To kick things off, here’s an excerpt from the NWMLS press release:

Competition among home buyers "still fierce;" rising interest rates adding to fury

With inventory apparently improving, some would-be buyers are staying on the sidelines. The increased inventory is “cooling some buyers,” reported George Moorhead, managing broker at Bentley Properties in Mill Creek and a member of the MLS board of directors. “We also have buyers who are stepping back as they are frustrated with current inventory and multiple offers going well above asking price,” he added.

Okay wait. That makes no sense at all. They’re trying to claim that an increase in inventory is causing buyers to get out of the market? When the big story for the last year-plus has been buyer frustration at record low inventory? That does not pass the sniff test. I can see higher interest rates being a reason that sales might soften, but increase inventory? Nope.

Read on for my take on this month’s local news reports.

Marissa Evans, Seattle Times: More buyers than sellers push King County home prices up

Lack of homes for sale has been the major reason behind rising home prices in the Puget Sound area.
…
Glenn Crellin, of the Runstad Center for Real Estate Studies at the University of Washington, said the shortage is happening for a combination of reasons. Some homeowners are waiting for prices to rise even more, while others owe more than what they could get for their home. This prevents owners from being able to sell unless they can make up the difference out-of-pocket.
…
Despite the shortage, Matthew Gardner, principal for Gardner Economics, said this is the kind of report he’s been looking forward to seeing. The number of listings increased 21 percent for Seattle in the past month.

“We are seeing a late increase in spring listings,” Gardner said. “It’s going to be a busy summer now.”

Whoa. Accurate insight from Matthew Gardner? Okay then.

Aubrey Cohen, Seattle P-I: Surging home prices fuel fears of a new bubble

Shoppers fighting over the few homes listed for sale in the Seattle area pushed up prices again in May, prompting fears of a fresh housing bubble, according to a new report.
…
“We certainly can’t sustain 15 percent annual price increases,” said Glenn Crellin, associate director of the Runstad Center for Real Estate Studies at the University of Washington.
…
“Traditionally, during the initial phase of a rate uptick we see a flurry of activity,” Crellin said.
…
After that initial flurry, Crellin said, rising rates “will tend to slow things down a little bit.” They’ll also moderate median price increases, as the same monthly payment will buy less, he added.

Here’s hoping.

I held this post until this late because I was hoping a story would appear on the Everett Herald, but so far there’s nothing. If they post one tomorrow I might update this space.

[Update]

They did finally post a story: Kurt Batdorf, Everett Herald: Fewer county homes listed, so prices rise

Median sale prices on homes and condominiums in Snohomish County jumped by $40,000 in May from a year ago, due in no small part to the continuing decline in active listings.
…
“There are still home owners who want or need a higher equity position in order to sell their home, so they may continue to wait and watch,” said Dan Gunderson, broker with Windermere Everett.
…
“We currently have significantly less inventory of bank-owned and short-sale properties,” Gunderson said. “New construction is currently about 15 percent of the inventory, and we would like to see it at 20 percent. Supply is certainly a driver of the increased property values. Affordability, low interest rates and the job market in this region are contributing to the increased value as well.”

[End of Update]

Kathleen Cooper, Tacoma News Tribune: Seller’s market pushes home prices higher in Pierce, Thurston

Prices are rising as more buyers enter the market and fewer homes are listed for sale. Inventories in both Pierce and Thurston counties dropped in May, 20 percent and 16 percent respectively. Pierce County has just under two months’ supply of homes for sale, according to the NWMLS – a number so low only King and Snohomish counties beat it, with about one month’s supply there.

Reasons for owners not putting their house on the market vary but probably include people still suffering the hangover of the market collapse, now five years past.

Well, it’s been five (almost six) years since the local housing market began to collapse, but the collapse only really ended a little over a year ago.

Unfortunately literally the exact same story ran in The Olympian, so instead of the usual five reports this month, we only really got three.

(Marissa Evans, Seattle Times, 06.05.2013)
(Aubrey Cohen, Seattle P-I, 06.05.2013)
(Kurt Batdorf, Everett Herald, 06.07.2013)
(Kathleen Cooper, Tacoma News Tribune, 06.06.2013)
(Kathleen Cooper, The Olympian, 06.06.2013)

The post May Reporting Roundup: Inventory Increase Edition appeared first on Seattle Bubble.

I attended a meeting last week sponsored by the National Association of Hispanic Real Estate professionals (NAHREP). This group has brought many high quality educational events to the greater Seattle area and I’m so impressed with NAHREP that I decided to join.  I have been following the success and growth of NACA, the Neighborhood Assistance Corporation of America, for several years. They are a non-profit association born out of disgust with predatory lending and the use of subprime loans by banks, lenders, and brokers during the housing bubble.  It’s founder, Bruce Marks, was featured on 60 Minutes, and many other national news programs.  NACA has two main goals:

1. To extend the reach of affordable lending and homeownership to every working person; and,
2. To combat discrimination and exploitation of working people by lenders and financial institutions.

NACA has offices in many states and is in the process of coming to the greater Seattle/Puget Sound. They have no physical office here but they are on the way.  NACA, a non-profit organization, also holds either a lender or mortgage broker license in the states in which they do business.

“Best Mortgage in America”

NACA is bringing their “Best Mortgage in America” to WA State. They hold a WA State Mortgage Broker license MB-4082 and currently have one licensed loan originator assigned to WA State with the intent to hire more, though their compensation plan is best served by loan originators who prefer salaries in line with working for a non-profit….because one of the many duties of NACA employees is to spend many hours thoroughly counseling their clients before the client becomes a homeowner, and requires long face-time office hours of 830-6PM.  So what is the “Best Mortgage in America?” Let’s find out.

• NACA acts as the mortgage broker; loans are funded by Bank of America or Citi
• Purchase money loan only (there is no refinance program)
• Less than perfect credit—Okay
• No credit score—Okay
• Affordability and Character-based lending
• Below market interest rates
• Interest rate buy downs at purchase are encouraged
• 30 or 15 year term
• 1-4 single family home, condo, coop
• Loan limits: Home or Condo for King, Pierce Kitsap. Snohomish county loan limit not yet available…SFR: $341,516, Duplex: $416,254, Triplex: $488,153, Fourplex: $583,514
• Rehab/Renovation Lending: 110% of after-repairs-completed value
• Owner occupied only
• Owner occupied for as long as the NACA loan is in existence
• No down payment
• No closing costs

NOTE: Actually there ARE closing costs.  The representative from NACA said, and I quote, “There is a fee, and there are non recurring costs but these are paid for by the lender.”

Before NACA goes wild with their “no closing costs” marketing program in WA State, I recommend their compliance department read our WA State Mortgage Broker Practices Act:
WA 208-660-440

(3) Is it a violation to advertise that third-party services are “free” when the licensee has paid for the services? Yes. Advertising using the term “free,” or any other similar term or phrase that implies there is no cost to the applicant is deceptive because you can recover the cost of the purportedly “free” item through the negotiation process. This is a violation of RCW 19.146.0201 (2), (7), and (11). See the Federal Trade Commission’s Guide Concerning Use of the Word “Free” and Similar Representations (16 C.F.R. §251.1(g) (2003))

Misc

• NACA fully underwrites the credit portion of the loan before the borrower is released to purchase a home from the Realtor and the pre-approval letter will contain the monthly payment including taxes, insurance, and homeowner’s assoc dues, if any, instead of just a sales price.
• One purchase every 5 years to discourage flipping.
• RE Condos: Requires 51 percent owner occupied in the complex w less than 10 percent of the units delinquent. Complex does not have to be FHA approved.
• Not just for first time homebuyers: Home buyer cannot own another piece of real property when receiving the NACA loan.  Note: the Homebuyer CAN own land or timeshare because we can’t “owner occupy” our land or timeshare.
• If purchasing a short sale, NACA buyers do not pay any of the seller’s fees including any third party short sale negotiator fee
• No income limits
• No time limit required to stay in the home
• ITIN (individual taxpayer ID number) okay
• Also avail: mixed use commercial-residential
• Buyer pays for home inspection
• Cannot use a NACA loan to purchase property at a foreclosure auction.
• NACA selects the title company
• Homebuyer’s loan closing will take place in the local NACA office.

Real Estate Brokers

Real estate brokers go thru a NACA training program. Since NACA does a lot of homebuyer outreach education, if a buyer is referred from NACA to the real estate broker then the real estate broker will pay a referral fee to NACA of 33%.  They do not yet have a real estate license in WA State but will soon and mentioned “buyer broker representation” as part of their goal for WA State.  Their real estate broker program is not up and running yet but the NACA rep says plans are in place to bring the program into the Seattle/Tacoma area soon.

REOs: 14-Day First Look with B of A

NACA-approved home buyers have an exclusive option to purchase REOs from Bank of America before they are listed in the MLS. Not all REOs, and not all of B of A’s REOs…just some.  This “first look” list goes from Bank of America to NACA.  NACA sends the REO list to Realtors affiliated with NACA. B of A has three BPOs completed to determine the price.  Selling broker makes sure NACA-approved buyer can qualify.  If yes, then the NACA-approved buyer can view the home before it is listed on the MLS.  If a NACA-approved buyer submits a full list price offer within the 14 day “first look” window, then the offer must be accepted by B of A, even if other offers are higher.  IN ADDITION: If NACA-approved buyer makes a full price offer within the first 14 days…are you sitting down? Get this—B of A will give 10 points to the buyer to buy down the interest rate.  Typically 1 point = .25 of a rate buydown so this means the NACA-approved buyer could end up with a 2.5 percentage point interest rate buydown. The opportunistic side of my brain started thinking about how I could buy a home this way but the skeptical side of my cold black heart tells me that maybe the First Look homes are going to be mostly dog house former meth labs in Granite Falls.

NACA Homebuyers Are Heavily Counseled 

All bets are against the NACA borrower.  Zero down, less-than-perfect credit sounds like your typical FHA borrower using gift funds for the down payment. And currently FHA’s default rate is 15%. Zero-down-less-than-perfect-credit also sounds like a subprime borrower.  At the peak of the meltdown/housing reset, subprime loans defaults went as high as 40%.

So why should NACA’s default rate be any less?  Here’s why: The NACA borrower goes through heavy pre-purchase counseling and has access to after-purchase default support services such as help with forbearance/repayment plans and loan modification support. In addition, if you have a NACA loan and you are in financial distress, you can receive 3 monthly payments paid by NACA to bring your loan out of default.

So what’s the catch?

NACA homebuyers must join NACA at a cost of $20 per month while they are attending pre-homebuyer counseling classes and then the cost is $50 per month for 5 years ($3,000.) In addition, NACA homeowners must agree to participate in 5 NACA activities each calendar year. Activities include community volunteer work, hosting a NACA meeting in your neighborhood, organizing a homebuyer workshop, participating in advocacy campaigns against predatory lenders, and so forth.

Reasons For

Clearly this is a great deal for first time homebuyers who want a mortgage with a very low interest rate and don’t mind going through the extensive homebuyer counseling, don’t mind paying $50/month for 5 years, and don’t mind carving out time to participate in 5 volunteer activities each year.  Some consumers were burned by predatory lenders during the real estate bubble and burned again with the 2008 recession. Maybe they are now renters…it’s been 2 years since their financial distress event and they are considering buying once again.  This sounds like a good program for people with a previous foreclosure of bankruptcy due to the extensive pre-purchase counseling they will get at NACA.. Anyone against predatory lending should welcome NACA to town.

Reasons Against

Clearly this is not a good loan program for people who don’t want to commit to owner occupancy for the life of the loan, or do not want to become active NACA members, are financially uber smart and would consider the homebuyer counseling classes beneath them. Budget? Savings? They’ve been doing this successfully for years and don’t need somebody to hold their hand. On the other side of the financial spectrum, not all buyers are going to fit into the NACA box including those with higher debt-to-income ratios.  Yeah, we are free-throwing those high DTI loans into the FHA program for as long as that will last. NACA DTI is a more manageable 31/40.

Sustainable homeownership should be our goal in mortgage lending. This is NACA’s main priority and I welcome NACA to Washington State.

By the way, NACA’s loan default rate is less than 1 percent.

The post NACA: The Largest Housing Services Organization in America Comes to Washington State appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Multiple offers are “the new normal” for housing market around Puget Sound

“Multiple offers have become the new normal,” remarked MLS director Diedre Haines, the Snohomish County regional managing broker at Coldwell Banker Bain. “We have literally gone off the charts in absorption,” she stated, adding the dip in pending sales in that county “is all due to lack of inventory.”
…
Prices will continue to rise as current market conditions are sustained, predicts J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. Among the conditions he mentioned are historically low interest rates, pent up buyer demand, and a shortage of available inventory.
…
Whether the market becomes more balanced may depend on listings. Northwest MLS figures show every county in its service area had year-over-year gains in new listings during April. “Let’s hope this is the start of a positive trend for inventory,” commented Mike Grady, the president and COO of Coldwell Banker Bain, but then added, “Considering the overall market landscape, it’s likely there won’t be enough sellers to fill buyer demand, at least for the short term.”

For once I’m on the same page as at least one of the real estate agents quoted in the NWMLS release (Mr. Grady). Of course, I’m hoping for more inventory so the market becomes more balanced, while they’re most likely motivated primarily by the additional commission checks that come with additional listings, but I’ll take what I can get.

Read on for my take on this month’s local news reports.

Sanjay Bhatt, Seattle Times: County home price back to $400,000

The double-digit percentage gain in home prices is triple the inflation rate and isn’t sustainable in the long run, [Glenn] Crellin said.

“We need inventory for the market to really stabilize,” he said.
…
Eastside broker Mike Chaffee said he represents a buyer who wants a house that will ensure her son attends popular Newport High School in the Bellevue School District. His buyer is well qualified, with a 30 percent down payment.

They’ve been looking for a year.

At homes in the neighborhood, Chaffee has sprinkled fliers with unsolicited offers for “top market value,” vowing to close a deal in 30 days and save the seller money on closing costs. Chaffee said it’s an example of how buyers are getting creative.

“I’m doing my best to get this buyer a house,” he said. “If I can do it without 10 other people putting in an offer, it relieves a lot of stress on the situation.”

Two people responded to the flier: One wanted $50,000 over what the house was worth, Chaffee said, while the other asked for $100,000 over the house’s market value.

His buyer didn’t bite.

Another month of great reporting in the Seattle Times. Kudos to Sanjay Bhatt for doing a great job filling the void left by Eric Pryne’s retirement.

Aubrey Cohen, Seattle P-I: King County house price back up to $400,000

“I’d been hoping to see an increase in listing activity, and I really can’t figure out what everybody’s waiting for,” Crellin said. “It’s been tight now for several months, and that doesn’t bode well for stable prices.”

It looks to me like inventory did begin to show signs of life in April. We’ll know in a few months whether we’re finally heading toward a more normal market, but I was encouraged by April’s inventory.

Kurt Batdorf, Everett Herald: Supply of homes for sale tightens in county

It’s 2007 all over again for the county real estate market as antsy buyers rush to buy what’s available in a tight supply of homes for sale.
…
Several factors are contributing to a “recipe for a frenzied May real estate market,” said John Deely, another member of the Northwest MLS board of directors and the principal managing broker at Coldwell Banker Bain in Seattle.

“The market pace has not subsided from previous months with low inventory and low interest rates being the primary drivers,” he said.

Wait, that does not make sense. Low inventory is driving the “frenzied market pace”? Um, no. If anything, low inventory is holding back sales.

Rolf Boone, Tacoma News Tribune: Pierce housing sales, prices continue up

The Pierce County housing market enjoyed another good month, with both sales and prices rising again and extending a streak that started last October, according to Northwest Multiple Listing Service data released Monday.
…
Another characteristic of the recent housing market has been fewer homes to choose from, and that continued into April as well.

Here we go again with the qualitative language, describing the market as “good” when it is clearly only good for sellers and is in fact quite frustrating for buyers. Boo.

Rolf Boone, The Olympian: Thurston home sales, prices rise in April

Thurston home sales and median prices rose in April, the fourth consecutive month of an improved housing market, according to Northwest Multiple Listing Service data released Monday.

Once again, the full story from The Olympian is only in the print edition, so all we get online is a brief rehash of the press release.

(Sanjay Bhatt, Seattle Times, 05.07.2013)
(Aubrey Cohen, Seattle P-I, 05.06.2013)
(Kurt Batdorf, Everett Herald, 05.07.2013)
(Rolf Boone, Tacoma News Tribune, 05.07.2013)
(Rolf Boone, The Olympian, 05.06.2013)

The post Reporting Roundup: The New Normal Edition appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Prices "spiking" as home buyers compete for scarce inventory

CASH MONEY

“All price ranges are feeling a lift,” reported Dick Beeson, principal managing broker at RE/MAX Professionals in Tacoma. Northwest MLS director John Deely echoed that comment: “We are seeing many homes in Seattle meet and exceed pre-bubble price levels,” stated Deely, the principal managing broker at Coldwell Banker Bain in Seattle.

“The recovery continues on a slow and steady pace in most areas and surging hard in others,” concluded Darin Stenvers, vice chair of the MLS board.
…
The upward spike in prices is largely the result of limited supply. “Whenever we get down to a severe shortage of homes for sale, we get double-digit home price appreciation,” observed J. Lennox Scott, chairman and CEO of John L. Scott Real Estate.

Demand continues to outpace supply, creating high absorption rates, Deely stated, adding “Open houses are drawing large crowds.” For example, he reported several open houses from the past weekend experienced traffic exceeding 50 people per day.

Sweet, we’re back to using the old realtor standby of “open house traffic” as a measure of market demand. Never mind that pending sales had their first year-over-year decline in nearly two years. Open house traffic is on the rise! The market will expand forever!

Read on for my take on this month’s local news reports.

Sanjay Bhatt, Seattle Times: King County house prices jumped almost 20 percent over year

About a quarter of buyers are paying all cash for homes, said OB Jacobi, president of Windermere Real Estate in Seattle. The rest are putting down, on average, between 20 and 50 percent cash, he said.

“I think that is pretty shocking,” Jacobi said. “It’s crazy.”

Foreclosed properties are drawing an even higher rate of all-cash offers. Seattle real-estate broker Keith Brown, who sells only foreclosed homes, estimated that roughly half the offers on a property he lists are all cash.

“I’m not quite sure where everyone is coming up with all this cash, but there’s definitely been a huge increase in the last few months,” Brown said.

Data > anecdote. All-cash deals were 38% of the Seattle-area market in 2011. I happen to have just run these numbers for Q1 in King County, and it’s up to 42%. Mr. Jacobi and Mr. Brown’s observations are both underestimating the scope of all-cash transactions, and overstating the recency of any change. All-cash deals have been growing steadily and strongly since 2007. There has been no sudden increase of all-cash sales in 2013.

Aubrey Cohen, Seattle P-I: Homes even harder to find in Seattle area in March

Observers of the local real estate market had hoped March would come with increasing listings, helping ease the area’s shortage of homes for sale. It didn’t, although there was a sign the sales surge could be starting to abate, or at least that people are running out of homes to buy.

“I’m a little surprised that we didn’t pick up more listings than we did,” said Glenn Crellin, associate director of the Runstad Center for Real Estate Studies at the University of Washington. “I was really hoping that we’d start to see some balance coming into the listing side of the equation, and these numbers indicate that we’re going to have a really challenging summer. … These numbers are just amazingly low.”

It gets old talking about how few listings there are, month after month, but when that’s still the biggest story in the real estate market, leading with something else doesn’t make sense.

No article has been posted yet in the Everett Herald. I’ll update this post later if they post an article today.

Rolf Boone, Tacoma News Tribune: Pierce County real estate market continues rebound

Pierce County’s streak of improved home sales and higher median prices continued in March, with both sales and prices rising again, likely cementing the view that the slower housing market finally is behind us, according to new Northwest Multiple Listing Service data released Thursday.
…
But the March data also show that sellers are beginning to sense a new direction in the market. For the third month in a row, new listings are outpacing the figure from last year.

Sounds like the inventory situation might be a little better in Tacoma than it is in the Seattle area.

Rolf Boone, The Olympian: Home sales in county continue to rebound

The March housing data is in for Thurston County and it looks a lot like it did in January and February, with home sales and median prices showing positive gains, according to the Northwest Multiple Listing Service.

Windermere Olympia is the busiest it has been in the past four years — particularly for those homes priced between $185,000 and $225,000, which in some cases are attracting multiple offers, owner Steve Garrett said.

“Activity has picked up ten-fold,” he said, adding he expects a very productive 2013.

Ten-fold from… last month? Last year? 1880? Hmm…

(Sanjay Bhatt, Seattle Times, 04.04.2013)
(Aubrey Cohen, Seattle P-I, 04.04.2013)
(Rolf Boone, Tacoma News Tribune, 04.04.2013)
(Rolf Boone, The Olympian, 04.05.2013)

The post Reporting Roundup: Spiking Prices Edition appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Western Washington housing indicators aligned "for spring market to remember"

“The market is struggling to provide enough inventory for anxious buyers seeking to take advantage of low interest rates,” reported Dick Beeson, principal managing broker of RE/MAX Professionals in Tacoma. Also, he lamented, considering 25 percent of the selection is distressed, “It leaves some buyers with tough choices.”
…
“Low supply and high demand continue to drive our market,” stated Northwest MLS director John Deely. He said multiple offers are the “rule rather than the exception” for new listings in core urban areas that are priced well. Deely, the principal managing broker at Coldwell Banker Bain in Seattle, noted a new listing in North Seattle recently drew 12 offers and the property was bid almost 10 percent above its listing price.

