November Neighborhoods Months of Supply Update

Let’s close out the week with a look at “Months of Supply” for the 30 NWMLS areas in King County. For an explanation of what months of supply means, please refer to the original neighborhood MOS breakdown post. Also, view a map of these areas here.

November MOS for King County as a whole came in at a record-high 8.75 (compared to 6.74 for November 2007 and 8.33 for October), bringing the record run of 6+ MOS to fifteen months.

In the graphs below, you’re looking at the MOS for the “Res Only” data from the NWMLS King County Breakout pdfs for the one-year period of December 2007 through November 2008. The bar graph is centered vertically on 6.0 MOS, so that it is easier to visually tell the difference between a seller’s and buyer’s market (i.e. – shorter bars mean a more balanced market). Most of the graphs have the same scale on the vertical axis and has the King County aggregate figure plotted in red on the far right, so they can be easily compared. The Eastside is the one exception, since MOS is getting so high over there, too much information was being cut off to keep the same scale.

Note that there are a few areas that appear to have no bar at all for a given month—this represents an MOS value at or close to 6.0. Also keep in mind that whatever the reason, pending sales have become increasingly disconnected from closed sales recently, which means that these statistics are likely understating the magnitude of the “buyer’s market.”

We’ll start off with the chart that lets you directly compare each area’s MOS to its value one year ago. November 2007 is in red, and 2008 is in blue.

KC SFH MOS: Eastside

Following below are the breakouts for SW King, SE King, Seattle, N King, and the Eastside, as well as a summary of this month’s data.

Note: Area 100 (Jovita/West Hill Auburn) was over 21 in January, and has been clipped.



Note: For Area 701 (Downtown Seattle) we’re using condo data.

KC SFH MOS: Seattle

Note: Area 800 (Vashon Island) was over 17 in September, and has been clipped.


Note: The vertical scale on the Eastside graph was adjusted to fit the multiple areas with extremely high MOS.

KC SFH MOS: Eastside

Just like last month, only three of thirty King County areas were in seller’s market territory in October, ranging from 5.16 MOS in 705 (Ballard, Greenlake, Greenwood) to 5.87 MOS in 385 (South-Central Seattle). Note that all three of these “seller’s market” areas are within the city of Seattle.

The cumulative MOS for Seattle proper bumped a bit more into buyer’s market territory at 6.91 in September. The Eastside as a whole actually dropped slightly month-to-month, down to 11.27.

Only three of thirty neighborhoods trended more toward a seller’s market than a year ago. Eleven neighborhoods were above 10 MOS, firmly in buyer’s market territory.

The three toughest markets for sellers were Kirkland-Bridal Trails (560) at a staggering 21.76 (nearly two years), Medina / Clyde Hill / W. Bellevue (520) at 13.59, and Enumclaw (300) at 13.00. 520 continues its 10+ MOS streak, now at 15 months.

The three best markets for sellers as of last month were: Ballard/Greenlake/Greenwood (705) at 5.16, North Seattle (710) at 5.40, and South-Central Seattle (385) at 5.87. No other market had less than 6.0 MOS last month.

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About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.


  1. 1
    98115_Renter says:

    Is there any way to get median prices and trends for the neighborhoods?

  2. 2
    softwarengineer says:


    How about a bar chart of past listed homes that are still legally unsold [no phony sales please] and currently unlisted, but aren’t in your months of supply [but should be]?

  3. 3
    TheHulk says:

    Area 560 looks like the Burj Dubai :)

    Prices are still too high. Sellers should get a clue and lower them pronto. I think the RE market is heading towards a winter freeze, especially on the high end.

  4. 4
    Buceri says:

    My daily Redfin updates are now starting to show early 2005 prices. Most selling for a loss (and in Everett).

  5. 5
    Travis says:

    According to this “market expert” homes are only appreciating and will continue to do so. Check out the video and judge for yourselves.

