Here’s a view on listings that we haven’t visited in a while. In this chart I use the NWMLS-published data on new listings, pending sales, and total inventory to visualize the inflow and outflow of single-family listings in King County.
First up is a chart that goes back as far as NWMLS data is available:
Now a zoom-in of just the last couple years:
In theory it shouldn’t be possible for “delisted” to show up as a positive number in this chart as it has off and on over the last year or so. I assume that this is happening due to late-reported pending sales from agents and the unusual way the NWMLS records their statistics. Despite that confusion, this chart does a good job of showing just how tight the market has gotten in the last year. Very few homes are being delisted without selling.
In the 18 months following the July 2007 price peak in Seattle, an average of 1,608 homes were delisted each month. In the last 12 months that number has averaged just 21.
Finally, here’s a look at the monthly flow of new listings less pending sales:
The average value in the chart above from 2007 through 2009 was a net gain of 1,288 listings per month. In the last 12 months the average has been a net loss of 221 listings per month.
As far as supply and demand goes, it’s definitely not a great time to be a buyer right now.
+80
This is pretty frustrating as a buyer. What are your thoughts on whether or not I should get into the market right now? I have no problem renting – although it’d definitely be nice to be able to buy a place with mortgage rates so low and to be able to have a nicer/bigger place for approximately the cash outflow. I have more than enough of a downpayment to put down, but my biggest issue is that I don’t want to overpay as I don’t see myself staying in a home for more than 5 years and don’t want to lose a chunk of money on it when I sell/upgrade.
Do you see this as a bubble that’ll pop in a few years (or ease out of)? Or are we pretty much expecting these prices for the next few years?
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Tim, I know you bought your house for personal reasons at the time that was right for your family. But I have to congratulate you on buying at exactly the right time market-wise too. Even if you might not have seen the inventory glut coming more than the rest of us, you bought right around the market bottom and while there was still a healthy amount of inventory.
Our personal right time to buy came summer 2012. We’re still renting and looking at the inventory out there it seems we’ll have to hold off a while still before we can settle into a place for 10+ years the way we hope to (I.e. switching to a place we own where landlord plans don’t influence your living situation).
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Actually this has been discussed. Tim bought a lower tier house in the beginning of 2011. The lower tier dropped significantly the following year according to case shiller andit still isn’t back to what he paid for it. The only person on Seattle bubble who precisely hit the bottom of a market was corndog with his Feb 2012 high tier REO purchase.
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RE: Mark Glover @ 1 –
Mark,
When you buy a house expacting to live in it for less than five years, that makes it more risky.
If you’re buying it strictly as a financial investment, you probably shouldn’t live in it.
If you’re buying it because it feels like owning a home is something that will make you happy, then limiting it to five years greatly increases the financial risk.
As a long term investment, residential real estate has done OK. But there were people in 2007 who though they were only buying for five years. Yeah, prices are down and interest rates are low, but I’m not seeing any indications that we’re going to see sustained price increases. It’s really too early to declare that the housing market has rebounded and is going to keep going up for the next five years. It might. But there’s plenty of reasons to believe that it won’t.
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Prices should be shooting through the roof then with all that “pent up demand”.
Happening?
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RE: corndog @ 3 – Give it a rest, dude. If your assertion that my home’s value has “dropped significantly” were true then you would have no problem finding a home comparable to mine in my neighborhood for less than I paid.
I encourage you to give that a shot. You’ll be looking for a home on at least a 5,000 square foot lot with 2-3 bedrooms, 1.5+ bathrooms, a fully updated kitchen, at least 1,600 finished square feet with an additional 1,000 square feet of usable basement space with 7ft+ ceilings, covered parking for at least 2 cars, plus a garage. I also have a corner lot but I won’t hold you to that part.
Here’s a search to get you started. Good luck with that.
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RE: Lo Ball Jones @ 5 – Nope, and probably won’t happen any time soon either, thanks to the “pent-up supply” that’s also sitting on the sidelines waiting to jump in as the market improves for sellers.
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RE: Ira Sacharoff @ 4
I’m less worries about making money, and more worried about losing a whole bunch of money. Looking in areas like Wallingford/Montlake the prices (to a beginner like me) seem like they are over inflated, every property being in a multiple offer situation because of the low amount of inventory. I’m worried about going into a bidding war and paying an over inflated price, only for the price to drop 5 years from now when inventory comes back.
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No matter what inventory is doing sales look to be at about evens. They may be falling off do to lack on inventory, but buyers are out enforce.
That’s the rise in prices, when the same number of buyers, or more, are bidding against a lower supply.
