February Stats Preview: Still No Relief In Sight For Buyers

With February in the books, let’s take a look at the local housing market stats for the month. Short story: If home buyers were hoping things might start to look better for them, they were disappointed. There is still almost no supply and plenty of demand.

Here’s the snapshot of all the data as far back as my historical information goes, with the latest, high, and low values highlighted for each series:

King & Snohomish County Stats Preview

Sales decreased just a bit from a month earlier in both counties, and were basically flat from a year ago. Listings dropped to yet another new all-time low in both counties. Foreclosures are still at their historic lows.

Next, let’s look at total home sales as measured by the number of “Warranty Deeds” filed with King County:

King County Warranty Deeds

Sales in King County fell 2 percent between January and February (a year ago they rose 17 percent over the same period), and were down just slightly year-over-year.

Here’s a look at Snohomish County Deeds, but keep in mind that Snohomish County files Warranty Deeds (regular sales) and Trustee Deeds (bank foreclosure repossessions) together under the category of “Deeds (except QCDS),” so this chart is not as good a measure of plain vanilla sales as the Warranty Deed only data we have in King County.

Snohomish County Deeds

Deeds in Snohomish fell 7 percent month-over-month (vs. a 9 percent increase in the same period last year) and were perfectly flat from February 2016.

Next, here’s Notices of Trustee Sale, which are an indication of the number of homes currently in the foreclosure process:

King County Notices of Trustee Sale

Snohomish County Notices of Trustee Sale

Foreclosure notices in King County were down 41 percent from a year ago and Snohomish County foreclosure notices were down 32 percent from last year.

Here’s another measure of foreclosures for King County, looking at Trustee Deeds, which is the type of document filed with the county when the bank actually repossesses a house through the trustee auction process. Note that there are other ways for the bank to repossess a house that result in different documents being filed, such as when a borrower “turns in the keys” and files a “Deed in Lieu of Foreclosure.”

King County Trustee Deeds

Trustee Deeds were down 24 percent from a year ago. Still basically bouncing along the bottom.

Lastly, here’s an update of the inventory charts, updated with previous months’ inventory data from the NWMLS.

King County SFH Active Listings

Snohomish County SFH Active Listings

Inventory fell 10 percent between January and February in King County, and was down 26 percent from a year earlier.

In Snohomish County it was the same story: Listings down 5 percent month-over-month and down 33 percent year-over-year.

Record low levels for both counties. Again.

Note that most of the charts above are based on broad county-wide data that is available through a simple search of King County and Snohomish County public records. If you have additional stats you’d like to see in the preview, drop a line in the comments and I’ll see what I can do.

Stay tuned later this month a for more detailed look at each of these metrics as the “official” data is released from various sources.


About 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.

67 comments:

  1. 1

    The two biggest take-aways for me.

    1. How close the NTS data for King County is to the low record. As was the case over 10 years ago, people often can avoid foreclosure by taking other actions (primarily selling or borrowing).

    2. How the active inventory dropped fairly significantly this year, but went up slightly last year.

  2. 2
    MM says:

    Insane low inventory level. Tim – I propose a new guessing game:

    What will be the King County SFH active listing number in Dec 2017?

  3. 3
    S. Sounder says:

    I know it’s an old story, but these inventory numbers keep getting more and more ridiculous. Price increases are going to get more and more extreme unless something changes.

    Tim I’d love to see some data on new construction. Are we seeing significant new supply coming on line in response to these higher prices and low inventory, and how do current levels of new construction compare to 2004-2007?

  4. 4
    Deerhawke says:

    It is hard to tell how many of those warranty deeds were actual sales to unrelated parties, but let’s say 500 of those are changes in ownership within a family or partnership or other transactions that we would not normally consider sales on the open market. That still leaves us with 2078 sales and only 1416 listings. What does that say about the state of supply and demand? How long can that go on?

  5. 5

    RE: Deerhawke @ 2 – You’d be better off comparing the NWMLS sales because that’s apples and apples. In addition to the situations you mention, the warranty deeds would include condos, commercial and vacant land as well as unlisted residential.

  6. 6
    Eastsider says:

    Sales number has been higher(!) than inventory for some time. I suspect a number of sales are off market/private party sales. Given the number of unsolicited mailings going to property owners, this may be expected. So supply is there, as evidenced in the closings. They just don’t show up in the inventory number. This may be the new ‘norm’ in this market.

  7. 7
    Umka says:

    RE: Eastsider @ 4

    I suspect that a lot of the properties are not even advertised here on our local market, but rather in Shanghai on Beijing.

