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.

22 responses to “Expensive Eastside Sales Surged in July”

  1. Blurtman

    Tahoe and Suburban driving megamansion hogs. Oink! Oink!

    Rate this comment: Thumb up 4

  2. J.R.

    I’m having trouble reconciling the “median price” graph here with the “decline from peak” graphs in earlier posts dissecting Case-Schiller data. Looking at this post, it appears that most areas of Seattle have prices very close to what they were at the peak of the bubble, but the “decline from peak” graph doesn’t show us as nearly that close. What’s the difference? Is there a significant time lag? Disagreeing data sources? Some kind of inflation adjustment? Median versus average?

    When I look at these historical graphs, I always think of the poor schmuck who bought at the peak of the bubble – which graph should he be looking at to know when he is finally back to break-even? If some of those people really are back to break-even, it seems like the agent/press booster club should be making a lot of noise about it.

    Might be worth it’s own post if the answer is interesting :)

    Rate this comment: Thumb up 0

  3. FlipperInSeattle

    RE: Blurtman @ 1

    Really? So, if you work in say Redmond and want to live close enough to work to not have an eco-killing cross-bridge commute you are automatically deemed sub-human?

    Wow, so much thought in your post…

    Rate this comment: Thumb up 1

  4. wreckingbull

    RE: J.R. @ 2 – I think the decline from peak graphs you reference utilize CS data, which includes all of King, Pierce, and Snohomish counties, thus the more tepid price increases.

    Rate this comment: Thumb up 1

  5. whatsmyname

    Here’s how the median prices changed year-over-year. Low tier: up 3.9 percent, middle tier: up 1.3 percent, high tier: up 12.0 percent.

    Well, there you go. Just some localized activity on the Eastside. No bubble in Seattle; why have you been getting us so worked up?

    Rate this comment: Thumb up 0

  6. Mike

    RE: J.R. @ 2 – It’s heavily neighborhood dependent. Last year I saw a lot more ‘peak buyer escapees’ unloading, but for some reason that tapered off this year despite the increase in prices. I can only guess the people that were dying to move already jumped, and this year it’s more of the ‘it’s a good time to sell’ folks making a move.

    I had been tracking peak resales regularly for the last 2 years to get an idea of where my area is relative to 2007 prices. This summer there hasn’t been much to track. The sales either tend to be 15+ year owners, or post bubble buyers probably looking to move up using the equity they gained in the recovery.

    With only a handful of new distress sales, 98117 and other parts of North Seattle are starting to look a lot more like a normal resale market albeit with limited inventory.

    Rate this comment: Thumb up 0

  7. Kary L. Krismer

    RE: J.R. @ 2 – I’m not following. The median was $468,000, which is rather close to the peak of $481,000, but on these type of charts you’d hardly notice that difference.

    Looking at the top chart here, 2 of the 3 areas appear to be basically just below their prior peak and one is clearly below. That would get you to being something below the peak, which is what the numbers indicate.

    As to the main post, this isn’t terribly surprising that there’s an uptick on the volume of the more expensive area, given that the median has risen rather sharply the past two to three months. That would indicate a change of mix more than an increase in county-wide values.

    Rate this comment: Thumb up 0

  8. ChrisM

    Saw a comment somewhere where the allegation was made that seniors were screwed by ZIRP: the expected income was reduced as a result of the low interest rates (presumably CDs) and that they had run out of money.

    So… their descendants (40-50 year-olds) got to pick up the slack.

    This naturally cascades on to the youngest generation hitting college. The discrestional income was now gone (and it is so late that my spelling skills are gone as well).

    So… does this affect housing? I think it does…

    I’ve posted before that I’m floored that AARP isn’t rioting given the pathetic CD rates.

    Rate this comment: Thumb up 0

  9. softwarengineer

    RE: J.R. @ 2

    Seven Years After Any Peak in Housing Prices

    Even calling this insanely unaffordable possible “return to peak” a good thing….is still a massive loss to an investor. Broker fees on equities make investing in a seven year house price stagnation with escrow and staging costs [about another 10-15% to sell] seem like a cake-walk in comparison. Seven year stagnation on like $500K+ units will bankrupt even fairly well off households in Seattle….assuming you bought in as “an investment” with a lion’s share of your available cash….

    Rate this comment: Thumb up 1

  10. softwarengineer

    RE: ChrisM @ 8

    Same Goes With Current Overpopulation Decreasing Jobs for Millenials in Seattle

    They should all be in an uproar.

    Rate this comment: Thumb up 1

  11. Joe M

    RE: FlipperInSeattle @ 3

    Blurtman didn’t criticize living on the east side. It’s great if you want to live near work. Tim’s post is about upper end structures, though, and many of them on the east side are Mcmansions. And if you drive a gigantic gas hog, you’re as much an “eco-killer” as bridge commuters. Certainly those giant SUVs burn more gas overall than my sipper does on the bridge commute and around Seattle.

    Anyway, everybody lives where they want to or have to. Nobody chooses where to live out of stewardship for the environment. Unfortunately. It’s a plus that they may appreciate about their house, and use it to feel superior to others, but it’s not why they live there. I guess that’s true of vehicles too. Sure I’m eco friendly in my little car but it’s not why I drive it. I just think Tahoes and their ilk are disgusting. What a pain to be behind one or even look at one.

    Rate this comment: Thumb up 1

  12. Kmac

    By Joe M @ 11:

    RE: FlipperInSeattle @ 3
    I just think Tahoes and their ilk are disgusting. What a pain to be behind one or even look at one.

    Seattle is your type of town then.

    I think it is disgusting when people try to impose their beliefs on everyone else.