I don’t see how inventory will correct. We had 10 years between 1998 and 2008 when prices did shoot up before they receded.
Will people be paying the same prices because the payments are less? Sure, but it doesn’t make a lot of long term sense. A mortgage is a thirty year committment. Would it be better to save more by renting, and maybe have prices correct downward?
Just because prices haven’t declined in the past five years, with the most manipulated market place I have ever seen, doesn’t mean the correction isn’t coming.
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RE: The Tim @ 6 – I’m talking about the Case Shiller. Do you deny the chart shows your right back to where you started. Definitely not impressive timing. No search required. . I just look at your own chart. Sorry, DUDE. http://seattlebubble.com/blog/2013/01/30/case-shiller-tiers-all-three-tiers-defy-seasonality/
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RE: corndog @ 10 – Even if I accepted your false premise that the Case-Shiller data is directly translatable to an individual home, I fail to see how a flat home value after a year and a half is some kind of huge negative when my ownership horizon is 30+ years. Over that time frame, what happened to the value in the 18 months after I purchased is irrelevant.
The bottom line though is that unless you can find an actual comparable home to buy (or that someone recently bought) at the allegedly lower price, your entire premise falls apart.
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RE: The Tim @ 11 – your admirer entered a generalized statement of praise. It only requires a generalized response. Generally speaking, they are incorrect to assume that your timing was perfect. I’ve shown that quite clearly. Whether your price is up or down from the median it’s quite clear there’s nothing impressive about your purchase. . Especially for a guy that talks of himself in third person and is flirting with the idea of writing a book. When all is said and done you have a low tier house. . That’s your end game. . Thats fine. . Just not noteworthy.
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RE: corndog @ 12 –
When Tim bought his house, he stated that he didn’t buy at the bottom. Tim has his own family and more important things to consider than being a real estate snake like you or I. If I remember correctly, he wanted to adopt a child and having a home was one of the requirements. He said it was probably near the bottom and the timing was right, so he bought.
If you want to fight about the bottom, fight me, cause I focused only on getting the best deal I could because I don’t have a family or other things to consider.
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Great thanks for the advice – just wanted to confirm that prices will probably be adjusting downwards in the near term (5 years or so).
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RE: Mark Glover @ 8 –
Take Ray Pepper’s advice and don’t get into a bidding war.
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RE: corndog @ 12 –
In my view anyone who made a purchase in the narrow window (18months?) between when prices got relatively close to bottom and inventory went to nothing did great (which I realize/agree involves good luck in future market movements, in addition to good judgment).
So as I said above, cudos to Tim.
Corndog, it sounds like you made an excellent purchase too. I wish I had jumped on it like you did too. If you didn’t put others down quite so often, or in such aggressive wording, I think you’d hear more recognition/praise for this (perhaps even to the point of matching your self-nomination for the role of “best market timer” :-) ).
As a reflection on my personal situation, I was clearly too gun shy about my primary residence purchase. I did buy a couple of Las Vegas investment properties at the right time. I guess I hadn’t built up the confidence to gamble on real estate market timing with bigger amounts at the time.
Corndog, did you buy your reo after it was listed in the NWMLS, or in some earlier stage? Since I was too gun shy before I’m wondering if I should go all out and buy at auction :-).
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RE: Kristian @ 16 –
Please don’t give Corndogs credit. He did not get a good deal, just ask David Losh. He bought in the wrong place at the wrong time. He’s mad now, so he comes on this website and tries to tear other people down to compensate for his own failures.
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By The Tim @ 7:
IMHO, the hidden card is where the concentrations of “pent up supply” are located. The banks know this information.
I tried to buy in an area where demographics and sales rates during the bubble years pointed to a low # of escape sellers going forward. We’ll see how that plays out.
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The stench of El Cornholio’s post-purchase dissonance is rather strong, I must say.
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“As far as supply and demand goes, it’s definitely not a great time to be a buyer right now.”
If everyone thinks so, it is probably a great time to buy! Just take a look at the NYC market. People have been holding off buying decisions because prices are too high, and they are forever priced out.
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RE: Kristian @ 16 – RE: The Tim @ 11 –
The other, more important factor, than buying at the “bottom” of the market, because there is no top or bottom to the Real Estate market, is location.
If you make even a bad deal on a great location you can come out ahead over the long term.
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RE: David Losh @ 20 –
I agree. Tim bought in North Everett which did surprise me because I don’t like that location. I know there were big plans to revamp that waterfront area and then redo broadway, but the financing supposedly fell through. I don’t believe that North Everett will be fixed up for another 20 years. I have no data to back that up. I got fed up with all the talks of fixing that area up and it never happened.
