NWMLS: Listings and Sales Slip, Prices Edge Up in July

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July market stats have been published by the NWMLS. Here’s a quick excerpt from their press release

“We should be entering the summer doldrums, but I don’t see that happening,” reported Diedre Haines, principal managing broker-South Snohomish County at Coldwell Banker Bain in Lynnwood. “Inventory remains low, but prices and demand continue to increase, prompting murmurs of a looming bubble,” she commented, adding, “Some say yes, and just as many are saying no” when asked about the likelihood of a bubble.

The leap in prices may have some people crying “housing bubble,” said OB Jacobi, president of Windermere Real Estate. “I still feel confident we’re not headed in that direction. Bubbles result from irresponsible lending practices, but buyers in King County have high credit scores and higher than average down payments. This area also has a high percentage of homeowners who are ‘equity rich’ which means their home is worth more than twice what they owe. For a housing bubble to occur we would expect to see far lower equity, down payments and credit quality.”

Home salespeople have a historically good record when it comes to predicting housing bubbles, so you know you can believe what OB Jacobi says. (That was meant to be read with an extremely sarcastic tone.)

Now let’s dive into the numbers for July.

CAUTION

NWMLS monthly reports include an undisclosed and varying number of
sales from previous months in their pending and closed sales statistics.

Here’s your King County SFH summary, with the arrows to show whether the year-over-year direction of each indicator is favorable or unfavorable news for buyers and sellers (green = favorable, red = unfavorable):

July 2017 Number MOM YOY Buyers Sellers
Active Listings 2,898 +11.4% -18.5%
Closed Sales 2,727 -5.7% -2.7%
SAAS (?) 1.28 -6.4% -4.0%
Pending Sales 2,950 -13.0% -7.8%
Months of Supply 1.06 +18.1% -16.2%
Median Price* $658,000 +0.8% +18.6%

Prices keep climbing as listings are still scarce. What more is there to say? So far this year we haven’t seen any movement in the trends that point to some kind of change coming soon in the market.

Here’s your closed sales yearly comparison chart:

King County SFH Closed Sales

Closed sales fell six percent between June and July. Last year over the same period closed sales decreased three percent. Year-over-year closed sales were down three percent.

King County SFH Pending Sales

Pending sales fell thirteen percent from June to July, and were down eight percent year-over-year.

Here’s the graph of inventory with each year overlaid on the same chart.

King County SFH Inventory

Inventory rose 11 percent from June to July. Unfortunately for buyers, year-over-year inventory was still down 18 percent.

Here’s the chart of new listings:

King County SFH New Listings

New listings were down fifteen percent month-over-month, and down seven percent from last year.

Here’s the supply/demand YOY graph. “Demand” in this chart is represented by closed sales, which have had a consistent definition throughout the decade (unlike pending sales from NWMLS).

King County Supply vs Demand % Change YOY

No real change here. Supply and demand is still very much trending in sellers’ favor.

Here’s the median home price YOY change graph:

King County SFH YOY Price Change

July saw the highest year-over-year price increase since March 2016.

And lastly, here is the chart comparing King County SFH prices each month for every year back to 1994 (not adjusted for inflation).

King County SFH Prices

Yet another new all-time record high.

July 2017: $658,000
July 2007: $481,000 (previous cycle high)

Here’s the article from the Seattle Times: King County home prices grow $100,000 in a year for first time; West Bellevue jumps 41 percent


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.

367 comments:

  1. 251

    By Erik @ 244:

    I’ll take my Somolian refugees over Everett the sexual predators of Everett any day.

    I think you mean North Seattle (allegedly).

    http://komonews.com/news/local/3-n-seattle-brothers-7879-and-82-arrested-child-sex-abuse-investigation

    Change the “violent-love” to a three letter word that is a lot like six.

  2. 252
    Doug says:

    RE: S-Crow @ 236 – I hope you’ve shared that story in the Mustachian forums.

  3. 253
  4. 254
    Deerhawke says:

    RE: steven @ 238

    First, let’s talk about cars.

    In the 50’s, 60’s and even into the 70’s, you had to have a routine when you walked out to your car. You said a little hopeful prayer about it starting. You got in and had to know how many times to pump the gas and whether to pause before turning the key– and this was adjusted for the season. If everything went well, it started. If not, you were opening the hood and smelling the gas and wondering how you had been so stupid to have flooded it. An engine needed to be rebuilt every 75,000 miles on average. So of course you were thinking about buying a new car all the time.

    Then in the 80’s along came better alloys, electronic fuel injection and Japanese value-priced precision. By the late 90’s when I bought my Camry, it was an incredibly well designed, well balanced machine for not a lot of money. I never think about whether it will start but just assume it will. It has well over 200,000 miles on it and it isnt even burning any oil. Mostly it is my kids’ car and a car for visitors coming to Seattle, but I still take it out once or twice a week because it is quicker and uses less gas than my F150. It is probably only worth $1000, but why should I sell it when it still runs great? At some point, it will throw a rod or blow a valve. I will leave it smoking beside the road and give the remains to KUOW. I will Uber home feeling satisfied. But that could be another 75,000 miles from now. Maybe 100,000.

    The point is that if you do your research in buying a car (think Honda/Acura and Toyota/Lexus) and maintain it regularly, it should give you a quarter of a million miles before you have to think about selling. These are rapidly depreciating assets, so buy the top of the line model new (or gently used) and get the most out of your investment by keeping it for the lifetime of the asset. Cars are about transportation, not status. And they certainly are not about building net worth.

    In terms of my house, it is certainly not part of an anatomy measurement contest. I began buying bad places to live in the late 1980’s, then fixing them up and selling them to move into the next bad place. It took a toll on personal time and family life, but it was the only way not to be a long term tenant. Ten years ago, I bought a double lot for half price, built two really nice houses, sold one, and kept the other. The neighborhood has gone up and the Seattle market has gone up. So I now have about $1.5M in accumulated equity in the house. In the next four years, I plan to pay it off before retirement.

    Doug@ 243 is right. These days, a $2 million house isn’t what it used to be. It is just a rather nice, large house in a central neighborhood. It doesn’t even have to have a view.

    Actually let me clarify, right now in Seattle there is a fairly substantial difference between a $1.9995 million house and a $2.1 million house. Anything over $2 million has to be distinctive. It has to be really big, have a view, have really distinctive architecture and finishes, or a couple of the above. It is a defining price point.

    Mine is just a $1,9995 million house.

  5. 255
    uwp says:

    By Kary L. Krismer @ 242:

    http://www.seattletimes.com/seattle-news/politics/proposed-seattle-taxes-targeting-foreign-buyers-investment-properties-take-fire/

    Home prices are still soaring, after an initial dip when the tax took effect.

    Prices for existing homes surged 11 percent in the five months ending in July, while prices for new homes are rising at their fastest pace since 1990.

    The typical single-family detached house in Greater Vancouver now costs $1.3 million U.S.

    But but but, they told me Vancouver was crashing after they put a tax on those evil foreign speculators!

  6. 256

    RE: Deerhawke @ 249

    :) And I think people may be confused by the fact that it is worth that…but that is not what you paid for it?

  7. 257

    By Deerhawke @ 249:

    First, let’s talk about cars.

    . . .
    It has well over 200,000 miles on it and it isnt even burning any oil.

    Yes, talking cars is fun! ;-)

    Neither my 89 Ranger, with just under 200k, or the 05 Toyota, with over 170k, need any oil added between 5k oil changes (although the Ranger no longer gets to 5k between changes).

  8. 258
    Kmac says:

    RE: Deerhawke @ 249

    Very tactful response – [thumbs up]

  9. 259
    Erik says:

    RE: Kary L. Krismer @ 246
    Isn’t censorship great.

    Seattle bubble needs to take a field trip to Everett. We can walk the main strip and see people screaming out random things because they have been using meth so long. We can go into the bars and talk to the patrons and hear their sad life stories.

    I’m sure there are criminals in North Seattle as their is everywhere. I’m just saying that Everett has a very high density of people with mental disorders, many probably from drug abuse. I went there recently to visit a friend and nothing had really changed. I encouraged my friend to get out and he agreed. He grew up there and is now around 50, so I’m not sure he’ll ever leave. This friend is the same guy that helped me on my Kirkland condo. Ex drug addict and alcoholic. He said I was an integral part of his recovery. I was just trying to keep him sober so he’d do good work on my remodel. He’s now sober and getting married soon. He wants me to be the best man, I just hope the wedding is not in Everett, but I don’t think he can afford anywhere else.
    Everett is a terrible city and I just don’t think anyone should have to endure that even if you save some money. Everett is telling everyone that they are doing the waterfront project revitalization project again. Heard those lies far too many times. Everett is garbage town and always will be.

  10. 260

    RE: Erik @ 254 – With the exception of maybe Woodway, there are probably bad areas of just about any city. (Although citizens of Woodway probably consider the areas where lots are smaller than 2 acres the bad parts of town.)

    I would note though that right now the top story on Google for Renton is that they have a new two way street! That’s a story from August 18th.

  11. 261
    uwp says:

    Erik’s Everett bashing is one of my favorite sub-plots on this blog.

  12. 262
    Erik says:

    RE: Kary L. Krismer @ 255
    Renton is coming up. Great place to invest as long as Boeing doesn’t move the 737 line somewhere else after the 10 year agreement is up.

  13. 263
    Erik says:

    RE: uwp @ 256
    Hahaha! Thanks.
    This site is about real estate and it needs to be known where to buy and where to stay away from. North sound criminals go to Everett. South sound has a lot of bad places, so it’s more of a mix.
    If you want to buy something and have the price appreciate, buy in Seattle or on the east side. I like Seattle because the values are more stable, but eastside is raging in price appreciation right now. I learned this hard lesson first hand after owning rentals in those areas. Seattle and eastside tenants are easy. They just want to go home and get on the computer. In everett it’s much more difficult to find a good renter. If you do find one, the value of your real estate will likely not increase as it would in happy livable areas. Everett has a bad name for a reason. Go visit objectively and draw your own conclusion. Do more than drive through the area.