    Rate this comment: Thumb up 1

  13. Blurtman

    RE: FlipperInSeattle @ 3RE: Joe M @ 11 – No, I was certainly not criticizing living on the Eastside, but just the high end mega-mansions. I live in Sammamish where we recently installed checkpoints to keep folks like Eric out, and I absolutely appreciate the exclusivity that high incomes can afford.

    Here is what I am talking about: http://www.buchanhomes.com/buchan/communities/chestnut-estates/inventory

    Everyone must have 4,000 plus sq. ft. or its not real living. We clear cut the land, put in 4,000 – 5,000 sq. ft. mega-mansions, and then plop in Home Depot trees, plants and turf. Now that is living!

    Just stroll through that neighborhood, or the nearby Greenbriar neighborhood, and you will see not shortage of Tahoes, Suburbans, large trucks that see no real work, and multiple large gas guzzlers in the mega-mansion driveways. These developments are primarily baby incubators, where crazed aggressive driving moms pilot the large gas guzzlers. One generation of Oinkers raising another. Oink, oink! Oink, oink!

    Rate this comment: Thumb up 7

  14. Erik

    RE: Blurtman @ 13
    I left the eastside, not the other way around. I used the eastside as a stepping stone. Thanks bro.

    I bought low in Kirkland and sold to some computer fool 2 years later. Then I bolted to the city where I can officially make fun of you sterile yuppies. When the market crashes again, I plan to buy half of Sammamish and turn it into a parking lot.

    I am kidding of course… I would move to Sammamish if I could afford a nice place there. I am moving to Alki beach because it is still cheap. My contribution to the neighborhood watch in Alki is keeping you eastside trash bags off my beach. I basically search for boring people with jobs and are not committing crimes and kick their a$$ out. Westside til I die.

    Rate this comment: Thumb up 1

  15. Blurtman
  16. Erik

    RE: Blurtman @ 15
    Eastside is a boom and bust area that is driven by computer nerds. When it busts over there again, I will buy view property in Sammamish or Kirkland. Right now they can filter out people like me with high prices. When the eastside market dumps again, I will sneak into Sammamish and hole in.

    Rate this comment: Thumb up 1

  17. Blurtman

    RE: Erik @ 16 – Good idea! But Sammamish is changing, and becoming more and more developed. A town center is on the way to complete the transition to Redmond. Snag a waterfront property after the next crash. I might, too.

    Rate this comment: Thumb up 1

  18. Peter Witting

    RE: Blurtman @ 13 – I hate those McMansions and completely understand the stereoptype you describe. My Suburban hauls wet Labrador retrievers, dead ducks, the occasional deer and loads of wood, and looks like it…no shiny rims rolling here!

    Rate this comment: Thumb up 2

  19. Joe M

    RE: Kmac @ 12
    What are you talking about? I didn’t try to impose my beliefs on anyone. I can’t–I don’t have the power to do so. I wish I did.

    Do you equate expressing beliefs (or rather tastes, which is what I was talking about) with imposing them? I guess no one should say they like a dislike a certain movie, wine, or book for fear of crushing the feelings of a sensitive person like you who might feel judged?

    P.S. Hey, while I’m imposing. Another thing I don’t like is chain restaurants. I wish Seattle would pass even more regulations and kick all those crappy places over to where ever you live so you could be surrounded by them in a sea of ugliness. Say what you will about Seattle, an awful lot of eastsiders who care about food come over here when they want something really good.

    Rate this comment: Thumb up 4

  20. Blurtman

    RE: Joe M @ 19 – Spot on! There are only a few great east side restaurants – Cafe Juanita, Barfing Frog, Montalcinos, and The Stone House. We frequently go into The City to enjoy a nice meal at a much wider selection of fine restaurants. And the chains peddle death – have you ever explored the caloric content of the average Jimmy Johns sandwich? Horrific!

    Rate this comment: Thumb up 1

  21. Kmac

    RE: Joe M @ 19

    You crushed me, thin skinned Joe…
    a real keyboard intellectual you are.

    I’ll let you have the last word, which I’m sure you will, so don’t disappoint….

    Rate this comment: Thumb up 0

  22. One Eyed Man

    RE: Blurtman @ 20RE: Joe M @ 19RE: Joe M @ 11

    Being disgusted with high end suburban capitalists for conspicuous consumption and ignoring externalized costs is like being disgusted with Whinny the Pooh for sharting in the woods. They perceive their actions as not only socially acceptable but probably also both admirable and aspirational. Expecting them to share the social cost you perceive is like expecting them to pay a voluntary tax increase. If the “free” market doesn’t assess the cost to them, that cost is not only irrelevant to the decision making process, its an unreasonable burden and deterrent to economic grow.

    But hey, when you’re in Rome, join the crowd and buy a ticket to watch the lions eat some children of a lesser god. And the value of trickle down from high end conspicuous consumption is economically important to keeping the low classes noses to the grind stone. And after all, is preserving life on earth for some generation after I’m gone really as significant as the material comforts of my McMansion with heated travertine toilet seats and the quiet time value of DVD’s in my land yacht’s headrests.

    One caveat: Nobody views a “Chevy Tahoe” as anything but plebian. if you want to feed your superiority complex you have to up the price tag to a Benz, Lexus, BMW, Cadillac or Lincoln. I own a Chevy and if you don’t look down on me you should even though It cost me half of what my neighbors Lexus cost. His is a little nicer, but we both have about 170K on them and mine amazingly hasn’t even needed a break job! Thank god for those heavy chrome bumpers because its so inconvenient to slow down when those urban people step off the curb.

    Rate this comment: Thumb up 5

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