Posted by: Timothy Ellis (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.

10 responses to “Around the Sound: Housing Market Slowly Regulating”

  1. softwarengineer

    Home Sales Down, Prices Up

    At some point there won’t be any home sales if this keeps up.

    http://finance.yahoo.com/news/u-existing-home-sales-hit-140327853.html

    Its a good time to:
    1. Find a gypsy tribe to share a Seattle home with?
    2. Give up and redecorate the parents’ basement you’ve been living in the last 30 years.
    3. Sell your car so you can afford Seattle rent?
    4. Work two jobs until you get a stroke?
    5. Put off kids and marriage until you’re SWE’s age….LOL

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  2. Craig Blackmon

    Tim, is there any way to parse out numbers within a county? I’m learning the hard way (although not as hard as for the client) just how tough it is for buyers in “close in” and popular neighborhoods (in my case, West Seattle). Anybody looking for a home in these neighborhoods really isn’t impacted in any way by growing inventory in ex-urban King Co. (e.g. Maple Valley). It would be fascinating to look at these same metrics specific to these popular neighborhoods.

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  3. FlipperInSeattle

    We’re still seeing the markets very localized. We’ve had something on the market near $350 in Federal Way for 3 months with little action, and we just put a $325 under contract in Renton the first day it was on the market. We’re bringing a $465k in West Seattle on this week and I would expect to get a lot of traffic.

    Location, location, location.

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  4. Tim Deerhawke

    I agree with Craig Blackmon. It really would be helpful to see numbers just for the aggregate Seattle zip codes. I would define that as anyone who can vote in the Seattle mayoral race. Does the MLS break this out?

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  5. Scotsman

    What’s going on in Island county? A fair number of sales so I don’t think the values got skewed down but that’s a pretty hefty slide. Rising ferry prices driving people out? Second home market collapsing? Any Island county realtors here?

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  6. Kary L. Krismer

    By Tim Deerhawke @ 4:

    I agree with Craig Blackmon. It really would be helpful to see numbers just for the aggregate Seattle zip codes. I would define that as anyone who can vote in the Seattle mayoral race. Does the MLS break this out?

    You could come close, but I don’t think the zip codes closely follow the Seattle city line. For example, I’m pretty sure parts of 98178 are Seattle and unincorporated King.

    FWIW, I’m showing just under 800 active SFR listings with a “Seattle” address and just under 600 sales in March. So the inventory is about 1.33333 months supply. Median for March sales just over $440,000.

    And as long as we’re talking median, the non-distressed median for all of King County is almost $450,000. Since the peak median had very few distressed properties, that would be a better number to compare against $481,000. But even then, there would be other changes in the mix, so a straight comparison is not really worth much either way.

    Numbers from NWMLS, but not compiled by or guaranteed by the NWMLS.

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  7. softwarengineer

    RE: Kary L. Krismer @ 6

    Omits Hidden Foreclosed Market Yet to be Listed Anyway?

    Based on Seattle history over the decades, even during grim buyer opportunity from almost no listings and its high priced stock lies a little used oasis [perhaps not for married families or those with kids though]. Foreclosed homes. They occur equally everywhere. Layoffs and health problems don’t need a zip code.

    Yeah, it will take time and money to get these units in line again…..but many do not require that much effort and/or cash either. Trade in those for a while until you have enough gold saved up for the “listed” gold units? Investigate with the listing agents carefully though, some have “considerable” past liens against them.

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  8. Kary L. Krismer

    RE: softwarengineer @ 7 – You really need to define terms when talking about foreclosures. You could mean pre-foreclosure, and actual foreclosure sale at auction or an REO.

    When referring to non-distressed sales I was referring to NWMLS sales which were not short sales or bank owned (REO). So that would include a property that had been foreclosed but bought by a flipper on the “courthouse steps.” Neither median figure I used (peak or current) would include foreclosure auction sales, because the NWMLS is not involved with those.

    Although not as bad as in the past, banks simply are not good at getting value out of either short sales or REOs. And the properties currently in REO status tend to be some of the worst properties, because otherwise they would have been bought at auction. The median REO sale in March was well under $225,000. Short sales are barely over $250,000. Both those numbers evidence a huge disparity when compared to medians over $400,000.

    Numbers from NWMLS sources, but not compiled by or guaranteed by the NWMLS.

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  9. Tim Deerhawke

    Thanks Kary. That is helpful.

    I am guessing that an inventory level of 1.3 months is the same as an employment number of 5%– full employment just takes account of transactional friction. Basically that means that anything that is not completely overpriced or total garbage is selling — and selling quickly. What I have heard is that if you compare listings to pendeds, the level is closer to 1.1.

    In the Seattle neighborhoods north of the cut that I track, things have been moving unbelievably fast. Two houses on my street in Greenlake sold over a weekend. The house next door to mine (which I built) had a sold sign on it four hours after putting up the yardarm. Evidently there were multiple all-cash offers. The winner was substantially over offer price, no contingencies, closing in two weeks.

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  10. Mike

    RE: softwarengineer @ 7 – dude, foreclosures do not happen equally everywhere! Theoretically that is possible but this is not backed up by actual data. Foreclosures are FAR more prevalent in lower end and remote locations due to buyer demographics and resale ability. More affluent areas have a greater concentration of equity, as well as a people who planned ahead to weather a financial setback.

    Take a high demand area like 98117 and compare it to Kent. If an owner in either place bought in 2007 with 20% down and needed to sell now, the former could likely do it and get most of their down payment back. In Kent the seller would need to bring cash to closing and if they didn’t have enough the house would be sold short or foreclosed. That’s why foreclosures are not distributed evenly at all.

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