  14. 264

    RE: Erik @ 257 – This was one of my favorite P-I blog pieces, although I should have looked up how to spell Johh Keister’s last name. I spelled it based on a German pronunciation.

    http://blog.seattlepi.com/realestate/2008/01/05/john-kiester-still-a-sellers-market/

  15. 265

    Before you leave the car topic, Kim just got back from getting the Jeep checked out before emissions and tabs and he was told he needs a new engine ($6,000 to $8,000). They said they are going to give him “a waiver” for emissions and tabs but it’s a hefty vehicle (2006 Grand Cherokee) and I’m wondering if I should dump it and get a different vehicle before paying for tabs on this one.

    I know absolutely zero about vehicles so any thoughts about next steps appreciated.

  16. 266

    RE: Ardell DellaLoggia @ 260 – I’m confused by your “before emissions” wording, but I wouldn’t rely on the opinion of someone who works at the emissions station. If that was a mechanic I’d suggest going somewhere else. Is the check engine light on?

    I don’t know if having really bad rings would cause a vehicle to fail emissions, but I can’t think of any other condition which would cause a failure and require engine replacement. And even that wouldn’t require engine replacement.

  17. 267

    RE: Kary L. Krismer @ 261

    Thanks Kary. He’s on his way back with the waiver and the Jeep. I’ll try to fill in the blanks after I see the paperwork he brings home. As I said…I really don’t know what I’m talking about. :) …and yes, I said 2nd opinion as well. It hasn’t been giving us any trouble and seems to run just fine, so definitely a 2nd opinion. By “before emissions” I mean it was not the dealer and not the emission station. He takes it to get checked out before he goes to the emission station. Maybe he should just go there and see if it passes without the waiver. There should be more detail on the waiver. He said something about the 6 and 7 cylinder of the engine or some such thing. :)

  18. 268

    RE: Ardell DellaLoggia @ 262 – If he didn’t pull the plugs or at least use a stethoscope, I’d be very skeptical.

  19. 269
    Kmac says:

    I wouldn’t get new registration yet if you are planning on dumping it.
    The legislature, a year ago or so, deemed licensing is only for the current owner.

    If the vehicle sells, a new licensing fee is charged to the new owner.
    Old owner can retain plates and tabs and even transfer them to a different vehicle.

    Exception:Collector and horseless carriage plates CAN go with vehicle if desired.

    Don’t waste your money if selling soon…..

  20. 270

    RE: Kmac @ 264

    If we can transfer to the new vehicle then it’s not a waste? Sorry for being dense. Cars not my thing.

    Says “Failed Emissions Found cylinder #8 and #7 low compression. Rec. replacing motor. Customer Declined”.

    Need new tabs by end of August and I’m up to my eyeballs in work. Kim seems to think the “waiver” (it doesn’t say waiver anywhere on this paperwork) is enough to get new tabs. I’m thinking “Failed Emissions” means he can’t get new tabs and I need a vehicle by end of month.

    I can always rent a vehicle if he can’t get tabs for this one because I don’t want to make this decision while staging a house in a week’s time.

    Does needing a new engine on an 11 year old vehicle sound right? Maybe I just never owned a vehicle for 11 years before. :)

  21. 271
    Anonymous Coward says:

    RE: Ardell DellaLoggia @ 265 – The waiver doesn’t help you pass the test. If you fail the test, instead of actually fixing the problem, you only have to spend $151 towards fixing the problem. Then you take the “repair” receipt back and get a waiver for the emissions portion of renewing your tabs. See more here: http://www.emissiontestwa.com/e/faq.aspx#15 I’m guessing the fees you already spent in getting the check engine light diagnosed exceed $150 and are eligible to be used toward the emissions test waiver. As to whether or not the engine needs to be replaced, I’d find out the actual error codes (any autoparts store will use their computer to read the codes for free). Then you can google search make, model, year and code. The forums will tell you what’s most likely wrong, what the fix would be, and ~how much it would cost.

  22. 272
    Kmac says:

    By Ardell DellaLoggia @ 265:

    RE:
    If we can transfer to the new vehicle then it’s not a waste? Sorry for being dense. Cars not my thing.

    Yes, that sounds right, but they will probably charge you some kind of “service” fee to transfer existing plate to something else.

    I just thought I’d throw that out there, because most people don’t realize they started double dinging the licensing a few years ago.
    I believe most people DO NOT transfer the plates over to another vehicle.
    A STEALTH TAX INCREASE!
    I see ads on craigslist were seller claims “just licensed” but don’t seem to not understand that this is no longer a benefit to the buyer.

    Does needing a new engine on an 11 year old vehicle sound right? Maybe I just never owned a vehicle for 11 years before. :)

    Not unrealistic, but way too many variables contribute to lifespan.
    If you are between two and three hundred thousand, you did alright.

  23. 273
    Erik says:

    RE: Ardell DellaLoggia @ 265
    My truck didn’t pass emissions this year. I went to napa and borrowed the device they had to read error codes. I reset the code and unplugged my battery by taking one of the wires off. I put the battery wire back in the next day, drove back to get it tested, and it passed. If the reason it didn’t pass was an error code, this method I described will serve you. It takes a while to register the error code again in your system, so if you get it tested quickly after resetting the code, the error code will not read and you will pass.

  24. 274

    RE: Kmac @ 267

    111,000 miles and it seems to be running just fine.

  25. 275

    RE: Ardell DellaLoggia @ 269 – It could be many things. If the codes or some other method really did narrow it down to two cylinders, I’d suspect either plugs or injectors (assuming multi-point). Either of those would be fairly cheap. If it’s valves or rings, that would be a lot more expensive, but still wouldn’t be $6-8k.

    BTW, you didn’t answer whether the check engine light is on. If it’s really two bad cylinders causing problems I would suspect the check engine light would be on for a 2006 vehicle. If it’s not on, that would be even more suspicious.

    If you don’t mind going a distance for the second opinion, I know a mechanic in north Seattle personally, and I’m sure he’d give you the straight scoop (even after I tell him how abusive you are to me!) Email me if you’re interested.

  26. 276
    Kmac says:

    By Ardell DellaLoggia @ 262:

    RE:

    Thanks Kary. He’s on his way back with the waiver and the Jeep. I’ll try to fill in the blanks after I see the paperwork he brings home. As I said…I really don’t know what I’m talking about. :) …and yes, I said 2nd opinion as well. It hasn’t been giving us any trouble and seems to run just fine, so definitely a 2nd opinion.

    Yes- second opinion is in order, especially if there are no other tell tale signs (CEL, lack of power, obvious mechanical failure, etc…).

    By “before emissions” I mean it was not the dealer and not the emission station. He takes it to get checked out before he goes to the emission station. Maybe he should just go there and see if it passes without the waiver.

    I’m pretty sure that you need to actually have the emissions test performed before any emission repair costs apply toward the waiver.
    If you send $300 pre-emission testing and it doesn’t pass the initial emission inspection, you will need to spend anoth$150 to meet the waiver requirement.
    If it was me, and it runs and drives good still and I wanted to keep it for a while longer, I would get the test done. If it fails then I would get the $150 (waiver threshold) spent (and a second opinion while you’re at it??) to qualify for the waiver.

    This may have been posted earlier, but here are the waiver requirements:
    http://www.emissiontestwa.com/e/Documents/FailureBrochure.pdf

    Pull the oil dipstick and see if there is a gassy smell to it (bad rings?) or if there is water (bad head gasket or cracked block or head).
    Also, oil or excessive pressure in radiator would most likely be a bad head gasket.

  27. 277
    Deerhawke says:

    Ardell, I spent some time in high school helping a friend rebuild his Dad’s WW-II surplus 1944 Willy’s. I think it saw service in the Philippines. Fifty bucks originally from an Army-Navy story and packed with something called cosmoline that looked like earwax by the bucket. Not much there but stamped steel, cast steel and a bit of wiring, but simple and tremendous fun.

    I haven’t been a big Jeep fan since the 60’s. I mean, the company has been owned by just about everbody (Renault, Rambler, Chrysler, Daimler, Fiat, a couple of hedge fund types– did I miss anybody?) I don’t mean to sound like a chauvinist, but this girl has had drinks with everybody in the bar and been upstairs with most. Why oh why would you marry her?

    Normally I would say just sell it and buy a Honda or Toyota-made 4×4. Long term not bad advice, but short term that is certainly a little harsh and premature.

    After all, the basic engineering is pretty solid. It is really hard to believe that a 2006 vehicle with 111, 000 miles would be worn out and need $6-8K in repairs. That is probably about the value of the vehicle after all. It is certainly more than it should take to drop in a rebuilt engine. You may be just really unlucky, but I would say what you truly need here is not a new car but a new mechanic. Your current guy must need a new roof on his house. Or maybe he has a kid going to college. Yeah, I’ll bet that’s it. He needs money for college.

    Get a second opinion. And if you need it, a third opinion. Keep going until you find someone who has a really well articulated theory that makes sense. What you are seeing could be bad plugs or wires or something simple like that. Or it could be something minor off-kilter in the electrical system that is manifesting itself in the combustion readout.

    Hey if we keep this up, we are on our way to recreating Car Talk without the down east accent and absurd laughter. Actually, nah, let’s not even try ….

  28. 278

    RE: Deerhawke @ 272 – Who wants to be Click and who wants to be Clack?

    Ardell, keep that documentation in case this does turn out to be a scam. Trying to sucker someone into paying $6-8k to pass emissions should get someone’s attention.

  29. 279
    ess says:

    Below is an interesting article indicating that new housing sales are slowing down, although it is still higher than a year ago. Embedded in the article is a discussion about the rate of new construction, and how the lack of it is contributing to the increase in prices. The article also indicates that millennials are getting ready to buy, and are going to require housing that just won’t be available.

    Anyone know if new construction sales and building is also slowing down in Seattle and beyond? Or is it all being focused on apartments? Apartments may alleviate the temporary situation, but it won’t help those who aspire to something bigger if they eventually get married and have kids. No new Levittowns being built around here.

    http://www.marketwatch.com/story/new-home-sales-skid-to-7-month-low-in-july-2017-08-23

  30. 280

    RE: ess @ 274 – FWIW, new construction SFR in King County for July was down about 10% MOM, but up slightly over 10% YTD.

    Numbers from NWMLS sources, but not guaranteed.