OB Jacobi, president of Windermere Real Estate Company, noted the month’s supply of homes in King County has dipped to about 1.2 months, well below the six-month threshold that many in the industry consider to be “normal.” Jacobi, who is also on the MLS board of directors, noted supply is at its lowest level since May 2005 during the peak of the housing boom. “The impact of low inventory levels is stiff competition among buyers, often resulting in homes selling for well over asking price,” he remarked. Also, he added, the imbalance also leads to rising median prices.

J. Lennox Scott, chairman and CEO of John L. Scott, Inc., attributes surging sales and prices to several factors, including positive job growth, historically low interest rates and fewer homes being listed. “This restriction of homes for sale is prevalent in the price ranges where more than 90 percent of activity is taking place, causing prices to rise,” he stated.

It is still worth pointing out that home prices are not really “surging,” with the non-distressed median price only up 3.8% as of January. That said, the market right now is definitely not buyer-friendly.

Read on for my take on this month’s local news reports.

Sanjay Bhatt, Seattle Times: Inventory crunch drives King County home prices up

First-time homebuyers are jumping into the market, observers say, since housing prices hit bottom a year ago. When the median house price in King County hit $308,125 in February 2012, that was the lowest level in eight years.

But inventory isn’t keeping pace for several reasons:

Some sellers are waiting for prices to climb higher before listing their homes. Others still owe more on their homes than they’re worth.

A third group of sellers is unwilling to interrupt the cash flow they receive from renting out their homes at high rates.

Eric Pryne has retired, so Sanjay will be taking over the reigns for real estate reporting over at the Seattle Times. He’s done a good job in the past filling in when Eric has been out, and this month’s article is no exception.

Aubrey Cohen, Seattle P-I: More home sales, fewer listings driving up prices

A continuing shortage of homes for sale drove up prices in the Seattle area in February, according to a new report. But there are signs the market could be changing.

…Pending sales — which don’t all close, but can be the best indicator of recent activity — fell 1.6 percent in Seattle and rose just 0.5 percent countywide. That could reflect an abating of the sales surge or people having trouble finding something to buy.

Short article this month from Aubrey, but he still squeezed an insight in there, pointing out that sales are likely to switch from year-over-year gains to losses soon.

Kurt Batdorf, Everett Herald: County home prices surge as inventory shrinks

Shrinking home inventory once again drove a double-digit increase in year-over-year median home and condominium sales prices in Snohomish County.

“In my 37 years working in the real estate industry, I have never seen inventory this low,” Diedre Haines, regional managing broker for Coldwell Bank Bain-Snohomish County and a member of the Northwest Multiple Listing Service board of directors, said in a news release.

This month’s Herald article is little more than a minor rewrite of the NWMLS press release.

Rolf Boone, Tacoma News Tribune: Home sales, prices continue to climb in Pierce County

The Pierce County housing market put together another impressive month in February, highlighted by a double-digit increase in median prices, according to Northwest Multiple Listing Service data released Tuesday.

That’s welcome news for homeowners, but median prices still have a way to go to match the median prices set during the boom in housing.
…
Allen Realtors of Lakewood President Mike Larson said all the metrics he follows — transactions, pending sales and phone calls to the office — are on the rise.

“We’re finally seeing some traction and momentum and that’s fueling what we’re seeing in values,” he said.

He also said he senses more confidence among consumers, partly because the election is over. Larson admitted the national economy is not exactly rosy, citing the sequester, but the “stock market is setting records just about every day.”

It’s not clear exactly what this agent means by “we’re finally seeing some traction,” but right now the market is being pretty limited by the lack of inventory. I don’t really see how an extreme shortage of homes for sale is “traction.”

Rolf Boone, The Olympian: Thurston home sales increase in February

The Thurston County housing market continued to show improvement in February, with home sales rising nearly 30 percent in the year-over-year period, according to Northwest Multiple Listing Service data released Tuesday.

“I think the real estate recession is in the rearview mirror,” Windermere of Olympia real estate agent Gregory Moe said.

Home sales rose 29.9 percent to 200 units last month from 154 units in February 2012, the combined single-family residence and condominium data show.

The Olympian’s article is pretty short and to the point.

(Sanjay Bhatt, Seattle Times, 03.05.2013)
(Aubrey Cohen, Seattle P-I, 03.05.2013)
(Kurt Batdorf, Everett Herald, 03.05.2013)
(Rolf Boone, Tacoma News Tribune, 03.05.2013)
(Rolf Boone, The Olympian, 03.06.2013)

The post Reporting Roundup: Tough Choices for Buyers Edition appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Brokers report brisk sales, but rising frustration for home buyers

Punxsutawney Phil’s prediction of an early spring is showing up in the latest housing activity report from the Northwest Multiple Listing Service. Its statistics for January showed a 14.4 percent year-over-year increase in pending sales and a 23.6 percent jump in closed sales amid a 31.3 percent decline in inventory.
…
“I personally have never seen the ratio between active buyers and available inventory in Seattle’s close-in neighborhoods so out of balance,” remarked Mike Skahen, owner/designated broker at Lake & Co. Real Estate in Seattle. Skahen, a real estate professional since 1976, said multiple offers and bids well over the list price are common. “Even homes that were hard to sell for various reasons are being snapped up so those sellers were wise to list,” he added.

Lena Maul, a new member of the Northwest MLS board of directors, and the designated broker/owner at Windermere/North in Lynnwood, agreed now is a good time for sellers to list. “Sellers who are considering a spring or summer listing may want to consider listing now as demand is outweighing supply,” she noted, adding, “This has given well priced sellers the advantage with the benefit of quick sales and multiple offers.”

I actually agree with that last part. While it’s become a fairly lousy time to try to buy a home, it is currently a pretty great time to sell. We haven’t seen a market with supply and demand this skewed toward sellers in a long time, if ever, and it won’t last forever.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: King County home prices dip to March lows

A change in the mix of houses sold also played a part in the drop in the median, an analysis of listing-service data by online brokerage Redfin suggests.

“Distressed” sales — bank-repossessed houses and “short sales” for less than what sellers owe lenders — accounted for a bigger share of sales last month: 24 percent, compared with 19 percent in December.

That’s meaningful because distressed houses generally sell for significantly less than “non-distressed” properties.

As usual, great work from Eric at the Seattle Times. Such a dramatic contrast with the “reporting” that used to be printed over there during the bubble years under the reign of Rhodes.

Aubrey Cohen, Seattle P-I: Low home inventory driving up prices

The Seattle area continued to have incredibly few homes for sale in January, according to a new report.

thanks to fewer homes hitting the market and more selling, Seattle itself had 1.9 months worth of homes on the market in January, at the current sales pace, while King County had 2.2 months worth of homes, according to the Northwest Multiple Listing Service. That’s down from 4.2 months and 5.2 months, respectively, a year earlier.

“I personally have never seen the ratio between active buyers and available inventory in Seattle’s close-in neighborhoods so out of balance,” Mike Skahen, owner of Seattle’s Lake & Co. Real Estate, said in a news release. “Even homes that were hard to sell for various reasons are being snapped up.”

Somewhat of a short piece from Aubrey this month. No much more than a rehash of the press release. I guess he’s busy with other projects.

No story has been posted in the Everett Herald again. Perhaps I should give them a call to see if they need some help with real estate reporting.

Rolf Boone, Tacoma News Tribune: Prices, sales improve in Pierce County home sales

Fewer homes to choose from, combined with steady demand, is thought to stimulate home prices.

Home sellers, though, might be sensing an improved market because the number of new listings for January rose compared with the year-ago period. New listings just in January rose to 1,260 units from 1,043 units in January 2012.

Of course, in January of 2012, the whole Seattle area was covered with inches of ice for a week, which might have caused listings to be somewhat depressed. I wouldn’t put much stock in year-over-year comparisons of new listings for January for that reason.

Rolf Boone, The Olympian: Thurston County housing sales, prices up

Fewer homes to choose from, combined with buyer demand, is thought to stimulate prices.

Thurston County Realtors Association President Pat Pieroni didn’t go so far as to say the turnaround in the housing market is complete, but it is a sign that the market has hit bottom and is beginning to rise again, he said.

“There’s just a good feeling out there right now,” Pieroni said Tuesday, adding that prospective buyers are a little more motivated than they were a few months ago.

January also was much busier than it typically is, he said.

Nothing like “just a good feeling” to drive the market. Or something.

(Eric Pryne, Seattle Times, 02.05.2013)
(Aubrey Cohen, Seattle P-I, 02.05.2013)
(Rolf Boone, Tacoma News Tribune, 02.06.2013)
(Rolf Boone, The Olympian, 02.06.2013)

The post Reporting Roundup: Seller’s Market Edition appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Northwest MLS Tallies Busy December as First-time Buyers, Investors Return

While the expected seasonal slowdown occurred last month, determined buyers were undaunted by sparse inventory and record-breaking rainy days, according to December statistics from Northwest Multiple Listing Service.

Frenzy!

“This is a unique housing market,” said J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “There is nothing normal about the combination of factors fueling the current market,” he added.
…
Brokers expect the housing market rebound to continue, while cautioning sellers to refrain from becoming too greedy and expressing hope for “controlled natural growth” to sustain the recovery. They also believe distressed properties, rising rents and re-engaged investors will have an impact on activity for the foreseeable future.
…
Looking ahead, many brokers expect a strong market in 2013, with some expressing concern about “frenzied bubble growth.”

Oh yeah. I bet they are real concerned about that prospect. I’m sure it keeps them up at night.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: Local supply of homes for sale hits another record low

The number of houses for sale in King County has hit yet another record low, according to statistics released Monday by the Northwest Multiple Listing Service.

“There’s just nothing available out there,” said Glenn Crellin, associate director of research at the University of Washington’s Runstad Center for Real Estate Studies.
…
Inventory — or lack of it — has been driving the Seattle area real-estate market for several months. Brokers and analysts attribute it mostly to the large number of “underwater” homeowners who are disinclined to sell because they owe lenders more than their houses are worth.

The UW’s Crellin predicted inventory will increase in coming months, in part because rising home prices mean fewer homeowners are underwater.

2012 was indeed the year of crappy selection, start to finish.

Aubrey Cohen, Seattle P-I: December saw slowing home sales, rising prices

One reason for the decrease in pending sales is that sales had started to pick up last December, said Glenn Crellin, associate director of the Runstad Center for Real Estate Studies at the University of Washington.

Another may be the dearth of homes for sale, he said. “It could be that the potential buyers aren’t finding anything they like.”

And, unlike during the bubble years, he said: “This time they’re not willing to jump in and buy anything that’s on the market in their price range.”

Crellin is on a roll the last couple of years. He’s spot on here.

It seems that the Everett Herald has not posted a story about the December data yet. If I see one later today I will update this post to include it.

Rolf Boone, Tacoma News Tribune: Home sales offer happy ending to 2012 in Pierce County

The Pierce County housing market ended 2012 on a positive note as median prices rose 14.48 percent, the largest percentage increase of the year, according to Northwest Multiple Listing Service data released Monday.

Median prices rose to $200,563 last month from $175,199 in December 2011, the combined single-family residence and condominium data show. Home sales in the same year-over-year period weren’t as strong, rising just 2.15 percent to 808 units from 791 units, the combined data show.

Hmm, here we go again, describing “the market” as “positive,” when really it’s only positive for sellers. I had hoped that we would leave this kind of language behind with the bursting of the bubble.

Rolf Boone, The Olympian: Fewer homes for sale, but prices remain low

The number of homes for sale in Thurston County fell under 1,000 units in December for the first time in six years, according to Northwest Multiple Listing Service data released Monday.

The number of homes for sale fell 25.38 percent to 988 units in December from 1,324 units in December 2011, the combined single-family residence and condominium data show.

A combination of factors have contributed to the lower inventory levels, and it could mean that less supply and buyer demand stimulate home prices, Washington Realtors Association President Mark Kitabayashi said Monday.

Inventory levels are lower because sellers are waiting for prices to rise, but also because of the holidays, and the uncertainty created by the election and the so-called “fiscal cliff,” he said.

“It all kinds of adds up,” he said.

So, inventory fell between December 2011 and December 2012 “because of the holidays”? I wonder which holidays we had in 2012 but not 2011…

(Eric Pryne, Seattle Times, 01.07.2013)
(Aubrey Cohen, Seattle P-I, 01.07.2013)
(Rolf Boone, Tacoma News Tribune, 01.08.2013)
(Rolf Boone, The Olympian, 09.06.2013)

The post Reporting Roundup: Unique Greedy Frenzy Edition appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

High demand, low inventory sparking multiple offers, market momentum

Woo! Momentum!

“The market is done with needed correction,” declared one broker.
…
“There continues to be extremely low inventory levels and high buyer demand which is causing multiple offers in many local areas,” reported OB Jacobi, president of Windermere Real Estate. He also noted a “definite uptick” in the number of cash buyers, “many of which are investors.”
…
Frank Wilson, another MLS director and the branch managing broker at John L. Scott Real Estate, described the current market as “the best of most worlds: low interest rates, a supply of homes to choose from that are aggressively priced, and lenders who are beginning to engage in ‘make sense’ loans.”

Moorhead noted short sales are up significantly from two years ago “and now outpace bank owned (REO) listings,” prompting outreach to hesitant sellers. “We all have a call out to sellers who are on the fence to remind them this is the first ‘sellers market’ we have seen since 2007. This also means sellers who were on the edge of being in a short sale situation may actually be on the positive side of the ledger,” he added.

It’s always a great time to buy or sell a home! I also love the claim that somehow today’s market is great for buyers because of “a supply of homes to choose from.” Never mind that it’s the smallest supply we’ve seen since they started keeping records.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: More buyers, few sellers, push up King County home prices

Inventory — or a lack of it — is driving King County’s residential real-estate market, brokers and industry observers say. Statistics released Wednesday by the listing service underscore the impact.

Countywide, just 3,720 houses were on the market as of Nov. 30, 14 percent fewer than at the end of October and 43 percent fewer than a year ago.

Inventory always dips in winter. But it hasn’t been this low since at least 1999.

Closed sales in November, however, were up 19 percent year-over-year. There were 16 percent more closings than new listings last month.

As usual, a straightforward take on the latest data from Eric Pryne. Nothing overly sensational and a clear explanation of the various factors that are driving the market.

Aubrey Cohen, Seattle P-I: Seattle-area house prices surge

“Incredible,” said Glenn Crellin, associate director of the Runstad Center for Real Estate Research at the University of Washington. “I’m surprised by how much they’ve jumped.”

Median prices can go up if there’s a change in the makeup of houses that sell in a given month. It could be, for instance, that buyers are taking advantage of record low interest rates to buy pricier houses. Indexes that look at repeat sales of the same houses have shown smaller gains.

But the median price “is indicative of how much money people are spending in the marketplace,” Crellin said.

It “certainly” reflects the extremely low inventory of homes for sale, particularly nice homes close to urban centers, he added. “There are bidding wars.”

I still think it’s a stretch to describe what’s going on right now as a “surge” in home prices. Bank-owned sales have fallen through the floor, so when we compare the median sale price in November 2011 to the median sale price in November 2012 we’re looking at two very different sets of homes.

Herald Staff, Everett Herald: Home sales steady in number, higher in price

The number of homes sold last month in Snohomish County was on par with November 2011, but prices were up.

The Northwest Multiple Listing Service indicated in a report Wednesday that a total of 806 single-family homes and condos sold in the county last month.

That’s half of the entire “story” from the Herald this month. Apparently they didn’t have anyone available to write a real piece this month.

Rolf Boone, Tacoma News Tribune: Pierce County home sales, prices continue to rise

Pierce County home sales and median prices rose in November, the second consecutive month in which both categories showed improvement, according to Northwest Multiple Listing Service data released Wednesday.

Home sales increased nearly 11 percent to 841 units last month from 758 units from November 2011, the combined single-family residence and condo data show. Median prices rose, too, climbing 5.5 percent to $195,000 last month from $184,848 a year ago, the combined data show.

And that’s about half of the News Tribune’s story, too.

Rolf Boone, The Olympian: Increases in Thurston home sales stop

An eight-month streak of improved home sales in Thurston County came to an end in November as sales fell 11 percent, according to Northwest Multiple Listing Service released Wednesday.

Thurston County home sales fell 11.66 percent to 197 units last month from 223 units in November 2011, the combined single-family residence and condo data show.

Several Thurston County real estate brokers could not be reached to comment on November’s data.

Now that is interesting. I did not notice that home sales were down year-over-year in Thurston. I’ll have to look at this a bit more in the next few weeks to see if there’s anything more noteworthy behind this blip in Thurston.

(Eric Pryne, Seattle Times, 12.05.2012)
(Aubrey Cohen, Seattle P-I, 12.05.2012)
(Herald Staff, Everett Herald, 12.05.2012)
(Rolf Boone, Tacoma News Tribune, 12.05.2012)
(Rolf Boone, The Olympian, 12.06.2012)

The post Reporting Roundup: Market Momentum Edition appeared first on Seattle Bubble.

Seattle’s apartment boom extends far beyond Ballard. Nearly 8,400 units are under construction in the city now — the largest number in at least 20 years, according to Dupre + Scott.

Developers are building them because demand has risen, led by a demographic surge of young adults who prefer in-city living, at a time when there’s little new supply.

Few projects were built during the recession. The last new complex in Ballard opened more than two years ago.

But analysts such as Cain and Dupre + Scott’s Mike Scott forecast that, in a year or so, all the new construction will start to tip the balance between demand and supply.

Vacancies will rise, they say. Rents will stabilize, perhaps drop. Landlords will start offering tenants concessions like free rent again.

And the turnaround could be most dramatic in neighborhoods like Ballard where developers have been most active.

“That submarket is getting an awful lot of product in a very short time,” says Scott. “It’s bound to have an impact.”

“It … could be a disaster,” Cain, whose clients are mostly landlords, wrote of Ballard nearly a year ago.

“Except, of course, for the tenants.”

It’s definitely worth reading the whole thing. It definitely sounds like the apartment rental market is going to get a lot more competitive (in renters’ favor) soon.

The post The Rent Won’t Be Too Damn High For Long appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Housing recovery continues with prices rising as inventory dips to lowest level since 2006

“Jump!” by Flickr user mao_lini

Last month’s housing inventory around western Washington fell to its lowest level since February 2006, according to statistics from Northwest Multiple Listing Service.
…
The shortage of inventory is helping propel prices. J. Lennox Scott, chairman and CEO of John L. Scott Real Estate, commented on the correlation of sharply reduced inventory and rising prices. “The rise in prices is derived from seasonally strong sales activity in a shortage of inventory market,” he remarked.

That comment makes no sense. The median price is down $10,000 from its summer peak, so how could “seasonally strong sales activity” (whatever that even means) have anything to do with the current price trend?

Unfortunately that’s the most interesting bit in their release. It seems that even the home salespeople that run the show over there are having a hard time coming up with anything new to say about this boring market.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: Home sales rise while inventory plummets in October

October’s 16 percent rise in the median single-family sale price in King County was the biggest year-over-year jump since July 2006.

But that increase is somewhat misleading.

House prices took a big drop in October 2011, with the median falling to $320,000 after hovering in the $345,000-350,000 range for several months.

This October’s $370,000 median looks strong in comparison. But the median has been slightly higher, between $375,000 and $380,000, in each of the past four months.

Another factor in the big year-over-year increase: The mix of houses selling has changed.

In October 2011, bank-repossessed houses, which are generally priced lower, made up 21 percent of all sales in King County, according to Redfin. Last month, that figure was just 7 percent.

As usual, Eric hits the nail on the head. It is such a refreshing change from the bubble years to have a competent, coherant real estate reporter at the Seattle Times who doesn’t just regurgitate the breathless sales spin from the MLS and local agents.

Aubrey Cohen, Seattle P-I: Home prices post biggest jump in six years

King County house prices registered their biggest gain in more than six years in October, according to a new report.

The median price of a house that sold in October was $370,000, up 15.6 percent from a year earlier, the Northwest Multiple Listing Service reported Monday. That’s the biggest year-to-year jump since July 2006, although the median price is still down 23 percent from its peak in July 2007.
…
“Wow. Things are certainly going very very well for the county,” said Glenn Crellin, associate director of the Runstad Center for Real Estate Studies at the University of Washington.

That said, the big boost to the median sales price is “probably an overstatement of what would be viewed as ‘appreciation,’” Crellin said.

One reason for this is that sales of homes in or under threat of foreclosure are down from last year, as a share of all homes, Crellin said. Such homes typically sell at a discount. Meanwhile, sales of higher-end homes in better condition and locations are picking up, he said.

Glenn Crellin, representing the voice of reason.

Kurt Batdorf, Everett Herald: Local real estate sales prices up 11 percent in October

Snohomish County’s housing market mirrored the rest of Western Washington in October, with listings at their lowest level since February 2006 driving year-over-year sales prices up by double digits for the first time since March 2007.

No real meat in the Herald today, just some regurgitated press release quotes. Disappointing.

John Gillie, Tacoma News Tribune: Home prices up in Pierce and Thurston counties on shrinking supply

Single family home prices showed a significant rebound in Pierce, King and Thurston counties last month as the supply of homes on the market continued to shrink.

