions as examples and my transactions, listed and sold in less than 30 days is not rare and so to call all of those homes listed and sold in less than 30 days NOT “inventory” is just changing the story of how much inventory there really is/was.

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  13. whatsmyname

    RE: ARDELL @ 12 – Well, not really. Inventory is a snapshot in time. If you have fewer houses available at the end of the month, inventory is down.

    You do have a good point regarding velocity. With increasing activity, I could over time look at more houses than the inventory number suggests. But with sales to others increasing as well, I also lose those opportunities that I don’t move on, so that at any one time my opportunities pretty much match current inventory. This will include both stale old listings and whatever is the realistic proportion of available new, good stuff.

    This is good information, and from a practical standpoint, I imagine that you want to get out the news: “Hey, it’s not just the same old 3,000 houses out there”. It doesn’t mean that the inventory number we have watched for 7 years is now untruthful. But I do agree this activity adds a new wrinkle that is worth being aware of.

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  14. Kary L. Krismer

    RE: whatsmyname @ 13 – Maybe selection would be a better term than inventory. The two would be highly correlated, but selection is more what Ardell is talking about.

    Most people aren’t looking to buy multiple houses–they just want to find that one house they like. Right now for many buyers they don’t like any of the houses in the markets they are looking at, and many have probably seen all the houses that fit their criteria and none are “that” house. So it’s not that there are not enough houses, it’s simply that the houses that are out there are not right for one reason or many reasons.

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  15. David Losh

    RE: ARDELL @ 6

    As long as we are talking anecdotes our company would usually have six properties on the schedule to prepare for sale at this time of the year, we have one. Those people bought in December, and are selling off behind them.

    We have two other clients who sold in December, quickly, within 30 days. Our November, December was busier than usual.

    There’s no doubt that Real Estate agents are making money, especially in high end prices where there is a perception of the buyer getting a good deal, but that doesn’t really change the numbers.

    Was this last Fall taking more inventory from what would normally be Spring Sales? Did more people buy all through last Summer, and Fall than normal?

    So really my question would be will we see that rush of new listings in February, March, April, and May?

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  16. ray pepper

    Trustee Deals of the week! In watching last weeks Pierce sales most homes got at or near opening bid. With so many hitting the market now appears there is plenty to go around. This week King County already opened with nearly 60 UNDER 300k and its only Monday:

    228187 221 SW 116TH ST
    SEATTLE, 98146
    1br / 1 ba / 732 sqft
    Built 1952 SFR
    Grantor : MACE Active 1st $242,296.25 $57,951.00 1/25/2013 10:00:00 AM
    ————————————————————
    639 SW 304TH ST
    FEDERAL WAY, 98023
    3br / 1 ba / 1080 sqft
    Built 1959 SFR
    Grantor : MADRIGAL Active 1st $249,654.07 $80,575.20 1/25/2013 10:00:00 AM
    ————————————————————-
    238622 3635 S ORCAS ST
    SEATTLE, 98118
    4br / 2 ba / 2950 sqft
    Built 1918 SFR
    Grantor : PHOENIX Active 1st $376,059.08 $169,197.60 1/25/2013 10:00:00 AM
    ————————————————————-
    13023 4TH AVE S
    BURIEN, 98168
    2br / 1 ba / 720 sqft
    Built 1948 SFR
    Grantor : KUNZ Active 1st $239,338.92 $90,000.00 1/25/2013 9:00:00 AM
    ————————————————————–
    26302 230TH CT SE
    MAPLE VALLEY, 98038
    4br / 3 ba / 3710 sqft
    Built 2005 SFR
    Grantor : HRABAR Active 1st $566,015.25 $200,000.00 1/25/2013 9:00:00 AM

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  17. Kary L. Krismer

    I’ll repeat what I said in another thread. We’re in this situation because potential buyers are more aware of low interest rates than potential sellers are aware of the favorable seller conditions in the market. That creates an imbalance.

    The sellers that need to be out there the most though are the ones whose houses would be difficult to sell in a more “normal” market. Traffic noise, messy neighbors, popcorn ceilings, LP siding, and even perhaps aluminum wiring–all more likely to be overlooked in this market, particularly if it’s not a short sale. With the exception of aluminum wiring (which I don’t check when previewing), I’ve seen examples of all of those go quickly, without any apparent discount for the condition.