  31. 281
    Deerhawke says:

    RE: ess @ 274

    I see a lot of new home construction out in Snohomish county in areas that used to be farms. I also see a fair amount of new building in Redmond where builders are putting 3-6 houses on lots that originally had one.

    But that is just anecdotal. You would need to look at King County records and compare the level of starts to past years. I looked for those stats online and couldnt find them easily. Anybody know where they can be found?

    I would guess the level of SF building starts is the same or a bit less over the last ten years. In August 2007, things were starting to slow down as the banks were shutting down construction lending. Most builders were not back to building, even in the smallest way, until 2012. Since then, builders have been trying to make up for 5 years of lost income from 2007-2011 They have had to rebuild their finances and their banking relationships. But it is so much harder to find developable land at a workable price. That is a tremendous constraint. The teeth imposed by the Growth Management Act (something I support to keep this city from becoming Dallas) are finally starting to really bite.

    And permitting is just a lot harder and more complex. When I was a kid, a standard permit set for a single family was two legal size pages plus the cover sheet. You could easily get a permit in a morning while you waited. Now in Seattle where I work, a standard permit set is about 20 pages 24×36 with a lot of boilerplate, fine print and interlaced calculations. A permit takes a minimum 4-6 months after 4 months for survey, architecture and engineering. There is an expectation by the city that everything about the plan set has to be completely perfect or you will need to go through another review cycle. Right now every review cycle takes at least 8 weeks (up from 2 in 2012). Ordinance/Structural and Drainage are running a full month behind schedule.

    Will all this constrain building of single family homes? Of course. Will it impact prices? You bet.

  32. 282
    Bubble Trouble says:

    By Kmac @ 264:

    I wouldn’t get new registration yet if you are planning on dumping it.
    The legislature, a year ago or so, deemed licensing is only for the current owner.

    If the vehicle sells, a new licensing fee is charged to the new owner.
    Old owner can retain plates and tabs and even transfer them to a different vehicle.

    Don’t waste your money if selling soon…..

    Really? That’s awesome. WA is the first state I’ve lived in where plates went with the car. Everywhere I’ve perviously lived – and I’ve lived in a lot of states – plates always stayed with the person, not the car. And I always found WA really weird for having it the other way around. Good to know the state has come to its sense :)

  33. 283
    N says:

    Here is an interesting take:

    https://www.cnbc.com/2017/08/23/heres-why-new-home-sales-tanked.html

    “Long term, the new home median price has been mostly 10 percent to 20 percent above the existing home median since 1990. Since 2011, however, new home prices have been at a 35 percent to 40 percent premium over resale prices,” John Burns wrote in a recent note to clients. “While the exact percentages aren’t perfect due to ‘apples and oranges’ comparisons, our consultants have been confirming for years that new home sales have been slowed by larger than usual new home premiums.”

    The supply of existing homes for sale is still extremely low, but the supply of newly built homes moved higher in July to 5.8 months of inventory

  34. 284
    Erik says:

    RE: ess @ 274
    I think a lot of these millennial software engineers won’t be having families because they will have a difficult time getting breeding opportunities. Pasty white skin and a boring personality is a tough sell in a male dominated area. A lot of the software engineers will be living in 1br 1ba condos with a cat.

  35. 285
    Blake says:

    This is about Chicago, but I’d bet Seattle is higher?

    http://www.chicagobusiness.com/realestate/20170302/CRED0701/170309967/heres-why-that-buyer-may-not-plan-to-live-in-your-home
    … Nationwide, 33.7 percent of last year’s home sales were to small investors, Attom’s data show. That’s up from 21.6 percent a decade ago. Institutional buyers picked up 3 percent of the Chicago-area homes sold in 2016. Combined with small investors’ buys, that makes 29.1 percent of sales going to non-resident buyers. (end quote)

    Probably higher here in Seattle, but I’m not sure how they get this data. Anyone know?

    IMHO, as the percentage of non-residental buyers gets higher the odds we may see more abrupt price drops also increases since these buyers are more likely to sell in a down turn to take profits or cover their losses and consolidate.

    btw.. this article by Charles Mudede is well worth reading as well. It may seem nice to have all this foreign (dirty?) money coming into Seattle, but it may leave just as quickly as it came!
    http://www.thestranger.com/slog/2017/08/22/25367678/seattle-doesnt-want-to-tax-foreign-money-or-know-a-damn-thing-about-it

    “In the case of Seattle, a popular city with a growing economy and stable political system (despite the pussy grabber in the White House), investors desire nothing more than to flood its commercial, apartment, and housing markets with yield-hungry capital. It can do so in a number of ways: directly with hard cash or indirectly through loans or partnerships. Also, do not think of this money as persons or nationalities. Think of it as absolute surplus, which in our age constantly suffers from low interest rates, and so is desperate to enter any stable/safe market whose values are rising above the rate of inflation. At present, if absolute surplus sits around, it loses value because interest rates are below inflation rates. This is the global situation and Seattle is now a major node in this global economy.”

  36. 286
    Minnie says:

    RE: Erik @ 279

    Erik, I too enjoy reading about ‘Adventures in Everett’. Its so bad its good :-)

    I’d like some opinions. How do you feel about all the new renters laws (protection) will affect the Seattle area? I’m referring to (off the top of my head) the “first come first serve” (Landlord must select the first tenant applicant that meets landlord criteria), security deposit payment by installments and most recently, the law that states that a landlord cannot take into account a potential tenants criminal record. This next part is purely speculation, but I believe that checking a tenants credit score will also soon be on the “no-no” list as it will be considered prejudice against those with past economic issues…..much similar to the criminal record check that has been thrown out.

    All of the stress that this must cause to landlords aside, do you think this will attract the unsavory types to Seattle? It only take a few to turn an apartment building or a neighborhood into a less desirable place.

  37. 287
    Erik says:

    RE: Minnie @ 281
    Wow, someone actually asked my opinion!

    In Everett, my rules were that if they had all their teeth, I rented to them. I had lots of bad renters because child predators and pain killer addicts usually have all their teeth. It’s more difficult to detect those.

    Tim posted an excellent article on here years back that interviewed leasing agencies and rated them in crucial areas. I chose one of the top rated agency. I’ve had a great experience so far.

    I rent condos in Seattle and have acquired tenants after these rules have been set in place. I’m not sure how my leasing agent does it, but all the tenants she hands me have a super high credit score, a great job, and end up being awesome renters. She must lose the undesirable candidate’s application or something? What I’m trying to tell you is I’m sure there is a way around the rules. How can anyone prove you didn’t accidentally file the application in the round file cabinet on accident? I’m not sure how it’s done, but I suspect plenty of applications slipping through the cracks happens. What are the repercussions for losing an application anyway? I think a select few will follow those ridiculous rules and all the smart investors will continue getting rich and conduct business as usual.

  38. 288
    N says:

    By Erik @ 282:

    RE: Minnie @ 281
    Wow, someone actually asked my opinion!

    In Everett, my rules were that if they had all their teeth, I rented to them. I had lots of bad renters because child predators and pain killer addicts usually have all their teeth. It’s more difficult to detect those.

    Tim posted an excellent article on here years back that interviewed leasing agencies and rated them in crucial areas. I chose one of the top rated agency. I’ve had a great experience so far.

    I rent condos in Seattle and have acquired tenants after these rules have been set in place. I’m not sure how my leasing agent does it, but all the tenants she hands me have a super high credit score, a great job, and end up being awesome renters. She must lose the undesirable candidate’s application or something? What I’m trying to tell you is I’m sure there is a way around the rules. How can anyone prove you didn’t accidentally file the application in the round file cabinet on accident? I’m not sure how it’s done, but I suspect plenty of applications slipping through the cracks happens. What are the repercussions for losing an application anyway? I think a select few will follow those ridiculous rules and all the smart investors will continue getting rich and conduct business as usual.

    I always find it so interesting to hear how the mind of those that are loose with the law and everything else think. Its not your job if you hire a management firm (although in my experience its hard to find any firm that will do as good a job as you can) but how do you expect to run credit and criminal checks on someone without explicitly asking their permission to do so via the application? And it only takes one professional tenant to see discrimination to get you in big trouble with big fines.

    It’s not so much that the application sucks up front, its what you find out upon background checks that cause the denials in normal circumstances. If your good at it you screen the obvious things up front so you don’t have someone who doesnt meet your minimum standards going through background checks. But then again you told us how you screened your tenants and it had nothing to do with credit or criminal checks! Sounds very high on the risk scare if you ask me.

  39. 289
    ess says:

    For those of you who have access to the Wall Street Journal, there is a fascinating article on pg B6, Wednesday, August 23

    “Chicago Flips the Script”

    A stately old Chicago condo building is going rental. In Chicago, it appears that the condo market is still below its peak, while rentals have surged 27% as of the low. And this is not the first building to deconvert, in part because millennials are renting and not buying. But an entire building of about 400 condo units – that is impressive just getting it done.

    And of particular interest to Erik – one real estate investor owns 87 units in the building – mostly purchased during the great recession. He will do very well and supports the deconversion.

    As to responses to my question to #274, thank you Kary,
    Deerhawke and Erik

    Deerhawke – I have heard that the process to build is much more complicated and expensive than it was some years ago because of the factors that you cite. I just hope that those that support all of those initiatives and restrictions are not the same ones complaining about prices. Increase the cost for businesses, and those expenses are going to be passed onto the consumers, especially when some of the factors limit the supply. Folks can’t have it both ways.

    Erik – sooner or later even those guys (might) get married and (maybe have kids). I did see an article regarding Toll brothers that some of their most expensive houses are being sold to older millennials who have rented and saved and are bypassing starter homes. So not every millennial will spend a life only with their cats in a one bedroom apartment. I bet the cats are also looking forward to more room also.

    As to Everett not being the best place to live – a shame because cities the size of Everett can be great places to reside – big enough to offer amenities but small enough to retain their human scale. Hopefully someday soon the words “gentrification” and “Everett” will be used in the same sentence.

  40. 290
    Erik says:

    RE: N @ 283
    When I lived in everett, I was poor white trash. Now I’m Seattle landlord white trash, so I’m moving in the right direction. “You can take the whore off the streets, but you can’t take the streets off the whore.”

