Predictions: Looking Into the Crystal Ball for 2010

It is time once again for our annual predictions post, where your host goes on record with crazy shots in the dark about what might happen in the Seattle real estate market over the next calendar year. For those of you following along with this game at home, here are the predictions of record for the past three years: 2007, 2008, & 2009.

First up, let’s see how everyone from 2009’s post did.

The Contenders:

  • Matthew Gardner, local land-use economist
  • Steve Tytler, Everett Herald Real Estate Columnist / owner, Best Mortgage
  • J. Lennox Scott, Chairman and CEO of John L. Scott Real Estate
  • Tim Ellis, editor-in-chief, Seattle Bubble
  Gardner Tytler Scott Ellis King Co. SFH
Prices:  “essentially flat” -5% to 10% “stabilized” “about -10%” -5.8%

This year’s winner for the closest prediction is Steve Tytler, whose guesses have consistently been the closest of anyone actually in the industry. My price guess looks like it will probably end up being the closest if you use Seattle’s Case-Shiller data (October was down 12.4%), but to be fair and consistent, we’re sticking with the NWMLS median, so Steve gets the prize this year.

Here is the text of my predictions on inventory, sales, and prices last year:

My guess is that inventory in 2009 will be flat to slightly down from 2008 for most of the year. I am betting that the double-digit YOY drops in sales will not last beyond the first or second quarter, but will eventually flatten out and maybe even show YOY gains.

As far as a specific prediction on prices, my guess is about another 10 percent drop in 2009, which would put December 2009’s median at $363,150.

Inventory did indeed end the year down, and sales showed YOY gains. Overall, my biggest shortcoming was in failing to foresee the February implementation of the $8,000 tax credit, which clearly provided a short-term boost to the market.

The Real Estate Non-Market
This brings me to my giant caveat for 2010. The excellent real estate analyst Rich Toscano wrote a great piece in November about the increasing difficulty of Forecasting the Real Estate Non-Market that I feel is quite relevant.

…the real estate “market” is now as much a political entity as it is an economic entity. The government has gone to amazing levels of effort to prop up the housing market. …huge amounts of money are being borrowed or simply created out of thin air and shunted directly into the housing market through multiple channels. Even as demand is thus boosted, supply is being constrained by foreclosure moratoria and opaque and arbitrary financial industry bailouts.

The net effect is that government intervention is exerting an enormous influence on the housing market. So one can’t just look at fundamentals as in the good old days. Instead, one is forced to practice a sort of real estate Kremlinology in an attempt to figure out how fiscal and monetary policy will affect, or cease to affect, the market.

Looking Back at Where We Have Been
Of course, it’s still fun to make wild guesses, even if we don’t know what the government will pull out of their future taxpayer-funded hat next. But before we get to this year’s predictions, I thought it might be informative to drop a few charts. The following three charts go back through 1993, which is as far back as I have been able to locate consistent NWMLS data on home prices.

First up is King County’s median SFH sale price, adjusted for inflation in November 2009 (the latest CPI data) dollars.

King Co. Median SFH Price (inflation-adjusted to November 2009 dollars)

In November 2009 dollars, the July 2007 peak was just barely shy of $500,000, peaking at $499,545. December 2009 came in 24% off that peak. Next, here is a chart of home prices and King County median household incomes, indexed to January 1993.

King Co. Median SFH Price & Median Household Income

Something still seems a bit, shall we say, off about that. Lastly, here is King County’s affordability index:

King Co. Affordability Index

Definitely an improvement there, but a lot of what is keeping that above 90 is the crazy low interest rates, being held there thanks to the government. See above.

The Crystal Ball Gets Murky
So, let’s see what predictions we can find from the usual suspects for 2010.

Oddly enough, it seems that fewer and fewer local real estate professionals are willing to step out on a limb with predictions. The only article I was able to find that referenced 2010 and quoted Gardner, Crellin, and Scott was Eric Pryne’s piece in the Times: Tax credit fuels home-sales bounce, but will it be just a blip?.

Here’s all those three had to say in that article:

In February, Congress approved an $8,000 tax credit for first-time homebuyers in hopes of kick-starting moribund home sales.

“It worked,” Lennox Scott, chairman and CEO of John L. Scott Real Estate, said at a recent industry forum. “That’s what completely activated the market.”