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  18. ARDELL

    RE: whatsmyname @ 14

    I posted a comment with links last night that may appear later, as the links caused it to go into moderation. I think that comment will explain what I am saying.

    January has always been the month to be vigilant for those who are looking for a good home. Inventory trickles out and gets snapped up quickly by the vigilant. Some years we have what I call “a never ending January” and the market stays like that long term.

    To a large extent the “never ending January” has become the market of modern times. Those waiting for it to change are dreaming of the day when they can once again tell an agent “let’s go look at homes a week from Tuesday and schedule 10 good homes for us to see.” That day is not likely coming back, and pretty much went away when homes became easier to select via the internet.

    There are more buyers of good homes that are priced well than there are sellers of good homes that are priced well. So much so that some buyers are skipping the “priced well” portion of the equation. They are busy. They have busy lives. They don’t want the process of buying a good home priced well to be as hard as it is. They don’t want making a good choice to take as long as it does.

    My point is that is not going to change. The good homes have come into inventory and have sold in less than 30 days. That is not to say that taking longer than 30 days to sell is by definition not a good home in every case. But clearly if sales are up then those additional sales reflect an increase in inventory that came and went quickly, and more the story than nothing left on the shelf after the sale was over.

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  19. corndogs

    RE: David Losh @ 2 – “Where’s the seller’s motivation today? They are competing with short sales, bank owned, and foreclosures. Buyers may be making multiple offers, but your property needs to be pristine, priced well, and you take a chance that yours is the property every one wants.”

    The motivation to sell and trade is as good as ever. When housing prices are low so are the costs of transaction. If your house is pristine and you get top dollar, you have the option of picking up one of those distressed properties you just mentioned. Whether you have the equity to do that is another question, but the motivation is there. Your logic as always is bass ackwards.

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  20. ARDELL

    “Inventory” = everything on market on the 30th day PLUS everything that listed and went pending during the 30ish day period between the strike points.

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  21. Kary L. Krismer

    By ARDELL @ 18:

    There are more buyers of good homes that are priced well than there are sellers of good homes that are priced well. So much so that some buyers are skipping the “priced well” portion of the equation.

    And also skipping the good homes part of the equation–that was my point above regarding LP siding.

    You’re right about having to act quickly. A few months ago I started drawing up contracts after previewing a property if I thought the client would like it. Even doing that, one time getting the client to see the property the first day it was on the market didn’t result in our being the only offer. Fortunately our offer was the best offer, although not the highest offer.

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  22. ARDELL

    RE: Kary L. Krismer @ 22

    I did have that 4 times recently Kary…but in the 2nd round. The seller took the highest offer first and that highest offer was far and above all others. BUT that is because the buyer had almost zero intention of proceeding and closing at that number. Easy to throw out a number to win and then walk or try to take most of the excess back at time of inspection.

    My clients prevailed at acquiring the house, but only because the Listing Agent burned once only called the one or two agents in the mix that seemed to have their act together.

    In one case I’m pretty sure the listing agent twisted someone’s arm at the open house to make an offer and gave them the number that would beat all others. In the end the seller received much less as to sold price as a result. The seller clearly could have received an additional $10,000 to $15,000 in the first round had a buyer’s arm not been twisted for the double commission issue of that effort.

    Back to Inventory…MANY homes go pending in less than a week BUT don’t end up being sold to the person who dragged it quickly into pending. When the 2nd buyer moves into Pending, the property does NOT go back to Active. So technically that 1 day on market was more like two weeks on market.

    mls stats are becoming less and less relevant when agents move from pending with one buyer to pending with a different buyer more than once, without putting the property back into active status. They are merely using the pool of buyers acquired as offers in the first day or two to sell the property in a longer period of time.

    Real Estate operates differently due to changes in technology. Statistical calculation of what is actually happening has to be modified as a result.

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  23. corndogs

    RE: ARDELL @ 18 – ‘The good homes have come into inventory and have sold in less than 30 days. That is not to say that taking longer than 30 days to sell is by definition not a good home in every case. But clearly if sales are up then those additional sales reflect an increase in inventory that came and went quickly, and more the story than nothing left on the shelf after the sale was over.’