    I don’t know how my rental management company gets me such great tenants, but they do somehow. They could be following the rules and be getting lucky.

  41. 291
    Erik says:

    RE: ess @ 284
    Interesting about Chicago. That many units in 1 building seems a bit risky, but the investor will probably get even richer.

    It is to be seen what happens with these undesirable millennial computer nerds. I think as time goes on, the west coast will get more condo friendly like the east coast, but who knows.

    Everett has been making promise after promise to attract a university of Washington campus, to revitalize the water front, and to force small businesses to conform to an asthetic code. None of this ever comes to fruition. Everett is full of families that have been poor for many years. Those families breed with other families in Everett and the cycle continues. Neighbors will talk big about remodeling there ugly houses, but when they get money they will buy tickets to the silvertips and go out to eat every night until they are back in the situation they are comfortable with, which is very poor with their home in ruins. People with mental disabilities and personality disorders need to go somewhere. I would rather not live in that area.

  42. 292
    Bubble Trouble says:

    An unemployed person with a 550 FICO and 6 felonies shows up at 8:00am.
    Someone making $200K with an 800 FICO and not so much as a parking ticket shows up at 8:05am

    Seattle law says #1 gets the apartment? Just when you thought liberal lunacy couldn’t get any more lunatic, they surprise you.

    I screen my tenants pretty thoroughly and I am upfront with what I’m screening for…no criminal records, excellent credit, minimum of 3.5 X rental gross income. Plus I take a look at their cars. I don’t really care what they drive, I care what the car looks like on the inside….if they treat their cars like a garbage dump, they’ll treat my property the same way. People with clean cars, tend to have clean homes as well.

    I did make an exception to this once. A potential tenant that I really liked had crappy credit. He got his brother to co-sign the lease and put down double the usual deposit. Worked out OK.

  43. 293

    From Blake, post 280

    This is about Chicago, but I’d bet Seattle is higher?

    http://www.chicagobusiness.com/realestate/20170302/CRED0701/170309967/heres-why-that-buyer-may-not-plan-to-live-in-your-home
    … Nationwide, 33.7 percent of last year’s home sales were to small investors, Attom’s data show.

    I read that, and I failed to see just how they identified which people owned multiple properties. That would not be an easy task. Name matching doesn’t work. You’d have to match name and mailing address for tax purposes. And it would be very difficult across counties. Finally, someone buying first and then selling might be included unless they tracked for a later sale. All this is very unlikely.

    I’d assume this is just more BS made-up real estate data, unless maybe there’s another site that explains how they do it.

  44. 294
    justme says:

    RE: Bubble Trouble @ 287

    >>Seattle law says #1 gets the apartment? Just when you thought liberal lunacy couldn’t get any more lunatic, they surprise you.

    The law does NOT say that. The landlord gets to set objective criteria. The first tenant that satisfies the criteria gets the rental. BLANKET rejections based on criminal record is disallowed.

    I will add a link to a older post, give me a minute.

    Here it is. Read also the comment foloowing it.

    http://seattlebubble.com/blog/2017/02/14/homes-sold-cheaper-south-king-neighborhoods/comment-page-2/#comment-260794

  45. 295
    vj says:

    I can see homes reduced prices in bothell, Kirkland & Bellevue via Redfin. Is that we are getting more inventory?

  46. 296
    Bubble Trouble says:

    By justme @ 289:

    RE: Bubble Trouble @ 287

    >>Seattle law says #1 gets the apartment? Just when you thought liberal lunacy couldn’t get any more lunatic, they surprise you.

    The law does NOT say that. The landlord gets to set objective criteria. The first tenant that satisfies the criteria gets the rental. BLANKET rejections based on criminal record is disallowed.

    I will add a link to a older post, give me a minute.

    Here it is. Read also the comment foloowing it.

    http://seattlebubble.com/blog/2017/02/14/homes-sold-cheaper-south-king-neighborhoods/comment-page-2/#comment-260794

    So I can make objective criteria, as long as that objective criteria doesn’t include criminal history. Much better.

    I’m waiting for the day when Seattle and other progressive cities decide you can’t discriminate based on income. You make $12/hr, you should be able to rent a $2500 apartment. Cuz you know….FAIRNESS!! And if you can’t afford the rent, the landlord has to eat the loss. After all landlords are all evil 1%ers, so they can afford it.

    Don’t laugh, it’s coming,

  47. 297

    By justme @ 289:

    RE: Bubble Trouble @ 287

    >>Seattle law says #1 gets the apartment? Just when you thought liberal lunacy couldn’t get any more lunatic, they surprise you.

    The law does NOT say that. The landlord gets to set objective criteria. The first tenant that satisfies the criteria gets the rental. BLANKET rejections based on criminal record is disallowed.

    I will add a link to a older post, give me a minute.

    Here it is. Read also the comment foloowing it.

    http://seattlebubble.com/blog/2017/02/14/homes-sold-cheaper-south-king-neighborhoods/comment-page-2/#comment-260794

    I think that’s correct, but I believe the law may require that the landlord process each one consecutively, and even gives the tenant a period where they can effectively back out without the landlord being able to process a second tenant. That understanding was based on newspaper reporting, so it might not be right (or I may be recalling it wrong). It’s not based on my analysis of the ordinance.

  48. 298

    Very interesting article on how much downtown office space Amazon is taking up. Note most the employees in such space are probably not low paid employees.

    http://www.seattletimes.com/business/amazon/thanks-to-amazon-seattle-is-now-americas-biggest-company-town/

  49. 299

    More Seattle oddness. They apparently paid a law firm $30,000 to draw up the income tax ordinance. It’s amazing to me that a city the size of Seattle wouldn’t have someone who can draft ordinances.

    http://www.seattletimes.com/seattle-news/politics/seattle-to-pay-up-to-250000-for-legal-help-in-defending-new-city-income-tax/

  50. 300
    Erik says:

    RE: Bubble Trouble @ 290
    I welcome more restrictions and government interference. Thomas Sowell says more government interference historically causes higher housing prices. I don’t really understand all the whys, but he’s a pretty smart guy and gives lots of examples where this had happened. When housing prices go up like they are in Seattle, the government interferes by making all these rules. Mr sowell says that always drives housing prices up, which is the opposite effect of what government wants. So while all the landlords on here are getting upset and complaining, they should be celebrating. I cheer for credit expansion and government interference in the housing market. Bring on the government interference! I’ll sit back with my coffee and cheer the Seattle dummies on.

    Watch, the more our government interferes, the higher housing prices will go. Then when we reach a top, we can dump our inventory onto a unsuspecting software worker and move somewhere more affordable but nicer. Atleast that’s what I’m gonna do.

  51. 301
    Anonymous Coward says:

    By Erik @ 294:

    RE: Bubble Trouble @ 290 – [T]hat always drives housing prices up, which is the opposite effect of what government wants.

    No. That’s the opposite effect of what the politicians *say* they want. If you want to know what someone wants, you don’t listen to what they say; you watch what they do. cf “stated preference” vs “revealed preference”.

  52. 302

    By Deerhawke @ 276:

    Now in Seattle where I work, a standard permit set is about 20 pages 24×36 with a lot of boilerplate, fine print and interlaced calculations. A permit takes a minimum 4-6 months after 4 months for survey, architecture and engineering. There is an expectation by the city that everything about the plan set has to be completely perfect or you will need to go through another review cycle. Right now every review cycle takes at least 8 weeks (up from 2 in 2012). Ordinance/Structural and Drainage are running a full month behind schedule.

    Will all this constrain building of single family homes? Of course. Will it impact prices? You bet.

    I may have more to say on that topic in a couple of weeks, but my comment for now is that one of the candidates for mayor is focusing of foreigners as the problem, and proposing probably illegal and clearly illegal solutions. It would be so much better to focus on what they can control, like permitting.

  53. 303
    Anonymous Coward says:

    By Deerhawke @ 276:

    The teeth imposed by the Growth Management Act (something I support to keep this city from becoming Dallas) are finally starting to really bite.

    I’ve said it before and I’ll say it again: GMA, affordable housing, and unchanging character of our neighborhoods: you can only have two of the three.

  54. 304
    Erik says:

    RE: Anonymous Coward @ 295
    Right. A lot of people on this website act high and mighty, probably cause they want to give that impression off for their jobs in real estate. The more someone says they don’t break the rules, the more I think they are a liar that breaks the rules. America is full of corruption, especially when money is involved. Real estate agents are closely tied to corruption in one way or another, so they wear a mask that says they are the furthest thing from corrupt. Well, I wasn’t born yesterday and I know they are full of it. Many times the person professing they would never think of deviating from the rules is the most corrupt when the time comes. The whole reason they wear the mask is to trick the sheep and slaughter them when the time comes.

    These people on this site that act like I’m this heathen are likely very corrupt. People will argue I’m sure, but it proves itself correct time and time again. I’m just honest and open about things. The cheaters aren’t.

    Have you ever noticed that lawyers, real estate agents, and bankers appear the most ethical. This may shock you, but it’s all a mask. They are often the most corrupt. I forget the statistics, but a large percentage of arch bishops in the Catholic Church have turned out to molest children. No coincidence here.

  55. 305

    RE: Erik @ 298 – I don’t think anyone says you’re a heathen. They question your competency and experience. That’s entirely different.

    As to your comments about ethics, you’re right that some people will try to hide their own unethical behavior. And it’s not just professionals. One other clue is someone who for no reason at all starts to mention religion. Most people who are very religious don’t do that, so when it does happen you should be suspicious. Chances are that person isn’t even religious, but just understands a few basic practices of the religion so that they can appear honest.

    One other factor is trying to determine how risk adverse someone is. If they take on risky investments then they may be willing to stomach worrying about the possible consequences of unethical or even illegal activity. If they are very risk adverse they are likely to be as straight and narrow as they come (something my brother teases me about).

    As to real estate agents, I’ve been following one. I looked into him because I thought he did something questionable for a client. I’ll report what I found if DOL acts, but in short another attorney I contacted who had sued the agent has turned him into DOL. I assume it’s just working it’s way through the process, because when I found what I found I had to ask myself: How is this person still an agent? Seemingly he won’t be very long, but the process does take time.