The median Pierce County home sales price rose by 6.97 percent to $201,000 in October, reported the Northwest Multiple Listing Service. In Thurston County, median prices rose to $220,000 from $212,500, and in King County, median home sales prices hit $370,000, up 15.63 percent from $320,000 a year ago October.

Same story in the News Tribune. Just a handful of numbers with no real insights.

John Gillie, The Olympian: Sales, prices for condos, homes increase from ’11

Single-family home prices showed a significant rebound in year-over-year comparisons in Pierce, King and Thurston counties last month as the supply of homes on the market continued to shrink.

Wait a minute… this is the same article that was in the News Tribune. I guess Olympia is basically the same as Tacoma. Or something.

(Eric Pryne, Seattle Times, 11.05.2012)
(Aubrey Cohen, Seattle P-I, 11.05.2012)
(Kurt Batdorf, Everett Herald, 11.05.2012)
(John Gillie, Tacoma News Tribune, 11.05.2012)
(John Gillie, The Olympian, 11.06.2012)

The post Reporting Roundup: Price Jump Fake Out Edition appeared first on Seattle Bubble.

It’s time once again for the monthly reporting roundup, where you can read my wry commentary about the news instead of subjecting yourself to boring rehashes of the NWMLS press release (or in addition to, if that’s what floats your boat).

To kick things off, here’s an excerpt from the NWMLS press release:

Housing market rebound continues, with "slow, unprepared buyers" settling for "2nd choice" homes

[MLS director Darin] Stenvers, the office managing broker at John L. Scott, Inc., in Bellingham, said the ingredients are in place for “a perfect buying season,” citing rapid absorption of inventory and well-priced homes as two factors. How long such conditions will last is “the $64,000 question,” he stated, noting pent-up demand in some areas has buyers feeling the pressure to move quickly to get their offers accepted.
…

“Empty shelves at a grocery store” by Flickr user Chris Waits

Despite brisk activity, Stenvers noted foreclosures and owners who are delinquent on mortgage payments remain a concern. The number of owners nationwide who are 90 days or more late in making payments is again on the rise, a situation that will continue to affect foreclosure rates, he explained.

“The lack of foreclosed homes not coming on the market has successfully stabilized prices but also created a lack of homes for buyers to buy,” Stenvers stated.

Buyers are also weighing the pros and cons of renting or buying. “The rent versus buy conundrum is still the biggest obstacle facing buyers today,” Stenvers reported.

Wow I don’t know why NWMLS hasn’t gone to this Stenvers fellow for quotes before. He’s a gold mine. According to Mr. Stenvers, record-low inventories could be considered to be the setup for “a perfect buying season.” I also really liked “the lack of foreclosed homes not coming on the market…” double negative for the win.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: King County home sales, median prices up from year ago

…2012 so far has been the best year for sales volume since the real-estate bust in 2008. Buyers are looking again, lured back to the market by record-low mortgage interest rates, rising rents and home prices that appear to have stabilized.

But the bust still is exerting some influence. Experts blame the lack of inventory in part on homeowners who bought just before the peak in summer 2007 and now can’t afford to sell. They owe lenders more than their homes are worth.
…
In downtown Seattle and Belltown condos, however, the median price rose nearly 19 percent, to $409,000.

When distressed sales are excluded, the median price of condos sold downtown over the past three months is actually higher than it was during the same period in 2007 — before the crash, according to data compiled by brokerage Realogics Sotheby’s International Realty.

Hmm, interesting claim from Realogics Sotheby’s. I’ll have to dig into that to see if I can confirm.

Aubrey Cohen, Seattle P-I: King County home prices, sales up; inventory down

The story remained the same in King County’s real estate market last month: prices and sales rose from last year, while the supply continued to be down.

While increasing sales are a big factor in driving down inventory, another issue is that rising prices don’t seem to be enticing more people to list their homes for sale. In fact, new King County listings were down 2.7 percent in September from a year earlier.

It may be that prices still haven’t risen enough for people to sell for more than they paid during the bubble years. Another possibility is that people have decided to sell, but need time to prepare their homes.

Probably more the first than the second.

Kurt Batdorf, Everett Herald: Snohomish County housing prices still rising

Snohomish County home sales and median sale prices showed another year-over-year increase in September, while the number of listed homes and condominiums shrank by nearly half.

The imbalance between supply and demand is “wreaking havoc” with some buyers and sellers, said Northwest MLS director George Moorhead, branch manager at Bentley Properties in Bothell. Some sellers are lamenting “missed opportunities,” but he thinks positive momentum will continue with a combination of tight inventory, record-low interest rates and changing views on home ownership.

“We are seeing clients’ views change from a home being a short-term investment vehicle to being a place where we raise and teach our families,” Moorhead said in a news release.

Nothing much more in this article than what’s in the NWMLS press release, unfortunately.

I couldn’t find a story this month in the Tacoma News Tribune. If something pops up I might come back and update this post.

John Gillie, The Olympian: County real estate continues to lag

While a lean supply of homes and condominiums for sale coupled with a healthier supply of buyers helped drive up average residential sale prices 9.2 percent in Western Washington, median prices in Thurston County continued falling from year-ago prices, said the Northwest Multiple Listing Service said Thursday.

In Pierce County the numbers were up 4.6 percent, according to new figures from the NMLS (sic).

Looks like we only get to read the short blurb version of the article online this month. The Olympian publishes a more in-depth story, but apparently only in print.

(Eric Pryne, Seattle Times, 10.04.2012)
(Aubrey Cohen, Seattle P-I, 10.04.2012)
(Kurt Batdorf, Everett Herald, 10.04.2012)
(John Gillie, The Olympian, 10.05.2012)

The post Reporting Roundup: Empty Store Shelves Edition appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

September housing statistics around Washington indicate recovery is continuing, strengthening sellers’ positions

“The biggest story this year is that the market has flipped,” proclaimed J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. He attributes the shift to a seller’s market in most areas and prices to a combination of factors, including historically low interest rates, lower adjusted prices, the shortage of inventory, an elevated number of investors, and the return of local home buyers.

Northwest MLS directors OB Jacobi and Joe Spencer are similarly encouraged by the latest numbers, mentioning steady momentum, rising consumer confidence, low inventory, a pickup of activity in new construction, and improving prospects for homeowners who are underwater.
…
Another MLS director, Joe Spencer, said the low inventory and heightened buyer activity are resulting in an imbalance of supply and demand, but he believes that “bodes well as we move into the fall season, which typically ushers in an increase in buyer activity.”

Buyers and sellers are “clearly more confident,” reported Spencer, the area director for Keller Williams. These consumers “are looking to take advantage of the market rebound in what appears to be a continued slow and sustainable recovery.”

I’m not sure how Mr. Spencer defines of an “increase in buyer activity,” but sales typically head on a steady pace downward every month after June or July:

If Joe Spencer is expecting some sort of fall spike, I think he’s going to be disappointed…

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: Sales hot in August for homes in King County

It all sounds good if you’re selling, or thinking about it.

But can this recovery last?

Two analysts say they foresee no imminent turnaround. But they won’t rule it out.
…
Glenn Crellin, associate director of research at the University of Washington’s Runstad Center for Real Estate Studies, said the economy and real-estate market both could suffer if the federal government doesn’t find a way around the so-called “fiscal cliff” of automatic tax increases and spending cuts at the end of the year.

But for now, he added, the local market looks healthy. Rising prices are giving more formerly “underwater” homeowners — who once owed lenders more than their homes were worth — equity in their houses again, he said.
…
Another reason prices are rising: The mix of houses that are selling has changed.

Last month bank-repossessed houses, which usually sold at a steep discount, made up just 6 percent of all King County sales, down from 17 percent in August 2011, according to online brokerage Redfin.

It hasn’t been this low in more than three years.

I was the other analyst quoted in Eric’s article. The steep drop in sales of bank-owned homes is a topic we have covered here in recent months.

Aubrey Cohen, Seattle P-I: Seattle-area home shoppers find slim pickings

King County has “such a short supply that it invites further price increases,” Crellin said. “The Realtors are right. They need inventory.”

So why aren’t more people listing their homes for sale, given the high demand?

Jacobi, Kelman and Crellin all pointed to owners who still wouldn’t be able to ask what they paid for their homes at or near the height of the market.

“They’ve sort of resigned themselves to staying put for awhile,” Crellin said.

Priced in forever!

Kurt Batdorf, Everett Herald: County housing market shows improvement for sellers

Closed sales, reflecting several months of strong pending sales, reached the highest volume so far in 2012. Northwest MLS said its brokers tallied 6,612 closings last month, continuing a streak of four months of 6,000 or more completed transactions.

In Snohomish County, MLS brokers had 1,057 closed sales of single-family homes and condos in August, up 15.4 percent. The median sales price rose 6 percent, from $232,000 to $246,000.
…
“Inventory levels are incredibly low, but our hope is that many homeowners who were underwater can now afford to sell because of the continued appreciation of home prices,” said Jacobi, president of Windermere Real Estate Co.

“In housing markets, slow and steady recoveries are good,” said MLS director Frank Wilson, the branch managing broker at John L. Scott’s Poulsbo office. “A market that runs too high or too fast leads to a quick decline in short order.”

He said he expects good momentum to continue into the fall.

Hah, I love that now the real estate agents are concerned about “a market that runs too high or too fast.” Where were these guys in 2005?

Kathleen Cooper, Tacoma News Tribune: August’s home price rise biggest of 2012 for Pierce County, MLS says

Sale prices of homes and condos in Pierce County had the highest year-over year increase of 2012 last month, data released Wednesday show.

The combined median sale price of homes and condos in August was $199,950, a 7 percent increase over the price at the same time a year ago, according to the Northwest Multiple Listing Service.
…
Other good signs: Closed sales in Pierce County increased by 3 percent compared with August 2011, while about 28 percent fewer homes were for sale.

I’m not sure that I would describe the dramatic decrease in inventory as a “good sign,” but whatever.

Rolf Boone, The Olympian: Thurston home sales top 300 units for second time this year

The Thurston County housing market had its second best month of the year in August, with home sales rising to more than 300 units, nearly equaling a mark set in June, according to Northwest Multiple Listing Service data released this week.

Sales rose to 306 units last month, a 27.5 percent increase over the 240 units that sold in the same period last year, the combined single-family residence and condominium data show. In June, 307 units sold in the county, the data show.

Not much meat in this one. It seems that the full article from The Olympian must not be online.

(Eric Pryne, Seattle Times, 09.05.2012)
(Aubrey Cohen, Seattle P-I, 09.05.2012)
(Kurt Batdorf, Everett Herald, 09.05.2012)
(Kathleen Cooper, Tacoma News Tribune, 09.06.2012)
(Rolf Boone, The Olympian, 09.06.2012)

The post August Reporting Roundup: Market Flip Edition appeared first on Seattle Bubble.

The primary issue is whether MERS is a lawful beneficiary with the power to appoint trustees within the deed of trust act if it does not hold the promissory notes secured by the deeds of trust. A plain reading of the statute leads us to conclude that only the actual holder of the promissory note or other instrument evidencing the obligation may be a beneficiary with the power to appoint a trustee to proceed with a nonjudicial foreclosure on real property. Simply put, if MERS does not hold the note, it is not a lawful beneficiary.

I’m not an attorney, so the full implications of this ruling are not entirely clear to me, but the unclear standing of MERS before this ruling may have much to do with why foreclosures in Washington were declining through much of 2011 and early 2012. Banks simply couldn’t foreclose through MERS when they still held the note.

With this ruling there is now a clear path for banks that use MERS to process foreclosures in our state. Before beginning a foreclosure, MERS will need to record a deed back to the bank that actually holds the note, who must then initiate foreclosure proceedings themselves.

It will be interesting to see if this has much of an effect on the foreclosure stats over the next six to twelve months now that the question of how much can MERS legally do in a foreclosure has been answered.

[Update: More analysis was posted this evening at The Seattle Times]

The post Washington State Supreme Court: MERS May Not Foreclose Unless They Hold the Note appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Multiple offers for homes stimulated by constricted supply, favorable financing

Brokers around western Washington reported brisk activity during July with home buyers scrambling to take advantage of attractive financing while encountering shrinking inventory and, in some areas, rising prices.
…
J. Lennox Scott, chairman and CEO of John L. Scott Real Estate, said strong summer sales and low inventory in the Puget Sound region are resulting in price increases and multiple offer situations. Prospective purchasers need to be “buyer-ready to get a home in today’s market,” he emphasized, noting that pre-approval on a loan and becoming very familiar with market conditions can be beneficial.
…
“Counter to the historic yearly pattern of increasing inventory from January to late summer, this year we have seen inventory levels shrink month over month,” observed Joe Spencer, area director for the Northwest Region of Keller Williams. “This pattern of shrinking inventory, historically low interest rates and higher consumer confidence clearly signals that the market is on the rebound,” he added.

*Yawn*

This month’s release is surprisingly low on hyperbole and misleading or flat-out incorrect statements. It must have been written by an intern who hasn’t yet learned the ways of the used home salesman.

Read on for my take on this month’s local news reports.

Connor Radnovich, Seattle Times: King County home prices up 7 percent from last year

With more would-be buyers than sellers, the buyers are starting to become frustrated, said Ellis and Seattle real-estate economist Matthew Gardner.

Gardner said the major reason for the low number of listings is that people are underwater on their mortgages — they owe more than their homes are worth — and have to stay in their homes.

He said the levels of inventory are the lowest they have been since early 2006.

People want to move, Gardner said, but can’t afford to pay the bank to leave and are waiting to get above water before they sell their homes.

This may be the first time on record that I find myself agreeing with Matthew Gardner.

Aubrey Cohen, Seattle P-I: King County house prices up from 2011, down from June

The story continues to be extremely low inventory. The county had 2.4 months worth of homes for sale at the current pace in July. That’s unchanged from June and down from 5.4 months worth of homes for sale in July 2011. Seattle had 2.2 months worth of inventory, down from 4.6 months a year earlier but up from 2 months in June.
…
A lower level of “distressed homes” — those in or under threat of foreclosure — has helped buoy prices, because these homes typically sell at a discount.

Yup, that’s what I’ve been pointing out for months now. Much of this year’s apparent increase in prices is really just a decrease in distressed sales.

Kurt Batdorf, Everett Herald: Home sale prices rise again in county

Record-low mortgage interest rates and a shrinking inventory of homes for sale again drove up sales prices across most of Snohomish County in July, a trend that first became apparent in April.

This month’s Herald piece is little more than a handful of numbers presented in prose form instead of a table, with a Joe Spencer NWMLS press release quote thrown in for good measure.

Rolf Boone, Tacoma News Tribune: Expert: Real-estate market in better shape

Despite lackluster results for the Pierce County housing market in July, a Lakewood-based real estate broker thinks the market is in much better shape than the data would suggest.

Pierce County home sales and median prices in the year-over-year July period were flat for the most part, with sales rising 2.36 percent to 860 units from 838 units, according to combined single-family residence and condominium data released by the Northwest Multiple Listing Service on Monday.
…
The fact that inventory levels continue to fall – possibly the lowest in five or six years – and has not stimulated prices because there’s less to choose from, was surprising for the July data, said Mike Larson, president and designated broker of Lakewood-based Allen Realtors.

Home prices aren’t “stimulated” by low inventory, they’re driven by local economic fundamentals—i.e. incomes. Why is that basic fact still so hard for real estate salespeople to understand?

Rolf Boone, The Olympian: Hopeful news continues for Thurston County home sales

The Thurston County housing market had one of its best months of the year in July — at least in percentage terms — as home sales rose 14.17 percent in the year-over-year July period, according to Northwest Multiple Listing Service data released Monday.

Although monthly sales fell below 300 units, last month’s sales still outperformed the market in July 2011, rising to 282 units from 247 units, the combined single-family residence and condominium data show.
…
Van Dorm Realty Managing Broker Steve Pust said the local housing market continues to get better and better, making it 14 straight months of sales increases for the west-side real estate brokerage, one of the largest in the area.
…
“Honest to goodness, confidence levels are increasing,” Pust said.

I love the “honest to goodness” bit. It’s almost as if he doesn’t expect you to trust the word of a salesman. Odd.

(Connor Radnovich, Seattle Times, 08.06.2012)
(Aubrey Cohen, Seattle P-I, 08.06.2012)
(Kurt Batdorf, Everett Herald, 08.06.2012)
(Rolf Boone, Tacoma News Tribune, 08.07.2012)
(Rolf Boone, The Olympian, 08.06.2012)

The post July Reporting Roundup: Summer Yawn-Fest Edition appeared first on Seattle Bubble.

The whole thing is worth a watch, but the real fun starts at the 5:38 mark, when host Tom Layson has Zillow’s Senior Economist Svenja Gudell and Tacoma agent and former NWMLS head Dick Beeson in studio for some Q&A.

After introducing the guests, Layson confronts Beeson with the chart from this 2008 Seattle Bubble post in which I annotated a graph of falling home prices with bottom-calling quotes from Beeson.

I’m not picking on you here, but I have a little chart from 2007 and 2008 that your friends at Seattle Bubble put together there, and you’ve called the bottom at least three times during the two-year period.

Gudell can be heard laughing in the background.

Layton goes on to ask Beeson if he’s ready to call the bottom again today, to which Beeson’s reply is to hem and haw for a few minutes and not really commit to anything.

Just for grins, here’s an updated version of the chart for today:

I wasn’t able to find any bottom calls since mid-2010 from Dick Beeson. It seems that he may have finally decided to stop setting himself up for ridicule like that.

The post Dick Beeson Finally Reluctant to Call the Bottom appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Sales volume, home prices around Washington state rising amid inventory shortages in many areas

The dinosaur represents rising interest rates, raining down the terror of double financial impact on the hapless homebuyer… or something.

June may have been cooler and wetter than normal, but weather did not seem to deter home buyers and sellers around western Washington. “Close-in Seattle neighborhoods have been experiencing the most intense buyer activity since 2006,” one broker remarked.

Northwest MLS directors credited several factors for contributing to brisk activity, with many of them mentioning inventory shortages. “Consumers bothered by the lack of inventory are ready to make sure they do not miss out on the shift in the market,” stated MLS board member Darin Stenvers, office managing broker at John L. Scott in Bellingham.

Frank Wilson, another MLS director, believes a unique aspect of this market is “artificially low interest rates” and said waiting to buy a home “could result in a double financial impact.”

Wow, some amazing logic on display there. Lack of selection is causing people to buy a home so “they do not miss out”? And you’d better buy quick before rates go up! It’s not like real estate agents have been using that line for the last decade or so.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: King County median home price up 10 percent over year ago

King County house prices saw a double-digit increase in June — the first time that’s happened in nearly five years, according to statistics released Thursday by the Northwest Multiple Listing Service.
…
“The numbers are even more positive than I had anticipated they would be,” said Glenn Crellin, associate director for research at the University of Washington’s Runstad Center for Real Estate Studies.
…
What’s behind the turnaround? Analysts pointed to several factors.

For one, the mix of homes that are selling has shifted. In February bank-owned houses — usually lower priced — accounted for nearly 23 percent of all single-family sales in King County, according to online brokerage Redfin.

Last month? Less than 10 percent.
…
Crellin said he expected the “shadow inventory” of foreclosed houses would have had a bigger impact on home prices by now.

“It just isn’t becoming as big a problem as I expected it would be,” he said.

Kudos as usual to Eric, taking the time to talk to multiple sources and try to understand what’s really going on in the market instead of just parroting the NWMLS press release, as some other reporters have been prone to do.

Aubrey Cohen, Seattle P-I: King County house prices rise by double digits

A dearth of houses for sale in June and fewer bank-owned listings helped push King County house prices up by double digits for the first time since the housing bust, according to a new report.
…
There’s a “critical shortage of listings,” particularly under $500,000, said Mike Skahen, the owner/designated broker at Lake & Co. Real Estate in Seattle. “It is not unusual for more than 50 buyers to come through open houses, and it’s become common now to hold listings open on both Saturday and Sunday.”

The heating market hasn’t renewed the buy-at-all-costs frenzy of a few years ago, agents said.

“What we find interesting today is the move away from a home being just an investment, but rather a long-term look at a specific neighborhood and how it complements a lifestyle,” Moorhead said. “Everyone we have interviewed still feels real estate is one of the best investments one can make, but they also realize it too has a downside. Therefore, you just cannot throw caution to the wind anymore.”

Really? After the biggest housing bust of all time “everyone still feels real estate is one of the best investments”?!? Unbelievable. Nothing will get through to some people, it seems.

Kurt Batdorf, Everett Herald Business Journal: Inventory shortages push up home prices

A shrinking inventory of available homes has started to drive up median sales prices and volumes of single-family residences in Snohomish County.
…
Snohomish County’s available home inventory sank from 4,548 units in June 2011 to 2,359 units this June, or 48.13 percent, according to data released July 3 by the listing service. MLS data indicates there is less than a two-month supply of homes for sale in Snohomish and King counties. Most analysts believe a supply of five to six months indicates a balanced housing market.

That tight inventory is driving sales activity upward.

Wait, what? Low supply is causing increased demand? Um, no. Low supply coupled with increasing demand is driving up prices.

Rolf Boone, Tacoma News Tribune: Home sales in county can’t keep May’s pace

After the Pierce County housing market posted an 8 percent increase in home sales in May, the market reversed course in June and fell more than 3 percent, according to data released Thursday by the Northwest Multiple Listing Service.

Although sales fell, a Pierce County real estate broker said it’s not enough of a decline to cause concern because the housing market overall continues to improve.

