The Seattle-area housing market gets some national attention in an article in today’s New York Times:
While Wall Street is growing hopeful that the economy might dodge a recession, many economists warn that the pain in the housing market may last for several years. Even local markets like Seattle, which once seemed immune to the slump, are weakening. Prices nationwide might fall as much as another 10 percent before a turnaround takes hold, economists said.
In Seattle, where housing had held up better than much of the rest of the country in the last two years, home sales have slowed sharply. Sales in King County, which includes Seattle, fell more than 33 percent in April from the same month a year earlier while the number of homes for sales is up 55 percent. Prices of single-family homes have fallen about 6.5 percent from their peak in July 2007 to February, according to the Standard & Poor’s Case-Shiller index.
[Tukwila resident Dennis] Humphrey, who works in the home improvement division of Sears, has made offers on two homes but the sellers have refused to negotiate with him. He is willing to spend up to $300,000 and has enough money to put 20 percent down, but Mr. Humphrey said he is afraid to buy right now because he is worried prices are going to fall further and could wipe out any money he puts into a home.
“I am not afraid of the monthly mortgage payment, and I am not afraid of taxes, but I am afraid of losing the value I am putting in,” he said, adding that a friend recently bought a home near San Francisco that has fallen in value by $70,000.
“I believe the right deal will come along,” he added. “And I am in no rush.”
I think a lot of potential buyers in the Seattle area are like Mr. Humphrey: not in a rush, despite the frenzied claims of many local real estate agents and organizations that the time to buy is now, now, now.
This piece marks quite a turnaround from the “wow, look how immune Seattle is” kind of stories we were seeing in the national press as recently as midway through last year.
(Vikas Bajaj, New York Times, 05.28.2008)