  8. 8
    MC says:

    It also could be most of new listing went pending within a few days, then only those listed few days before end of month would count to active listings.

  9. 9
    Deerhawke says:

    RE: Kary L. Krismer @ 3

    I agree that the MLS sales figure is a better indicator, but it is not out yet. (If you have access, I hope you will share it with us.)

    Nonetheless, it probably tracks the warranty deed figure for the month. We will be flat to down a bit from last month and down just a bit from last year’s figure. Meanwhile inventory, which seems like a real number drawn from the MLS is down 22%.

    Eastsider is right. Off market and private party sales are a larger percentage of the whole in a tight market like the current one. In 2008, very few builders and investors were buying from the dirt brokers so more of the sales went to the market. Now, there is little on the market to buy and the competition from other builders, investors and end-users is fierce. Doing deals off market is the only way to buy that makes sense. But even in a normal market where there is a reasonable supply/demand balance, builders and investors prefer to buy off-market. You can usually get more time to close which allows time for permitting and helps bring down overall carrying costs. I have been involved in dozens of deals and only bought 3 or 4 through the MLS.

  10. 10
    Aquamarineblue says:

    We just bought a home without an agent by writing to neighborhoods we liked. We had an appraisal, inspection and used a real estate lawyer. It was quick and painless, we are not all cash buyers and got a mortgage. In the neighborhood we bought in we had 3 responses from our mailing that we sent late fall, explaining we were pre-qualified and ready to buy. We closed quickly and the sellers had already moved out as they were planning to list in the spring. We found a number of houses this way while we were looking in 2016 (as well as using an agent). I know people at my kid’s school that have bought homes from each other. It is very hard to get a nice home on the open market as you are dealing with cash buyers and multiple offers.

  11. 11
    js says:

    By Deerhawke @ 6:


    In 2008, very few builders and investors were buying from the dirt brokers so more of the sales went to the market. Now, there is little on the market to buy and the competition from other builders, investors and end-users is fierce. Doing deals off market is the only way to buy that makes sense. But even in a normal market where there is a reasonable supply/demand balance, builders and investors prefer to buy off-market. You can usually get more time to close which allows time for permitting and helps bring down overall carrying costs. I have been involved in dozens of deals and only bought 3 or 4 through the MLS.

    How would an owner go about finding a builder off market? Or do you just wait until they come to you?

  12. 12

    RE: Eastsider @ 4

    “Inventory” is only the number of homes not pending on a given day in the month. I can get inventory as of this moment and it will change within hours and certain a few days.

    When most homes sell in a week or less, inventory is a bit meaningless as a data point. It is merely adding those no one wanted to those listed within the last few days.

    It doesn’t mean what you think it means. Largely the inventory is not missing things sold off mls (though there is some of that especially for flips and tear downs) but rather missing everything that was worth buying inside the mls and thus Pending vs Active.

  13. 13

    RE: Ardell DellaLoggia @ 8

    I think Tim uses Active as of the last day of the month as “inventory” meaning things that didn’t sell that month. So think of inventory as “fresh meat” added to inferior product. Not a useful data point IMO.

  14. 14
    Eastsider says:

    RE: Ardell DellaLoggia @ 9 – Yes, the MLS inventory number does not fully reflect the current market. The claim that inventory is at the lowest in years is dubious given that closings are up YTD compared to last year. Buyers who rely solely on the MLS and get into fierce bidding wars may be missing a good part of the supply and overpaying as a result. Deerhawke getting most of his supply off market is just one example. He does not ‘overpay’ to buy from the MLS. C-S home price index is a far more accurate measure of price appreciation than anecdotal reports in the Seattle Times.

  15. 15

    RE: Eastsider @ 10

    IN( vs not in) mls closings Jan YOY

    2017 – 1,370
    2016 – 1,104
    2015 – 1,187
    2014 – 1,164
    2013 – 1,162
    2012 – 986

    Currently Active 1,662

    This is what I see. I’m heading out the door so that was a quick tally. I fail to see why everyone is thinking inventory is shrinking when more are sold or relatively no difference. These are for SFH not townhomes King County.

    Required Disclosure: Stats are hand calculated in real time by Ardell and not compiled, verified or published by The Northwest Multiple Listing Service.

    The main difference is there is no good, standing inventory because good houses sell quickly. Selling quickly does not mean it wasn’t there in the first place.

  16. 16
    whatsmyname says:

    RE: Eastsider @ 10RE: Ardell DellaLoggia @ 9
    I think the use of MLS month end “standing” inventory came from a desire to have a verifiable number, and perhaps an internal and forward looking “what’s available for me now?” viewpoint. I think the consistency provides value in trending.