“The market has stabilized, and the market will pick up,” said Mike Larson, president and designated broker for Allen Realtors in Lakewood. “Buyers should look at it the same way.”

Here’s a crazy thought: Maybe buyers are getting sick of having nothing to choose from, and aren’t just going to buy whatever crap happens to be sitting around on the market?

Rolf Boone, The Olympian: Thurston home sales top 300 units for first time this year

Thurston County home sales rose nearly 6 percent in June, cracking 300 units sold for the first time this year, according to Northwest Multiple Listing Service data released Thursday.

Home sales rose 5.86 percent to 307 units last month from 290 in June 2011, while prices were flat in the same period, down 1.08 percent to $226,000 from $228,475, the combined single-family residence and condo data show.
…
“It is improving, and we know it’s improving,” Van Dorm Realty managing broker Steve Pust said about the Thurston County housing market.

“It feels like we’re at bottom,” he added, although he chuckled at his own comment because the bottom of the housing market has been a moving target for some time.

“Some time” as in, agents have been calling the bottom for nearly 5 years, basically since the first time prices showed signs of slipping.

(Eric Pryne, Seattle Times, 07.05.2012)
(Aubrey Cohen, Seattle P-I, 07.05.2012)
(Kurt Batdorf, Everett Herald Business Journal, 07.05.2012)
(Rolf Boone, Tacoma News Tribune, 07.06.2012)
(Rolf Boone, The Olympian, 07.05.2012)

The post June Reporting Roundup: Double Financial Impact Edition appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Tight inventory, record-low mortgage rates fueling Western Washington home sales
Low listing inventory and plunging mortgage rates are fueling buyer competition for homes close to job centers, according to brokers who commented on the latest market report from Northwest Multiple Listing Service.
…

Instant Market Activity!

J. Lennox Scott, chairman and CEO of John L. Scott Real Estate, described activity as a “double quick action market.” He noted local home buyers are back purchasing homes, “igniting strong sales activity up the price points.” This, combined with the low supply, and in some areas, shortages of homes for sale, is creating what Scott said is “instant market activity from a backlog of home buyers” when market-ready homes are listed.

“Double Quick Action Market” sounds like it should be a super hero anime or something. “Instant Market Activity!” would be the team of heros’ catchphrase, shouted out as they fly into the air, fists-forward, slow motion against a background of multicolored rays.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: House prices stay on rise in King and Snohomish counties

House prices rose in May in King County for the second consecutive month, prompting market-watchers to employ with greater certainty some words you may not have heard in a good long while:

Rebound. Stabilization. A seller’s market.
…
The year-over-year increase was the biggest since prices peaked in 2007 — and there have been few months since then with any increase at all.
…
Glenn Crellin, associate director for research at the University of Washington’s Runstad Center for Real Estate Studies, said the numbers didn’t surprise him. He’s been popping into open houses during walks around his neighborhood, Queen Anne.

Compared to three months ago, “the quality hasn’t changed, but the prices have,” he said. “They’ve gone up. And the houses are selling faster.

Eric also picked up my data about the 5-point drop in the share of bank-owned homes compared to a year ago. The article also touches on the buyer sentiment survey released this week by Redfin (my employer), that shows a shift in market psychology, as more buyers realize that it has become a seller’s market.

Aubrey Cohen, Seattle P-I: Seattle house prices post double-digit increase

Rising sales and low inventory helped push Seattle house prices up by 10.5 percent in May from a year earlier, according to a new report.
…
“Things that are in good condition are selling, they’re selling quickly, and they’re selling at good prices, from the seller’s point of view,” said Glenn Crellin, associate director of the Runstad Center for Real Estate Studies at the University of Washington.

So the bottom is clearly past, right?

“It’s still going to be pretty neighborhood specific, but we’re clearly past the bottom in some of the more desirable neighborhoods, Seattle and Bellevue, close to employment centers,” Crellin said.

I think this is the first true bottom call I’ve seen from Mr. Crellin. Although he was quite the sales booster back in the bubble days, in recent years I’ve found myself agreeing with nearly everything he has to say about the market, and this call is no exception.

Michelle Dunlop, Everett Herald: Home prices up again in Snohomish County

Home prices in Snohomish County increased again in May — establishing a two-month trend, according to a report released Monday evening.
…
The inventory of homes in Snohomish County is lower than that of any of the other 20 counties in the state tracked by the Northwest MLS. The county has a 1.5 month supply of homes on the market, meaning it would take that long to sell the homes available if no new houses were listed for sale. Analysts say that a 5 to 6 month supply of homes indicates a balanced housing market.

Not a lot of meat in this month’s article from the Herald.

Rolf Boone, Tacoma News Tribune: Local home sales up in May, prices steady

The inventory of homes in Snohomish County is lower than that of any of the other 20 counties in the state tracked by the Northwest MLS. The county has a 1.5 month supply of homes on the market, meaning it would take that long to sell the homes available if no new houses were listed for sale. Analysts say that a 5 to 6 month supply of homes indicates a balanced housing market.
…
Allen Realtors of Lakewood President and designated broker Mike Larson also pointed to the county’s falling inventory of homes for sale as another indicator of a more balanced housing market to stimulate sales. Inventory levels fell more than 30 percent to 3,758 units from 5,501 units, the combined data show.

“The supply and demand is not so extreme,” Larson said about the current state of the housing market. When the supply of homes is higher, such as when its closer to 5,000 units, buyers become choosier and sellers are forced to lower their prices to compete for those buyers, he said.

Hmm, perhaps demand isn’t very extreme right now, but supply is definitely extremely low.

Rolf Boone, The Olympian: Area home sales rise as prices remain flat

Thurston County’s housing market showed improvement for the third consecutive month and the South Sound real estate community is sensing a turnaround.

Home sales rose and median prices largely were flat in May, according to Northwest Multiple Listing Service data released Monday.
…
“Residential markets are perking up after nearly five years of decline,” said Ken Anderson, president and owner of Coldwell Banker Evergreen Olympic Realty, in an email. “Prices have stabilized and pent up demand is being unleashed.”

Apparently all the pent-up supply is still leashed.

(Eric Pryne, Seattle Times, 06.04.2012)
(Aubrey Cohen, Seattle P-I, 06.04.2012)
(Michelle Dunlop, Everett Herald, 06.05.2012)
(Rolf Boone, Tacoma News Tribune, 06.04.2012)
(Rolf Boone, The Olympian, 06.05.2012)

The post May Reporting Roundup: Double Quick Action Market appeared first on Seattle Bubble.

It’s time once again for the monthly reporting roundup, where you can read my wry commentary about the news instead of subjecting yourself to boring rehashes of the NWMLS press release (or in addition to, if that’s what floats your boat).

To kick things off, here’s an excerpt from the NWMLS press release:

Western Washington housing market "energized" and showing signs of "definite turnaround"

Northwest Multiple Listing Service brokers reported double-digit gains in both pending and closed sales during April compared to a year ago, but the most eye-catching number may pertain to prices. For the first time in more than four years (since January 2008) the year-over-year change in selling prices was positive.
…
Prices for single family homes continued climbing. The median price for last month’s closed sales was $250,000, up from both a year ago ($242,950) and from March ($234,487).

While cheered by the figure that snapped a 50-month string of negative numbers for year-over-year price comparisons, Northwest MLS brokers said consumers must be realistic in their expectations. They also noted the market recovery will be slow and incremental.
…
Tight inventory is creating sellers’ markets in some areas, according to reports from MLS directors. Inventory is down more than 27 percent for the Northwest MLS market overall, and by even larger margins in three counties: Snohomish (down 46.2 percent), King (down 39.4 percent), and Pierce (down 28.6 percent). Brokers say as demand outstrips supply, competition may intensify, especially for homes that are well-priced and in good condition in desirable locations.
…
Talk of a seller’s market has to be tempered, Wilson emphasized, because “when sellers hear these words in the news they instantly think their homes are worth a lot more money….and they are not. Even if our home prices appreciated 2-to-3 percent a year – which they aren’t currently — it will take many years for homes to return to the values that we saw a few years ago,” he suggested.

Despite his cautionary words, Wilson was upbeat. “We continue to see an increase in activity across the board. More people at open houses, more listings coming on the market, more buyers making offers and more multiple offer situations on correctly priced and staged homes.”

Weirdly, this is the most moderatly-toned release I’ve seen from the NWMLS in years, despite this being the first month in years that they actually have something moderately substantive to crow about. So strange.

Read on for my take on this month’s local news reports.

Sanjay Bhatt, Seattle Times: King County home prices rise with fewer houses for sale

“We’re at the beginning of the prime selling season, so to see this sort of strength coming out … this is very good news for the industry,” said Glenn Crellin, associate director of research at the University of Washington’s Runstad Center for Real Estate Studies.
…
“The very tight inventory of homes available for sale coupled with the stabilizing prices are probably going to convince some sellers that it’s now safe to come back into the marketplace,” Crellin said.

That doesn’t necessarily mean prices will grow rapidly.

Ding. Thanks to Sanjay for getting in touch with me to get the story on the decline in sales of bank-owned homes.

Aubrey Cohen, Seattle P-I: House prices rise in King County, surge in Seattle

House prices rose for the first time in a long time in King County last month, while they surged up by double digits in Seattle.
…
Writing on Trulia, real estate broker Kary Krismer threw some cold water on the King County increase.

“(D)on’t get too excited,” he wrote. “Remember the median is affected by mix.”

Lender-owned “REO” homes, which tend to sell for less, made up 22 percent of all house sales in April 2011 but less than 17 percent of sales last month, he wrote. “Fewer REO sales means a higher median, all other things being equal.”

Nice work Kary, getting the story out to the P-I. In other news, has anyone else noticed that the P-I uses the same photo every month on the NWMLS article? Plus it’s a photo of a For Sale by Owner sign, which, if the house sold, wouldn’t even be included in the NWMLS stats.

Michelle Dunlop, Everett Herald: Home prices rise 10% in Snohomish County

Northwest MLS director Meribeth Hutchings, broker and owner of Windermere Real Estate in Lake Stevens, credited favorable interest rates and low inventory for spurring activity.

“The demand for ‘good clean homes’ is extremely high,” she said. “Our primary buyer today is still the first-time homebuyer.”

No particular insight in this month’s Herald article. Mostly just a regurgitation of the press release.

John Gillie, Tacoma News Tribune: Many in state see uptick in median home prices

For the first time in more than four years, the median price of homes sold in Western Washington turned upward in April, a report reveals.

Frank Wilson, managing broker at John L. Scott Real Estate in Poulsbo, said sellers should not read too much into the positive news.

“When sellers hear these words in the news, they instantly think their homes are worth a lot of money … and they are not,” he said.

“Even if our home prices appreciated 2 to 3 percent a year — which they aren’t currently — it will take many years for homes to return to the values we saw a few years ago,” Wilson said.

Seriously, what has gotten into these agents? Now that we may finally actually be at the bottom they’re saying everything but calling the bottom. So weird.

Rolf Boone, The Olympian: Thurston home prices rise for second consecutive month

Thurston County median home prices rose more than 2 percent in April, the second consecutive month of price increases and another sign that the once-struggling housing market may have finally hit bottom.

Year-over-year median prices rose nearly 5 percent in March and climbed another 2.75 percent in April, according to Northwest Multiple Listing Service data released Thursday.

As usual, I could only find the blurb, unfortunately.

(Sanjay Bhatt, Seattle Times, 05.04.2012)
(Aubrey Cohen, Seattle P-I, 05.03.2012)
(Michelle Dunlop, Everett Herald, 05.03.2012)
(John Gillie, Tacoma News Tribune, 05.04.2012)
(Rolf Boone, The Olympian, 05.03.2012)

The post April Reporting Roundup: Tempered Optimism Edition appeared first on Seattle Bubble.

It is the West Coast’s most successful condominium high-rise community with established market values.

In light of the “established market values” comment, I find it interesting to note (hat tip to WestSideBilly) that Unit 3802, the second-largest unit on the 38th floor (the tower’s top level), sold on Friday for $3.6 million.

That would be an “established market value” 27% below where it sold just three years ago in May 2009, for just shy of a cool $5.0 million.

The previous buyer only financed $2.5 million at purchase, followed by another $500k loan a few months later, so that entire $1.4 million loss is on them.

• $1,362,820 loss on the sale
• $386,778 in interest payments
• $180,000 agent fees (assuming 2.5% commission)
• $92,831 in property taxes
• $60,660 in HOA dues
• Total Cost for 3 years: $2,083,089

$57,864 a month has got to be the most expensive rental in town, hands down.

[Update: Oops, I originally forgot to include the interest payments on the $3 million in loans. We'll assume that they were short term ARMs with rates 1.1 points below the 30-year average. I have now added the total interest payments to the above accounting.]

The post Top Floor Unit at 1521 Sells for 27% Off 2009 Price appeared first on Seattle Bubble.

First up, the NWMLS press release: “Buyer Ready” Home Shoppers Have Edge as Brokers Report Rise in Multiple Offers.

“Buyers are screaming for more inventory and they’re being more aggressive with presenting offers on homes,” reported MLS director George Moorhead, branch manager at Bentley Properties in Bothell. Home shoppers perceive the bottom is nearing, he noted, “and both buyers and sellers want to catch the historically low interest rates.”

That makes no sense at all. Why would sellers care more about “catching the historically low interest rates” than they would about getting a good price for their home? Obviously, they don’t really care about rates, otherwise we would be seeing a lot more listings on the market than we are.

FRENZY! by Flickr user Don DeBold

“Close to the job centers, 45 percent of new listings are selling within a single month. We are seeing a frenzied market in the Puget Sound region, especially in the more affordable and mid-price ranges, with an increase in sales activity in the high end,” remarked J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “Because of the shortage of homes for sale, combined with the sales surge being driven by job growth and historically low interest rates, if you are not ‘buyer ready’ you may not get a house in today’s market,” he added.

FRENZY!

Diedre Haines, another Northwest MLS director, said pending sales in Snohomish County, which jumped 21 percent, would have been “considerably greater were it not for the buyer competition due to the magnitude of multiple offer situations.” She said they are seeing the return of price escalator forms, pre- inspections, set dates for sellers to review offers and properties selling above list price, according to Haines, the regional managing broker at Coldwell Banker Bain in Lynnwood. “Prices are not increasing dramatically but those properties that are listed and priced correctly, especially in the $300,000 and below range, are selling within days of coming on market,” she noted.

Hah. I love the “sales were okay, but they would have been even better bit. This lady should run for public office.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: King County home prices highest since September

“I think in some places prices are recovering, but it’s very neighborhood-specific,” said Glenn Crellin, associate director of research at the Runstad Center for Real Estate Studies at the University of Washington. “Those markets that are close to the job centers are by and large doing pretty well.”

Prices in Seattle were up more than 3 percent from a year ago and nearly 9 percent from February. Neighborhoods north of Interstate 90 all saw double-digit year-over-year increases.

Sweet, it’s the North of I-90 magic!

Aubrey Cohen, Seattle P-I: Seattle house prices up again

Sales actually fell 2.1 percent in Seattle from a year earlier, while rising 10.5 percent countywide. Pending sales, which don’t all close but can be the best indicator of recent activity, were up 15.4 percent in the city and 26.9 percent in the county.

But, with few new homes hitting the market, supply fell to 2.8 months worth of homes for sale at the current pace in Seattle and 3.2 months of supply countywide. That’s down from 4.4 months and 5.6 months, respectively, a year earlier.

Hmm, not much meat in this month’s article. Both of the quotes appear to be lifted straight from the NWMLS press release. Oh well.

Michelle Dunlop, Everett Herald: County home sales up; fewer houses on market

The number of homes for sale in Snohomish County last month was down nearly 44 percent compared to March of 2011, indicating a stabilizing housing market.
…
“The lagging inventory is actually helping prices stabilize, which we hope will have a positive impact on the real estate market as the year progresses,” George Moorhead, branch manager at Bentley Properties in Bothell and director of MLS, said in a statement.

I don’t really see how a dramatic 44 percent drop in inventory can be considered “stabilizing.” I also like how even after everything the market has been through, real estate salespeople are still hard-wired to view declining prices as a bad thing. Lower prices are a good thing. We don’t need prices to “stabilize” to have a “positive” market.

C.R. Roberts, Tacoma News Tribune: Pending Pierce County home sales increase

Real estate brokers representing the 21-county region of the Northwest Multiple Listing Service said Friday that the latest monthly housing market figures indicate “a sustainable recovery” is finally afoot.

Bonus points for using the word “afoot” in a professional news article.

C.R. Roberts, The Olympian: Home sales data suggest Pacific Northwest economic revival

Real estate brokers representing the 21-county region of the Northwest Multiple Listing Service said Friday that the latest monthly housing market figures indicate “a sustainable recovery” is finally afoot.

Wait a minute… This is the same article with just a few words and numbers changed. Bonus points withdrawn.

(Eric Pryne, Seattle Times, 04.05.2012)
(Aubrey Cohen, Seattle P-I, 04.05.2012)
(Michelle Dunlop, Everett Herald, 04.06.2012)
(C.R. Roberts, Tacoma News Tribune, 04.07.2012)
(C.R. Roberts, The Olympian, 04.07.2012)

The post March Reporting Roundup: FRENZY Edition! appeared first on Seattle Bubble.

That’s what happens when you make a big public announcement about intentions to convert to condos, scaring away all your good tenants, then fail to follow through because you stupidly kicked off your plan just as the housing bubble was beginning to deflate.

From Eric Pryne’s write-up over at the Seattle Times:

The buildings’ previous owner, Walton Street Capital, of Chicago, bought them in 2006 for $44 million, and at first pursued a plan to convert Smith Tower to condos.

The housing crisis killed that proposal; meanwhile, office tenants fled the historic tower, which opened in 1914.

It’s now more than 80 percent vacant, according to court records, and monthly rents don’t cover the building’s operating expenses.

Walton Street defaulted on the mortgage last year, and CBRE began pursuing foreclosure shortly after it acquired the debt in September.
…
At CBRE’s request, a King County superior-court judge in December appointed a receiver, Goodman Real Estate, of Seattle, to take over management of the tower.
…
According to Goodman’s latest report to the court, another CBRE affiliate has begun marketing the building to prospective tenants. There’s interest in two complete lower floors and suites on three other floors, the report says.
…
Goodman representatives have told him they expect to have the tower at least 50 percent occupied by the end of the year.

So it sounds like the dream of the Smith Tower Condos is dead.

The post Smith Tower Foreclosed appeared first on Seattle Bubble.

It’s a great time to be a seller… if you can afford to sell at today’s prices. And it’s a great time to be a buyer… if you can be really patient and are willing to tolerate being out-bid numerous times if you’re shopping for “move-in ready” homes in a trendy neighborhood.

Mostly it’s a frustrating time to be either buying or selling in today’s market.

As one commenter put it recently:

The “bottom” isn’t looking nearly as fun as it sounded like…

The post Buyer’s Market? Seller’s Market? Neither, Really. appeared first on Seattle Bubble.

If you’re looking for evidence of a real estate comeback, just check out any Sunday open house in Ballard, a popular Seattle neighborhood.
…
This particular house just went on the market last week. It’s a small, two–bedroom, 1927–era home. It’s on a quiet street with neat houses and well–kept lawns. It’s close to parks and a popular elementary school.
…
Jed Kliman is the listing agent. He works for Windermere. He says the home has been completely renovated, and all of the fixtures and appliances are brand new.

My conversations with Deborah about the unusually anti-seasonal decline in inventory provide some statistical context for the Ballard anecdote she found.

Here’s the listing of the home featured in the story: 8021 29th Ave NW

Note that the listing agent counted the entire 1,180 square foot unfinished (and short—look at how close to the ceiling that broom stands) basement, which doubles the MLS-listed square footage of what is in reality a 1,180 square foot, 2 bedroom, 1 bathroom home.

That said, the home appears to have the nicest possible finishes that you could reasonably put into a house that size. The whole place practically sparkles in the listing photos. Deborah confirmed to me that it looks just as nice in person.

What is a 2-bed, 1-bath, 1,180 square foot home north of 80th street worth today? Over the last six months or so, the most that any similarly-sized home has sold for in that area is $300,000. On the other hand, there are currently only 10 homes for sale in the 98117 zip code priced $400,000 and under, so “entry-level” inventory in that neighborhood is pretty slim.

And Kliman says it’s priced right: $389,000. And he expects it to go fast. He says there are a lot of people looking to buy homes in Ballard, and very few houses for sale.

…with so few properties on the market, the competition to buy a home is now fierce. Remember that house in Ballard? Well, agent Jed Kliman set a deadline. Offers had to be in the day after the open house.

So how much do you think this little barely-in-Ballard home will end up selling for?

Go ahead and click the photo above and head over to the listing to check out the photos before you make your guess… It’s okay, we’ll wait…

Okay, ready?

Kliman: “So, we have six offers, and there is a seventh being emailed over in the next 10 minutes or so.”
…
Kliman didn’t want to disclose too many details to KUOW, but he was willing to tell us that all six buyers were offering the full price of $389,000, or higher. Two people offered cash, two had already done inspections. Kliman and Therrien spent a couple of hours behind closed doors making phone calls to agents. Then, the deal was done.

Owner Joe Therrien was stunned. He says the bidding war took him entirely by surprise. He didn’t think anyone would offer full price for his house.

“…this is roughly equivalent to winning the lottery for me.”

