Seattle Bubble

Let’s look back a couple years to see what local real estate agents were saying a few months after the price peak in Seattle, and about a year into the housing decline across most of the rest of the country. Here’s a selection of choice quotes from some October 2007 articles. Note that local home prices are down roughly 15% ($60,000 on a $400,000 home) in the two years since these articles were published.

NWMLS press release, October 5, 2007:

Trying to time the market is “a fool’s game,” remarked one MLS director. “If you are buying a home to live in for more than three years, then buy the one you love, not the one that you can save $25,000 on,” advises Matt Deasy, general manager at Windermere Real Estate/East Inc. in Bellevue.

J. Lennox Scott, chairman and CEO of John L. Scott Real Estate said now is “an ideal time for buyers.”
…
“The time is right for buyers on the sidelines to step forward. They have many more home choices now than in the past few years,” observed [Windermere broker] Marcie Maxwell.

Seattle P-I, October 5, 2007:

One month of lower prices doesn’t mean much, said Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University.

“I think it is suggestive that there is some real softness in the (Seattle) market,” he said. “But at the same time, I think we’ve got a more resilient housing market than in many parts of the country.”
…
Matthew Gardner, a Seattle land-use economist who works with developers, does not put much weight on the Seattle median-home price, particularly because it excludes most sales of new condos, he said Friday.

Actually, year-to-year increases of about 4 percent in the median price across King County and the 19 counties in the listing service were higher than Gardner anticipated, he said. He expects a leveling off — with increases of roughly 3 percent — for a couple of years.

“We need to get through this backlog of inventory,” he said. “Also, we need to start allowing time for wages to catch up.”

Tacoma News Tribune, October 6, 2007:

Agents on Friday, however, largely portrayed Pierce County’s one-month price decline as more anomaly than trend and what’s to be expected in a market normalizing after the boom years of 2004 and 2005.
…
Buyers shouldn’t view one month of lower prices as a sign that more are on the way, said Bill Riley, owner of Gateway Real Estate. Riley is vice president-elect of the Washington Realtors, which plans to launch a campaign this month encouraging buyers to purchase now rather than wait.

“This is not a start of a decline. We’ve never seen a decline in such a strong fundamental market,” he said, pointing to expected job growth…

Everett Herald, October 6, 2007:

“It looks like the market has kind of taken a deep breath and just corrected itself a little bit,” said Nathan Gorton of the Snohomish County Camano Board of Realtors.
…
“It’s a good time to be a buyer right now.” … “I talk to a lot of buyers’ agents whose customers are saying they just want to sit back right now because they don’t think it’s a good time to buy a home,” he said. “They think, ‘Oh my gosh, the market is falling apart.’ Nothing could be further from the truth.”

For comparison, here were my comments about these stories at the time:

It will be interesting to watch the increasingly ridiculous gyrations of local real estate salespeople as the market continues its downward path, and they come up with more and more outrageous statements that fly in the face of reality. It looks like the bubble deflation show has finally rolled into town.

Indeed it has been an entertaining show, and trust me; it ain’t over yet.