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RE: corndog @ 12 –
“Whether your price is up or down from the median it’s quite clear there’s nothing impressive about your purchase. . Especially for a guy that talks of himself in third person and is flirting with the idea of writing a book. When all is said and done you have a low tier house. . That’s your end game. . Thats fine. . Just not noteworthy. ”
With all due respect CornDawg, The Tim didn’t buy his house to be “impressive” or “noteworth.” On the other hand, his contribution to the knowledge base of people who read this blog is extremely noteworthy. You’re home purchase may have a greater probability for a high rate of return and/or been timed closer to the bottom, but those weren’t the primary criteria for The Tim’s purchase. The Tim said many times that he bought based upon a number of reasons, which were primarily personal family reasons. And although you at least imply that you are not impressed with The Tim’s knowledge base concerning residential real estate and his ability to write a book on the subject if he were to so choose, the fact that you read this blog would appear to indicate otherwise. Perhaps a “thanks” might be more appropriate than the trash talk and self adulation you often dish out. I happen to think your house was a great purchase. But knocking down a trey at the buzzer doesn’t make you MJ. And if you were reading this blog before your purchase, you might just owe The Tim a trip to the Tip Jar for the assist.
You’ve made some great comments and observations on occassion and in this forum, you deserve credit for that. But this isn’t a league game, its the practice court. You don’t get any credit here for having 50 steals from Erik or Losh unless you help build the community knowledge base or help somebody learn something in the process. If you want to play the point and be a leader in this forum, you do it by building the community knowledge base and helping those who need it rather than talking trash to satisfy your own ego. Especially if you’re just dis’n those who might lack your ability or acumen. Save the trash talk for a little friendly humor directed at the other big dawgs who can handle it.
You can’t win a championship on this floor and trashing the coach or the towel boy won’t get you a ring. You and I both know what it means to have a hundred assists. You’ve got a few on the stat sheet here, but Tim’s the guy racking up the big numbers on this floor. Tim brings the ball up the court every day and he gets it in the hands of the open man more often than not. Trash talk won’t change that. If you want the assist, move the ball and feed the open man. There’s no column on the stat’s page for robbing Losh of his dignity.
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RE: One Eyed Man @ 23 –
Truth be known, I think corndogs comments are entertaining. I am usually laughing out loud when I read them. I try to crank him for fun just so I can see his reply. It keeps me engaged, so I can learn more about real estate while laughing and having a good time. I do play the victim as corndogs has previously pointed out. If I really didn’t like corndogs, I wouldn’t keep taking shots at him to get a reaction.
I have been called larva, dung beetle, cry baby, little be-otch, spoiled sport, teenErik and now towel boy…. :) Thanks.
I can see from the feedback that I do need to get more specific when I’m trying to burn someone. I have noted this and next time I can only hope to throw a well groomed strike.
This is my 5th and final comment, so see ya on the next thread.
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RE: Erik @ 24 –
My apologies Erik if I implied any lack of respect for you. I didn’t mean to. Basic human dignity and respect is an important issue for me and I’m often guilty of not being as aware as I should of my own indiscretions in that area. I know you’re intellectually capable and a strong and confident individual, but there are people who read this blog and are intimidated at the idea of participating in the discussion. Their questions and comments will occasionally provide insight that many of us can benefit from.
I guess my concern here is also that The Tim felt he had to institute a limit on comments because at some point it might limit the ability of somebody to say something extremely important to a thread. The Tim’s always allowed this to be a pretty much wide open forum and I hate to see that limited. The web is the intellectual forum that the Public House was 200 years ago and to at least some degree its displacing the hard copy printed word as the forum for journalism.
It probably doesn’t happen often, but occasionally a thread will hit 50 to 100 comments and a contributors 6th comment might be well warranted and provide educational insights that I and probably others would hate to miss out on. I don’t want to see censorship, even if it’s as well intended as I perceive The Tim’s action in limiting comments to be.
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RE: Mark Glover @ 1 –
Mark – after reading all your comments, DO take into consideration that even if prices move sideways you’ll still be losing a whole lot of money over those 5 years. It’ll cost you 8-10% to churn from one to the next place as you pay RE commissions, excise taxes, title insurance and escrow, staging, fix up to sell and moving costs (plus what ever else there is). IMO a 5 year “ownership” horizon is WAY too short. Better to keep renting from a landlord instead of a bank.