$400,000-plus for a 2-bedroom, 1-bath house in that location? Seven offers, two all-cash?!? Who are these people? I mean sure, inventory is low, but why would buyers be so desperate that they would pay over $335 per square foot in Loyal Heights? Head over to KUOW’s site to listen to the whole tale and see if you can make any sense of it.

I have to say, the corridor bordered by the ship canal on the south, 85th street on the north, Puget Sound on the west, and Lake Washington on the east is pretty much the last place I’d want to be trying to buy a home right now. For whatever reason, that area seems to have turned into the Twilight Zone of Seattle real estate in 2012.

The post KUOW on Low Inventory and Over-the-Top Anecdotes appeared first on Seattle Bubble.

For some reason, the NWMLS press release still hasn’t been published to its usual space on their public site, so we don’t have the source material to reference this month. Instead, enjoy this chart of King County single-family home prices since 1993, both in raw form and adjusted for inflation using Seattle’s CPI less shelter:

Inflation-adjusted home prices in King County are back to about where they were in early 1999. Nice.

[Update]
A reader emailed me a copy of the NWMLS press release that was sent to them by their friendly neighborhood real estate agent. Here’s an excerpt:

Washington homebuyers realizing “market may have reached bottom of cycle”

With spring on the horizon and consumer confidence on the rise, members of Northwest Multiple Listing Service are reporting positive gains in activity. Pending sales for February increased more than 27 percent from a year ago, more sellers are listing their homes, and brokers are reporting an uptick in multiple offers.

“Buyers are beginning to realize that we may have seen the bottom of this real estate market,” remarked Frank Wilson, branch managing broker at John L. Scott Real Estate in Poulsbo and a member of the Northwest MLS board of directors. “Waiting to buy may only result in paying a higher interest rate, having fewer houses to choose from, or finding that sellers do not need to give up as much as they have in the past,” he added.
…
Commenting on the market around Kitsap County, where prices dipped nearly 11 percent, Wilson said he expects prices to “stabilize and even reverse as we move further into 2012.” With 4.3 months of supply in that county, he believes the market is tilting toward sellers. “We continue to see more multiple offer situations on homes that come on the market correctly priced,” he stated.

Most of the rest of the quotes were printed verbatim in the news articles quoted below. I would like to point out that while I actually do think we’re basically at the bottom for prices, scare tactics like the Frank Wilson quote at the end of the second paragraph above are still lame and deserving of mockery.

[End of Update]

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: Shrinking inventory breaks fall in King County home prices

Fewer homes are listed for sale in King County now than at any time since the housing crisis began, and observers say the lack of inventory is starting to influence prices, at least in some neighborhoods.

Don’t get excited — overall, prices are still down.

Countywide, the median single-family sale price hit another postboom low in February — $308,125, down 2 percent from January, 8 percent from February 2011 and nearly 36 percent from the market’s peak in July 2007.

Glenn Crellin, assistant director for research at the University of Washington’s Runstad Center for Real Estate Studies, said he wouldn’t be surprised if the median dips below $300,000.
…
The total number of houses and condos on the market in King County last month was down 32 percent countywide and 38 percent in Seattle from February 2011, according to the listing service.

There haven’t been this few homes listed for sale in any February since 2006.

Again, Eric nails the story.

Aubrey Cohen, Seattle P-I: House prices rose in Seattle in February

What can one read into Seattle’s increase, seeing as prices were down by 10.1 percent year-over-year in January?

“I think it really is a market that’s trying to figure out exactly where it belongs, what normal looks like,” Crellin said, noting that there’s wide variation in price changes by area in and around Seattle. “It’s very much a neighborhood-specific kind of thing.”

Job growth and historic low interest rates are actually creating a seller’s market through the mid-price ranges and contributing to surging sales near job centers, J. Lennox Scott, CEO and chairman of John L. Scott Real Estate, said in a listing service news release. “It’s a special moment in time in real estate history. We have a backlog of qualified buyers looking for homes to purchase.”

Sales are up, but I think it’s still quite a stretch to say they are “surging” anywhere. And I wonder if Lennox would mind quantifying exactly how “special” this time is “in real estate history.” Is it as special or more special than, say, November 2007, when he declared that “we’re in one of the best markets in the nation here in the Northwest,” and that prices wouldn’t fall? Hmm.

Michelle Dunlop, Everett Herald: Local home sales rise in February

Home sales in Snohomish County continue to outpace last year, though the supply is beginning to dry up, according to a report released Monday.

“The only thing tempering this from being a hot, thriving market are the short sales and foreclosed properties which represent about one-third of the transactions,” said Frank Wilson of Northwest MLS in a statement.

Nearly half of the home sales in the county last year were foreclosures or short sales, according to Washington Property Solutions of Bellevue.

Those dang short sales and foreclosed properties. If only they would just go away we could get back to that hot-hot-hot market of 2005!

Kathleen Cooper, Tacoma News Tribune: Home sales up last month in Pierce and Thurston counties

Successful sales provided a glimmer of hope for the Pierce and Thurston county housing markets in February.

More homes sold in Pierce and Thurston counties last month than the same time a year ago, though sale prices continued their drop.
…
But the median sale price of single-family homes and condos fell 16 percent in Pierce to $169,450. That’s about 40 percent off the peak of $285,000 in August 2007.

Not much meat here in this month’s article.

Kathleen Cooper, The Olympian: County home sales up, but price declines

More homes sold in the two counties last month than the same time a year ago, though sale prices continued their drop.

Closed sales rose 2 percent in Thurston and 30 percent in Pierce, according to data released Monday by the Northwest Multiple Listings Service, which represents 21 counties in Western and Central Washington.

…Thurston’s median sale-price drop wasn’t quite as bad, down almost 3 percent to $211,500.

Not much here, either.

I actually had a nice chat on the phone last month with Rolf Boone, who usually writes the real estate stories for The Olympian. I learned that the reason we mostly see just these short blurb articles online is that the full articles that he writes for some reason are only published in print, and not online. That’s a bummer, because it sounds like he really cares about his work and is trying to really feel out the story, but the fruits of his labor are hidden from me in the digital space.

(Eric Pryne, Seattle Times, 03.05.2012)
(Aubrey Cohen, Seattle P-I, 03.05.2012)
(Michelle Dunlop, Everett Herald, 03.05.2012)
(Kathleen Cooper, Tacoma News Tribune, 03.06.2012)
(Kathleen Cooper, The Olympian, 03.06.2012)

The post Reporting Roundup: Party Like It’s 1999 Edition appeared first on Seattle Bubble.

You can watch the entire presentation here, if you’re into that sort of thing. Tom’s got quite a few charts of forecasts that bottom out in 2012 and then ramp up over the next few years. Personally, I think he might be a bit too optimistic about the rate of recovery, but I do agree with him that the worst is most likely behind us.

Hat tip to my coworker Lisa Taylor, who spotted this on King County TV last night. Thanks Lisa!

The post Official King Co. Economic Forecast Cites Seattle Bubble appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Housing market "healing itself," numbers are "astoundingly good"

Declining inventory, extremely low interest rates, and positive job growth are contributing to rising optimism among industry professionals, but Northwest MLS directors say distressed properties continue to be a drag on the market’s recovery.

Bzzt. Got it backwards there, friends. The continuing stream of short sales and foreclosure sales aren’t “a drag on recovery.” They’re how we get recovery. All the bad sales from the bubble need to be cleared out before we can get back to a “normal” market. Period.

The lower number of new listings coming on the market is due to a combination of factors, said J. Lennox Scott, CEO and chairman of John L. Scott Real Estate. Among them, he mentioned underwater sellers (who owe more on their homes than the current value), sellers with equity holding off for higher prices, and the lack of new construction/condominiums.

Sounds like there’s a lot of pent-up supply out there. Plus a bunch of would-be sellers that are priced in forever.

“We are simultaneously seeing the continued rise in pending and closed sales,” Jacobi stated. “Usually pent up demand and rising sales means that prices will be going up. But, unfortunately, that isn’t the case thanks to the high level of distressed properties that continue to drag down the entire market,” he explained.

“Lightning bolt!” by Flickr user Jason Foster

Oops, you said “unfortunately” when I think you meant “thankfully.”

Northwest MLS director Darin Stenvers believes “the perfect storm is brewing.” He said the pent-up need for homes in good condition is creating shorter market times and sales close to the original asking price. “It is a great time for sellers who have been waiting,” said Stenvers, the office managing broker at John L. Scott Real Estate in Bellingham.

“The market is almost done with the needed correction,” Stenvers stated, adding, “Distressed homes and REOs are not going away fast but have slowed and should soon level off.” He also foresees a loosening of overly restrictive lending guidelines.

I wonder what exactly Mr. Stenvers believes has been “overly restrictive” about recent lending guidelines. It amazes me that he seems unable to make the obvious connection between all the “distressed homes and REOs” and the fast-and-loose lending that led to this whole mess in the first place.

Anyway, I could go on all day with this ridiculous nonsense from the NWMLS, but I won’t. Read on for my take on this month’s local news reports.

House prices in King County hit another new post-boom low in January, according to statistics released Monday by the Northwest Multiple Listing Service.
…
But King County is a big place, and the real-estate market isn’t the same in SeaTac as it is in Sammamish.

A closer look at the statistics reveals significant variations from neighborhood to neighborhood.

As in the past few months, they suggest an increase in “distressed-property” sales — bank-repossessed homes and “short sales” for less than sellers owe lenders — is responsible for much of the countywide price drop.

Those sales accounted for about 40 percent of all closings in King and Snohomish counties last month, according to an analysis by Re/Max Northwest Realtors.

Sales are up most, and prices have fallen farthest, in areas with large numbers of distressed sales.

Low prices = more sales. Go figure.

Countywide, however, distressed-property transactions “continue to drag down the entire market,” said OB Jacobi, Windermere real-estate president.

That won’t change anytime soon, Crellin said: “There’s still a tremendous backlog.”

Homeowners are at least 90 days past due on 76,000 mortgages statewide, he said, but only about 5,000 homes are completing the foreclosure process each quarter.

At that rate, it would take nearly four years to work through the backlog, Crellin said, although he expects the pace of foreclosures will pick up.

And this is why we’ll be at the bottom for quite some time to come.

Aubrey Cohen, Seattle P-I: Low home supply isn’t helping prices

Home sales continued to pick up in King County last month, helping push the inventory of homes for sale to what traditionally would look like a seller’s market. But prices continued to fall, reaching levels last seen in 2004.
…
Local real estate executives have made premature announcements about a market rebound several times during the housing downturn. But the economics blogger Bill McBride, of Calculated Risk, has been more bearish, until now.

“There have been some recent articles arguing the ‘housing bottom is nowhere in sight.’ That isn’t my view,” McBride wrote in a Monday post titled “The Housing Bottom is Here.“

Bold call from Bill at Calculated Risk. I love that Aubrey calls out the local real estate “professionals” for their constant bottom calls since 2008.

Kurt Batdorf, Everett Herald: Home sales increase, prices shrink in January

Declining inventory, extremely low interest rates and positive job growth are contributing to rising optimism among industry professionals, but Northwest MLS directors say distressed properties continue to be a drag on the market’s recovery.
…
Year-over-year median prices for single-family homes fell 9.5 percent, from $254,000 to $230,000, the MLS reported. Prices for condos were off 33.4 percent, falling from $186,000 to $123,950. Condo prices in southeast Snohomish County plummeted from a median of $209,500 last January to $72,000 this year.

“Price increases are muted by short sales and foreclosures that are causing low appraisal values,” said J. Lennox Scott, CEO and chairman of John L. Scott Real Estate.

There are price increases out there, you just have to dig deep to find them!

C.R. Roberts, Tacoma News Tribune: Pierce and Thurston County home prices drop 12.5 percent

Down: The median price of homes – both residential and condominium – in Pierce and Thurston counties.

Down: The number of homes actively listed for sale.

Down: The number of new listings.

Up: The number of home sales pending.

So much for the first month of 2012.

Okay…

C.R. Roberts, The Olympian: Median home price falls by 4.2% in county

Anderson said the numbers reported Monday are no longer tied to “the artificial stimulus of various tax credits and incentives that date to 2009.”

“The improvement in the numbers show that the market is healing itself and standing on its own.”

If you want to re-read the NWMLS press release, just pick up The Olympian.

(Eric Pryne, Seattle Times, 02.06.2012)
(Aubrey Cohen, Seattle P-I, 02.06.2012)
(Kurt Batdorf, Everett Herald, 02.07.2012)
(C.R. Roberts, Tacoma News Tribune, 02.07.2012)
(C.R. Roberts, The Olympian, 02.07.2012)

The post Reporting Roundup: Healing Perfect Storm Edition appeared first on Seattle Bubble.

Senate Bill 6337 was recently introduced in the WA State Legislature regarding short sales.

After a short selling homeowner gets the shortfall deficiency waived, the homeowner receives a 1099 in the mail because debt forgiveness is a taxable event. Some people may have to pay taxes on the deficiency, others may not depending on their circumstances. More about that from the IRS here.

When a bank/lender issues a 1099 for debt forgiveness that means the bank also gets to write off the deficiency as a bad debt which may decrease the amount of taxes the bank/lender owes the IRS. Seems fair.

SB 6337 is asking the WA State Legislature to no longer allow a bank to pursue a homeowner for the deficiency on a short sale once the bank issues a 1099. Okay, still seems fair…

Here’s an excerpt from the Realtor Summary Sheet on the issue:

Key Points:

Provide certainty and consumer protections for short sale sellers is critical in the current real estate market. Successful short sales often prevent foreclosures that would harm consumers, tax revenue and economic recovery.

Okay, hold on a minute. Foreclosures are a natural and necessary part of the market cycle. Not everyone is going to be able to hang on to home ownership.  It’s beyond debate that the high home ownership rates we saw at the top of the bubble were not sustainable.  Foreclosed homes will be sold to investors and other home buyers who can afford home ownership using rational underwriting guidelines instead of the insanity of the bubble days. BTW, here’s what default rates look like for loans originated in 10-11 compared w/the bubble.

There are many foreclosure prevention programs available today, including the new changes to the Home Affordable Modification Program. Many homeowners in foreclosure have been in the system 18 months to 2 years without making a payment.  Yes, their credit score will plunge, but they’re also living rent free for 2 years. Seems to me that this might be a sort-of stealth economic shot in the arm, unless they’re using the money to shoot things into their arm.

Regarding tax revenue, there’s no excise tax paid on a trustee deed v. a short sale which is conveyed using a warranty deed, however, after foreclosure there IS excise tax paid when the foreclosed REO home is sold.

Regarding economic recovery, this particular law is not going to help our economy in WA State recover any faster. The banks are foreclosing slowly so as not to crash the market with REOs.  If we really want an economic recovery to happen faster, let the foreclosures commence. We will hit bottom VERY fast and then everyone will be super busy again. But that ain’t gonna happen and I fail to see how this bill could be tied to an economic recovery in our state.

This legislation will protect short sale sellers from mortgage debt collection actions when the short sale seller was issued a 1099-C Form and thus must pay income tax on the discharged debt.

Wait a minute. If a homeowner HAS assets, what’s the lender’s motivation to approve a short sale without the ability to collect the shortfall either at the close of escrow in the form of a new unsecured note, or in the future? Put yourself in the lender’s shoes just for a minute: If you sold a home and took back the paper/held the note, and now the new home buyer wants to sell short, would you just simply “forgive” the difference out of the goodness of your heart? NO. Not if you have a cold black heart like mine. I’d want the person to prove financial hardship first. I’d run the numbers and if it makes sense to take the write off, well then maybe my heart could be convinced to melt just a little, for, say 5 minutes which is enough time to sign the paperwork. If however, your home buyer had assets, why would you want to waive the short fall? If all banks/lenders just give a blanket hall pass on all short sale deficiency then the masses would suddenly sell short. Oh now I get it. Maybe this would motivate more people to….list their home, which means more real estate commissions. Okay, I’m getting it now. Realtors, I love you, but I’m not convinced this is in the best interest of homeowners. There’s more:

Lenders still have the ability to decide whether to reserve the right to collect mortgage debt owed after a short sale, or whether to issue a 1099-C and claim a deduction for tax purposes.

Oh goodie. I’m sure the bankers will thank us for that small token of appreciation.

Go to the 1 hour 9 minute mark (1:09) of this video to hear the six minutes of dialogue from the bill sponsor and the banker and lender who showed up.

One of the possible consequences if this bill is passed is that if banks/lenders are discouraged from pursuing homeowners (with assets) for the short sale deficiency, then it is entirely possible that
banks/lenders will then decide to just foreclose, which is the opposite outcome that the bill’s sponsors desire.

I’d like to hear/see/touch/feel/taste real examples of homeowners who were pursued for the deficiency and see if these are people who are financially destitute or if these are people with assets.

It looks like WA SB 6337 is a copy/paste of a bill that passed in Oregon last summer. Do we have access to stats from Oregon that could show us what happened to short sales/foreclosures after the law went into effect?

If we are serious about “protecting short sale sellers,” let’s require all homeowners  obtain prepaid legal counsel before the short sale is listed. Attorneys would make sure the final paperwork has no deficiency clause and seller’s legal questions can be answered by someone who is a member of the WA State Bar Assoc.

As it is written, SB 6337 has the potential for increasing foreclosures in WA State, and that might be a good thing, depending on your vantage point. Either way, go forth into the conversations surrounding this bill educated on the possible consequences.

The post A Look at WA SB 6337 “Protecting Short Sale Sellers” appeared first on Seattle Bubble.

The Seattle Times Real Estate Section – This sub-page on the Times could definitely use a little layout love, but Eric Pryne et al have been putting out some really quality material lately. You can get an RSS feed of their real estate stories here.

New To Seattle – As the name implies, this site is written by a recent transplant to Seattle, William P. Barrett, who also happens to be a Senior Editor with Forbes. His posts are neither frequent nor regular, but are always an interesting read.

GeekWire – The current project of former Seattle P-I (then Puget Sound Business Journal) tech writers John Cook and Todd Bishop, GeekWire is a great place to get local tech news. It’s like TechCrunch with less noise, less ego, and a fun local touch.

Urbnlivn – Still a fan of Matt’s non-stop work covering the local condo scene. Having started just 8 months after Seattle Bubble, I think he and I have the two longest-running regularly updated local real estate sites.

The SunBreak – In their own words, “The SunBreak is an online magazine of news & culture. It’s a conversation about all the things on Seattle’s mind.” I find the writing to be a refreshing, independent take on Seattle goings-on.

Curbed Seattle – Real estate tabloid. Definitely falls on the “entertaining” end of the spectrum as opposed to the “useful” end, but there’s nothing wrong with entertaining well, which Curbed does.

What are your favorite local sites?

The post The Tim’s Favorite Seattle Blogs & News Sites appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

"Healthy marketplaces" emerging with shrinking inventory, favorable financing
Home sales finished the year much stronger than they started, with pending sales for the fourth quarter outgaining the first quarter by more than 3,000 transactions for a 21 percent increase, according to new figures from Northwest Multiple Listing Service.
…
“All over we are seeing healthy marketplaces emerge as the inventory levels drop,” said J. Lennox Scott, CEO and chairman of John L. Scott Real Estate. “As you get closer to the job centers of Seattle and Bellevue, the marketplace is looking strong again,” he added while expressing optimism for the coming year. “The outlook for 2012 is the continuation of a strengthening marketplace, especially in the more affordable to mid range priced homes.”
…
OB Jacobi, president of Windermere Real Estate, believes the market has undergone a shift. “Where we’ve been during the past year is a place of transition. It has been a slow recovery, but the housing market has finally turned a corner, albeit a soft one with some bumps along the way,” he commented.

Despite rising sales, Jacobi, a member of the Northwest MLS board of directors, noted foreclosures and short sales continue to cause downward pressure on prices. “Many would-be sellers are still wary of the market, and as a result, there are fewer homes for sale,” he observed, adding, “At the same time, there are buyers who are eager to strike while the iron is hot, so in some areas, homes are selling before many buyers even have a chance to react.”

Um, no. Most would-be sellers are not “wary of the market.” They’re stuck in their homes. They’ve been “priced in” and simply couldn’t sell even if they wanted to, because they’ve got no equity, can’t afford to take the loss, and aren’t likely to get their lender to approve a short sale.

Here’s a slight variation on the closed sales chart I posted yesterday, to give you an idea what a “healthy marketplace” apparently looks like:

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: King County median home price falls by double digits again

Probably because they’re cheaper, distressed properties also are pushing sales volumes up compared to a year ago: King County single-family home sales were up 0.5 percent, condo sales 20 percent, Snohomish County house sales nearly 21 percent last month.

What’s more, analysts say, competition from short sales and bank-repossessed homes almost certainly is discouraging many prospective sellers from putting their houses on the market: in King County, 25 percent fewer homes were listed for sale last month than in December 2010.

“If people aren’t forced to sell, they’re not [selling],” said land-use economist Matthew Gardner. “They’re willing to wait until they see more signs of stability in the market.”
…
Reports that more homeowners are falling behind on their mortgages suggest the distressed-property pipeline won’t unclog anytime soon, said Glenn Crellin, director of the Washington Center for Real Estate Research at the University of Washington.

That should keep prices from rising, he said.

Bingo! Not to mention all the pent-up supply Gardner alludes to. Once there’s any sign of stability, sellers will rush the market.