    To your points, sales over the period plus standing inventory at the end of the period is a better, if still imperfect, indicator of what has been out there, and would be just as verifiable and consistent. I hate to join the ranks of those asking Tim for more work, but his chart indicates that there must be a spreadsheet with the key components. Adding a row of trustee deeds plus warranty deeds plus EOM inventory would provide that answer for the whole 2000 to now period. It would be interesting to see how that would affect our perception of inventory over the whole. I still think we have low, low inventory.

    As to the non-MLS, I have been both a FSBO buyer and seller. I don’t think it’s a big part of the house market. While I would encourage everyone to look at non-MLS product, Deerhawke’s purchases are likely for land and teardowns, not viable houses, so he’s probably not targeting the properties you want very often. Friend and family deals are not usually geared to profit maximization, so your willingness to outbid nephew Billy probably won’t count for much. Still, it’s good to look.

  17. 17

    RE: Aquamarineblue @ 10
    Even in Sellers’ Markets

    The hidden bargains [foreclosures before public auctions destroy the bargains] are thick with 100s of possibilities….I saw this demonstrated in the 80s on Investor’s Edge [an Issaquah real estate book of foreclosures to grab up]….Investor’s Edge is no more but the secret listings are there to discover. Grab ’em up quick if ya find ’em first!!!

    BTW…a realtor friend taught me the ropes on leverage flipping strategies….don’t be a MSM lemming lined up for normal listing excessive prices to step “over the cliff”.

  18. 18

    RE: softwarengineer @ 17
    Location, Location, Location

    Foreclosures are scatterred equally in all locations….even Sammamish and Seattle….

    The unemployed, elderly and mentally ill have no set location…..they are everywhere.

    It requires diligence and investment savvy. American ingenuity IOWs.

  19. 19

    RE: softwarengineer @ 17
    SWE is Learning the Ropes Too

    That $287K recently listed unit in my neighborhood sold as a short sell foreclosure for $72K a couple years ago….I was a dummy not to grab it up…

    A good example of what I’m talking about…

  20. 20
    Aquamarineblue says:

    The house we bought we paid fair market value, it was not a foreclosure, the couple had lived there for 30+ years. They didn’t downsize however, they bought a horse property with lots of land. As interest rate go up I don’t imagine house prices coming down substantially, just stabilizing. Even though many houses are still being sold large numbers of people are moving to the area and there are also plenty of foreign investors (and domestic) paying all cash. People are also hanging onto property and turning it into rentals rather than selling. I know a young married couple who bought an apartment in downtown Kirkland 2 or 3 years ago. They just bought a townhome on Queen Anne and are renting their apartment in Kirkland.

    One issue for us was to buy a house big enough that our kids (aged between 10-16) can stay on as young adults if they need to while in college etc. as the housing situation is clearly not going to get any better. That is another reason why Babyboomers are not selling, many still have adult children at home. The sellers of our home still had a 30+ child at home who moved to the new property with them.

  21. 21
    Sea says:

    Its interesting to note that the Zumper apartment rent data is negative YOY in all of the top 10 most expensive cities except San Diego, LA and Seattle, with SF down nearly 10% YOY. Also interesting that Seattle is almost flat YOY and down 3% from the October high. A new building near me in West Seattle is now offering 6 weeks free with a lease signing.

    Curious to see if the trend continues as spring and summer come. I’ve noticed a similar trend in looking at rentals on Zillow (mainly Beacon Hill, north Seattle/Shoreline), lately seems as many properties have done price reductions as not. Could be seasonal and landlords trying to maximize rent and pricing high but given the trend in other top cities it makes you wonder…

  22. 22
    Deerhawke says:

    RE: js @ 11

    “How would an owner go about finding a builder off market? Or do you just wait until they come to you?”

    Normally an agent who specializes in doing “dirt” deals contacts owners whose property looks like a good candidate. I then get contacted by that agent who tells me that they have a prospect. The agent usually gets no commission on the front end — and this can make the deal quite attractive to the seller. The agent gets paid on the listback of the completed new construction.

    But I have bought directly from neighbors who approached me at the block party. I have walked up to houses that look like good candidates for urban renewal and left a note. I have had people come by a job site and tell me that they are helping Aunt May to get her house ready for the market and might I be interested in buying it.

