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.

11 responses to “Year-Over-Year Price Gains Rapidly Descending to Earth”

  1. Kary L. Krismer

    Tim, IMHO you really should always include the MOM chart, like you used to back in this thread:

    http://seattlebubble.com/blog/2014/03/27/case-shiller-home-prices-weakest-since-early-2012/

    You only seem to have included the additional chart twice this year.

    Better yet, include another chart for YOY data. The second derivative is useful, but by itself it’s not that useful.

    Rate this comment: Thumb up 1

  2. Andrew

    Someone is betting on another global (including the US) recession in 2015.

    http://www.independent.co.uk/news/business/analysis-and-features/doom-and-gloom-2015-global-recession-warning-from-financial-seers-of-the-century-9624700.html

    Anything is possible.
    Especially, if one considers the Mexican standoff between Obama and Putin and a full-fledged war in the middle of Europe (reminds me the 1999) — almost unnoticed in the US media.

    Rate this comment: Thumb up 2

  3. Deerhawke

    I am not sure why there only need to be two options in real estate pricing– increase or decrease. If the year-over-year price rate of change decreases, that does not mean they are heading for a fall. It could also be an indicator that prices are leaving behind the period of rocketing growth and simply slowing down. Or reaching a nice sustainable plateau.

    If I were to make a guess about where prices are heading in Seattle, I would say that I see growth slowing down to a more routing pace of 3-5% per year, most of it occurring in the spring.

    Boring perhaps, but a lot more stable and sustainable than what we have seen since 2012.

    Rate this comment: Thumb up 0

  4. Kary L. Krismer

    By Andrew @ 2:

    Especially, if one considers the Mexican standoff between Obama and Putin and a full-fledged war in the middle of Europe (reminds me the 1999) — almost unnoticed in the US media.

    Reminds me more of 1936.

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

    Rate this comment: Thumb up 4

  5. K Johnston

    What, though, of the demand issue for Seattle housing? 1-br apartments can only get us so far, and SFR demand has to be pretty substantial in coming years due to the influx of immigrants/workers. If demand drives housing (duh), even if we are at a near-high now, I don’t think that is the end of the story for coming years (even though I am one of those who believe a recession is coming)…

    Rate this comment: Thumb up 1

  6. Andrew

    By Kary L. Krismer @ 4:

    By Andrew @ 2:
    Especially, if one considers the Mexican standoff between Obama and Putin and a full-fledged war in the middle of Europe (reminds me the 1999) — almost unnoticed in the US media.

    Reminds me more of 1936.

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

    That would be even worse. At least for Europe.

    Rate this comment: Thumb up 1

  7. Erik

    RE: Deerhawke @ 3
    Yeah probably. I would love to see another busy though now that I have some cashola.

    Rate this comment: Thumb up 0

  8. Blurtman

    RE: Erik @ 7 – Erik, Wodka will put hair on your chest, but you might try cognac and kahlua.

    Rate this comment: Thumb up 0

  9. Shoeguy

    Prices went nuts for a year. 20% increases in prices nationwide with stagnant and declining wages was crazy investor driven nonsense.

    Now that investors are pulling out of the market, median prices will again struggle to regain parity with median incomes, just like they did after the ’08 crash.

    It’ll be interesting to see what kind of destructive policies the Fed and the WH will enact this time to try to juice house prices if prices start to turn down again.

    Rate this comment: Thumb up 3

  10. BacktoBasic

    By Shoeguy @ 9:

    Prices went nuts for a year. 20% increases in prices nationwide with stagnant and declining wages was crazy investor driven nonsense.

    Now that investors are pulling out of the market, median prices will again struggle to regain parity with median incomes, just like they did after the ’08 crash.

    It’ll be interesting to see what kind of destructive policies the Fed and the WH will enact this time to try to juice house prices if prices start to turn down again.

    Inflation. Seattle min wage will be $15/hr. The landlord will jack up your rent with will totally elimate the wage gain. The cost of min wage will show up in the bill because business ower has to offset the cost increase due to wage increase. Your salaried owner will suffer not only from housing inflation but other price increase.

    Rate this comment: Thumb up 4

  11. Christian Wathne

    By Deerhawke @ 3:

    I am not sure why there only need to be two options in real estate pricing– increase or decrease. If the year-over-year price rate of change decreases, that does not mean they are heading for a fall. It could also be an indicator that prices are leaving behind the period of rocketing growth and simply slowing down. Or reaching a nice sustainable plateau.

    If I were to make a guess about where prices are heading in Seattle, I would say that I see growth slowing down to a more routing pace of 3-5% per year, most of it occurring in the spring.

    Boring perhaps, but a lot more stable and sustainable than what we have seen since 2012.

    I think you’re spot on with this comment

    Rate this comment: Thumb up 1

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