Aubrey Cohen, Seattle P-I: Home sale surge abated in December

A surge that buoyed Seattle-area home sales in the second half of 2011 lost some steam in December, while prices continued to fall, according to a report released Wednesday.

Sales of King County homes rose 4.1 percent from a year earlier — down from a 46.1 percent jump in November and the lowest year-to-year increase since June, according to the Northwest Multiple Listing Service. Annual comparisons had been boosted in recent months by the fact that sales were depressed in the second half of 2010, after a homebuyer tax credit expired.

Okay so he says right there in the article that the year-over-year numbers were high only because last year was in the crapper, not because this year was high, but he’s still calling it a “surge” in sales? Huh? Does the chart above look like a “surge” in 2011 sales to you?

I’ve come to expect better than this from Aubrey. This month it feels like he’s just phoning it in.

Michelle Dunlop, Everett Herald: County home sales increase, prices fall

Snohomish County’s housing market closed out the last month of 2011 on the same projection as the past six months: home sales continued to rise while home prices declined.

About 846 single family homes and condos were sold in the county last month, according to a report released Wednesday by the Northwest Multiple Listing Service. Sales were up 23.7 percent from the same month in 2010.

However, the median home price fell 9.3 percent to $222,750, down from $245,700 in December 2010.

Most of the rest of the article is just wholesale quotes from the press release.

Rolf Boone, Tacoma News Tribune: As Pierce County home sales rise, prices tumble

The Pierce County housing market ended the year on a sour note as median home prices once again fell by a double-digit margin in the year-over-year December period, according to data released Wednesday by the Northwest Multiple Listing Service.

That’s good news for the prospective home buyer in search of a deal, but tough on the home seller trying to sell as values continue to plummet.

Gotta love how they call it a “sour note,” but then go on to admit that it’s good for buyers. Rolf even admits just a few paragraphs later that low prices “have helped to stimulate Pierce County home sales.” Doesn’t sound so sour to me.

Rolf Boone, The Olympian: Thurston County home sales rise 5% in December

Thurston County home sales rose 5 percent in December, ending the year on an encouraging note after sales were down or flat for most of 2011, according to Northwest Multiple Listing Service data released Wednesday.

Although sales eked out an end-of-the-year gain, median prices continued a downward trend, falling 7 percent, the combined single-family-residence and condominium data show.

Wait, falling prices and rising sales are “sour” in Pierce County but “encouraging” in Thurston? Huh? Note that both of these articles were written by the same guy…

(Eric Pryne, Seattle Times, 01.04.2012)
(Aubrey Cohen, Seattle P-I, 01.04.2012)
(Michelle Dunlop, Everett Herald, 01.04.2012)
(Rolf Boone, Tacoma News Tribune, 01.05.2012)
(Rolf Boone, The Olympian, 01.05.2012)

The post December Reporting Roundup: Corner-Turning Edition appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Home sales outpace number of new listings for first time in five years
Last month’s total number of mutually accepted offers was 22.4 percent higher than the same month a year ago. It also marked the first month since December 2006 that the number of pending sales surpassed the number of new listings (6,043), prompting discussions of possible inventory shortages.

“As we head toward the end of the year, it’s certainly good to see a healthy number of buyers relative to the available inventory for sale,” said Mike Grady, president and chief operating officer of Coldwell Banker Bain. “In fact,” he noted, “there are some desirable neighborhoods in urban core areas where the case could be made there are too few homes currently for sale.”
…
“Entering the New Year, the Seattle metro area will start off with a shortage of inventory in both the more affordable and mid-priced ranges,” suggested J. Lennox Scott, CEO and chairman of John L. Scott Real Estate. He noted a high percentage of sellers are receiving offers within the first month or two of listing their homes.
…
For homes and condominiums that sold last month, the median selling price was $225,000, down 10 percent from the year-ago median price of $250,000. Single family home prices were off 8 percent from a year ago ($234,612 versus $255,000), while condo prices slipped more than 17 percent ($169,000 versus $204,500).

Brokers point to distressed properties, which tend to be deeply discounted, as a primary cause of lower prices.
…
“Home prices continue to get dragged down by foreclosures and short sales, which is disappointing given how strong home sales are,” said OB Jacobi, president of Windermere Real Estate. “We probably won’t see drastic changes in prices until the banks work through the distressed inventory,” he noted, adding, “but we expect the pace of this process to pick up over the next several months, so hopefully by this time next year we’ll be singing a different tune.”

If we just ignore the inevitable fallout of the massive housing bubble (bank-owned homes and short sales), we can almost pretend as if prices aren’t falling!

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: Prices dive as “distressed” home sales rise in King County

Rising demand — sales — coupled with reduced supply — inventory — ordinarily is a recipe for higher prices, OB Jacobi, president of Windermere Real Estate, told an industry gathering last week.

Not this time. Distressed properties are keeping prices down, Jacobi said, and they are unlikely to increase much soon.

“The worry is, what do the banks have in their shadow inventory” of homes in foreclosure that haven’t been put back on the market for resale, he added.

More foreclosures are on the horizon.

The number of Washington homes whose owners were delinquent on their mortgage payments has increased in the past year, according to the Mortgage Bankers Association.

And, at their current pace, it could take banks nearly four years to work through the current statewide inventory of properties whose owners are at least 90 days delinquent on their mortgages, [WCRER Director Glenn] Crellin added.

This would seem to back up what I’ve been saying about the apparent dramatic drop in foreclosures: it’s just the pipeline clogging up due to legilative meddling in Olympia. If that four years number is accurate, it’s a pretty good bet that we won’t see price increases for at least that long, as well.

Aubrey Cohen, Seattle P-I: Home sales up, prices down in November

“Entering the New Year, the Seattle metro area will start off with a shortage of inventory in both the more affordable and mid-priced ranges,” J. Lennox Scott, CEO and chairman of John L. Scott Real Estate, said in the release.

But Crellin rebuffed talk of a shortage, saying that the listing service’s inventory numbers miss many of the lender-owned homes already on the market. He added, “If the inventory gets much shorter we’ll start to see the lending institutions putting more of their product out there.”

Crellin vs. Scott: FIGHT!

Michelle Dunlop, Everett Herald: Home sales increase in Snohomish County; prices fall

“We probably won’t see drastic changes in prices until the banks work through the distressed inventory,” Jacobi said, adding, “but we expect the pace of this process to pick up over the next several months, so hopefully by this time next year we’ll be singing a different tune.”

Brokers are optimistic about the potential benefit a tentative labor agreement between the Boeing Co. and the Machinists union could have on the real estate market. Union members vote Wednesday on a contract that secures future 737 work in Renton and ensures labor peace until September 2016.

With that news, combined with momentum from other major area employers, “we are seeing solid, renewed demand for local housing,” J. Lennox Scott, chairman and CEO of John L. Scott Real Estate, said in a statement.

If you say it often enough, you can make it true.

Kathleen Cooper, Tacoma News Tribune: Home prices still falling in Pierce County

Distressed properties are to blame for the falling prices, brokers said, because they sell at a discount.

“Home prices continue to get dragged down by foreclosures and short sales, which is disappointing given how strong home sales are,” said OB Jacobi, president of Windermere Real Estate, in a news release. “We probably won’t see drastic changes in prices until the banks work through the distressed inventory.”

It’s unclear how long that will take, and how far prices will fall until then. The MLS, which represents 21 counties in Western and Central Washington, classifies distressed properties as those that are bank-owned, and its data showed that almost 38 percent of the single-family homes that sold in Pierce County last month were in that category.

You can really tell how much care and effort went into this article.

No story on the NWMLS November numbers in The Olympian this month, but they did post this yesterday:
C.R. Roberts, The Olympian: Negative equity on the rise locally

Eighteen percent of homeowners in Olympia and the Thurston County area owed more on their mortgages than their homes were worth in the third quarter this year, according to the analytic and business-services company CoreLogic.

That compares with 18.2 percent in the previous quarter. Nationwide, 22.1 percent of mortgaged properties were in negative equity.

“I think it’s certainly a trend that’s going in the wrong direction. It’s probably as much a reflection on the overall economy as anything else,” said Mike Larson, owner-broker at Allen Realtors and president of the Tacoma-Pierce County Association of Realtors.

Statewide, 245,694 mortgages were in negative territory – from a total of 1.42 million mortgages overall in the state. Across the country, 10.7 million mortgages were underwater, from a total of 48.5 million mortgages.

“As long as there’s a reluctance or a hesitation to buy, the values are going to continue to erode. As values erode, the number of people who are upside-down will increase,” Larson said.

If only someone could have foreseen this vicious cycle before prices got so out of control!

(Eric Pryne, Seattle Times, 12.05.2011)
(Aubrey Cohen, Seattle P-I, 12.05.2011)
(Michelle Dunlop, Everett Herald, 12.05.2011)
(Kathleen Cooper, Tacoma News Tribune, 12.06.2011)
(C.R. Roberts, The Olympian, 12.05.2011)

The post November Reporting Roundup: Distressed Edition appeared first on Seattle Bubble.

Yes, they’re charting different things, and yes, this Sunday’s story isn’t directly about real estate, but the similar visual style coupled with such starkly different tones still struck me as interesting.

The 2006 story: Home prices’ long rise: Is the end near? (Seattle Bubble response)

The 2011 story: The Great Recession’s toll: Tallying the impact in the Northwest

The post What a Difference a Few Years Makes appeared first on Seattle Bubble.

What does this mean for you, the reader?

• Better/faster coverage of relevant stories from the Seattle Times
• More readers, commenters contributing to the conversation here
• Possible future collaborations with Seattle Times & other partners

Note that there is no money changing hands here, nor any sort of ownership change. Seattle Bubble is still a wholly independent operation, written, edited, published, and overseen by yours truly. The News Partner Network is just a way for the Seattle Times and local independent news sites and blogs to mutually benefit from the different resources provided by each.

Here’s the official announcement over at the Seattle Times: Seattle Times announces more local news partners

The post Seattle Bubble Partners with The Seattle Times appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Northwest Multiple Listing Service members reported solid gains in pending sales (up almost 21 percent from a year ago), consistent demand in many price ranges, a shortage of homes in a few categories, and some resurgence of move-up buyers.

Despite those encouraging indicators, prices were down almost 11 percent area-wide compared to a year ago and brokers say there is persistent “hesitancy” in the market.

“fire sale” by Flickr user zimway2k

“All the pieces (for a recovery) exist — low interest rates, lots of choices, increasing loan availability as well as purchasing programs, yet as a whole the housing market has stalled in many places,” said Northwest MLS director Frank Wilson.

“What is holding back the housing market has little to do with houses,” Wilson stated, pointing to uncertainty in the stock market and volatile global economies, along with a more complicated, prolonged transaction process and lack of job creation.
…
Pricing data should be viewed with some misgivings, said Joe Spencer, president and COO of John L. Scott Real Estate. “Headlines stating home values have fallen by double digits compared to last year don’t always reflect what is really happening,” he explained, noting factors that can influence prices.

“Not every home has dropped 15 percent in value,” Spencer insists. He attributes much of the decline to a combination of factors, including shifting demographics and the influence of distressed properties, which he said may be as high as 40 percent in some areas. More investors and first-time buyers are purchasing in the more affordable price ranges, which results in a downward shift of median prices, Spencer explained. Also, he noted, distortions caused by REO (bank- or other lender-owned) and foreclosed properties contribute to price depressions.

“When you adjust for these conditions and compare ‘standard resale homes’ the change in home values is much less drastic,” Spencer emphasizes. He believes a more accurate reflection of price declines for the Seattle area is around 6 percent, citing research by CoreLogic, Wells Fargo Securities and other analysts.

You know it’s bad when even Joe “The Perfect Buyer’s Market” Spencer‘s ultra-massaged data shows price declines of six percent.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: Puzzling plunge: 15% year-over-year drop in county home prices

King County home prices tumbled to a new post-boom low in October, and no one is sure exactly why.

As real-estate insiders offered a host of possible explanations for the drop Thursday, they also debated whether it’s a harbinger of a new, long-term decline — or a one-time statistical blip.
…
Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University, said he expects prices will continue to slip for another year.

“There’s little pressure on buyers to be active, especially with interest rates not expected to rise for some time,” he said. Mortgage rates have been at historic lows — even dipping below 4 percent for a 30-year term — for much of this year.

But Tim Ellis, who writes the real-estate blog Seattlebubble.com, said he’s not making too much of the October numbers.

“One month does not a trend make,” he said. “I’m inclined to take a wait-and-see approach.”

Wait, did I just read that right? Glenn Crellin and I disagree, but he’s the more bearish one? Welcome to bizarro world. Later in the article, Eric gets to what I think is really going on:

Ellis said that while Redfin’s research also shows a big year-over-year drop in the median sales price last month, the price per square foot fell much more modestly.

That suggests “for whatever reason, people bought smaller houses,” he said.

The geographic mix also shifted. Listing-service statistics show King County’s lowest-priced areas — Southwest, Southeast and North King County — saw the biggest increases in sales last month. They also experienced the biggest price drops, and that brought the countywide number down.

Aubrey Cohen, Seattle P-I: King County’s median home price dips below $300,000

The median sales price of a King County home just dipped below $300,000 for the first time since September 2005.

The median price was $287,500, including houses and condos, in October, the Northwest Multiple Listing Service reported Thursday. That’s down 7.3 percent from September, 17.9 percent from October 2010 and 32.4 percent from a peak of $425,000 in July 2007.
…
Crellin said the drop in the conforming loan limit was a factor, but “maybe a little overstated,” by Jacobi. He saw a bigger role for sales of distressed homes and cash purchases by investors, adding that sellers may accept a lower offer that’s cash, because they know that financing won’t be an issue.

Also, sellers of more-expensive homes are starting to cut their prices, Crellin added. “It’s the combination of all these things hitting at once.”

I think Crellin is spot on here, actually. I seriously doubt that the lower conforming limits were the primary explanation for this one-month drop. The mix of sales is just shifting toward the cheaper homes. It’s so odd—when something is less expensive, more people want it. Who could have guessed.

Mike Benbow, Everett Herald: Home sales increase by 43 percent

Home sales in Snohomish County were solid in October, but prices continued to drop significantly from a year ago, the Northwest Multiple Listing Service reported Thursday.

There were 828 homes sold in the county last month, a 43 percent increase from the same time last year. The county’s percentage increase in sales was the highest for the listing service territory, which covers most of Western Washington.

The strong sales and strong pending sales, which rose 29 percent last month, were a good sign for the housing market. But other indicators showed the local market is anything but healthy.

Median home prices in the county, for example, dropped nearly 15 percent in comparison to October 2010. That sent the combined median home price for single-family homes and condominiums to $221,142, a drop from $260,000 a year ago.

Not much meat in this month’s article from the Herald.

Rolf Boone, Tacoma News Tribune: Pierce County home prices continue decline

The median price of a Pierce County home continued its runaway descent in October, falling more than 16 percent in the year-over-year period, according to Northwest Multiple Listing Service data released Thursday.

October’s price decline was the sixth consecutive month in which median prices have fallen by at least double digits on a year-over-year basis.
…
Tacoma-Pierce County Association of Realtors President Mike Larson said one reason prices continue to fall is the large number of homes still for sale in the county. More than 5,000 homes were for sale last month, which means a prospective buyer can make a low offer for one house, and if it isn’t accepted, that buyer can just move on to the next house, he said.

Wait, he’s saying that inventory is high? I haven’t looked closely at Pierce County recently, but I highly doubt that inventory there is all that high compared to historic levels.

Rolf Boone, The Olympian: Thurston home sales rise 7 percent in October

Thurston County home sales finally broke out of an extended rut in October, rising 7 percent last month after several months in which sales were flat, according to Northwest Multiple Listing Service data released today.

Home sales rose 6.99 percent to 245 units from 229 units in October 2010, the combined single-family residence and condominium data show.

Super-short blurb in the Olympian online this month, with a tease to “see Friday’s Olympian” for the real story. Looks like this is all we get online.

(Eric Pryne, Seattle Times, 11.03.2011)
(Aubrey Cohen, Seattle P-I, 11.03.2011)
(Mike Benbow, Everett Herald, 11.03.2011)
(Rolf Boone, Tacoma News Tribune, 11.04.2011)
(Rolf Boone, The Olympian, 11.03.2011)

The post October Reporting Roundup: Fall Fire Sale Edition appeared first on Seattle Bubble.

I’ll let the sign speak for itself, but I will say that I really don’t understand the connection these protesters appear to be making. Other signs at the protest:

• “STOP ROBBIN’ OUR HOODS!”
• “STOP ILLEGAL FORECLOSURES”
• “NO MORE Foreclosures in OUR WA!”
• “BANKERS LIED, ECONOMY DIED”
• “Fund the needy, Not the greedy”
• “BANKS TERRORISTS WORSE THAN AL QAEDA”
• “HOMELAND SECURITY NEEDS TO DEFEND MY HOME”

How are foreclosures equivalent to corporate greed, theft, and terrorism?

The post “Who Is Home Will U Steal Today” appeared first on Seattle Bubble.

Unfortunately, it seems that someone in the editing department mis-labled the “Humor” section of the magazine as “Real Estate.” Consider the following excerpts from the article entitled “Buyer’s Market” (which begins on page 77):

San Diego resident Matt Scharkozy is trying to relieve a seven-year itch. After spending that much time renting a home in th Southern California city he has grown to love, the telecommunications salesman and Pennsylvania native decided last summer to take the plunge and buy a condominium.
…
Some might think Scharkozy is taking a risk buying a home in this time of economic uncertainty. But he, and others like him, may accomplish the ultimate goal for many in real estate: buying at or near the bottom of the housing market.

Some real estate experts are predicting that, barring a double-dip recession or an unforeseen crisis in Europe or another part of the world (and, yes, those are big “ifs”), 2012 will be the year housing markets start to heal and home prices not only stabilize but maybe even begin to rise.

Yup, now even airlines are getting into the real estate bottom-calling business. Of course, what do you expect when the magazine has been largely funded by builders of brand new condos and houses? Here are a few of the prominent advertisers found inside:

• Escala (downtown condo)
• Olive8 (downtown condo)
• Fifteen Twenty-One (downtown condo)
• The Sanctuary (Capitol Hill condo conversion)
• Tannerwood (North Bend new homes)
• The Burnsteads (new homes)
• Lindal Cedar Homes (custom home builder)
• Harvard & Highland (Capitol Hill condo)

But wait, it gets better!

So where are the best locations to buy a home—places where property values are expected to rise in the coming years? While you might expect cities such as Seattle and San Diego to be on the list, other cities may come as a surprise.

Fiserv’s economic models, which are created using data for single-family homes and condominiums, have identified strong markets throughout the West. Fiserve found that prices in Tacoma, Washington, are expected to increase 24 percent between 2011 and 2013. In fact, Stiff expects that just about any metropolitan area in Washington state—as well as many other cities throughout the western United States—should see home prices rise.

According to Fiserv, the cities of Bend, Oregon, and Carson City, Nevada, both could see home prices spike by 17 percent, while 10 percent gains are expected in Seattle, Tucson and Reno.

You read that right. 10% gains by 2013 in Seattle, 24% in Tacoma. They used economic models, you guys, so obviously you can trust these forecasts to be absolutely accurate.

To wrap things up, enjoy this quote from Julie McAvoy, community sales director at Realogics Sotheby’s International Realty in Seattle (who happens to be handling sales at Olive8):

“I don’t think there has ever been a better time,” McAvoy says about acquiring a condo. “But it has to be for a long-term hold. If you want to buy a place and live in it, I don’t think you can beat this moment.”

Pretty much this exact same article could have been (and basically has been) published in 2008, 2009, and 2010. According to the people who make money selling homes, sudden recovery and price growth has been just around the corner ever since home prices first started falling here in the Seattle area in late 2007. Newsflash: That is not going to happen. We’re in for a long slog of flat to slightly declining prices. Deal with it.

In case the online version of the magazine is taken down, I have generated a pdf excerpt of the cover, table of contents, and the real estate section for your enjoyment.

The post Fly the Real Estate Cheerleading Skies with Alaska Air appeared first on Seattle Bubble.

Clearly designed to look and feel just like the official voter’s guides (same paper stock, same layout styles), this local REALTOR® publication contains a list of every REALTOR®-endorsed candidate for offices in King County and the various cities in the county.

You might think that you would get to see both candidates for each office, read a little about each one, and learn the justification for why one candidate earned the REALTOR® endorsement over the other. You would be wrong. Instead, all you get is the name, photo, and a brief pro-REALTOR® statement from each endorsed candidate, and that’s it.

Why are the REALTORS® endorsing Jane Hague over Richard E. Mitchell for King County Council in District 6? Who knows! All the REALTOR® Voting Guide tells us is that Jane is “proud to have received the early endorsement of the SEATTLE KingCounty REALTORS®.” Wow, that is really useful information.

The guide does have the questionnaire pictured below on the last page, which they explain that they gave to candidates to determine a “rating” that a handful of the candidates in the booklet have been given. Apparently the most pressing political issue to local REALTORS® (judging by the length of each question) is the restriction of Open House Signs (question 6).

Gotta protect that precious open house traffic, after all.

The post Confused about politics? Let REALTORS® think for you! appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Northwest MLS brokers say September activity reflects "healthy activity, positive trends"

photo by Flickr user jchatoff

“This market is proving to be challenging, but not for the reasons you might think,” said OB Jacobi, president of Windermere Real Estate Co. He pointed out interest rates are low, affordability is high, and confidence in the housing market is improving. “These are all good things, but the result is an influx of motivated buyers in a market where inventory levels have not yet caught up to the demand.” Jacobi, a member of the Northwest MLS board of directors, said one consequence is “stiff competition for move-in ready homes that are priced right, especially in neighborhoods close to Seattle.”