    Home ownership has decreased from 69% to 65.5% since 2005. Who owns that disappearing 3.5%? Investors. The pie is shrinking. The pie is likely to continue shrinking to 64% to where it was prior to government programs that encouraged no money down sub-prime a-holes to buy houses.

    You need to look at the total pie. The inventory of available houses has steadily and relentlessly decreased to a ‘months of inventory’ of less than 1. This is functionally as low as it can possibly go. It doesn’t matter how fast houses sell, It doesn’t matter what Joe Blow seller is thinking. If there simply isn’t enough houses to go around, that’s hard to change.

    Contrary to what Ray Pepper said about the investor led recovery being unsustainable, it doesn’t have to be sustained. All that has to happen is that investors absorb a big piece of the pie, they have done that and continue to do so.

    From here competition is increased, prices rise.

    Inventory goes no where until prices increase substantially. I said that a year ago, I’ll be saying it again six months from now.

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  24. David Losh

    RE: corndogs @ 23RE: corndogs @ 19

    Let me say this again, prices will remain stagnant as long as wages remain stagnant.

    Investors buying inventory keeps prices lower than if mom, dad, and the kids make emotional purchases. It all has to do with the numbers of Return on Investment.

    A year ago you could make a case for rent increases, but today more rentals are coming on the market to compete with each other.

    The consumer can only pay so much for housing, they already have massive debt, so I don’t see the consumer paying more for a housing unit going forward.

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  25. ARDELL

    RE: corndogs @ 24

    hmmm…food for thought as I am not making a distinction as to who buys that home and to what purpose. Heading to the Dentist…but will think about that.

    As example, the home I recently sold in one day in Kirkland sold to someone who is going to use it as a rental. I was the Listing Agent. What difference is it if someone bought it to live in it or bought it to hold as a rental property? What does that have to do with “inventory”.

    Admit you lost me there…

    The townhome I am readying for market in the U-District can be purchased by an owner occupant with 2 children or by someone who will live in it and rent out two of the three bedrooms to students or by someone who will rent it to 3 students and be a landlord only.

    How does the conversation change based on who buys it and to what purpose they use it? It’s a piece of inventory….to be listed and sold. How does who buys it change the fact that it is-was a piece of inventory?

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  26. ARDELL

    My comment 13 that was in moderation posted. Thank you Tim. When you think about the volume of transactions that go from Active to Pending in less than 30 days, as shown in my examples, inventory is not as problematic as people suggest it is. They simply don’t like having to make fast decisions. I don’t blame them for that…but that is a different problem than “low inventory”.

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  27. David Losh

    RE: ARDELL @ 13

    It’s still not inventory.

    The reason you have multiple offers is because there is low inventory.

    People are buying what is available at the moment.

    There is no doubt Real Estate agents are making money, that’s not the point to the buyer who has to make hasty decisions based on NWMLS listings that come, and go off the market.

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  28. ARDELL

    RE: corndogs @ 24

    Prices can never increase at the same rapid pace that they can decrease. That has always been true and why cash has to fuel a recovery.

    People misinterpret that to mean “all cash” transactions fuel the recovery, but that is not 100% the case except for the fact that people don’t understand the need to fill the gap with cash.

    You will see counter offers to the financed offers essentially saying you have to be willing to use cash or a different LTV if the property does not appraise. That puts the financed buyer on a level playing field with the cash buyer.

    If the seller is worried about the house appraising, even though they have 10 offers offering higher than expected appraised value, then all cash will win OR the buyer who is willing to use a lower LTV or more cash but not all cash to compete.

    If lenders will only allow a 3% increase or NONE as to appraised value, and the market moved 6% since “the comps” sold, then that difference…that rise in home prices, must be fueled with cash…at least to the extent of the 3% to 6% difference.

    Without cash infusions, the market can only rise a tiny % every sale…and take a long time to create enough tiny % sales to create an upswing in home prices. On the down side, prices can drop 25% in one year…but for the same thing to happen on the upside, the recovery has to be fueled with cash infusions, as the lenders can not fund that kind of appreciation in a short period of time. Well they can…but they shouldn’t.