  56. 306
    Erik says:

    RE: Kary L. Krismer @ 299
    Use your knowledge in law to clean the swamp. I would if I were you. When you are retired, you will be able to reflect on your positive contributions on society and that is a big one that is needed.

    This is trial by fire for me Kary. I jump into things over my head and navigate my way through them the best I can. This increases my stress temporarily, but the financial rewards are too good to stop. I plan on doing this real estate dabbling for the rest of my life while gaining knowledge and experience. It’s much easier to make money in real estate than working a 9-5 everyday until I’m too old to retire and enjoy life. Now that I have some rentals in Seattle, I have some options. It’s all about how I react to change now.

    What I can tell you is that going from poor to having some money is a different path than going from comfortable to rich. People lie wreckingbull say “diversify!” Wreckingbull got lucky and was paid lots of money to program computers. If you diversify $10 and you get lucky, in 5 years you’ll have $20. People that don’t have money should be taking risk. Us poor people have nothing to lose and everything to gain!

  57. 307

    By Erik @ 300:

    RE: Kary L. Krismer @ 299
    Use your knowledge in law to clean the swamp. I would if I were you.

    I very seldom turn people into the authorities because I find it frustrating based largely on what I have seen at the bar association and also the Attorney General’s office. The bar is very slow to act and sometimes don’t do anything at all against some of the most unethical attorneys I know.

  58. 308
    ARDELL DellaLoggia says:

    RE: Erik @ 298

    I wouldn’t say it’s “a mask” because often they believe it when they say it. I was quite old when I discovered that almost everyone believes that they have high standards when it comes to ethics and integrity. I think maybe they don’t know what those words mean. As they say, there is great honor among thieves.

  59. 309
    Erik says:

    RE: ARDELL DellaLoggia @ 302
    You’re right, I totally agree. This is classic Dale Carnegie “How to make friends and influence people.” People don’t blame themselves for anything, so there is no reason to criticize, condemn or complain about them ever because most won’t even digest your words. I read the book probably 20 times and took the course about a year ago. I’m nowhere near perfect, but I’ve come a long ways.

    There is one part of the book that describes a murderer that honestly felt he was being ambushed after a cop approached his car and he murdered the cop. Another one is Al Capone. He had no idea what he did wrong nor would he take blame for anything he did. People don’t view themselves objectively because they can’t. If they do, it will hurt their pride, and they won’t allow themselves to do that.

    You know more about people than me, and it seems you have learned through experience. I did math my entire adult life. After taking the course, I’ve been on leadership roles and my life has been better since I’ve been applying the concepts. It’s an easy read, but learning to apply the concepts is very difficult.

  60. 310
    ESS says:

    http://www.marketwatch.com/story/home-price-zestimates-live-on-as-zillow-wins-lawsuit-dismissal-2017-08-24

    I assume this matter goes up on appeal. Article didn’t say if this was on a motion for summary judgement. If so – an even bigger win for Zillow.

    I don’t know – I would guess if someone provide an analytical tool that had the word “estimate” in it, I would assume that it was an estimate.

  61. 311
    Erik says:

    RE: ESS @ 304
    One time Ardell shared a real estate “rule of thumb” on this site. Everyone on this site began attacking her and telling her she’s wrong cause they found a situation that didn’t fit that rule of thumb, Point is that a lot of people don’t get what estimate is or “rule of thumb.”

  62. 312

    RE: ESS @ 304 – My take on such suits is that for them to prevail in a state the Zestimate system would need to violate state appraiser licensing laws.

  63. 313
    Bubble Trouble says:

    By Erik @ 294:

    RE: Bubble Trouble @ 290
    I welcome more restrictions and government interference. Thomas Sowell says more government interference historically causes higher housing prices. I don’t really understand all the whys, but he’s a pretty smart guy and gives lots of examples where this had happened. When housing prices go up like they are in Seattle, the government interferes by making all these rules. Mr sowell says that always drives housing prices up, which is the opposite effect of what government wants. So while all the landlords on here are getting upset and complaining, they should be celebrating. I cheer for credit expansion and government interference in the housing market. Bring on the government interference! I’ll sit back with my coffee and cheer the Seattle dummies on.

    Watch, the more our government interferes, the higher housing prices will go. Then when we reach a top, we can dump our inventory onto a unsuspecting software worker and move somewhere more affordable but nicer. Atleast that’s what I’m gonna do.

    Whenever the govt does something to help Group X, Group X is worse off. In this case X is renters. What all this stupidity does, like you say, is increase the cost of housing, which raises rents. And right on cue, the govt will blame evil landlords for high rent, and come up with another brilliant plan that will do the opposite. Rinse and repeat, forever. See also $15 minimum wage.

    I’ve already moved away. But it’s fun watching the madness from afar.

  64. 314
    northender says:

    RE: Erik @ 282
    It would be wise to be aware of the terms of your contract with the property manager, how your manager screens applicants, and the liability you may have due to that screening. From what I have heard most property manager contracts pass liability on to property owners. It would really suck to get nailed with a fair housing lawsuit due to poor practices of the property manager. No one wins a fair housing lawsuit – best case is you don’t lose.

    Also, why do you even have a property manager for Seattle condos!? Especially when you’re already negative cash flow! It’s not like they require much effort. If being a landlord is your chosen profession do the work yourself and keep the 8% or whatever they charge.

  65. 315
    S-Crow says:

    Let’s talk about Everett (Eric) :

    I’ve lived on Capitol Hill for 20 yrs. I’ve lived on Queen Anne for 4+ yrs. I’ve lived in Ballard for a number of years. I’ve lived in Edmonds and I now live out in Snohomish where according to some people in real estate you would think you’d need a passport to get to it’s soooo faaar away.

    The Everett area along Broadway/Pacific and north to Everett Community College where WSU is opening a very large Satellite branch has No MORE riff raff than I see walking around in the CD in Seattle, Broadway and adjacent areas (Seattle Central Community College) on Capitol Hill, numerous places in Downtown Seattle, around Uptown in lower Queen Anne, etc. The only difference is the density of the riff raff in Seattle. Heck I see the riff raff around nicer areas including Volunteer Park.

    Anyone buying in Seattle will gain more equity more quickly than buying a worn out post WWII house on the East side of Broadway Ave in Everett.

    A lot of people who work in Seattle are considering Everett and other areas of Snohomish County that are very appealing both in price point (although that is becoming more limited as the prices have accelerated higher) and access to transit (any) and having things Seattle doesn’t offer: like space and land and access to Lakes for water sports and major hiking opportunites and winter sports within an hour. It’s why some of my surrounding neighbors who are builders, small business owners and former Seattle developers move to Snohomish and surrounding areas.

    It takes me 50 minutes door to door to get from Snohomish to SeaTac airport via 405 or I-5 during regular traffic (obviously not during rush hour). It takes me 90 minutes door to door with regular traffic from Snohomish to Leavenworth duing the Spring and Summer. Depending upon what my mood is it takes me up to 45 minutes to get to really good hikes along the Hwy -2 corridor, along the mountain loop hwy or up towards Stevens pass. I Ski and when I don’t go to Crystal I am up at Stevens Pass in under 60 minutes WITH with snow on the ground after Index and did that numerous times this past Winter due to really good conditions.

    The point is Everett and other Snohomish County areas offer things that you can’t get in Seattle. Seattle offers things you can’t get in Sno Co.

    Everett’s (Boeing) Paine Field is getting new commerical flight service with Alaska Airlines as the main launch airline and United has apparently already followed. Can you get to San Francisco/Silicon Valley or LA , San Diego or Orange County or Portland from Paine Field? We’ll see.

    Highly Recommend: By the way if you have not seen Paul Allen’s Historical Flying Heritage Collection and Combat Armor museum at Paine Field it is quite a treat. I finally got a chance to see it with my son about 2 weeks go. I’d go a second time. Take your time and the museum volunteer staff giving personal tours are top notch. The technical details and historical stories told by the volunteer staff about each aircraft, weapons/rocket system and Armor is outstanding.

    S-Crow

  66. 316
    Erik says:

    RE: Bubble Trouble @ 312
    I’m not sure why all this causes prices to increase, but that’s what Thomas Sowell says happens when the government interferes in “The Housing Boom and Bust.” So landlords should welcome all this government interference as it will only have the effect they want, which is drive housing prices up.

  67. 317
    Erik says:

    RE: northender @ 313
    I’ll ask my property manager how she screens. I use a reputable property management company. I certainly don’t want a property manager that is not playing by the rules though.

    Why don’t I manage the properties myself? Probably mostly superstition, but it could be my personality. I end up making friends with tenants and the tenants end up not paying on time in the past. With a property manager, I don’t even talk to the tenants and everything runs smoothly. I think an experienced property manager like mine has the right amount of tact and sternness where everything runs smoothly. This could be superstition, but when I managed property myself I was stressed out and stepped on. Now that I have a great property manager everything runs smoothly. I am not going to disrupt a system that is running like clockwork. If I start having trouble, I will consider switching things up. If it’s not broken, don’t fix it.

    Besides, I can be open to new opportunities in different locations. I don’t feel stuck in Seattle. If I left the area, nothing would change.

  68. 318

    By northender @ 313:

    Also, why do you even have a property manager for Seattle condos!? Especially when you’re already negative cash flow! It’s not like they require much effort. If being a landlord is your chosen profession do the work yourself and keep the 8% or whatever they charge.

    I would strongly disagree with this advice. The property manager would be better able to assess rent levels and screen tenants and have proper practices (e.g. use a Lead Based Paint Disclosure when required). Also, they would be the ones to take the call in the middle of the night when something is wrong.

    But mainly, I disagree with your liability assessment. I believe the liability for violating fair housing laws probably does pass through, but I would question whether or not the PM could contractually have their client be responsible for their violations. Beyond that though, many years ago we ran into someone like Erik who had something like ten condo rentals and a seven figure judgment against him because of a fire in a unit that severely injured an infant. The landlord could not prove he gave the tenant instructions on how the smoke detector worked. The judgment was in excess of his insurance. If he had a property manager then the proof would have likely been available, but if not there likely would have been additional insurance and/or additional assets to pay. As it was he was forced to liquidate everything he had to pay as much of the judgment as he could–something the judgment creditor was allowing him to do in lieu of filing bankruptcy.