After plummeting 20 percent in 18 months from its summer 2007 peak, the median price of a single-family home sold in King County slipped only slightly more in 2009.

And next year? “They’re not going to go up,” Jill Wood, Windermere Real Estate president, said of home prices. “They’ve probably leveled off for now.”

Even that assessment may be optimistic, others say. Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University, said it’s more likely that prices will continue to decline through midyear.

The question now is, how many prospective buyers remain? “Were we stealing future demand?” Seattle land-use economist Matthew Gardner asked at a recent forum.

So we’ve got no prediction from Scott, an ambiguous forecast of a decline from Crellin, and a question from Gardner that he likely already knows the answer to. We did also get a bonus forecast from Jill Wood of prices having “leveled off.”

The only commentator I’ve found still willing to join me in predictions is perennial Seattle Bubble favorite Steve Tytler. Here’s his piece: Forecast for 2010 housing market: slow decline

I think average home prices will continue to drop a little, but the pace of depreciation will continue to slow. Overall, average home prices may fall about 5 percent, but as always the rate of depreciation will vary from neighborhood to neighborhood. In general, highly desirable neighborhoods, especially those close to major job centers, will do better than outlying areas.

Will we hit the housing market bottom in 2010? Maybe. You can only know for sure that a market has bottomed in retrospect when you can look back at housing prices on a graph and see the point where they stopped going down and started going up and stayed up. We may very well hit that point some time next year, probably late spring or summer.

Kudos to Steve for still being willing to stick his neck out there.

The Tim on 2010
So finally we get to my predictions for the coming year. Keeping in mind that unknown future government meddling will probably throw off any guesses I make today, my outlook for 2010 is pretty similar to what I saw for 2009. I don’t think Seattle home prices have bottomed yet. If allowed to adjust to market fundamentals, they’ve probably got at least another 10% to fall, maybe a bit more. I would expect most of that to come this year.

Barring any additional free money giveaways, sales will probably show YOY gains during the first part of the year, and be more or less flat for the second half. I suspect that interest rates will rise, possibly up into the sixes, which when combined with the borrowed sales thanks to the tax credit, will end up supressing sales as the year winds down. Inventory will probably be flat to down slightly.

There you have it, The Tim on record for 2010. Now lets’ hear your predictions in the comments, as well as in this poll:

What's your King County SFH median price prediction for 2010?

  • Down more than 20% (4%, 19 Votes)
  • Down 20% to 15.1% (4%, 19 Votes)
  • Down 15% to 10.1% (14%, 68 Votes)
  • Down 10% to 5.1% (41%, 205 Votes)
  • Down 5% or less (24%, 121 Votes)
  • Up less than 5% (11%, 53 Votes)
  • Up 5% to 10% (1%, 6 Votes)
  • Up more than 10% (1%, 3 Votes)

Total Voters: 494

0.00 avg. rating (0% score) - 0 votes

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.

167 comments:

  1. 1
    waitingforseattletocool says:

    The Tim,

    I don’t think you can say that rising interest rates will automatically supress sales. I am not saying there isn’t some correlation.

    What I am saying is that the majority of home builders and home owners would probably take an improving economy and higher interest rates over a declining economy and lower interest rates almost anytime.

    Whether the economy improves while interest rates are rising is a seperate question.

  2. 2
    patient says:

    This was my prediction for 2009:

    “So my guess for 2009 is a 5% decline in median and again a 10% for Case Shiller”

    I’d say it’s looking like it’s going to be pretty decent predictions and another proof that the best way to go for the Seattle housing market for me is to gather my own information and make a prediction on what I think is the most likely development and ignoring the industry shills and MSMs propaganda, they do not have a good track record ( Steve Tytler being the exception ).

    I think 2010 will be pretty much like 2009 but with reversed order. I.e a pretty flat spring followed by a decline in the second half of the year. So I’ll repeat 2009s prediction, -5% for median and -10% for Case Shiller.

  3. 3
    Ray Pepper says:

    This is a prediction?

    “I think average home prices will continue to drop a LITTLE, but the pace of depreciation will continue to slow. Overall, average home prices MAY fall about 5 percent, but as always the rate of depreciation will VARY from neighborhood to neighborhood. **In general, highly desirable neighborhoods, especially those close to major job centers, will do better than outlying areas.”**

    Kind of obvious don’t you think? Just like it will be very cloudy today with a high probability of rain……….LITTLE, MAY, VARY

    My favorite part is this one** In general, highly desirable neighborhoods, close to job centers will do better”**YA THINK???