  6. 6
    David Losh says:

    Months of Supply are always a favorite with me. There is a lack of corresponding data for buyers ability to purchase, or accounting for how many people would dump a high mortgage payment if they possibly could.

    The Months of Supply is a gimmick that Real Estate sale people use as a motivator to get people to buy or sell.

    It’s like talking about interest rates as an indicator of how much money a house should cost. Should a house cost more because interest rates are low? No.

    The only factors concerning you buying a home are Location, Price, and Condition. There can be two million town home like properties on the market today, but if you are looking for a Cradtsman still paying retail.

    For that matter price is determined between a buyer and seller. What is the buyer willing to pay and what is the seller willing to sell for? It’s that simple. All the data in the world amounts to talking and negotiating points.

  7. 7
    TheHulk says:

    The only factors concerning you buying a home are Location, Price, and Condition. For that matter price is determined between a buyer and seller. What is the buyer willing to pay and what is the seller willing to sell for? It’s that simple. All the data in the world amounts to talking and negotiating points.

    Essentially you are talking about the price-discovery mechanism. Let me clue you in on a secret. We have one that exists (or at least I do).
    A. Find a house you like AND foresee yourself living in for at least 10 years
    B. Figure out the “right” price of that house in 1997/1998. (Do comparisons with comparable sales at that time etc)
    C. Regardless of sale data in between multiply that value by 1.4 (4% non compounded if you are generous) or 1.3 (3% and taking a hedge against the future). Voila! That is the price of the house which I deem reasonable. If seller doesnt agree to that selling the house is his problem, not mine.

    Of course I would not mind if someone is willing to go even lower than that, but now I think I am smoking something… lol

  8. 8
    victorchai says:'s-Best-Long-Term-Real-Estate-BetsThese 10 markets are the least likely to overheat and bust and the most likely to have vibrant economies moving forward.

    Drive along Interstate 80, just outside the city of Sacramento, Calif., and scores of gated and planned communities await. Only they’re not what developers envisioned. Sidewalks are empty; homes are unoccupied.

    More from

    • In Depth: America’s Best Long-Term Housing Bets

    • In Depth America’s Post-Subprime Boomtowns

    • In Depth: Best Cities for Trapped Homeowners
    Blame the heady days of the real estate boom. Easy-to-acquire mortgages, plenty of open land and generous zoning provided new homes to scores of buyers. Between 2000 and 2005, Sacramento-area builders doubled production.

    But as prices dropped and demand dried up, builders cut back. This year, there are expected to be 6,140 new constructions in the Sacramento metro area. That’s down from 20,370 in 2005, according to the National Association of Home Builders (NAHB). Median prices are now $212,000, down from $375,000 in 2005. For many residents, this is old news. Sacramento home builders and buyers engaged in the same behavior leading up to, and following, the Savings & Loan crisis. That’s when construction doubled and then quartered once prices fell. Indeed, it’s a market prone to booms and busts, which not a good sign for long-term investment.

    That’s not the case in Seattle, New York or Philadelphia, which are far less volatile when it comes to building and vacancy spikes in tough economic times. There’s just less room to grow and few laws that make it easy to do so. In these markets, building activity doesn’t rise as hastily during national booms, and, as a result, doesn’t crash as dramatically during slowdowns (based on historical volatility and current market conditions).

    Behind the Numbers evaluated the 40 largest Census-defined metro areas using the last 25 years of data from NAHB. We calculated volatility in supply (new construction) and demand (vacancy rates). Our measure tracks the degree of difference between how specific housing markets expand or contract in relation to the national market. If, for example, a city’s building rate grows by 5%, versus 1% nationally, there’s usually a similar pattern on the way down. That may be good for a flipper in the right place at the right time, but it’s not good for long-term investing. The top 10 cities on our list are those that grew in value, but avoided large swings in times of excess and stress.