  23. 23
    jon says:

    RE: Sea @ 21 – Apartment construction has stepped up in response to the demand, so it will be a while before we see rents increasing again.

    https://www.rentcafe.com/blog/rental-market/apartment-construction-at-a-10-year-high-new-units-up-a-staggering-50-percent-in-2016/

    House construction is not responding in the same way. So as older houses are gobbled up for apartment construction or replacement by larger houses, the spread in price between average apartment and average house is going to increase.

  24. 24
    Deerhawke says:

    RE: Ardell DellaLoggia @ 12

    Ardell, if you don’t like using inventory statistics, how would you suggest an economist measure supply vs demand in this market?

  25. 25
    Blurtman says:

    By softwarengineer @ 18:

    RE: softwarengineer @ 17
    Location, Location, Location

    The ……., elderly and mentally ill have no set location…..they are everywhere.

    E.g., the House of Reps, Senate and White House.

  26. 26
    Brian says:

    RE: Sea @ 21

    Here’s the link for anyone interested
    https://www.zumper.com/blog/rental-price-data

  27. 27
    Ross says:

    I walked by the display center for “Tower12” apartments built at 2nd & Virginia. I was blown away by the cost of rentals (NB: I haven’t rented in about 10 years, so I might well be out of touch).

    high floor 2BR/2Bath (~1450 sqft) /w view was on the order of $6500/mo
    Penthouses (2BR/2Bat) were just ~1800 sqft, with nice view for $9500/mo +
    The cheapest units still available were $2400/mo for ~600sqft “kind of” 1-bedroom

    I don’t get who the audience forking out $9.5K/mo or $6500 a month for a 2 bedroom apartment are. $6500/mo is close to the mortgage on a 2M home with 20% down. Maybe it’s 1.75M if you back out expenses like property taxes and insurance/HOA. You can still buy some pretty decent properties or condos in Seattle for ~1.75M. And if you have the finances to qualify to pay upwards of $7K/mo on housing, you’d probably qualify for a mortgage at most banks. Maybe it makes sense for corporate housing or short term assignments, but that’s gotta be a pretty small part of the market. Still, there’s way too much inventory at this price point and more is coming online.

    I can see some interest from the techies at Amazon and other tech companies at <$3000/mo price range. Beyond that, I don't see a large market of renters.

    Another thing that struck me was how much money was spent on the marketing center for a rental tower. From models of the homes, high end sleek prints, fancy touch screens and custom apps to look at the homes; this is the kind of marketing expense that was spent on builder sales centers at the height of the boom, I've never seen it for rental sales before (Though I'm not really looking).

    IMO, There's gonna be a rental price correction in the not so distant future, especially in the high end rentals. Or maybe they'll try to convert to condos?

  28. 28
    Ross says:

    By jon @ 23:

    RE: Sea @ 21
    House construction is not responding in the same way. So as older houses are gobbled up for apartment construction or replacement by larger houses, the spread in price between average apartment and average house is going to increase.

    On the supply side, that might be true, but rising (or lowering) rents is also driving purchase demand.

    If I know I can rent a 1BR for $850/mo (as one could not too long ago), I’m quite content to keep renting for a while. But if rent jumps to $2500/mo for the same unit, then I’ll look what $2500 gets me on the purchase market and maybe buy something so I can lock-in my monthly housing costs.

    If I see rental prices stabilize or even drop, then my sense of urgency to buy a place also drops. I’ll just keep renting and wait and see until the right property at the right price comes along. Or maybe I’ll find a job somewhere else and it will be an easier decision to take it since I don’t have to sell a property.

    So rental prices dropping probably leads to reduced demand and perhaps a stabilizing of RE prices, even if supply is stagnant or even decreasing. Then the would-be sellers holding out for the perpetual next 10% gain sense the market turning and list their property, and supply increases.

    Well, all of these do depend on exactly how much relative supply and demand comes to this market. I guess that’s the million dollar question.

  29. 29
    Anonymous Coward says:

    I just finished my weekly perusal of sold homes via Redfin, and it’s officially crazy in West Seattle.
    $135k over asking for a 2/1 estate sale with water damage and mildew visible in the photos.
    https://www.redfin.com/WA/Seattle/3837-34th-Ave-SW-98126/home/329251.

  30. 30
    GoHawks says:

    Eastside median “surges” to $832,000.

    Poll question, will the Eastside median price hit $1,000,000 before the market corrects?

  31. 31
    Hugh Dominic says:

    RE: Anonymous Coward @ 29 – That is insane. That’s not even in the upzone area.

  32. 32
    Erik says:

    RE: Anonymous Coward @ 29
    West Seattle is where it’s at. That’s where I like to buy.