  69. 319
    Erik says:

    RE: S-Crow @ 314
    Mr. Crow, I have seen it and it’s great stuff. I went there and got free booze because I earned a modern aircraft structures certificate years ago. In return for the hundreds of hours I put in learning to analyze airplanes, I got a diploma, free food, booze, and free admission to Paul allen’s aircraft museum. Another good one is future of flight museum. See the one in Seattle though and not Everett as the one in Seattle is much better.

    I lived in capital hill for a year right next to that community college. Everett and capital hill both have “grit,” but not on the same way. Capital hill has artists and people with drug problems. Everett has criminals, especially people that have committed sexual crimes. I lived west of broadway on 22nd and Oakes for 6 years. The people in that area are the people that committed crimes in snohomish and king county and were pushed out somehow. I know, I rented to them. Everett will take them when other cities harass them. The city of Edmunds and snohomish are great. You are making a huge mistake by saying snohomish county is all the same. Snohomish county takes criminals and sexual predators and puts them in Everett. If you don’t believe, why don’t you move to Everett and see for yourself? Schools are horrible there. I never went to them, but I would jog by in the mornings and I heard stories from friends and neighbors that went there.

    You are trying to lump snohomish county as all the same, but that couldn’t be further from the truth. The nasties of snohomish county are funneled into Everett. I think those same nasties have reproduced and sexually abused to create more nasties. If I didn’t know first hand the filth that is Everett, I wouldn’t be so adimint about it. I’ve rented homes there, rooms in my house there, I have friends there. I can tell you that it’s a terrible place and you need to have your gaurd up at all times there. You are probably in snohomish now looking over your large plot of land, but I walked the mean streets of Everett daily and I know with certainty what it’s about.

    The company I work for is located in everett and tries to attract to engineering talent from mit and such. They tell these young people not to live in everett. They tell them to live in Seattle or the eastside. Reason being is that they are young and they don’t want them to get depressed and leave. For older married people, snohomish, woodinville, and areas like that are great too. No comparison to Everett and it’s filth.

  70. 320
    Erik says:

    RE: S-Crow @ 314
    What is your motive for defending Everett? Is it because you are friends with Tim and he moved there?

    Eitherway, it’s very clear to me what is happening…the people with mental problems/criminals are residing in Everett for whatever reason. Not the place for a happy family in my opinion. I wouldn’t define any family in my Everett neighborhood as happy.

    Everett tried to bring a UW branch in, but they settled on a WSU branch. That’s pretty funny. I’m surprised they got WSU to agree to that, but that’s why they are the lesser of the 2 schools I guess.

    When I was living a crappy life in E-rot, I was just waiting and waiting for change. Checks in the mail, but it somehow got intercepted at a post office in Bangladesh. The clean people that go to that WSU branch may live in Edmonds, mill creek, and snohomish, but most people that want to live in a happy and healthy community will not live in forever-rot.

    It feels like “The Emporer’s Clothes.” Everyone else can deny that Everett is filthy, but deep down they gotta know the truth.

  71. 321
    N says:

    Having had one or more rentals for over 10 years and living across the country during much of that time I’ve tried management companies and while they can vary what I learned what that no one will care about the property as much as you and if your competent and do your homework no one will do as good a job as you will. Even from a distance I could do a better job and be much happier with my tenant experience.

    If you don’t know what your doing, aren’t willing to properly screen and do background checks, then that is a different story. I’ve never had a late payment in these 10+ years.

  72. 322
    Erik says:

    RE: N @ 320
    Which cities do you own. I use to own in Everett and it was one problem after another.

  73. 323
    N says:

    By Erik @ 321:

    RE: N @ 320
    Which cities do you own. I use to own in Everett and it was one problem after another.

    Spokane. But based on what I’ve read of your posts it seems you committed the #1 sin, not properly screening applicants. Without screening properly, other than in the best of the high end neighborhoods your going to run into problem after problem. I’ve seen those applicants but they don’t make it passed screening.

  74. 324
    N says:

    http://www.huffingtonpost.ca/2017/08/23/toronto-housing-bubble-has-expired-and-gone-to-meet-its-maker_a_23158813/

    Toronto prices are down 19% since April. Apparently things can change quickly. Still up year to date however.

  75. 325
    Deerhawke says:

    I just went through renting two properties in Seattle under the new rental laws. It is really clear to me that the new laws were definitely drafted by people who have never had a rental of any kind. Big surprise there.

    In my world, much of the real screening takes place over the phone. If they only want to email and text rather than calling me, that is the end of communication. In that first call, I tell them briefly about the house. I then usually ask a lot of basic questions such as who is in their group, what they do, what they are expecting in a rental. You always get some interesting responses.

    Oh, you are two families that each have three kids and two dogs and want to save on rent and child-care by renting one single-family house. Interesting…. So, that is ten people and four dogs, do I have that right? Ok, I have you on my list. Definitely, let’s be in touch….

    Ok, so you understand that the house is renting for September 1 but you aren’t moving here until mid-October and won’t be able to make a decision until then. You want to be on the list and get a number? Sorry, I can’t do that until October. Please call back then. Ok?

    Wait, you haven’t even told me what your name is and you want to know what number you are on the list? Do you think this is one of those radio shows giving away money to caller #8? You won’t tell me your name but just want a number? OK, Well you are #114. Thanks for your call.

    Ok this just went on Craigslist 20 minutes ago and you start by asking me if I am negotiable? I’ll get back to you when I am….

    All true stories. All of those calls were pretty short.

    A couple of other things I learned.

    Nobody is interested in renting before the 10th of the month. Everybody is interested in renting after the 10th. Everybody is super interested on the 15th. You probably don’t want the people who are still left in the pool after the 20th. Nobody these days seems capable of looking forward more than 2 weeks. Very odd.

    These days nobody has a dog. Nobody has a cat. Or a hamster or a snake. But everybody has an emotional support animal (ESA) that is supposed to NOT count as a pet. So no extra deposit or fee or restriction of any kind. And they want to tell you that it is your absolute responsibility under the law to make a “reasonable accomodation” for their support animal. I had four young women who said they each had an emotional support animal — each a large 40+ lb. dog. When you look into this, you find that one woman in California who has a degree in psychiatric nursing is supplying most of the ESA certificates. What an amazing business. She interviews you over the phone for 10 minutes, you pay her $100 by credit card and you get the certificate by email a few minutes later. Anyone who has occasional stress, depression, or 20 other symptoms qualifies. Quite the scam. I came up with ways of defeating this, but I am not 100% sure they are legal.

    I said that because of rampant ESA fraud, I would require a certificate from a local board-certified psychiatrist, psychologist or psychiatric counselor. Must be board-certified in Washington State. I also said I would want a certificate testifying to a continuing care obligation. And finally, I said I would expect that since they have this disability, I would expect that they would routinely take the ESA with them to work and other social functions. Most people at this point said, ok, why don’t we just consider this a pet and asked how much extra per month and how much extra for the deposit.

  76. 326
    ESS says:

    RE: Kary L. Krismer @ 317

    This is why one should load up on liability insurance. especially when it comes to rental property. It is not that expensive to increase one’s liability insurance, as well as umbrella policy and it is tax deductible. I did exactly that after someone told me that they were worried about their limits being reached in an auto accident. Got me thinking and I increased everything – home, umbrella, rentals, car etc I may increase my liability insurance on the houses again. Too many people who think everything that happens to them is someone else’s fault, and lots of lawyers to accommodate them in that thinking.

    As to the owner’s liability of the property manager’s incorrect actions, wouldn’t it pass to the homeowner via agency law if it was in the scope of employment, and shouldn’t the homeowner insure that the property manager has lots of liability insurance and that there be a hold harmless clause in the agreement? Something else to worry about.

  77. 327
    ARDELL DellaLoggia says:

    RE: Deerhawke @ 324

    Love this dose of reality.

    You and I both had properties going on market around Labor Day as I recall. The carpet guys have been in mine all day and I decided on quick, not OCDing on, staging, photographer Monday and list late Wed with offers Wed after Labor Day.

    How’s your timeline lining up?

    I figure between yours and mine we will have a quick read on New Construction Seattle vs starter home in Kirkland. Mine is a 1932, one and a half story with a big yard and a great kitchen that was remodeled by the previous owner. Still a starter home though.

    Are you going on before or after Labor Day? As I recall you had some delays from your subs.

  78. 328

    By ESS @ 325:

    As to the owner’s liability of the property manager’s incorrect actions, wouldn’t it pass to the homeowner via agency law if it was in the scope of employment, and shouldn’t the homeowner insure that the property manager has lots of liability insurance and that there be a hold harmless clause in the agreement? Something else to worry about.

    As between the injured party, yes. But as between the landlord and the management company, I’m pretty sure that the landlord could collect from them for their negligence.

    BTW, good think on the insurance. A lot of people make the mistake of only getting insurance in an amount of their net worth. That’s not exactly how it works. If you’re worth $500,000 and have $500,000 of insurance, and cause a $2,000,000 loss, the injured party will take your assets, your insurance and be seeking the rest. Your only hope in that situation is that the insurance company will settle for the limits (something they have a duty to attempt to do). But if they don’t, you’re looking at bankruptcy or other options.

  79. 329
    northender says:

    RE: Kary L. Krismer @ 317
    I don’t know why you would strongly disagree with the idea of self managing a condo. I’m very comfortable providing the required disclosure forms and getting tenants to acknowledge in writing that they have received them. It’s not difficult. And I want to be the one setting rents and handling inquiries – that way I know if I’m getting tons of interest and rent should be higher or if I’m lucky to get the asking rent. I suppose it’s not for everyone but I want control.

    I wonder how responsive property managers are to calls in the middle of the night. I manage a condo for a friend and last year when a 4th floor pipe broke on a Saturday morning I saw the flurry of emails asking for help from the company the condo board uses to manage repairs and emergencies. It took about 4 hours to get a response and that just said someone should turn off the water supply to the building.

    And you disagree with my liability assessment? Really? Here’s what I said “It would be wise to be aware of the terms of your contract with the property manager, how your manager screens applicants, and the liability you may have due to that screening. From what I have heard most property manager contracts pass liability on to property owners.” I’m curious what property management contracts have to say about liability, would anyone be willing to post that language from a contract?