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  29. corndogs

    RE: David Losh @ 25

    Losh said – “Let me say this again, prices will remain stagnant as long as wages remain stagnant.”

    Wages aren’t stagnant. We already covered this, you have no memory.
    http://seattlebubble.com/blog/2012/09/24/will-local-incomes-climb-or-fall-in-the-coming-years/

    Losh said – “Investors buying inventory keeps prices lower than if mom, dad, and the kids make emotional purchases. It all has to do with the numbers of Return on Investment”

    You should never ever, under any circumstances, say or type the term ‘return on investment’. That statement is as absurd as your existence.

    Losh said – “A year ago you could make a case for rent increases, but today more rentals are coming on the market to compete with each other.”

    And more renters are also coming onto the market you hammerhead . Homeownership has decreased from 69% to 65.5%. All that matters is what is actually happening to rents. They are going up! It doesn’t matter if your scrambled noodle thinks it makes sense or not.
    http://www.bizjournals.com/seattle/blog/2013/01/seattle-apartment-rent-increases-lead.html

    Losh said – “The consumer can only pay so much for housing, they already have massive debt, so I don’t see the consumer paying more for a housing unit going forward.”

    This has already been covered too. The only consumer debt that is increasing is student loans. Car loans ticked up because of Hurricane Sandy… otherwise, all consumer debt as a % of GDP is falling. Housing is nearly at record affordability.
    http://en.wikipedia.org/wiki/Consumer_Leverage_Ratio

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  30. Kary L. Krismer

    By ARDELL @ 27:

    They simply don’t like having to make fast decisions. I don’t blame them for that…but that is a different problem than “low inventory”.

    It also affects people looking for a narrow type of property in a small geographic area, but they can also be affected with higher inventory if they’re limiting their choices significantly.

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  31. corndogs

    RE: ARDELL @ 26 – What difference is it if someone bought it to live in it or bought it to hold as a rental property?

    A person who bought the house to live in it, in most cases also sold a house. Therefore, net inventory is not changed. except for the two months his house was listed.

    An investor who buys it does not sell another house. therefore, Inventory decreases by one (nothing is added)

    Investors decrease the pie buy buying multiple homes. Typical homeowners do not. that’s the difference.

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  32. ARDELL

    RE: Kary L. Krismer @ 30

    Yes…I am working with that now and testing the reality of those limitations after explaining how they are backing themselves into a corner. I force them to at least look at what the options are…and then if they choose to go back into the corner…then we work with that.

    But at least they know when I am done that they chose “low inventory” based on geographic field of interest, and a few other parameters specific to them, and don’t blame it on “the market” or wait for “the market” to change.

    Informed consent and a full understanding of the cause of their dilemma is better than waiting for inventory to “improve”. If you will only live within 4 square blocks, then “absorption rate” is somewhat irrelevant to the case at hand.

    But people like to read in the paper that the answer to this problem is “coming soon”, when the answer to the problem comes from looking in the mirror.

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  33. corndogs

    RE: ARDELL @ 29 – “Prices can never increase at the same rapid pace that they can decrease. That has always been true and why cash has to fuel a recovery”

    Well, if prices don’t increase or new units get built, then you can expect the ‘available inventory’ to stay where it is. LOW.

    From a home-owners standpoint. Prices do not have to appreciate as quickly as they did before. A 3% loan pays down faster than a 7% loan. After 5 years, you can unload with less appreciation.

    This is why the Japanese market isn’t as bad as it looks. With lower prices and low interest rates. Your overall cash out lay can be less than the previous situation even with no appreciation. (smaller payments equal monthly savings, low interest rate equals faster paydown).

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  34. ARDELL

    RE: corndogs @ 34

    Volume also impacts a recovery and was part of the reason for the bubble as well.

    Take one town home complex as example (I have a specific one in mind with real data). Every appraiser on every transaction was allowed 5% increase in appraised value for appreciation, given “the upward trend” instruction given from lenders to appraisers.