    No surprise, metro areas in California, like San Diego, Los Angeles and Sacramento–some of the nation’s most noteworthy boom-bust markets–performed poorly by this measure. Folks from all over the country move to California in boom periods, given its diversified industry, which includes everything from oil to entertainment. This is reflected in housing construction rates, which rank near the top in years when the stock market rises and jobs are plenty. Problem is, they take off when the party’s over, leaving mass unsold inventory, something home builders have yet to fully account for even though it’s a pattern dating to the 1980s.

    “Migration in California tends to be very elastic,” says Mark Zandi, chief economist of Moody’s “People move there quickly when the economy is good and leave when it’s not.”

    The only exception was San Francisco, which is so geographically constrained that it’s difficult to overbuild there.

    It’s this kind of constraint that helps many East Coast cities resist volatility. Less room to build protects these cities from the crippling oversupply that’s hurting places like Phoenix or Las Vegas.

    “Along the eastern seaboard, prices got pretty high, but it wasn’t followed by crazy levels of production because these are old, built-up cities,” says Denk of the last boom. “Prices are going to come down, and that’s going to keep prices weak, but they’re not struggling with over supply.”

    New York, for example, has the lowest level of construction relative to its population, which constrains supply and vacancy, allowing the market to correct more quickly.

    More from Yahoo! Finance:

    • America’s 5 Most Affluent Neighborhoods

    • Where U.S. Home Values Are Falling Fastest

    • Your Home’s Market Value in 2009
    Visit the Real Estate Center
    “There’s no new inventory in the pipeline for 2009,” says Jonathan Miller, president of Miller Samuel, a Manhattan residential appraisal firm. He says that will help existing buildings move properties and soften the real estate downturn in New York.

    Job-growth forecasts also play a role in determining a region’s long-term strength. To gauge this measure, we looked at predictions through 2017 from Moody’s These are based on Bureau of Labor Statistics (BLS) data of market sectors (manufacturing, bad; biotech, good, for example) and its own analysis of each area’s business costs and growth prospects. So, while San Antonio and Atlanta have virtually no zoning restrictions and allow liberal home construction during good times, they’ve been consistent leaders in job creation and Moody’s rates them as second and sixth, respectively, for job growth through 2017. This leads to positive expected-absorption rates as job seekers head there.

    Job-growth and construction rates are important determinants of an area’s future health. That’s because they have historically governed housing prices since they govern supply and demand. However, during the housing boom, the national mortgage market helped inflate cities beyond their economic underpinnings. Expect to see job and business growth return as engines of property price gains.

    “Housing markets are supposed to be local, local, local, but the boom was pretty much national, and a lot of housing markets decoupled from local economic drivers,” says Robert Denk, an economist with the NAHB. “The current correction will change that.”

    Of course, that’s not to call a bottom or suggest you rush to buy real estate tomorrow.

    © iStockphoto
    Washington, D.C.
    Washington D.C., remains on the mat–prices are down 24%, and the exurbs are packed with foreclosures. But even so, the D.C. metro has the nation’s lowest rate of unemployment, according to the BLS. Growth in government jobs is stable, and Northern Virginia particularly has been one of the nation’s fastest growing business centers, helping lift the commonwealth to the title of Best State for Business.

    Prices are likely to continue falling nationwide for at least another year as the mortgage and housing markets shake out their hangovers. And while it might be some time before those who bought at the market’s peak recoup their costs, the cities on our list possess the strongest fundamentals for when the market settles.

    America’s Best Long-Term Housing Bets

    1. Seattle, Wash.
    Job-growth projections 2008-2017: 1.5%

    Seattle’s peak building period in the 1980s run-up was in the second quarter of 1986. The Savings & Loan crisis didn’t fully halt building activity until the fourth quarter of 1992. What lands it in the first position on this list is the combination of strong job growth with a building cycle that hasn’t run in high excess of demand and, in part, its constrained geography. Especially compared to cities on the West Coast, Seattle has historically not overheated in boom times.