“In Central Puget Sound, 90 percent of sales activity is taking place in the more affordable and mid-price ranges, where the inventory level of homes for sale is low to healthy,” said J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “Historical low interest rates combined with lower adjusted prices are attracting home buyers and investors at a healthy sales activity level,” he observed.
…
“Historically, low inventory at these levels has led to stable or slight increases in home valuations,” said Northwest MLS director Joe Spencer, COO and president of John L. Scott Real Estate. “It’s too early to tell,” he added, “because there are a lot of crosscurrents in the economy, but it’s encouraging seeing positive trends in sales activity and listing inventory.”

That is some unexpected restraint on display by Joe Spencer. You can tell he really, really wanted to call the bottom there, but he managed to hold off, at least this month. I also have to say that I’m a bit surprised by Mr. Scott’s claim that we’re seeing a “healthly sales activity level.” Again, sales are lower than they have been any other years except for 2008 and 2010, and about 20% lower than where they were in the midst of the dot-com bust. I’m not exactly sure how that qualifies as “healthy,” especially to someone in the business of selling homes.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: King County home sales up, median price down 8 percent from year ago

Buyers closed on 37 percent more houses in King County in September than in the same month last year, according to statistics released Wednesday by the Northwest Multiple Listing Service.

But the year-over-year surge may reflect past weakness as much as current strength.

Sales volumes plummeted in mid-2010 — and didn’t recover for several months — after homebuyer tax credits that were part of the Obama administration’s economic-stimulus package expired.

Fewer houses sold in King County last September than in any September since at least 2004.
…
Will prices rise anytime soon? The real-estate industry is facing some head winds “that are causing angst in the buying public,” Gardner said. Those head winds include new restrictions on “jumbo” mortgages, proposals to require higher down payments for nonconforming loans and talk of eliminating the mortgage-interest tax deduction.

But the stability in median prices since spring is a positive sign, Gardner said, and he doesn’t expect another big drop anytime soon.

Of course, Matthew Gardner also expected that home price appreciation would return in 2010… Overall, another great piece by Eric that highlights what’s really going on in the market.

Aubrey Cohen, Seattle P-I: Home sales cool but supply remains low

After posting big year-to-year gains in recent months, Seattle-area home-sale deals cooled off in a bit September.

Pending sales, which may not close but are the best indication of the most-recent activity, were up 24.3 percent in King County and 9.8 percent in Seattle from September 2010.

While not bad, these were down from jumps of about 34 and 28 percent in August and were the lowest increases since April, which was the last month that this year’s sales were compared with months last year when a homebuyer tax credit boosted sales. In fact, what the new totals may show is the wearing off of year-to-year gains boosted by a hangover after the tax credit went away last year.

That’s about the extent of the original content in this month’s P-I article, as the rest seems to be more or less a rehash of the NWMLS press release. I guess Aubrey was a bit busy with other projects this month.

Mike Benbow, Everett Herald: Home sales increase for second straight month in county

Home sales in Snohomish County rose 36 percent in September, showing an increase from a year ago for the second straight month, the Northwest Multiple Listing Service reported Wednesday.

There were 837 homes sold last month, compared to 615 in September of 2010. Sales were slow last fall because many of last years purchases were in the spring to take advantage of federal tax breaks offered to home buyers.

Not much meat here, either.

Rolf Boone, Tacoma News Tribune: Home prices plummet in Pierce County, MLS data show

Pierce County median home prices fell again last month, the fifth consecutive month in which median prices have fallen by 11 percent or more, according to Northwest Multiple Listing Service data released Wednesday.

Homeowners hoping to get some good news about home prices didn’t get the answer they wanted in September as median prices fell 12.94 percent to $191,750 from $220,250 in September 2010, the combined single-family residence and condominium data show.

I think what he meant to say was “home buyers hoping to get some good news about home pricees got exactly what they wanted in September as homes became even more affordable, giving up the unsupportable gains of the bubble years.”

Rolf Boone, The Olympian: Thurston home sales flat for fifth month

Thurston County home sales were flat in September, the fifth consecutive month in which year-over-year home sales have barely budged, according to data released today by the Northwest Multiple Listing Service.

Super short blurb in the Olympian this month, with a promise of “more on this story” in “Thursday’s Olympian,” but so far nothing more has shown up on the website. Perhaps only the print readers get the goods now.

(Eric Pryne, Seattle Times, 10.05.2011)
(Aubrey Cohen, Seattle P-I, 10.05.2011)
(Mike Benbow, Everett Herald, 10.05.2011)
(Rolf Boone, Tacoma News Tribune, 10.06.2011)
(Rolf Boone, The Olympian, 10.05.2011)

The post September Reporting Roundup: Motivated Buyers Edition appeared first on Seattle Bubble.

Yesterday over on the Redfin blog, I dug a little deeper into the conforming loan limit changes, pulling detailed sales data from all around the country by zip code to see which areas would be most affected by the change.

The result was another Google FusionTables zip code heat map. Below I have embedded the Seattle area. Note that to calculate the percent of sales that would be affected, I assumed 20% down. Click on any zip code to see the breakdown. Red represents 20% or more affected, Orange for 10% to <20%, Yellow for 5% to <10%, and Blue for <5%.

As I pointed out a couple weeks ago, for most of the Seattle area, the change is a non-event. The use of the word “hardest” in the headline is highly relative. For most of the Seattle area well under 5% of homes fall between the two limits. Over on the Eastside there are a few areas that creep up to around 10% affected, and one—South Sammamish—that hits almost 25%.

It will be interesting to see if sales in the red and orange areas on the map take any sort of hit over the next few months beyond what we would expect to see due to regular seasonality.

The post Conforming Loan Limit Changes to Hit Eastside Hardest appeared first on Seattle Bubble.

In order to get a sense of scope on how many sales might be affected by this new change, I did a few quick searches on Redfin.

Under the current limit of $567,500, a buyer with 20% down could buy a home priced up to $709,375. Under the new limit of $506,000, the 20%-down buyer can now only go up to $632,000. According to Redfin, 4.1% of homes on the market (SFH, condo, & townhouse) in King County right now fall between those prices (426 out of 10,490 listings). 4.5% of sales in the last six months have fallen in that range (601 out of 13,350 sales).

If we assume the worst-case scenario of just 3.5% down under the existing limit a buyer could purchase a home of up to $588,083, while under the new limit that drops to $524,352. 4.8% of current listings fall between those ranges (502 out of 10,490), and 5.4% of sales (724 out of 13,350).

If you take the broadest possible range of $524,352 at the low end under the new limits, down from $709,375 at the high end under the existing limits, you’re talking about 11.7% of listings (1,228 out of 10,490) and 12.9% of sales (1,725 out of 13,350).

So the new conforming loan limits will affect between 4% and 13% of the Seattle-area market. Doesn’t seem like such a massive disruption to me…

Full disclosure: The Tim is employed by Redfin.

The post How Much of the Seattle-Area Market Will be Affected by New Conforming Loan Limits? appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

Northwest MLS brokers notch this year’s best monthly tally of sales during August

“For the first time in a long time, I can say with confidence that things feel better,” said Northwest MLS director OB Jacobi, president of Windermere Real Estate. “We shouldn’t get too distracted by the large increase in pending sales,” he cautioned, noting, “It’s a positive sign, but these figures are being compared to last summer’s post-tax incentive doldrums. With that being said, we’re excited about the positive momentum in the market.”
…
“With a low level of home inventory for sale and historically low interest rates, we are seeing a healthy volume of sales activity causing multiple offers,” observed J. Lennox Scott, chairman and CEO of John L. Scott Real Estate.
…
Commenting on the latest numbers, NWMLS director Frank Wilson emphasized, “A real estate market is about activity and momentum.” He also noted historic affordability, with the cost of a home better matching income levels and extremely low interest rates contributing to favorable conditions. “We continue to live in a real estate market of extreme affordability, affordability levels that have not been seen in decades,” he stated.

They forgot to mention the “high open house traffic.” I like how they’re focusing on “momentum” from a period when sales were at record lows. Sure, we’ve moved out of the gutter, but we’ve got a long way to go before we get back to anything resembling a “normal” market. Here’s a quick look at August single-family closed sales in King County for every year since 2000:

Sure, 2011 looks great compared to 2010—the lowest year on record—but even during the worst year of the dot-com recession in 2002 we had 25% more sales in August than we did this year. But never mind the data. Let’s throw out nebulous concepts like “activity and momentum” and tell ourselves that everything is coming up roses.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: Local home sales on pace to top last year’s total

More houses are likely to sell in King County this year than in 2010, when federal tax incentives fueled the market, observers agree.

But sales volumes are far off the frenzied, pre-bust pace of 2006 and 2007. And prices remain flat: The median price of a single-family home sold in King County has barely changed in six months, the Northwest Multiple Listing Service says.

Buyers closed on 35 percent more houses in August than in the same month last year, according to statistics released Tuesday by the listing service.

The big year-over-year increase wasn’t a surprise: After federal tax credits that were part of the Obama administration’s economic-stimulus package expired around mid-2010, home sales fell into a lull that persisted well into fall.

It’s nice to have Eric back again. The intern produced pieces that were certainly better than the shameless cheerleading that used to be pumped out on these pages by our old friend Elizabeth Rhodes, but Eric is still the best at telling the complete story, in my opinion.

Aubrey Cohen, Seattle P-I: Home sales surged in August, while prices fell

Local home sales shot up in August by the largest percentage in years, while home prices continued to sag, according to a new report.

Last month’s sales rose 36.4 percent in King County and 28.3 percent in Seattle from August 2010, when the market was still hung over from the expiration of a home-buyer tax credit, the Northwest Multiple Listing Service reported Tuesday.
…
Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University said we won’t have an “apples-to-apples” comparison until next month, when September numbers come out, because the tax-credit hangover had worn off by September 2010.

The text of Aubrey’s article is much more even-toned than the headline. I suspect Aubrey didn’t choose the “home sales surged” title. I don’t agree with Glenn on this one. I think that the sales hangover didn’t really wear off until October last year. I think we’ll still see pretty unnaturally high year-over-year numbers next month. October 2011 will probably see more sales than October 2010, but it most likely won’t be 30% more.

Mike Benbow, Everett Herald: County housing market shows signs of an upswing

August was the best month for home sales in Snohomish County since April 2010, the month the nation’s homebuyer incentives expired.

There were 916 homes sold in the county last month, a 42.7 percent increase from August 2010, the Northwest Multiple Listing Service reported Tuesday.

The huge jump in sales isn’t a big surprise.
…
Because of the low prices, many people who didn’t have to sell their homes now kept them off the market. Listings in the county totaled 4,425 homes in August, a 26 percent drop from a year ago.

Short article, but Mike does hit on a good point there about inventory. I suspect we’ll be seeing pretty low inventory for quite some time, given the large number of bubble buyers who are essentially stuck in their homes.

John Gillie, Tacoma News Tribune: Central Puget Sound area housing sales up from 2010

Encouraging news for the Puget Sound housing market emerged Tuesday with the release of new sales figures for August.

Pending sales for the four-county central Puget Sound area, King, Pierce, Snonohomish and Kitsap, were the highest they’ve been in August since 2006, said the Northwest Multiple Listing Service. And closed sales were up significantly in all four counties.
…
“For the first time in a long time, I can say with confidence that things feel better,” said John Jacobi, president of Windermere Real Estate. But Jacobi cautioned that the 26.42 percent increase in pending sales in the 21 Washington counties that Northwest MLS covers was so large in part because August 2010′s pending sales were relatively weak.

“We shouldn’t get too distracted by the large increase in pending sales,” he said. “It’s a positive sign, but those figures are being compared to last summer’s post-incentive doldrums.”

Al Morken, broker with Better Properties Real Estate’s North Proctor branch, likewise was cautious about pending sales because so many fail to close because of strict credit requirements, more diligent home inspections and inconsistent appraisals.

Despite the warning about pending sales given right in the NWMLS press release, let’s dedicate half of our article to talking about pending sales. That sounds like a good plan.

John Gillie, The Olympian: Thurston’s August pending sales up year-over-year

Encouraging news for the Puget Sound-area housing market emerged Tuesday with the release of sales figures for August.

Thurston County saw pending sales increase from 344 in August last year to 370 last month, said the Northwest Multiple Listing Service.

Pending sales for the four-county central Puget Sound area – King, Pierce, Snonohomish and Kitsap – were the highest they’ve been in August since 2006, said the Northwest MLS. And closed sales were up significantly in all four counties.
…
Closed sales in August reflected that same positive news in those four counties, while closed sales in Thurston County last month were down slightly.

Pierce County saw a 44.24 percent increase in closed sales last month. King had a 36.4 increase. Kitsap figures reflected a 36.36 percent bump, and Snohomish had a 42.68 percent increase.

Thurston County’s closed sales were down 2.44 percent, the new figures showed.

Argh, I hate it when they publish basically the same exact article in the News Tribune and the Olympian. However, it is interesting that Thurston County isn’t seeing the same big year-over-year increase in closed sales. Not sure why Thurston would be left out of this party. I’ll have to dig into that a little more to see what’s going on down there.

(Eric Pryne, Seattle Times, 09.06.2011)
(Aubrey Cohen, Seattle P-I, 09.06.2011)
(Mike Benbow, Everett Herald, 09.06.2011)
(John Gillie, Tacoma News Tribune, 09.07.2011)
(John Gillie, The Olympian, 09.06.2011)

The post August Reporting Roundup: Gutter Momentum Edition appeared first on Seattle Bubble.

In his post, Is a Home a "Lousy" Investment? Tom takes on the recent Wall Street Journal piece A Home Is a Lousy Investment, arguing that this view is too simplistic.

Tom’s 1,300-word post includes everything we love here at Seattle Bubble: graphs, tables, and detailed criticisms of underlying assumptions. His conclusion is sound, as well:

…homeowner equity with a mortgage is an attractive but risky investment, in some ways more risky that the stock market because a family can lose all of their equity. As with the stock market, deciding whether it would be a good investment depends crucially on how long the family can hold onto the investment.

Of course, even buyers that plan to hold for a long time were making horrible investments in 2006 and 2007, but for a more “normal” market, I think Tom’s analysis is fair.

Head on over to the new blog, read the whole post, and drop them a comment. It’s good to see more level-headed local commentary on these types of issues. Best of luck, Tom!

The post New King County Econ Blog: Housing is Risky, not Lousy appeared first on Seattle Bubble.

To kick things off, here’s an excerpt from the NWMLS press release:

July housing activity around Washington described as "classic good news, bad news story"

“It’s classic good news, bad news story,” said Northwest MLS director Frank Wilson, branch managing broker at John L. Scott Real Estate in Poulsbo. “The good news is that we seem to be at the bottom,” he remarked, adding, “The bad news is we are just sitting there. Although homes are still selling, and in some cases at the asking price and in a reasonable amount of time, these are isolated to specific price ranges and geographic areas.”
…
“In selected areas and price ranges, where there is a low level of homes for sale, we are seeing high sales activity for new properties when they come on the market,” reported J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. Scott noted healthy sales activity is occurring close to the job centers of Seattle and Bellevue, with transferees leading the way. However, he acknowledged, “lower sales activity is being reported in the outlying markets and in the high end.”

Awesome. Yet another bottom call from a local agent. Time for another look at the median price chart:

Also, I really enjoy that big string of qualifiers from Lennox before he refers to “high sales activity.” Translation: for the kinds of homes that are selling, there are homes that are selling! Wow!

Read on for my take on this month’s local news reports.

Christine Harvey, Seattle Times: Seattle-area home sales jump in July; prices skid

Despite the increase over last July, the total sales so far this year aren’t much different from in 2010.

Single-family closings in King County totaled 10,310 from January through July 2010, compared with 10,204 this year, MLS data showed.

Median home prices, however, were down significantly in July.
…
Glenn Crellin, director for the Washington Center for Real Estate Research at Washington State University, said there is “a substantial amount of bargain hunting in the market.”

His observations were reflected in the King County statistics, where activity was up 34.7 percent in Southwest King County and 29.4 percent in North King County — the cheapest areas.

So weird! When homes are cheap, people want to buy them. Go figure!

Aubrey Cohen, Seattle P-I: Home sales rise, but price drops accelerate

While Seattle-area home sales rose in July, prices posted their biggest drop of the year, according to a new report.

Problem: sales actually fell June to July and prices actually rose slightly. The apparent large changes year-over-year in sales and prices are skewed since we’re comparing to the first post tax credit month of 2010.

“We’ve got a market that is reflecting some stabilization compared to the severe dropoff that we saw last July” after the tax credit expired, said Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University.
…
The housing market needs good economic news, Frank Wilson, branch managing broker at John L. Scott Real Estate in Poulsbo, said in the news release. “Until consumers get excited about what is happening in our economy, here we will sit, which in the big picture is better than where we were a few years ago.”

I think we need more than some “excitement” to see a boost in homebuying. We need to see some actual improvement in the underlying economic fundamentals. You know, employment, incomes, that sort of thing?

Mike Benbow, Everett Herald: Home sales climb in July in Snohomish County

It’s a little too early to tell, but Snohomish County’s long drop in home sales may have reached bottom and started to climb out.

For the first time in a long time, home sales rose significantly in July in comparison to a year ago, the Northwest Multiple Listing Service reported Thursday.

*Sigh* Mike apparently completely forgot about the cliff sales fell off of a year ago. This despite the fact that he wrote about it at the time.

Rolf Boone, Tacoma News Tribune: Pierce County home sales skyrocket as prices fizzle in July

Pierce County home sales soared in July, likely lifted by bargain prices, which fell more than 11 percent from last year, according to data released today by the Northwest Multiple Listing Service. It was the third consecutive month since May that Pierce County median prices have fallen more than 11 percent.

Still, home sales last month rose more than 20 percent to 838 units from 686 units, the year-over-year combined single-family residence and condominium data show.

Wow, “skyrocket”? Really? Total fail.

Rolf Boone, The Olympian: Thurston County home sales flat in July

Thurston County home sales were flat in July, likely a disappointing result for the South Sound real estate community after home sales trended upward in June, according to data released today by the Northwest Multiple Listing Service.

Year-over-year sales for July fell less than 1 percent to 247 units from 249 units, and median prices fell 4 percent to $225,000 from $234,900, the combined single-family residence and condo data show.

Sadly, although there is apparently an interesting story here (sales were actually down from 2010, when they were up everywhere else?), all we get for Olympia is this super-short blog post.

(Christine Harvey, Seattle Times, 08.04.2011)
(Aubrey Cohen, Seattle P-I, 08.04.2011)
(Mike Benbow, Everett Herald, 08.04.2011)
(Rolf Boone, Tacoma News Tribune, 08.04.2011)
(Rolf Boone, The Olympian, 08.04.2011)

The post July Reporting Roundup: Skyrocketing Bottom Edition appeared first on Seattle Bubble.

So here’s a weekend conversation starter for you: Will you be buying Zillow when they hit the public markets? Why or why not? What do you think of the $485 million valuation? Does Zillow provide enough value to become a viable long-term company? What will they look like in 5 years?

The post So, Who’s Going to Buy Zillow Stock? appeared first on Seattle Bubble.

Way back in 2009, Craig Blackmon (of WaLaw Realty, a Seattle Bubble advertiser) ran a four part series (Part 1, 2, 3, 4), laying out his argument for why lawyers provide better representation than real estate agents. Since then he has dropped in with some regularity to hammer home his point that real estate agents typically are not providing real value to consumers.

In his most recent volley (Representation by RE Agents: Is That an Oxymoron?), Craig used a real life example of what he describes in the comments as a “trap” laid by agents in the way the MLS rules are set up:

The listing agent indicated that s/he was busy but that s/he would send another agent to provide access. My clients assumed this was an associate of the listing agent, and the listing agent was taking steps to provide access as part of the job of selling the home. The clients were interested in two homes listed by the same agent, and the “associate” provided access to both, only one of which was suitable for my clients. Total time: Approximately one hour. At the end of the tour my clients informed the showing agent that they intended to use my services if they wanted to move forward. The showing agent did not mention that she was totally unrelated to the listing agent and would have a potential claim on the SOC [Selling Office Commission] if the clients purchased either home.
…
The “associate” was actually another agent working under a different broker in a different firm. The listing agent frequently refers new business to this “showing” agent. Because I cannot rebate a commission to which some other agent has a claim, I asked the showing agent if s/he was going to assert a claim on the commission (as the “procuring cause”). The answer? Yes I am! But as a compromise s/he offered to accept 30% of the commission, a typical referral fee. With a sale price of about $700k, s/he wanted $6k for the hour of work.

In the ensuing comment thread, Ardell seems to be taking the position that this opaque practice is perfectly fair, and it’s the buyer’s own fault if they aren’t familiar with the rules (or something like that).

Apparently in response to Craig’s posts, Ardell put up a post arguing the opposite point: Why Agents Are Better than Lawyers.

People don’t know what we do. because it is PERSONAL. What we do for our clients is never known until someone who thinks this business is EASY walks a mile in our shoes. THIS is what I do BEFORE I even START! The Listing won’t even be in the MLS until Wednesday.
…
[listing before and after photos]
…
Even staging the Linen Closet, the kitchen cabinets, the patio set out on the deck…you name it. Closets… anything a buyer will open and look inside.
…
And oh…

BTW…

I didn’t see any LAWYERS in Joann Fabrics on 4th of July Weekend.