  80. 330
    ESS says:

    RE: Kary L. Krismer @ 327

    I have also heard the theory that one only needs as much coverage to cover their assets also. I have always wondered what legal planet those folks reside in.

    I did have a friend who rebuffed all my exhortations to get business liability insurance. His concern was a corollary of the Field Of Dreams thinking – if you have insurance the lawsuits will come. With considerable assets = he took a tremendous risk as a DBA all those years – luckily nothing ever happened to warrant a liability claim against the products he was selling. For our business we not only incorporated, but the corporation bought lots of liability coverage.

    The most expensive increase to all the coverages I doubled was the car insurance. That is where the real carnage is taking place – so that was a fairly hefty increase. The rest was minimal, just a few bucks per house to double the liability coverage, and a few bucks more for the next million dollars in umbrella.

    I was at an event last week discussing landlord stuff with another landlord. She indicated that their agent had been on her to get an umbrella policy and increase her coverage. She said she was going to the next day – so perhaps I reached someone with what I think is pretty good advice. Perhaps hearing it from a non agent got her thinking that it wasn’t just someone trying to churn business and needlessly cost her more money.

    Housing subject. Note the latest segment on NBR today. The article below should give comfort to those who recently bought investment property ( not in Everett) as to the direction of the real estate market. Apparently there is not enough new housing being built, and an acute shortage of “starter” housing.

    http://nbr.com/2017/08/25/heres-how-housings-woes-could-get-worse/

    BTW – what is the operational definition of a “starter house” these days.

    And Deerhawke, thanks for the heads up about ESAs. I did some legal research as to this issue, as to the Federal statues and guidelines when it comes to ESAs. (No legal advice here – see your lawyer). That research has been e-mailed to partner (aka wife) for a serious discussion about a rental that is coming up in a few months. Having lately observed all these animals in their ESA outfits, I bet it will be a growing trend in the future.

  81. 331
    Jordan Chang says:

    I love Erik’s comments! quick question erik, what do you think is will happen in South King county (Renton, Kent, Auburn)? Will there be an Everett in the south?

  82. 332

    By northender @ 328:

    RE: Kary L. Krismer @ 317
    I don’t know why you would strongly disagree with the idea of self managing a condo. I’m very comfortable providing the required disclosure forms and getting tenants to acknowledge in writing that they have received them. It’s not difficult.

    You don’t know what you don’t know. The guy I mentioned didn’t know he had to prove instructions on a smoke detector were given to a tenant. Another situation a non-professionally managed building didn’t know that lead based paid disclosures/forms needed to be given to tenants.

    And you disagree with my liability assessment? Really? Here’s what I said “It would be wise to be aware of the terms of your contract with the property manager, how your manager screens applicants, and the liability you may have due to that screening. From what I have heard most property manager contracts pass liability on to property owners.” I’m curious what property management contracts have to say about liability, would anyone be willing to post that language from a contract?

    What I’m saying is that the landlord probably has liability for that as a matter of law, but that they could then make a claim against the property manager. It’s not that easy to contractually limit liability for your own negligence. Contracts may have such provisions, but that doesn’t mean they will stand up. Imagine if every attorney contract and every real estate agency and listing agreement had provisions limiting liability for the attorney’s or agent’s negligence! Do you think that would stand up?

  83. 333
    justme says:

    RE: Kary L. Krismer @ 331

    >>Imagine if every attorney contract and every real estate agency and listing agreement had provisions limiting liability for the attorney’s or agent’s negligence! Do you think that would stand up?

    Easy, they just redefine in the contract that almost nothing can count as negligence. Done.

  84. 334
    S-Crow says:

    From the Wall Street Journal this morning: Tapping home equity for cash is big again.
    ———————
    “Banks insist the increased borrowing doesn’t herald a return to housing-bubble days”

    Me: LOL, Why of course not! All those vacations, toys and brand spanking new Trucks and cars eveyone sees driving around are paid for in cash. With earned income and not my house.

    S-Crow

  85. 335

    RE: S-Crow @ 333 – I agree vacations and toys are probably not good uses for a HELOC, unless maybe they can be paid off within a year. Car loans are so cheap I’m not sure why anyone would use a HELOC to buy a car or truck (not sure about deduction of interest), but I guess you could. It’s not like auto loans are all that much different–if anything they are more prone to abuse.

    But, the main very legitimate reason for using a HELOC would be improvements to the house. Even if you have the cash to do those things, the use of a HELOC would allow you to maintain liquidity.

    The real reason HELOC use is up though is now there is more equity in houses! And it’s rising, not falling. In about 2009 or so falling values was one of the reasons lenders cut back or cut off HELOC accounts.

  86. 336
    OA says:

    RE: Kary L. Krismer @ 334

    Kary while I’m in agreement with your response, I think S-Crows point was that tapping into home equity is once again becoming popular and easier. Which bites many people in the butt later on when their debt owed on the home is less than the value of the home itself.

    People like you and I would a use HELOC in a way that makes sense ( on expenditures that would add value to the home), but unfortunately there are many out there that do spend this money on vacations and cars. One of my relatives just took out around$125k and one of the first things he did was take his family to Bora Bora for 3 weeks. And in addition to this he’s about to buy a new range rover. It’s unfortunate, but this is common behavior.

  87. 337

    RE: OA @ 335 – Yes, I’ve seen a lot of that type of behavior, and that’s a sad story.

    Also quite common from back when I was practicing bankruptcy law was run up credit card debt, refinance the home loan to pay off credit card debt, run up credit card debt again, refinance again, on and on until the house appreciation no longer supported the borrowing.

  88. 338
    OA says:

    RE: Kary L. Krismer @ 336

    That’s scary. Life is short, so it’s good to live a little, but being financially irresponsible negatively impacts you and your loves ones down the road. Gotta live within your means.

  89. 339
    Erik says:

    RE: Jordan Chang @ 330
    Good question Jordan. As the old saying goes, the 3 most important things in real estate are location, location, location, so you want to pick a good one.

    A lot of investors that I know are buying in auburn right now. They could know something I don’t know, but auburn is the southern brother of Everett. I know someone that works for the city of auburn and they say that Auburn offers a lot of housing and assistance to homeless people and ex convicts. I worked in auburn a few years and it was pretty nasty. Judging by the people that live there, there is a lot of meth there. Go down to Fred Meyer and hangout at the parking lot in auburn. I use to get food there for lunch because it is the only place I could find that has organic food in Auburn. Fred Meyer has a small organic section, but the parking lot is full of meth addicts so be careful and get ready to be hounded for spare change.

    Renton and Kent are slightly more appealing to me for real estate investment. I don’t buy there because both cities are poor and the only thing keeping them afloat is aerospace manufacturing. Boeing is moving toward automation and I’m sure the vendors in the area will follow suit. I bet in 15 years they will be making more planes in Renton with a lot less people. Manufacturing in the United States in general is moving toward more robots and less people. That is how we are going to complete with countries that can build airplanes for much lower labor costs. Less employees means lower real estate prices, so I’d stay out of manufacturing areas if I were you. The only reason boeing stayed in Renton was because machinists forfeited there pensions to keep boeing in Washington state. When that contract is up Boeing may leave. If Boeing leaves, Renton will get even worse.

    Buy in areas that are going to write the software and design the robots, not industrial cities that run the machines. I went to a facility where composite parts were being manufactured. The place was pretty big, but it was empty. After looking around a while, I found an older woman that came and talked to me. Her job was basically to write an email to the programmers that fix the code that runs the machine. She told me now that everything is running smoothly, she doesn’t really have much to do. She was running several machines that basically ran themselves. This tells me that these manufacturing cities like auburn, Renton, and Kent are going to get worse and worse while Seattle and eastside get more and more expensive.

    Don’t make the same mistake I made in my 20’s when I bought in everett. Nothing will change because the people aren’t about to move out. The cars will stay in their yards and there homes will never get fixed up. If you can’t afford a nice area, buy a small condo in those nice area. That’s what I did and my life is much better because of it. If. You need a bigger place, buy in bothell or kenmore. Those are nice areas commuting distance to Seattle and Bellevue.

  90. 340

    A few months ago someone here suggested that computers could replace people writing software. Someone else thought that was absurd, and I agreed with that second person.

    But then there is this: https://www.technologyreview.com/s/603381/ai-software-learns-to-make-ai-software/

    Also, there’s apparently a self-driving car that does what it does not based on written code as much as learning how to drive from observing humans do it. So it doesn’t avoid running over humans because it’s been programmed that way, but instead because that’s what it’s seen. The obvious problem is if it does something they don’t like, no one knows why it did it!

    Anyway, even jobs writing software apparently can be lost to computers.

  91. 341
    Erik says:

    RE: Kary L. Krismer @ 339
    Just my opinion Kary. I could be totally wrong and it wouldn’t be the first time. I’m the same guy that thought Everett was about to explode with money, which will never happen. I don’t know all that much about what is going on at the city level or what is in the works. I do know Auburn and Everett encourage mentally ill people to come to their cities, so I won’t invest there. Renton could be the next Beverly Hills for all I know.

  92. 342

    Rather than getting stories on studies indicating how many people are underwater we’re now getting stories on how many people have a lot of equity.

    http://www.telegram.com/news/20170824/kenneth-harney-whats-it-take-to-be-in-home-equity-elite

    It’s still BS though (which Harney gets into a little bit). You can’t determine value without visiting a property (basically the Zestimate type error) AND you can’t tell how much money people owe against their house from the public records. Equity is value less debt, and if you can’t determine either . . ..

    But surprise, surprise. People owning their houses longer than 20 years are more likely to have significant equity. I’m glad they performed that study so that we would know that! /sarc

  93. 343
    Doug says:

    May-to-June CS HPI data out tomorrow morning. Will the Seattle bubble be popping as some here have suggested? Me thinks not.

    Place your bets!

  94. 344
    Ross says:

    By Kary L. Krismer @ 339:

    A few months ago someone here suggested that computers could replace people writing software. Someone else thought that was absurd, and I agreed with that second person.