    2. Washington, D.C.
    Job-growth projections 2008-2017: 0.9%

    Building activity hit high points in the second quarter of 1986 and the first quarter of 2006. In the most recent bust, D.C.’s exurbs have been particularly hard hit. Even so, the region has the lowest rate of unemployment in the country, according to the Bureau of Labor Statistics. Despite recent building exuberance, it has the second lowest demand volatility in the country, meaning that vacancies have historically been very low.

    3. San Antonio, Texas
    Job-growth projections 2008-2017: 2.0%

    There may be little zoning in Texas, and the state may be a model of sprawl (read: lots of homes built in good times), but San Antonio has fared better than its Lone Star brethren throughout the peaks and valleys of the last 20 years. Volatility in home building and vacancy were in the middle of the pack nationally, while the metro area’s job-growth figures have been national leaders.

    4. Minneapolis, Minn.
    Job-growth projections 2008-2017: 1.1%

    Minneapolis has not experienced the same sort of booms seen elsewhere. In the most recent run-up, building activity peaked in the third quarter of 2004; this will help the market in the short term as it means less new inventory dragging down prices. The city’s real strength is its economy, which has less of a manufacturing base than most Midwestern cities and hosts a handful of multinational corporations.

    5. New York, N.Y.
    Job-growth projections 2008-2017: 0.6%

    Part of why New York City prices are so expensive is because the cost to build is one of the highest in the country. There’s also no open land to be found. While that hurts affordability, it stems overbuilding relative to demand. Historically, the New York metro area has the lowest vacancy fluctuations of any city in the country. Unless a new island is added, expect that to continue.

  9. 9
    David Losh says:

    You can pick a price by whatever means. The seller has his price.

    In the interest of transparency let me clarify a statement I made about the bottom of the Real Estate market being August of 2008. 8/8/08 was predicted to me by a very nice Korean gentleman as the bottom of the market. He sold in 2007 to buy in 2008. He may now want to wait until 2009, but his logic was good.

    Once prices crashed in 2007 there was a year of mourning and hope that prices would return to “normal.” By all indications those hopes were destroyed after the abysmal end of the 2008 spring selling season. Sellers were devasted that they were no longer commanding the prices they chose.

    In these months sellers continue to hope for the new year, presidency, and economic stimulus. There are some who recognize that if they need to sell they need to make a deal.

    The Korean gentleman cut his price and sold the property in 2007 rather than wait. He and his wife did rent an apartment. So from my way of thinking he did peg his strategy right. He wants a home in New Castle where ever that is, it’s near Bellevue, I’m sure, but it’s out of my area.

    The point is that you can pick a price as a buyer today and as time goes on it may be easier, but the market definitely shifted this last summer.

  10. 10
    deejayoh says:

    According to this “market expert” homes are only appreciating and will continue to do so. Check out the video and judge for yourselves.

    Yes, that Debbie Walters knows of what she speaks. I mean, just check her own listings.

    Like this one in Medina! It’s a short sale, last sold for $3.9mm in 2006. It’s been on the market for $2.5mm – sitting for 195 days.

    Yup, that’s some appreciation. I bet the owners would agree with her. She knows the market, and as a REALTOR would never tell you anything but the truth

    Listing history:
    Nov 17, 2008 Price Changed $2,500,000 — NWMLS #28111067
    Oct 31, 2008 Price Changed $2,900,000 — NWMLS #28111067
    Sep 26, 2008 Price Changed $3,200,000 — NWMLS #28111067
    Sep 13, 2008 Price Changed $3,400,000 — NWMLS #28111067
    Aug 28, 2008 Price Changed $3,600,000 — NWMLS #28111067
    Aug 14, 2008 Price Changed $3,800,000 — NWMLS #28111067
    Jun 27, 2008 Listed $3,979,000 — NWMLS #28111067
    Jul 10, 2006 Sold $3,900,000 >1,000%/yr Public Records

  11. 11
    deejayoh says:

    Wow. I just did a little digging around to see what was happening with that house. I’ll leave out the particulars, as anyone who wants to check the parcel viewer can figure it out – But it looks like a husband and wife who bought/sold at least a couple of places for very suspicious values – like this home– Sold for $870k in 06/06; Zillow $661k today

    Five pages of records with KCRO, the last two w/mostly Recontrust

    I also found the guy’s web site.