I’d like to place the question out there to the Seattle Bubble readership: Whose argument do you find more convincing? Craig or Ardell?

I know we’ve got a handful of other real estate professionals that frequently comment here, and while I appreciate your contributions, I’m more interested in the average Joe consumer’s opinion on this one (especially since most of the regular professionals have already weighed in over at RCG).

So what say you, is it a good idea to hire a real estate agent to represent you in today’s market, or does it make more sense to go with a lawyer or some other alternative model?

The post Real Estate Agents: Advocates, or Deadweight? appeared first on Seattle Bubble.

Strangely, as far as I can tell the NWMLS has still not yet published their press release this month. When it eventually is, it should be found here. In the meantime, it was sent to me, so here’s an excerpt:

Pending sales around Washington State at mid-year surpass year-ago levels; industry leader says "It feels like we have hit the bottom of the market"

Continuing the double-digit gain in home sales during May, last month’s pending sales surpassed the volume for June 2010 by nearly 36 percent .

Oops, let’s pause again to look at the pending sales chart in order to make sense of this claim of “continuing double-digit gains.”

As you can see, “double digit gains” doesn’t really indicate that this year is seeing particularly strong sales, but rather it’s just a result of sales falling off a cliff post-tax-credit last year. Also, don’t forget that “pending” doesn’t mean what it used to. Back to the press release…

“It feels like we have hit the bottom of the market,” remarked Lennox Scott, chairman and CEO of John L. Scott Real Estate. He described sales activity as being at “healthy levels” for the past seven months across all price ranges close to the Seattle-Bellevue job centers and up through the median price range in the surrounding markets. “Buyer confidence has definitely returned,” he proclaimed.

This from the same professional that in late 2007 boldly declared that there was no way prices would fall 25%, but at most “they may come off ever so slightly off the peak.”

But let’s not focus on the past… Read on for my take on this month’s local news reports.

Christine Harvey, Seattle Times: Local home prices slide again, but market may be stabilizing

The trend that drew the most attention among market observers was that pending sales have been fairly steady since March at a much higher level than they had been since April 2010′s expiration of federal tax credits.
…
Tim Ellis, editor of the real-estate blog Seattlebubble.com, said the change in pending sales isn’t impressive because the June 2010 totals were so low.
…
Pending sales can be misleading, however. They have become a less reliable measure of future sales as contracts often don’t pan out because of difficulties in financing, or lenders don’t agree to short sales, for example.

Thanks to Christine for getting in touch with me and taking the time to understand what’s going on as she sits in for Eric on the real estate beat.

Aubrey Cohen, Seattle P-I: Seattle area’s housing market heats up

The latest home sale numbers give local real estate professionals confidence that the Seattle area’s housing market has bottomed out.

“It feels like we have hit the bottom of the market,” Lennox Scott, chairman and chief executive officer of John L. Scott Real Estate, said in a news release accompanying the Northwest Multiple Listing Service’s report on June home sales, released Wednesday.
…
Of course, local real estate professionals have mistakenly called the bottom more than once since the market peaked in 2007. And the expiration of a homebuyer tax credit in April 2010 meant the subsequent months were the peak of the post-credit hangover, with particularly low sales. That may make this June look particularly rosy compared with a year earlier.

…there still appears to be a large inventory of distressed homes that are on the market or waiting to enter the market. That could hold back prices for some time.

Great job as usual from Aubrey. I especially appreciate that he pointed out the repeated bottom calls we’ve seen from various professionals over the last four years. Kudos.

Mike Benbow, Everett Herald: Pending home sales up in county, but prices still low

Pending home sales in Snohomish County rose dramatically in June, prompting at least one industry leader to suggest the region’s housing industry may be rebounding.
…
Completed sales in June were down, but only slightly. There were 866 homes sold in the county last month compared to 898 a year ago, a 3.6 percent drop.

While sales appeared to be leveling off, prices continued to fall as foreclosed homes and short sales continued to load the local market.

Mike rightly points out that closed sales are not seeing any sort of surge and prices are still down, but he seems to have forgotten what he reported last month about the reason behind the “dramatic” rise in pending sales year-over-year.

Rolf Boone, Tacoma News Tribune: Monthly data: Pierce County home prices drop again

The South Sound housing market showed some improvement in June as more homes sold than in the month before, but year-over-year sales dropped. And median sale prices dipped yet again.
…
Windermere real estate agent Mark Kitabayashi, who works in Pierce and Thurston counties, said prices are lower in Pierce County because it “still has a tremendous amount of short sales.”
…
Part of this is due to the county’s slower economy and a jobless rate that has hovered around 10 percent. There also was more subprime borrowing during the housing boom, he said. Still, softer prices have resulted in some competitive pricing for new construction, such as homes in south Pierce County that sell between $150,000 and $220,000, Kitabayashi said.

Nice, Rolf avoids the “pending sales surge” nonsense entirely and focuses on some stats that have more meaning.

Rolf Boone, The Olympian: Is Thurston’s housing market ‘starting to firm up’?

Washington Realtors Association President Phil Harlan, a real estate agent for Keller Williams, thinks the bottom of the housing market is “starting to firm up.”

The Thurston County housing market has shown improvement from May, Harlan said, although it still is a bit delicate and susceptible to outside influences.

One concern he has is that lending, once so lax that all one had to do was “fog a mirror” to get a loan, he said, has swung too far in the opposite direction. Not everyone has a 700 or higher credit score, but that doesn’t mean they aren’t qualified borrowers. There still are prospective homeowners who can show a stable income and that they can manage money, he said.

“We’re leaving some people out of the equation,” Harlan said.

I keep hearing this refrain from real estate agents lately, that lending is suddenly “too strict.” I’d like to see some specific examples of people that they think should be able to get financing but have been denied, and what exactly the threshold should be. Is it really such a bad thing if we have high standards for people to be able to obtain a loan many times larger than what they earn in an entire year that will take them thirty years to pay off? I would argue that it is not.

(Christine Harvey, Seattle Times, 07.06.2011)
(Aubrey Cohen, Seattle P-I, 07.06.2011)
(Mike Benbow, Everett Herald, 07.07.2011)
(Rolf Boone, Tacoma News Tribune, 07.07.2011)
(Rolf Boone, The Olympian, 07.07.2011)

The post June Reporting Roundup: Renewed Bottom Calling Edition appeared first on Seattle Bubble.

Here are the audio segments (the first is about seven minutes long, the second about 10 minutes):

It’s interesting to note that in the second segment, Dori’s guest was Howard Bono, the subject of a number of recent posts on these pages. He makes basically the same argument about the ethics of walking away that I made in this pair of posts from a year ago:

• On Misguided Ethics and Walking Away from a Mortgage
• Did Banks Act in Good Faith During the Bubble?

I mostly agree with Howard’s comments on the air, although it is pretty disingenuous to claim that “most of the time you don’t get to review it [the mortgage contract], most of the time you don’t even read it” (at about 4:20 in the second clip). If you’re going to walk away, take responsibility. If you didn’t read the mortgage contract that’s nobody’s fault but your own. You certainly had an opportunity to review it, you just declined that opportunity.

The post Dori Monson Tackles Walking Away from Your Mortgage appeared first on Seattle Bubble.

Note the big red auction banner on the left and the sign in the former readerboard. Let’s get a closer look at that sign with the auction details…

Hmm, the fine print is a little hard to read. Who is the listing agent for this quality property? How do I schedule a private showing?

Yes, that’s right. Ms. “Bubbles are for Bathtubs,” the one and only Kendra Todd.

The post Guess Who’s Facilitating the Auction of Rick’s Nightclub? appeared first on Seattle Bubble.

First up, let’s have a look at the source material from the NWMLS itself. Here’s their press release: Momentum building as home buyers respond to lower prices, favorable financing

Northwest Multiple Listing Service members reported a 43 percent increase in pending sales of single family homes and condominiums during May compared to the same month a year ago.
…
Matt Deasy, the general manager of Windermere Real Estate/East, considers the small differences between year-to-date figures for 2011 and the “tax incentive fueled market” of 2010 to be “good news.”

Mike Grady, president and COO of Coldwell Banker Bain, was also upbeat in his comments about the current market. “The substantial jump in pending home sales reported today won’t be surprising to the brokers working in the core urban markets of Seattle and West Bellevue,” observed Grady. He also noted the increasingly strong demand for homes and falling inventory “is making for a very competitive market in those areas, with multiple offers on the best properties becoming more common.”

Nice, I love the cognitive dissonance on display there where they mention last year’s tax credit in reference to the year-to-date figures, then totally ignore it when crowing about the pending sales.

Before we dive into this month’s reports, let’s have another look at the pending sales chart:

Not only does the pending sales count for May 2011 only look good in comparison to the massive dropoff in May 2010, but take a look at how 2011′s thick red line compares to the lines for 2000, 2001, and 2002. Pending sales have been higher in 2011 than all of those years every month, but if you look at the closed sales chart, you’ll see that 2011 is lower than all of those years. Does that look like a recovery to you?

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: Home prices drop again, but pending sales turn upward

Home sales and prices continued to drop in May. But brokers hailed a surge in pending sales — mutually accepted offers that haven’t yet closed — as a sign the Seattle area real-estate market is regaining momentum.

That statistical bump is misleading, another industry observer countered.

Buyers closed on 1,654 houses in King County last month, 6 percent fewer than in May 2010. The median price, $345,000, was nearly 9 percent lower, according to statistics released Monday by the Northwest Multiple Listing Service.

Most of the buzz in industry circles, however, was about the 39 percent year-over-year jump in pending sales — the first such increase of the year.

I spoke with Eric for this piece and am quoted as the “industry observer” making the same basic point I made above. Thanks for taking the time to understand what’s really going on, Eric.

Aubrey Cohen, Seattle P-I: Jump in home sale deals may not last

Local home sale deals surged in May from a year earlier, according to a new report. But that’s mainly because May 2010 was particularly dismal.

Pending sales of houses and condominiums in King County surged 43.5 percent year over year, the Northwest Multiple Listing Service reported. That’s just the second increase in the past year and the biggest since April 2010, when people were rushing to beat an April 30 deadline for a homebuyer tax credit.

But that deadline left ‘precious few people willing to be active and sign contracts in the month of May last year,’ noted Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University. ‘So we’re comparing (this May) against an artifically low base.’

Nice! Aubrey leads his story off right away with the fact that the “jump” in pending sales is absolutely meaningless. I really enjoy the P-I’s real estate reporting a lot more when they have Aubrey on the beat than when they sub in a sports writer who would miss basic points like this.

Mike Benbow, Everett Herald: Home prices, sales drop in Snohomish County

Home prices in Snohomish County dropped in May more than 15 percent from a year ago, pushing the median price to $230,000, the Northwest Multiple Listing Service reported Monday.

The median, the combined figure for single-family homes and condominiums, is comparable to the county median back in December 2003.

Home sales dropped slightly last month to 820, a 3.76 percent decrease from a year ago.

But pending sales soared to 1,315, a 66.5 percent increase from last year at this time. That’s because homebuyers had rushed to buy in April 2010 to make the deadline for a tax break.

Mike Benbow can sometimes be hit or miss, but he rightly highlights the real story this month. Last year’s massive tax credit dropoff is not somehow a sign of a major recovery this year.

C.R. Roberts, Tacoma News Tribune: Number of pending home sales on rise in region

As the number of pending home sales increases, demand for properties is up as buyers take advantage of lower prices.

Northwest Multiple Listing Service reported Monday that members have reported a 43 percent increase in pending sales of single family homes and condominiums during May, compared with the same month a year ago. The agency represents members in 21 Washington counties. Sellers accepted offers from 7,509 buyers last month, up from the 5,242 a year before.

In Pierce County, MLS members reported 1,579 new listings for residential and condominium properties in May, compared with 1,443 a year ago. More importantly, there were 1,223 pending sales in May, well ahead of the 859 – a 42.3 percent increase – recorded a year ago. Closed sales rose to 796 from 741, a 7.4 percent increase.

More importantly, Mr. Roberts totally misses the real story. Worse, he basically just repeats the same thing for his piece in The Olympian.

C.R. Roberts, The Olympian: Pending home sales on the rise locally and regionally

As the number of pending home sales increases, demand for properties is up as buyers take advantage of lower prices.

Northwest Multiple Listing Service reported Monday that members have reported a 43 percent increase in pending sales of single family homes and condominiums during May, compared with the same month a year ago. The agency represents members in 21 Washington counties. Sellers accepted offers from 7,509 buyers last month, up from the 5,242 a year before.

In Thurston County, members marked 495 new listings, compared with 464 a year before. There were 338 pending sales in Thurston County in May, up nearly 22 percent from 278 sales in 2010. The 255 closed sales in May marked a 1.5 percent decrease from 259 a year before.

Oh well…

But wait, there’s more! It turns out that waiting an extra day to post this paid off with a second story from C.R. Roberts.

C.R. Roberts, Tacoma News Tribune: The story behind pending home sales

I was curious about the jump in pending sales reported yesterday by the Northwest Multiple Listing Service.

Did this signal the turnaround that sellers have been awaiting? Was this the numerical harbinger of better times having arrived?

Cheri Brennan, spokeswoman for Northwest MLS, said that there may be other explanations – beyond a full market rebound – for the increases.
First, she said, “There’s a lot of activity around foreclosures.”

And second, there were those incentives that expired a year ago. “The incentives went away, and there was a big dropoff from April to May last year,” Brennan said. “There was that big push to buy before the deadline hit.”

Well that’s better than what we got on Tuesday, but still a bit lame. Just a couple quotes from agents and no real analysis. In addition to the portion quoted above, he also spoke with a second NWMLS-approved agent who fed him some garbage about “the state of the market and the state of mind that buyers are bringing to the marketplace.”

(Eric Pryne, Seattle Times, 06.06.2011)
(Aubrey Cohen, Seattle P-I, 06.06.2011)
(Mike Benbow, Everett Herald, 06.07.2011)
(C.R. Roberts, Tacoma News Tribune, 06.07.2011)
(C.R. Roberts, The Olympian, 06.06.2011)
(C.R. Roberts, Tacoma News Tribune, 06.08.2011)

The post May Reporting Roundup: Not Fooling Anyone Edition appeared first on Seattle Bubble.

• Stan Humphries, Zillow Chief Economist
• Tim Terrill, Chief Operating Officer of Walton Development and Management
• Karen Weaver, Head of Market Strategy and Research at Seer Capital

The discussion had a generally pessimistic tone, but I tried to end on a slightly upbeat note, asking each panelist what the “silver lining” of today’s market was. I thought their responses were interesting.

Karen (the finance & securities expert) suggested that the silver lining is that we’re moving the economy away from being based so heavily on housing. In her words: “we had an economy based on building granite countertops.” She also said that there’s a shift in sentiment away from viewing home ownership as an investment and to seeing it as a consumption good.

Stan (the consumer website economist) take was that the bright spot in today’s market is for first-time home buyers (now and over the next three to five years), who are able to buy homes at a much better price than was possible during the boom.

Tim (the seasoned developer) described today’s market as a historic buying opportunity. I don’t recall if he said the exact phrase that now is “the best time to buy,” but his sentiment was basically that.

As you might guess, I found myself agreeing more with Karen and Stan last night than with Tim when it came to market outlook, however all three were in agreement that it will take years to work our way back to any sort of normal in the housing market.

The post What’s the Bright Spot in Today’s Market? appeared first on Seattle Bubble.

First up, let’s have a look at the source material from the NWMLS itself. Here’s their press release: Housing market "warming" as brokers report multiple offers in some areas

“While buyers remain cautious, they are ready to pounce on attractive, well priced homes and the open house traffic is very heavy,” [MLS director Mike] Skahen remarked. He credits the hiring at Amazon and general improvement in the Seattle economy with the boost, adding “a good recovery is under way.”

Joe Spencer, president and COO of John L. Scott Real Estate agreed with Skahen, saying the market is “showing signs of normality after three years of decline.” The reduction in new inventory is creating more balance between supply and demand, putting buyers and sellers on equal footing when negotiating a sale. “This is very positive news and should add to the trend toward price stabilization in many areas,” Spencer stated.

And we’re back to the “open house traffic” nonsense again. When you don’t have any verifiable data to back up your claims, fall back to “open house traffic.” It’s the NWMLS way.

Read on for my take on this month’s local news reports.

Eric Pryne, Seattle Times: King County homes prices, sales in April slip from year ago

How did King County’s real-estate market perform in April?

That depends on where you look — and whom you ask.

Countywide, the number of houses sold and the median price they fetched both fell nearly 7 percent from April 2010′s figures, according to statistics released Thursday by the Northwest Multiple Listing Service.

Last month’s median sale price was $349,950, down from $375,000 for the same month last year.

Realtors and other market observers attributed the drop in large part to a continuing surge in sales of lower-priced, bank-owned homes and “short sales” for less than buyers owe lenders.
…
All these variations prompted brokers to proclaim Seattle and the Eastside healthy markets — especially when you consider the year-over-year comparisons are with a month in 2010 when sales were juiced by buyers rushing to qualify for now-expired federal tax credits.

“Comparing ourselves to a year ago really isn’t fair,” said Lennox Scott, chairman and CEO of John L. Scott Real Estate. “That was a stimulus-driven market,” referring to the federal tax credit that expired last summer.

Come on guys, it isn’t fair. Wait, even with the stimulus, sales last year were one of the lowest of the last decade. But it’s not fair to note how far sales have dropped from that already low level? Hmm.

Aubrey Cohen, Seattle P-I: Hotter housing market? Numbers say ‘no’

Real estate companies say heat is returning to the area’s housing market. But the numbers still don’t show it.

…the listing service reported sales were down 11.4 percent in Seattle and 9.5 percent countywide from a year earlier. Pending sales, which can better reflect recent activity, fell 29.7 percent in the city and 22.5 percent countywide.
Numbers have been down from last year because of the expiration of a home-buyer tax credit. But April’s drops were the biggest this year.
…
“I’m sure that some of the very lowest prices probably are generating the kinds of multiple offers that the (listing service) press release is talking about,” said Glenn Crellin, , director of the Washington Center for Real Estate Research at Washington State University. “But I think by and large the numbers certainly are not as optimistic as the statements from the various board members of the multiple listing service would imply.

“I was surprised by how significant the reduction in closed sales was compared to a year ago,” Crellin said.

The decrease in pending sales is worrying, because that will translate to fewer closed sales in coming months, he said. “My expectation is that we’re going to continue to see a sluggish environment.”

Once again, Crellin is right on the mark here. In talking more with the agents here at Redfin, I think I’ve started to get a more clear picture of why the data is in conflict with what agents are experiencing out in the field. More on that subject in the coming weeks.

Mike Benbow, Everett Herald: Foreclosures push county home prices down to 2004 levels

Banks continue to work through their home inventory, and the number of homes for sale have fallen with the prices. There were 4,617 homes listed in the county in April, nearly a 14 percent drop from a year ago.

Many people who don’t have to sell have pulled their homes from the market because of the falling prices.

Joe Spencer of John L. Scott Real Estate said that reduced inventory is creating a better balance of supply and demand. He said it should help to stabilize prices.

If the pattern we saw leading up to the peak of the market is any indication, we can expect it to take about two years for prices to change directions once inventory shifts like this.

Rolf Boone, Tacoma News Tribune: MLS data: Pierce County home sales flat, prices fall in South Sound

Pierce County has some of the lowest median home prices in the region.

As a result, year-over-year home sales in Pierce essentially were flat at 779 units sold last month from 784 units in the year ago period, the combined data show. Elsewhere year-over-year April home sales fell more sharply in King, Snohomish, Kitsap and Thurston County where sales fell 27 percent.
…
In examining both the Pierce and Thurston housing markets, the increased number of home sales in Pierce County likely was lifted by its large military community, Heritage Bank President and Chief Executive Brian Vance said. One reason is that those in the military could take advantage of a first-time home buyer’s tax credit that was extended beyond what was offered to the general public, he said.

Hmm, it almost sounds like the data is showing that when homes are priced more affordably, more of them sell. What a bizarre, unexpected result.

Rolf Boone, The Olympian: Home prices, sales fall again

The South Sound housing market still is looking for momentum in the new year as sales, median prices and pending sales all fell in the year-over-year April period, according to Northwest Multiple Listing Service data released Thursday.

Thurston County home sales fell 27.41 percent to 188 units from 259 units, median prices fell 7.77 percent to $209,232 from $226,850 and pending sales fell 29.39 percent to 322 units from 456 units, the combined single-family residence and condominium data show.

In examining the Thurston County housing market, sales likely fell because of the caution created among prospective buyers by the uncertain future of the state budget and more state cuts, Heritage Bank president and chief executive Brian Vance said. Of Heritage’s total loan portfolio, about $45 million is in single-family mortgages, he said.

Less caution is always better for the real estate salepeople. Come on people, why don’t you throw caution to the wind and dive head first into the biggest purchase of your life as quickly as possible? Sheesh.

(Eric Pryne, Seattle Times, 05.05.2011)
(Aubrey Cohen, Seattle P-I, 05.05.2011)
(Mike Benbow, Everett Herald, 05.05.2011)
(Rolf Boone, Tacoma News Tribune, 05.06.2011)
(Rolf Boone, The Olympian, 05.06.2011)

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