  33. 33

    By Anonymous Coward @ 29:

    I just finished my weekly perusal of sold homes via Redfin, and it’s officially crazy in West Seattle.
    $135k over asking for a 2/1 estate sale with water damage and mildew visible in the photos.
    https://www.redfin.com/WA/Seattle/3837-34th-Ave-SW-98126/home/329251.

    You need to quit focusing on the difference between list price and sold price, because list price is just a number picked by the seller in consultation with their agent. Sometimes they pick a lower number to create a bidding war situation that will drive the house above what it would otherwise generate. Here it worked, so the listing agent did a great job marketing the property. In other situations it can backfire.

    One other thing I would say about West Seattle. I had a relocation client looking their last year (or maybe 2015) and their comment was to note how many agents in that part of town overstate the size of their listings. It makes it really hard to do comps because you have to look at the tax records and pictures of every comp just to figure out whether it’s really a comp. We even noted the square footage discrepancy on one property we made an offer on, but the seller just waited for a buyer who was going to focus on a bogus price per square foot to think they were getting a bargain when they weren’t. And I say that being someone who tends to discount price per square foot, but when calculating it properly puts you in a range well above the other comps it really shouldn’t be ignored because a buyer can’t assure themselves that they will be selling in the same market that has existed the past few years.

    It is interesting though how practices are different in different areas. In the north of I-90, east of I-5 area agents are much more likely to attach a title report to the listing. Other areas not so much. That is a great practice.

  34. 34
    Anonymous Coward says:

    RE: Kary L. Krismer @ 33 – Yes, you’re right the list price is meaningless. In this case, the list price was about the tear down price given the 3x lot value rule of thumb. It escalated $135 over that and needs a serious rehab, aka >$100k (generously low for the sake of argument.). But it’s still only 920 sq ft with a 920 sq ft basement which appears to be relatively low ceiling height. In which case you’re now $650k for a 2/1 with 920 sq ft in West Seattle. Which is a big increase from even a year ago

  35. 35
    Hugh Dominic says:

    By Erik @ 32:

    RE: Anonymous Coward @ 29
    West Seattle is where it’s at. That’s where I like to buy.

    Why is that? I don’t dispute you but I cannot fathom why it is hot relative to any other area.

  36. 36
    jon says:

    It looks like that house is very close to a future ST3 light rail stop.

    https://s3.amazonaws.com/stb-wp/wp-content/uploads/2015/12/19201508/WestSeattleOption.png

  37. 37
    Dustin says:

    By Hugh Dominic @ 35:

    By Erik @ 32:

    RE: Anonymous Coward @ 29
    West Seattle is where it’s at. That’s where I like to buy.

    Why is that? I don’t dispute you but I cannot fathom why it is hot relative to any other area.

    West Seattle was a good value compared to North Seattle until recently, but I think that higher prices there will deflect future buyers back to North Seattle neighborhoods.

  38. 38
    Erik says:

    RE: Hugh Dominic @ 35
    West Seattle is much cheaper than other parts of Seattle. Alki point is beautiful and relaxing, yet very near South Lake Union. Go for a drive around alki point and then down along the water. It seems like it’s a bit undiscovered. I’m still surprised how cheap the area is.

    Many baby boomers will be retiring in Seattle over the next few years. Retirees love alki beach and they are my favorite kind of renters.

  39. 39
    Sea says:

    This is so true. So many people became buyers because of the quickly increasing rental rates and so many people bought houses as investments because of the increasing rental rates + Appreciation rates. If rental rates go flat or decrease the buyer pool becomes smaller and thus your months of inventory on market increases even with no additional inventory. Why lock in my housing costs at 10% higher than prices were a year ago if it looks like rental rates may be changing course?

    By Ross @ 28:

    By jon @ 23:

    RE: Sea @ 21
    House construction is not responding in the same way. So as older houses are gobbled up for apartment construction or replacement by larger houses, the spread in price between average apartment and average house is going to increase.

    On the supply side, that might be true, but rising (or lowering) rents is also driving purchase demand.

    If I know I can rent a 1BR for $850/mo (as one could not too long ago), I’m quite content to keep renting for a while. But if rent jumps to $2500/mo for the same unit, then I’ll look what $2500 gets me on the purchase market and maybe buy something so I can lock-in my monthly housing costs.

    If I see rental prices stabilize or even drop, then my sense of urgency to buy a place also drops. I’ll just keep renting and wait and see until the right property at the right price comes along. Or maybe I’ll find a job somewhere else and it will be an easier decision to take it since I don’t have to sell a property.