    It says at the bottom “Enjoy to stay here”

  12. 12
    S-Crow says:


    Come work in my world. We are in the information business. We have a long long way to go to work through healing our markets. And there are scores of people out there who should be in prosecuted, but will never get so much as a “naughty naughty letter” from any law enforcement agency whether local or federal or by lenders who in my mind (even local lenders/banks who are struggling) were so stupid to let standards drop away. Not enough people in law enforcement to ever make a meaningful dent. Ever.

    When you think through it, law enforcement will go after the big fish for $2mil or $25mil in fraud, but in aggregate, the fraud total by every little guy far superceeds that of the one or two news headliners that the FBI or other law enforcement throws in jail. But they can only handle so many cases.

  13. 13
    Greg Perry says:

    “98115_Renter // Dec 19, 2008 at 8:06 am

    Is there any way to get median prices and trends for the neighborhoods?”

    Sure, email me with your request. I can narrow it down to you by zip code and price range.

  14. 14
    Interloper says:

    Damn, North Seattle’s still holding strong with less than 6 months supply.

    It’s hard to believe, considering the overbuilding and overpriced real estate around here.

  15. 15
    Robert Wojciechowski says:

    My question is to what extent the money supply surge that govt is undertaking – will have an effect on real estate and future inflation. The bailouts are really happening like crazy. Also when will debt of US govt make the whole economy unstable and unsustainable?

    The long term picture is essential for making buying vs selling decisions.

  16. 16
    mukoh says:

    You are right on in #12. :)

  17. 17
    anony says:

    Hmm, #14 starts “golly” in the post, but in the recent comments preview bar on the home page it starts with a curse word.

  18. 18
    Robert Wojciechowski says:

    I think the supply will start going down when inflation starts becoming an issue. Right now parking wealth in cash is the right thing to do. But the US govt is increasing supply (or printing money) on an unprecedented scale. And at some point this will turn into inflation that will wipe out any savings that people have. So having a shack will look like a decent deal.

    The other bubble is with treasuries. People buy them now because they think this is safe haven – but at some point this could also contribute to inflation.

    The USD value might also drop against major currencies. Ut has already but when people realize that it might not be worth that much then this could also cause problems down the line.

    The whole bailout game and flooding market with USD is kind of cool!

  19. 19
    Robert Wojciechowski says:

    Also it would interesting if somebody could analyze to what extent spending would go down if people started saving money. And how much unemployment this would cause? And how painful it would be for real estate?

  20. 20
    deejayoh says:

    I think the supply will start going down when inflation starts becoming an issue.

    Inflation is so far from becoming an issue that you can’t even see it on the horizon. Do you think the gov’t is increasing the money supply because they see imminent inflation? That they set short term interest rates at zero because they think inflation is just around the corner?

    Money supply is much more than what is printed or what the goverment is lending. It is the sum of everything that banks and other entities are willing to lend. In good times, the banks were lending tens of trillions of dollars a year. Now they are lending nothing and the government is trying to fill the gap with lending and money supply but it is a drop in the bucket vs. what was there.

    Paulson and Bernanke would LOVE to be worrying about inflation right now but the truth is that is the furthest issue from their minds.

  21. 21
    deejayoh says:

    If you need to see evidence of this, see the latest view of M3 (which the gov’t quit reporting) from

  22. 22
    Plymster says:

    Thanks deejayoh,

    That helped me understand exactly why deflation is the end result. It also helps me understand why the feds stopped printing M3. (I had though it was to hide their inflation, not to hide deflation, though I guess it makes sense either way.)

    It’s posters like you that make this blog something I keep returning to.

