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.

13 responses to “June Reporting Roundup: Affirmations Edition”

  1. Teacher Greg

    The real question though is whether foot traffic at open houses is up or not.

    Rate this comment: Thumb up 0

  2. Erik

    RE: Teacher Greg @ 1
    The people that buy the houses are programmers that look at homes on the computer, view the home once with an agent, then buy. Open houses are a thing of the past.

    I would guess inventory will rise this summer, prices rise, but not nearly as much as the past couple years. Cooling off compared to previous summers when sellers had buyers fighting to buy.

    Rate this comment: Thumb up 4

  3. wreckingbull

    RE: Erik @ 2

    It was a joke.

    http://en.wikipedia.org/wiki/Sarcasm

    Rate this comment: Thumb up 2

  4. Erik

    RE: wreckingbull @ 3
    Do you know Teacher Greg?

    If he does confirm that it is a joke… HAHAHAHAHA!! Whoop Whoop!! LOL!!!

    Here is a better joke… What do you call an old programmer that has lost his mind?

    Drum role please………………………………………….. Wreckingbull. BAM!

    Now that is funny. Your turn Wreckingbull.

    That felt good after taking lashing after lashing from you with no comebacks. I warned you Wreckingbull and you continued to push forward. I will not do to you what corndogs did to Losh because I do have a conscience, but I may increase your blood pressure slightly.

    Rate this comment: Thumb up 0

  5. Mike

    RE: Erik @ 2 – I actually bought my house after first viewing it during the open house. While I’m not a programmer per se, I do work for one of the big tech companies. Granted, I’d already viewed the house on RedFin and driven by it prior to the open, but actually seeing it during the open house was what convinced me to get an offer together stat. I don’t know how common that is, but it did happen in my case.

    But that was way back in the “slow” market of 2012…

    Rate this comment: Thumb up 2

  6. One Eyed Man

    RE: Erik @ 4

    Erik, the line about open house traffic being up has been a standing joke on Seattle Bubble for years. Among other things, it relates generally to comments by the heads of the big Seattle area real estate brokerages and other so called pundits in the monthly press release (by NWMLS?), where during the crash they would point to anecdotal evidence of open house traffic being up as a sign of a potential market turn around.

    Rate this comment: Thumb up 3

  7. Erik

    RE: One Eyed Man @ 6
    Thanks for laying it out for me.

    wreckingbull @ 3 –
    Sorry for the thrashing wreckingbull. I would delete that comment if I could. I will stand down now and think about my inappropriate outburst.

    Rate this comment: Thumb up 4

  8. Kary L. Krismer

    That was productive.

    Maybe we can have another six posts to determine that prior sentence was me being sarcastic?

    Rate this comment: Thumb up 2

  9. Erik

    RE: @ 8House salesman –
    I had a good time laughing while I posted comments, therefore it was productive. I also understand the joke now. Good times.

    Rate this comment: Thumb up 1

  10. Kmac

    Lenders Warn of New Housing Bubble on Horizon

    Mortgage bankers are fearful that another real estate bubble is on the horizon, according to a quarterly survey of 203 bank risk managers from the United States and Canada conducted by FICO. Fifty-six percent of respondents said that an “unsustainable real estate bubble is inflating.”

    See more at: http://realtybiznews.com/lenders-warn-of-new-housing-bubble-on-horizon/98725422/#sthash.5ebHMxJU.dpuf

    Rate this comment: Thumb up 0

  11. Deerhawke

    Underwriting standards and downpayment requirements are high. Virtually all the loans are standard conventional 15 or 30 year loans with 20% down. Inventory and new construction are low. Foreclosures and short sales are down to normal levels. Affordability is under pressure but still not terrible. So other than rapid price appreciation, none of the normal indicators of a bubble seem to be evident….yet.

    Rate this comment: Thumb up 1

  12. Kary L. Krismer

    By Deerhawke @ 11:

    Underwriting standards and downpayment requirements are high. Virtually all the loans are standard conventional 15 or 30 year loans with 20% down.

    WTF are you talking about? FHA is 3.5% down and conventional 5% (w/ PMI). VA is still 0%.

    Rate this comment: Thumb up 2

  13. Deerhawke

    True, but this misses the point.

    First, VA FHA and PMI loans have always been around. I don’t have any evidence to believe they play a more significant role now than they ever did. I haven’t heard that documentation requirements have been eased for these loans– quite the opposite.

    This kind of non-conventional financing probably plays a bigger role in other areas of the country, but I would be surprised if it is more than 10% of the transactions in King County. In the last 110 transactions I have been involved in (admittedly all in good neighborhoods and all in the city of Seattle) not one. A friend who has done about the same number of transactions in more marginal Seattle neighborhoods saw 2 FHA loans– both during the recession.

    In a hot market it is likely these loans play a smaller role because it is hard to get sellers to take a flyer on unconventional financing. I have some young friends looking for their first house and they were told by their agent that FHA would put them at a competitive disadvantage in a seller’s market.

    But the real point here Gary is that you do not see financial institutions offering the kind of financial crack now that they did from 2000 to 2008– Option ARMs, Liar loans, NINJA loans, non-verified owner occupied loans, low-doc no-money down LOC+ARM loans, etc, etc. I certainly haven’t heard of any banks modeling themselves on Wamu or Countrywide. So, that is WTF I am talking about.

    If you have a case to make that we are seeing the beginnings of another bubble, then make that case and tell us what mechanisms are at work.

    Rate this comment: Thumb up 1

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