    If one sale happens in that complex in that year, then prices go up 5% that year. But in 2005 and 2006 there were first 3 sales up at 5% each, then the neighbors said “at those price I’ll sell too!” and they all got 5% more than the last sale. So 6 sales in 3 months turned into a 30% appreciation in a 3 month period.

    If every appraiser upgrades x % on the comps, and each higher sale upgrades the comps plus x %, then the more properties sold in a short time frame pushes up appreciation in a shorter period of time.

    Of course the reverse is true with the same increment of % increase allowed. If 2 sell in a year vs 6, then the appreciation will be 66% less that year.

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  35. Howard

    By ARDELL @ 33:

    RE: Kary L. Krismer @ 30

    Yes…I am working with that now and testing the reality of those limitations after explaining how they are backing themselves into a corner. I force them to at least look at what the options are…and then if they choose to go back into the corner…then we work with that.

    But at least they know when I am done that they chose “low inventory” based on geographic field of interest, and a few other parameters specific to them, and don’t blame it on “the market” or wait for “the market” to change.

    Informed consent and a full understanding of the cause of their dilemma is better than waiting for inventory to “improve”. If you will only live within 4 square blocks, then “absorption rate” is somewhat irrelevant to the case at hand.

    But people like to read in the paper that the answer to this problem is “coming soon”, when the answer to the problem comes from looking in the mirror.

    Stop talking about me ;)

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  36. David Losh

    RE: corndogs @ 30

    You’re right we have covered this all before.

    Wages in Seattle are at $67K on average, and $56K for the lower end. You’d be better off buying in Tacoma than Seattle at those incomes. We also have some of the highest paid workers due to Microsoft, Amazon, and even Boeing.

    The price of housing outstrips those incomes.

    5.8% rent increase in 2012 doesn’t translate into future rent increases. That was in this week ends Weekly Twitter: http://seattlebubble.com/blog/2013/01/19/weekly-twitter-digest-link-roundup-for-2013-01-18/

    Once you get off the Wikipedia page definition of debt you’ll see that deleveraging is in part due to foreclosures, and short sales. Consumers are relectant to take on credit card debt, because they are being maxed out.

    I’m just going to put up the debt clock for you because it shows personal debt tracking government debt http://www.usdebtclock.org/

    Those student loans are still due, and the auto sales are still debt that takes dollars.

    Housing being at all time affordability is still debt.

    If the consumer, or investor isn’t getting appreciation beyond inflation then where is the upside to owning? The investor gets rental income that pays for the property over fifteen to twenty years, but where is the upside for the buyers?

    Even at that the investors are going to get tired of holding property when other opportunites are paying more.

    You need to look at the numbers.

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  37. whatsmyname

    RE: ARDELL @ 13
    Golly, Ardell; sounds like you are making some money. I don’t want to get into a big semantic thing, but inventory is a word with a standard definition. The increased velocity makes for a varied experience, but as Losh says in post 28, “It’s still not inventory. The reason you have multiple offers is because there is low inventory.”

    That is also the reason people have to move fast. Don’t worry. Property that sold quickly is counted; it is counted as “sold” or “pending”. Maybe the best thing is to use Kary’s term “selection”, and try to find a way to track that.

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  38. Kary L. Krismer

    RE: whatsmyname @ 38 – I almost this analogy earlier in my “selection” post, but didn’t.

    Using Best Foods Low Fat Mayonnaise, you wouldn’t consider the inventory at the Fairwood Safeway to be all of such mayonnaise on the shelf at the end of the month, plus all that mayonnaise sold during that month.

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  39. ARDELL

    RE: Howard @ 36

    haha!!! close, but no cigar. :)

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  40. ARDELL

    RE: whatsmyname @ 38

    OK…I give. :) Uncle!

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  41. ARDELL

    P.S. I just removed another piece of inventory about an hour ago. Sorry. :)

    7907 S. 112th Street, Seattle 98178…yes folks…South of I-90.

    I listed it December 19th so it was counted in December! I don’t like being among the uncounted masses. It won’t make the January cut…but should have made the December cut. I didn’t put the redfin link to it as that sends the comment into moderation.

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  42. ARDELL

    RE: corndogs @ 32

    Thank you…sorry I missed that reply earlier. I appreciate your explanation.

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