    But then there is this: https://www.technologyreview.com/s/603381/ai-software-learns-to-make-ai-software/

    Also, there’s apparently a self-driving car that does what it does not based on written code as much as learning how to drive from observing humans do it. So it doesn’t avoid running over humans because it’s been programmed that way, but instead because that’s what it’s seen. The obvious problem is if it does something they don’t like, no one knows why it did it!

    Anyway, even jobs writing software apparently can be lost to computers.

    It is certainly coming, and the good programmers in this city are helping the trend. I figure we’ve got a good 10 years before the entry level programmers can be replaced, and specialized/niche areas 15-20 years. The changes from AI are going to have a huge impact on a lot of professional fields, it’s just a question of how long it will take.

  95. 345

    RE: Deerhawke @ 253
    Toyotas Engineered By Higher Paid Engineers

    I’m an American engineer and you expect me to buy a Japanese Designed Car????

    They laid off 250K technicals from Detroit because of companies like Toyota, but by gosh its assembled in America….LOL

  96. 346
  97. 347
    David B. says:

    If I ever move to the east side of the Salish Sea, Everett will be high on the list of places to consider. It may not be perfect, but at least it’s far away from Erik!

  98. 348

    By Doug @ 342:

    May-to-June CS HPI data out tomorrow morning. Will the Seattle bubble be popping as some here have suggested? Me thinks not.

    Place your bets!

    Not sure what you mean by “popping,” but if you mean go down that’s highly unlikely given how closely correlated that C-S is with the NWMLS King County median, and the fact that C-S is a moving average and a few months behind. But anything is possible.

  99. 349

    Today I read a short little book called Being a Data Skeptic, by Cathy O’Neil, a math Ph.D with a interesting resume. It’s free on Kindle and was a test for if I wanted to buy $$ for another of her books. A quick read, but here were my favorite parts.

    Finally, sometimes businesses don’t actually want data people to do meaningful work–they just hired them as ornaments for their business, as marketing instruments to prove they’re on the cutting edge of “big data.”

    Describes Zillow and even Redfin perfectly!

    In other words, when people choose where to buy a house, they look up the standardized test cores to decide which public schools are good. This means towns with better scores are more desirable, increasing the cost of the houses in those neighborhoods.

    This apparent feedback loop adds to the widening equality gap in education and arguably undermines the extent to which it can be honestly called “public education.” If you’re paying an extra $200k for good schools, then you’re essentially pricing out poor people from that resource.

    There was also a section on how government programs to help pay for tuition merely increase the cost of tuition. Her focus was Pell Grants where mine has been student loans, but same basic thing.

  100. 350
    N says:

    No, it’s not residential real estate.

    https://seekingalpha.com/article/4101854-fed-just-say-new-bubble
    What Did The Fed Just Say About This New Bubble?

  101. 351
    StupidLifeDecisions says:

    RE: Deerhawke @ 324

    i think the landlords here are jerks, greedy, delusional, and pretty much always have very poor taste when it comes to picking out kitchen cabinets, etc.

    the only reason why i rent is because i will not buy in a seller’s market and the real estate market here will probably tank in a year and a half to two years (i’m basing this on the tech sector tanking in that time frame and that our current real estate prices here are mostly dependant on tech jobs ).

    as a renter who would strongly prefer not be in washington state but has a sick relative to take care of, i’m pretty disgusted with the rent increases and the yearly letter i get lecturing me on how rents have to go up because of legislation passed by our city council, who i do not vote, would never vote for, and am completely disgusted by.

    landlords like you should be grateful for the good run you’ve had the last few years. as a tenant, i pay my rent on time every month, make no drama, am not high maintenance, can wait on repairs to fit the landlord’s schedule, do no damage to my unit, keep it clean…. so i don’t really appreciate this long list of rules that you guys have for the privledge to pay too much in rent to live in the ugly rental units so popular in the seattle area.

    i’m going to move in december when no one else wants to and rip my landlord a new one at that time. i’m also going to tell him that all his letters explaining why he has to raise the rent are only going to incite all the socialist renters of seattle to vote rent control. basically the only thing that will save seattle from rent control is a major price correction. we will get a price correction, i just don’t know how much yet. can’t wait to find out though.

  102. 352

    RE: StupidLifeDecisions @ 349 – Rent control is illegal in Washington state.

    http://app.leg.wa.gov/RCW/default.aspx?cite=35.21.830

    But of course someone will probably point out that there’s also a statute that says cities cannot collect an income tax.

  103. 353
    Erik says:

    RE: David B. @ 345
    Ouch, your words are hurtful David B. Why so angry?

    Everett may be a good match for you if you are poor angry man west of the Salish sea. Add a alcohol/drug abuse problem and a criminal record and you’ll fit right in.

  104. 354
    David B. says:

    RE: Erik @ 351 – I’m not angry, because I live well away from you. And I want to keep things that way.

  105. 355
    Erik says:

    RE: StupidLifeDecisions @ 349
    Rent from me, I respond with a repair the same day. Just got a lovely note from my tenant thanking me for my quick responses. Keeping happy tenants is my top priority. That way things are more likely to run smoothly.

    As far as prices going down, I think you are wrong there. You predict the software industry is going to tank and Seattle will get cheaper? This sellers market is the time to buy. Incase you’ve been living under a rock, the world is moving to automation. The $15 minimum wage in Seattle will help propel more automation and more software jobs for years to come. We are at record low inventory and housing prices have no sign of stopping.

    I know you have made a lot of stupid life decisions in the past. You are making another stupid life decision by staying out of the Seattle real estate market. Buy a house now and you will change your username to “smartlifedecision.”

  106. 356

    By Doug @ 342:

    May-to-June CS HPI data out tomorrow morning. Will the Seattle bubble be popping as some here have suggested? Me thinks not.

    Place your bets!

    Well, top area in the country for 10 straight months.

    http://www.seattletimes.com/business/real-estate/seattle-leads-nation-in-home-price-growth-for-10th-straight-month

    The article refers to the 78% percentage increase since the bottom, but remember that C-S is apparently affected by mix, so that is misleading. The 13%+ increase YOY though, that probably isn’t misleading, and is somewhat concerning.

  107. 357
    Erik says:

    RE: David B. @ 352
    Why do you think I would make you angry?

  108. 358
    piggyshooz says:

    RE: StupidLifeDecisions @ 349 – if renters stop voting yes on everything, then regulation, rules and taxes would not be passed from the landlord to the tenant. All of the local government interference actually increases the pricing power for the landlord. I would say your landlord explaining the drivers for the rent increases is a good sign of good will in the form of open communication. rent is increasing due to the fact this area is on fire. try finding any of the following right now: a house to purchase at a reasonable price, a contractor to work on a house, hired help, a freeway that isn’t backed up all day, or a table at a nice restaurant without a reservation. blame the landlords greed all you want, but the real problem is all those people that are pouring into the area from elsewhere.

  109. 359
    ESS says:

    RE: Kary L. Krismer @ 354

    Kary, do you think the Seattle/Puget Sound market is so robust as a result of “irrational exuberance”, supply and demand issues, other matters or a combination of everything?

    Erik – good idea to make those repairs immediately. If you treat your investments with respect and care for them, hopefully the tenants will do the same. Does that philosophy work in all cases – no – but it does show that you care about your property and they won’t be in shock when they don’t get most of their security deposit back.

    And when there are shortages, prices increase. That in turn provides incentives to increase the supply. Unless government is involved and artificially causes disruption to the natural supply and demand equation. Rent control is an excellent example of that disruption.

  110. 360
    ESS says:

    RE: piggyshooz @ 356

    Piggyshooz – I believe there is finally some recognition on the part of some tenants regarding the relationship between tax initiatives that place the taxing burden on property and rent. It took a while, and some tenants will always excoriate landlords regardless of property tax increases, excessive government regulations and supply and demand issues.

  111. 361

    By ESS @ 357:

    RE: Kary L. Krismer @ 354

    Kary, do you think the Seattle/Puget Sound market is so robust as a result of “irrational exuberance”, supply and demand issues, other matters or a combination of everything?

    How about supply/demand issues which are a combination of everything? ;-)

    I would say the two things driving the market the most are a combination of tech people moving in and locals who were holding off buying now coming into the market. As to the latter, it’s somewhat similar to what happens in the car industry, where downturns can only last so long because eventually peoples’ cars start wearing out. People will eventually come back to the car market and things will start booming again. Currently we have a lot of people entering the market who were holding off for a good portion of the past nine years. So that, together with people coming to the area, is creating unusual demand. That explanation just covers the demand side.

  112. 362
    Doug says:

    RE: Kary L. Krismer @ 354 – I have heard that Seattle’s run up is exactly the same as Las Vegas’ prior bubble… :-)

  113. 363
    QA Observer says:

    RE: Kary L. Krismer @ 339

    Yep, that was me. In studying AI’s potential and the various literature around the subject, I am convinced we have entered what I humorously heard described as a “Geek Peak”.

    I posed a question to Ray Kurzweil last year when he was a key note speaker at Tune’s PostBack about what the career outlook was for tech workers, and his opinion was that by 2020, 75% of software would be AI developed, and by 2029, full AI automation in software AND hardware development (especially in material science, which in my opinion is the leading technological inhibitor). What will happen to tech hubs? Time will tell of course.

    The first country that can weaponize AI will be unstoppable militarily, hence the tremendous amount of money flowing into the sector by governments globally. Once AI writes code humans cannot decipher or reverse engineer, we are screwed. It would be like humans trying to teach a monkey design details of how a building is built. Scary!

  114. 364
    Doug says:

    Don’t look now, but the 10y UST has been in rally mode since the beginning of July and yielded as low as 2.09% this morning.

    But, but, but, I was told by every publication and talking head that rates were going to rise!?

  115. 365
    David B. says:

    By Erik @ 355:

    RE: David B. @ 352
    Why do you think I would make you angry?

    Trolls are notorious for their bad body odor, and I’m pretty sure that would get on my nerves.

  116. 366

    RE: QA Observer @ 361 – Well, eventually robots will be able to do almost every job, and people will have to find a way to keep busy doing things that interest them.

    And the best part is we’ll be able to tax the hell out of the robots to support the people! (Until they revolt.)

  117. 367
    Erik says:

    RE: David B. @ 363
    If you say so…

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