    So rental prices dropping probably leads to reduced demand and perhaps a stabilizing of RE prices, even if supply is stagnant or even decreasing. Then the would-be sellers holding out for the perpetual next 10% gain sense the market turning and list their property, and supply increases.

    Well, all of these do depend on exactly how much relative supply and demand comes to this market. I guess that’s the million dollar question.

  40. 40
    jon says:

    I was surprised to see here that SF (#2) and Seattle (#6) are among the US cities with the lowest percentage of rent to income ratio . http://www.citylab.com/housing/2016/02/the-rise-of-renting-in-the-us/462948/

    Since the 2008, there was been a big shift into renting from owning. With Seattle’s high income, that means there is a demand for luxury apartments that is going to skew the comparisons with average rents across other cities. Comparisons to average housing cost is going to be complicated also by the fact that so many people are staying in their houses even after the kids have grown up, and so the average house value will be lower than it would be for newly remodeled houses.

    So the large supply of apartments will indeed help keep down costs. Those lower costs will keep the region as being attractive to employers and also to people who prefer a house to an apartment. That will keep demand for houses increasing in the face of limited supply. Eventually ST3 and self-driving cars will increase the range that people can commute, and that will therefore probably moderate price increases. But that also makes the area attractive as a job hub and just a more enjoyable place for retirees to live. Not that there won’t be cycles of bubbles along the way of course.

  41. 41

    BTW, the NWMLS released their February numbers yesterday. Inventory at 1,434, sales at 1,351 and a median at $560,000. Almost 2,100 new pendings. All King County SFR.

    Numbers from NWMLS sources, but not guaranteed.

  42. 42
    uwp says:

    Compared to February 2016…

    Inventory down ~25%
    Sales flattish.
    Median up ~10%
    Pendings down ~10%
    Months of supply ticks down close to 1.0

    Ugly.

  43. 43
    Erik says:

    RE: Dustin @ 37
    Could be. Amazon will help bolster prices in West Seattle I think. The commute isn’t to bad from West Seattle to amazon I was told. It will be interesting to see which poor community wins out.

  44. 44
    Anonymous Coward says:

    By Kary L. Krismer @ 33:

    One other thing I would say about West Seattle. I had a relocation client looking their last year (or maybe 2015) and their comment was to note how many agents in that part of town overstate the size of their listings. It makes it really hard to do comps because you have to look at the tax records and pictures of every comp just to figure out whether it’s really a comp.

    Agreed. That was one of my pet peeves while shopping in 2014. In our experience, the biggest driver for the difference was the rule that total square footage could be used in the listing, not finished square footage. The square footage discrepancies between the property records and the listings are usually due to un-permitted remodels used to finish the basement and (sometimes) the attic. The thing I’ve never figured out is that there doesn’t seem to be any premium for permitted remodels vs unpermitted. The upside to the patient buyer willing to do their homework was that it made it very easy to figure out who got permits (and did it to code) and who didn’t. Which worked in our favor because we were willing to pay a premium for someone who had pulled permits because we knew they’d brought the wiring into compliance with the 2008 NEC.

  45. 45

    RE: Anonymous Coward @ 44 – I was speaking specifically of how common it was in West Seattle, but obviously it occurs to some extent elsewhere. But there at the time it was like an epidemic. I had to explain to the out of state clients that it wasn’t that way everywhere.

    Not sure there’s an area where un-permitted work is more common than others, but I blame a lot of it on contractors who push owners that direction even though they are licensed and could easily go the permit route. I’m not really sure what they’re afraid of. And that can come back to bite the owner in the butt later because it’s easier to do the work right the first time than to correct it–particularly with plumbing or electrical in walls. I’ve seen to the stud remodel projects where the licensing entity shut the project down and then the property ends up as a foreclosed REO sale still with warning tags on the windows.

  46. 46
  47. 47
    GoHawks says:

    Much stronger jobs number than anyone expected for the month of February. Rates are moving up, but the national economy is improving.

  48. 48

    RE: Blurtman @ 25
    Great Joke Blurtman

    Useless Swamp Gators….Rino/Progressive politicians are only good at hiding classified leak sources…to continue their felonious intelligence leaking and lazy do nothing stalling. Too bad that intelligence won’t leak into their brains…

  49. 49

    RE: Erik @ 43
    Amazon is Stealing all the Ivanka Trump clothing Sales Nordstrom Lost Being a Big Progressive Cry Baby

    Her clothing sales are at record highs now….LOL….Nordstrom must really hate Amazon now too….Amazon better wear a tin hat….LOL

  50. 50
    Brian says:

    Between Renton and Lynnwood, it appears almost 50% (roughly 453 of 932) of the single family homes on the market are asking $1M+. Doesn’t that seem pretty high? I wonder if luxury homes are starting to flood the market. I also wonder how many people (or couples) can really afford a $5000/mo mortgage and a $200k down payment.