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RE: Mark Glover @ 1 –
I would agree with No Name Guy. Unless you are looking to keep the house for a longer period I would stick to renting. I have a buddy who owns a house in AZ and another friend who owns one out of state. They say they are terrible to manage and both of them have ended up trying to break even on the sales. If you are planning on moving locally and you want to be a landlord there might be some incentive (low rates, prices, ect.) to purchasing right now. You would have to keep the property for some time.
The Tim, I have a few homes in N Everett. I think it will continue to turn around. You also have a great website.
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RE: One Eyed Man @ 23 –
In the above referenced comment, I said: “You can’t win a championship on this floor and trashing the coach or the towel boy won’t get you a ring.”
This sentence would more appropriately be rephrased as “One can’t win . . .” as I intended the word “you” to refer to everyone in general rather than to Corndog personally. Corndog is a capable individual with a history of success both here and in other forums. The sentence in my comment was intended to convey that I view this blog as a forum for learning and communication like a practice court and not as a forum for accumulating a win/lose record in a competition with other contributors. Competition here is of value only to the extent that it furthers the understanding of the issue discussed and motivates people. Too much trash talk can have a chilling affect on the open and free exchange of ideas. In general, trash talk is of value here only to the extent that it adds a little well intentioned humor or motivates people to think a little more. But I’ll tolerate a lot of trash talk rather than tolerate censorship. I’d much rather skip any comment that I find ill founded, boring, or otherwise objectionable, in my own discretion, than have comments censored or otherwise limited or restricted from view. I’d really prefer that you lift the comment limit Tim.
My apologies for being off topic with my comments on this thread.
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SWE Bought In 1999 in SE King County
And his 2012 King County assessed value dropped about 20% from 1999….
IMO, we’re all mooning out the window if we bought Seattle real estate the last decade or so, especially with escrow and staging costs added in, if ya gotta sell for cash [trade baby trade]….
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RE: One Eyed Man @ 28 –
Since last November I have been looking to upgrade my WordPress sites, and low, and behold Dustin Luther at Rain City Guide has come up with the look, and feel I have been looking for.
During this time I found Partick.net who is looking to monetize his site. I keep Seattle Bubble as an open tab on my computer because I have been fascinated by the daily drama.
I blog for business, and get a good return on my time. What goes on here at the Seattle Bubble makes little or no sense. People have been repeatedly shouted down, and that seems to be the draw. At the same time fewer, and fewer people comment, or choose not to be engaged in a discussion.
We’ll see if the feel of what Seattle Bubble once was can come back, but something needed to be done.
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RE: One Eyed Man @ 23 – It would certainly make for a peaceful game of retard Special Olympic basketball, if Corndog were to get a lobotomy and join your ball club One Ball Man. But you aren’t going to be getting friendly with Corndog in the locker room anytime soon. So you can quit the heavy breathing and quit humping my leg.
In regards to this elaborate world you’ve created as to what Seattle Bubble may be or may become, you will go nowhere with a prolific imbecile, such as David Losh on your roster. I’m with Krismer, Losh’s stupidity is too great to ignore.
Corndog can’t rob Losh of his dignity, he has none. Look at his last post… It’s absurd, he slinks back in and pretends to be oblivious to the fact that he is the reason that the 5 post limit was just initiated and acts like he’s an occasional eavesdropper who is amused by the insanity. If this guy had any dignity, he’d volunteer to take the 5 post hit himself, apologize for jamming up the threads and shut up for a while… it ain’t going to happen, the guys a ‘tard.
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RE: corndogs @ 31 –
Like I said kid, my fault no one elses. I was stupid enough to engage you, and your insulting behavior.
Now here you are again.
Your comments don’t advance the discussion. When you get cornered you start insulting people, because you have absolutely no grasp of Real Estate matters, or the over all economy, yet here you are telling me what a wizard you are.
Come on, tell me something new, or fresh, or interesting. You have a comment, or two left, and I have one.
Like I said, my fault, no one elses.
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RE: David Losh @ 32 –
David,
What you know about the many facets of real estate, particularly with regard to Seattle vs The Eastside, surpasses most any agent I meet on the street and in transactions on an every day basis. I don’t think the way you express that meshes well when you are engaging with others vs proffering your thoughts. But it is very sad that some miss that.
I think those that do miss it are the ones simply looking to find fault with most anyone.
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Ah… the 5 post restriction, though it treats the symptom over the cause, seem to have cleaned the place up.
Glad to see the flame wars die down. There is still much to discuss about the Seattle market.