  23. 23
    buystocks says:

    Agree no amount of money printing will replace the lost credit anytime soon.
    But the M3 doesn’t include available credit, does it?

  24. 24
    deejayoh says:

    No, M3 does not include all credit. I does include “Short term repurchase agreements” but I provided it as an example, as it does not include commercial paper or long term debt issued for mortgages, commercial lending, etc which have dried as well and based on the way they were issued in the past ~5 years were treated pretty much the same as cash.

    If M3 looks bad, any broader definition of money supply and/or the velocity of money looks even worse.

  25. 25
    Robert Wojciechowski says:

    I agree with this. The govt is printing money or increasing supply of money to try to replace the loss of money creation by the banks. Normally commercial banks create a ton of money – in fact the multiplier is 9 in most cases? The govt deposits say 1K into a commercial bank and 9k starts floating in the economy. Now the banks do not create as much money as before.

    Ultimately the inflation will set in – it is just a question of how much money needs to be put into the system.

    But when the govt injects lots of money this way – then at some point when banks start lending money – won’t this create a potentially deadly inflation? Suddenly all of this money floating around starts getting multiplied…….Obviously the Fed can try many things like selling sthg to banks or people to try to get money out of the system or it can try raising interest rates. The issue if this can be done on time and in correct proportions.

  26. 26
    Robert Wojciechowski says:

    The other issue is that the problem with US households is that they carry too much debt compared to income they make. So if the households start saving then demand goes down and US jobs get wiped out as well as ton of jobs in China. How would this affect the housing? To what extent unemployment at least in the short term be created?

    The govt can counteract the household spending slump by boosting spending on its own. But then to what extent the deficit can go up to stay sane? And at what point will it seem that US govt is going to go bankrupt? This for sure would have an effect on housing.

    The US govt is going to spend money on infrastructure and alternative energy. How will this affect Puget Sound region? And what uneomployment are we expecting here?

    I think there are still lots of uncertainties.

  27. 27
  28. 28
    what goes up must come down says:

    RW, why do you keep mentioning inflation it seems to me you are trying to promote home buying as a hedge against inflation — is this correct?

  29. 29
    Robert Wojciechowski says:

    To be frank I am confused. On one hand we have US households in debt that is starting to eat away their ability to spend. If they curtail spending then jobs evaporate. If the spending slows – you again have deflationary environment + if jobs evaporate – who will buy real estate? The last thing you do when you think you can loose a job is get a big loan for a house.

    The way to get spending up is again go into more debt or erase the debt? What are other ways to get around this issue?

    The govt is also in debt – huge debt. But now it needs to spend much more money in order to compensate for the fact that spending of US households is going down and the fact that money supply went down because banks are not willing to lend money as much as before. Plus US govt is afraid of rising unemployment – and with that lower tax revenue and possible social unrest. So the huge debt will be I guess financed with even bigger debt.

    And the issue is when will it all get to a point where it is unsustainable? That would have obvious effect on real estate.

    I agree that in the short term the strategy undertaken by US govt will work for sure to ease the pain and the real estate prices will be going down less. But at the same time there will likely be no more ARMs and exotic mortgages – then the amount of people buying will go down to normal levels and there is no stopping of the real estate going down. The question is how long it will take and whether real estate prices be flat for some time…..

  30. 30
    Robert Wojciechowski says:

    The only thing that can mitigate the burden of debt is inflation. This way households will have less debt. And would be able to buy more things again. It is kind of like a pyramid scheme – but I am sure the US govt will be tempted to do this. Nobody wants unemployment to climb as a result of spending slump.

    Right now there is deflation. But as soon as deflation is over I would jump in and buy sthg before the USD starts becoming worthless. One thing that is going well for the $$ is the fact that the rest of the world is equally messed up.

  31. 31
    Matthew says:

    Debt = deflation, and you can’t inflate your way out of it without the bond market imploding.

  32. 32
    Robert Wojciechowski says:

    OK. And what happens when the bond market starts imploding?

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