  51. 51
    Blurtman says:

    RE: Brian @ 50 – Californication. The Bay Area can make it work, and possibly here as well?

  52. 52

    RE: Brian @ 50

    Not when you consider that the more reasonably priced homes are more likely to be sold than currently for sale.

    Current math is

    1,086 homes for sale

    42% are over a million BUT only 16% of those sold in the last 6 months were over a million.
    42% are $500k-$1M and 52% of those sold in the last 6 months were in that range
    17% are under $500 and 32% sold in the last 6 months are under $500k.

    59% of those for sale are $1M or less but 84% of those sold are $1M or less.

    So what you are seeing is more people asking over $1M than will likely get over $1M and more under a million having gone more quickly to Pending and Sold.

    Required Disclosure: Stats calculated in real time by Ardell and not compiled, verified or published by The Northwest Multiple Listing Service.

  53. 53
    Brian says:

    RE: Blurtman @ 51

    True but there’s a different dynamic in California thanks to proposition 13, which holds down property taxes and disincentivizes long-time owners and heirs from selling, causing perpetually lower inventory levels.

  54. 54
    Brian says:

    RE: Ardell DellaLoggia @ 52

    Thanks for your data. It seems like it shows that there is a glut above $1M in terms of how many are listed and how many actually sell. Buyers are apparently being squeezed out at the bottom and have to settle for less and less.

    If there’s too much competition at the high end, then those homes will need price drops and it could cascade down the price tiers. Then again, maybe some of what we’re seeing is just because the spring market hasn’t heated up yet.

  55. 55
    Blurtman says:

    RE: Brian @ 53 – From the POV of Prop 13 restricting supply, sure. But from the perspective of having enough highly paid citizens, maybe general similarity up to a point.

  56. 56
    Mike says:

    RE: Anonymous Coward @ 29 – Try this: Ballard dump, 830 sq ft, (basement ceiling under 6′ high judging from stairway): Listed at $515K sold for $670K…

    https://www.redfin.com/WA/Seattle/3023-NW-69th-St-98117/home/165888

  57. 57
    ESS says:

    By Mike @ 55:

    RE: Anonymous Coward @ 29 – Try this: Ballard dump, 830 sq ft, (basement ceiling under 6′ high judging from stairway): Listed at $515K sold for $670K…

    https://www.redfin.com/WA/Seattle/3023-NW-69th-St-98117/home/165888

    Thanks for the great heads up. I guess the buyers don’t believe a bubble is going to burst any time soon.

  58. 58
    whatsmyname says:

    By Ardell DellaLoggia @ 52:

    1,086 homes for sale
    42% are over a million
    BUT only 16% of those sold in the last 6 months were over a million.

    OK, First part is easy
    BUT for the area you are discussing, how many homes were sold in the last 6 months?

  59. 59

    RE: whatsmyname @ 57

    Looking at my scribbles on a post it note from earlier looks like

    For sale 1,086 is 453 over a million, 458 $500k to $1M and 180 less than $500k. Numbers are a little off as the exactly $500k and exactly $1M duplicate but only off by 5.

    Sold in 6 mos 1,442 over a million, 4,784 $500k to $1M and 2,888 $500k or less. 9,114 total.

    So a one month supply of under $500k is 481 and there are 180 for sale.
    A one month supply of $500k to $1M is 797 and there are 458 for sale
    A one month supply of $1M+ is 240 and there are 453 for sale.

    I did not count townhouses as SFH in areas that call them that to keep the stats uniform throughout.

    There is an MLS rule that requires I put this disclosure whenever I post stats that are not regurgitated from a printed NWMLS report. Sorry to keep repeating it, but Required Disclosure: Stats calculated in real time by Ardell and not compiled, verified or published by The Northwest Multiple Listing Service.

    I just realized that normally when I do Absorption Rates-Months of supply I do 15 to 195 vs 0-180 for 6 months so as to not to lose most recent not posted yet and here I kept the 0-180 pre-set on the data because I wasn’t doing Absorption Rate when I gathered it. So there will be a bit of variance for those closed most recently and not posted yet.

  60. 60
    GoHawks says:

    RE: Ardell DellaLoggia @ 58 – Thanks Ardell. In a general sense, isn’t this typical? There are many more $450,000 buyers than $1.450 m buyers.