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I just gotta say it……….Corndog is my FAVORITE of all time here on The Bubble. An absolute riot. The only persons posts I actually seek out and genuinely laugh at. I read one a few weeks ago, about 1am when I got home late from Bball/Azteca, and my wife was pissed because I couldn’t stop laughing. Appears Corndog has taken over for where MichaelB left off..
The Bubble needs these characters to keep interest high and someone for the masses to hate. Corndog is to The Bubble as Phil Helmuth is to poker.
Bashaway Corndog and enjoy yourself while your doing it. I know Many others enjoy your “work” as well.
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RE: David Losh @ 32 – “Like I said, my fault, no one elses.” OK, admitting that you were wrong is a good start, now let’s elaborate a little bit on why it’s your fault. You just made a comment above, claiming that when Corndog “gets cornered” he gets insulting. Now the fact is, you’ve never “cornered” Corndog have you, you can’t produce an example because there aren’t any, right?… What actually happens is exactly what happened in the thread in question. You said something that was clearly wrong because you didn’t take the time to validate what you said before you said it… It’s understandable that you’re not accustomed to doing that because unlike with Aerospace Engineers and Lawyers there are very few negative consequences when a janitor says something wrong. Now maybe you like to express yourself in a free form fashion, kinda speaking out loud and shooting from the hip.. that’s fine but why don’t you go do that in your blogs… When multiple people are putting you down on a daily basis, you should re-evaluate . Clearly, you have some knowledge about some things like Ardell says, but for those of us who actually get paid on a daily basis to understand complicated problems and solve them, we find your sloppiness distracting…. we don’t feel that it is adding to the conversation. Unfortunately, we end up having to waste our time correcting you and although you might not like the results, we are indeed, adding to the conversation.
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RE: Corndogs @ 36 –
Good Morning!
No, I didn’t validate the numbers because they were unimportant which month the sales went to, as this post shows. People still bought into a period of low inventory. Why?
If Real Estate agents know that we are in a period of extremely low inventory, and there are very few places for sale, and your only chance of “winning” a bidding war is to over pay, then why don’t those agents advise the buyer to wait.
The answer is that most Real Estate agents are Real Estate sales people who depend on that commission to make the sale to feed the family. Discount Brokerages also have to encourage the buyer, or advise the buyer on how to “win” the sale.
I have always had a side business, except for once when my license was at Windermere and I was told I had to choose which line of business I was supposed to have. For about one year I did Real Estate sales, and it was one of the worst experiences of my life. The fact I’m good at sales, coupled with my aggressive style made other agents in my office uncomfortable. I’m not a touchy feely kind of guy, but never got caught up in bidding wars. I was in the neighborhood, beating the brush, looking to do deals.
So, fortunately for most of my career I have had the luxury of choosing my deals.
You don’t like my business? Get over it.
The fact is that in Real Estate there are good deals, and bad deals. Since 2008 I have seen a lot of bad deals. You made a bad deal, Tim made an OK deal, but Tim’s motivation, and reasoning is sound. Tim bought a location.
This site is interesting to me because it used to be a Bubble blog that has morphed into a Real Estate sales site. Tim going to work for my very good buddy Glenn Kelman shows what I’m saying about Real Estate sales.
Discount Brokerage hasn’t advanced Real Estate Agency in the slightest, from my point of view Discount Brokerage has kind of killed Real Estate Agency by encouraging less, and less qualified people to enter the Real Estate sales career.
Real Estate is a business, and you are either in the business, or not. I’ve been in the business my entire life. It is what it is. I’m addicted to Real Estate. There is no middle ground, you are either in the business, or an observer, or maybe a Real Estate sales person.
The world is divided in to two kinds of people, the people who are in the business of Real Estate and those who are not. It’s that simple.
Real Estate creates, or makes up 76% of the world’s wealth, from what I read two days ago. I could waste some time verifying that, but who cares, the premise is the same.
Real Estate, right now, for the middle class is draining wealth. Investors are getting richer, cheap money is building hefty portfolios in assets, and commodities, while Real Estate sales people encourage people to buy crap at premium prices.
Globally governments are propping up Real Estate prices, but it seems to me they will have to cut deficit spending, and focus on other things than propping up banking. People should be encouraged to buy well to prepare for that.
Me spending a little time in my blogging day warning people about paying too much for property seems appropriate.
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Good post Tim… very interesting indeed.
I for one am going to sell into this bogus market “resilience” that we are seeing. It’s been and is being manipulated, just like the stock market. The lack of inventory helps anyone willing to sell right now. I could be way off, but I think this is a good time to sell.
Think it’s too late to find some good deals on Phoenix area investment condos for all cash?
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