  61. 61
    Eastsider says:

    It appears that the 10 year treasury yield just hit a one year high this morning. It is now nearly double its lowest yield in the past year. Expect the 30-yr mortgage rate to hit 4.5% soon. The higher rate will likely slow down price appreciation in the coming year.

  62. 62
    Brian says:

    RE: GoHawks @ 59

    Well the inventory to sale ratio seems atypical (too many homes for sale vs sold in the higher price range). But I have no idea what that ratio is usually.

  63. 63
    Brian says:

    RE: Eastsider @ 60

    As of today, the rates are already 4.500% if you’re buying a condo with less than 25% down. At 25%+ down on a condo, most lenders will give you a SFH rate, which is about .125% lower.

  64. 64
  65. 65
    Blurtman says:

    RE: Brian @ 62 – That is quite a margin that the banks are pocketing. Quite outlandish rent seeking.

  66. 66

    RE: Deerhawke @ 24RE: Brian @ 62RE: GoHawks @ 60

    To Brian and Go Hawks, I didn’t want to contradict Brian’s “If there’s too much competition at the high end, then those homes will need price drops and it could cascade down the price tiers. Then again, maybe some of what we’re seeing is just because the spring market hasn’t heated up yet.” but rather provide him with more data so as to help him formulate his own opinion.

    To answer both of your most recent comments, no, not a glut or numbers that suggest price drops at the top will cascade down. Also not because the Spring market is not in full swing yet. Partly because $1 Million plus is much more common in some areas than others and the study area as proposed in Brian’s comment #50 is too broad (from Lynnwood to Renton) to draw conclusions from the data. While 16% over a million for that area is much less than the overall active numbers, that is not the case when you go to sub-areas within the whole where $1 M plus IS the market for that area.

    I’m using these 3 zip codes since they are the core of what I follow daily, 98033, 98004 and 98005 representing primary vs secondary markets in Kirkland and Bellevue. Of the 99 homes for sale almost 80% are over a million (78 of 99) but almost 60% of all homes sold sell for over a million (287 of 475 in 6 mos). That still looks like more than it is because even though it suggests that there is a 2 month supply of over a million product, there is virutally nothing for sale at just over a million (worth buying) and the glut doesn’t come in until you are much higher than a million.

    To Brian, a million dollars isn’t what it used to be. To look for the beginnings of a potential cascade down, I suggest you use $2 Million vs $1 Million for future reference, but we are no where near a price changing glut that will cause a trickle down of price drops in any market at the moment.

    Since I’m here I will loop in Deerhawke’s question to me back at comment #24. “Ardell, if you don’t like using inventory statistics, how would you suggest an economist measure supply vs demand in this market?”

    Deerhawke, I had to laugh when you asked “Ardell…how…an economist measure supply vs demand…” because it brought me back to my first day of class in Economics at Wharton where the professor took me aside and said “Ardell, just a heads up. You are never going to make it through this class if you try to interject any sense of reality. In this class, the real world does not exist.”

    To answer the question, you can in fact use inventory on any given day as compared to demand and you can use either closed as demand or pending as demand, but not both. BUT you can’t do that on ONE given day per month so as to only have 12 tracking points in a full year and only 3 per quarter. You have to write a simple program to calculate How many came on today, how many went pending today, how many sold today so that when the One Day a Month number comes out on the 30th or 31st it is an aggregate and not just capture of one moment in time. Pending would work better than sold because there is less of a lag time, but we have too many Pending statuses and these days some go straight to Pending and others go through Pending Inspection before going to Pending. You could try using no longer active but then you’d be mixing in taken off market. So sold against active and assume a 30 day lag would likely provide the best result if the end of month result was a 30 day average of numbers marked daily vs a one shot in the dark at the end.

    In reality, every single person buying a home knows that there is virtually no inventory except what might come on market today…in most all primary vs secondary markets and even in at least half of the secondary markets. So “inventory” doesn’t really exist at all except for the next new ones out the gate this week…which will no longer be active by next week. So there might be a one month supply when you look at the data…but there really isn’t a supply at all. I would say the average is 1 house per week for every 6 buyers or so.

    The problem with tracking inventory is you come to the conclusion that there is a supply, when in fact there is a negative supply as in 1 house for every 6 buyers. When the data gives you a false result, it’s bad data.

    Required Disclosure: Stats calculated in real time by Ardell and not compiled, verified or published by The Northwest Multiple Listing Service.

  67. 67
    Blurtman says:

    RE: Ardell DellaLoggia @ 66 – Most homes in new developments in Sammamish are priced at $1-1.3 million. It is common and no big thing to have bought a million dollar home.

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