    5-10% decline is the easiest call in the book knowing we have ever increasing short sales that are going to plague the markets for many years to come. Combine that with unrelenting foreclosures a 5% trendline down yoy is a certainity.

    Good God! Maybe its because I hear the Best Mtg ads on Dori Monson that makes me shake my head when I think of Steve Tytler. I’m sure he is a wonderful person but he brings nothing to the table.

    I wish we can get an update on his Broker friend in Az who continues to pay on his 500k Mtg when the home is worth 250k. Is it short saled yet Steve? Hamp program? Still current on Mtg? If so Steve please educate me as to why and please don’t use the word “morality” in the answer. Do you believe your broker friend has made a WISE decision coming from your wisdom as an Agent and a Mtg Broker? Is this what you would professionally advise your clients to do?

  4. 4
    patient says:

    RE: Ray Pepper @ 3 – So Ray, do we put you down for -5% on the median? Do you have a C/S prediction, -5% as well?

  5. 5

    2010

    And the beat goes on and down.

    The amount of the decrease will be contingent upon many factors:

    Commercial Real Estate Foreclosures
    SFH Foreclosures
    Per capita [not household] wages
    Fed Interventions [Fannie, Freddie, Tax Credits, Wall Street Bailouts, etc, etc]
    Commodity Inflation

    Many unknowns out there to digest. A 5-10% YOY degradation guess was popular and my guess too….one thing’s for certain, a price rebound in 2010 just isn’t possible, as the mainstream economists were predicting last summer. Wishful stimulus thinking and unemployment denial, IMO.

  6. 6
    patient says:

    In contrast to Ray I do by no means think a YoY -5% of the median is a given, I think it’s a good guess but I would not be suprised if it ends up +5%. It doesn’t really matter one or the other to me since the median(sales mix) doesn’t really interrest me, I’m more interrested in what happens to the value of homes, i.e Case Shiller. I see a YoY rise in C/S as much more unlikely than a rise in median.

  7. 7
    Scotsman says:

    2010 prices? who knows, probably flat to down slightly. 2014 prices? Down 30% from 2010, maybe more.

  8. 8
    patient says:

    Does anyone have a link to recent update of the FHA delinquency data? A FHA blow up in 2010 would make things interresting to say the least. The gov. would likely pump in more capital but to what political cost?

  9. 9
    Ray Pepper says:

    RE: patient @ 4

    Patient my prediction is this….down down down…short sales and foreclosures up up up because people will only be STUPID for so long.

    Its all coming back. I hope for everyone to get their Loan Mod and retain their homes but I just keep getting bombarded by people with the same problem over and over. Many are Bubbleheads as well.

    It costs bout 6-10% to sell in this state. Combined with valuations already nailed. Then we have the slow bleed over the next 5 years of homeowners realizing its not coming back. Then we continue to mount short sale after short sale. 5% yoy declines is a very safe bet.

    However, Mortgage cramdown initiated? That will be a game changer. I know I know…It will not happen…………Don’t be so sure.

    You see everyone wants to start the race again at the starting line. Its not very fair to start 500 feet back from the rest of the pack.

    They are all coming back! One way or another and housing prices are going no where but trendline down!

    BTW Short sales WILL and HAS sped up due to the sheer numbers that will present themselves. Bank on it!

  10. 10
    LA Relo says:

    Down 10-12% or so according to CSI.

    You have to take into consideration jobs and income when talking prices (to state the obvious). To know what housing will do, look at what jobs are doing now. In Seattle it’s not good.

    Then you add in moratoria, tax breaks, low interest rates, all of which are about to end, 2010 could easily be WORSE than 2009.

    Rates are going up, jobs are still being lost, and Comrade Obama is out of money to borrow from our children’s children’s children to float the deflating bubble off the bottom any longer.

  11. 11
    patient says:

    RE: Ray Pepper @ 9 – Thanks Ray, so -5% since your prediction should be the same as what you regard as the safest bet, right?

  12. 12
    ivan says:

    10%, if the tax credit expires. And prices will not bottom until there are gains in employment.

  13. 13
    Ross Jordan says:

    I think housing prices have everything to do with the local and national economy. So, this year in particular, predicting housing prices is really predicting which way the recovery will go.

    If unemployment recovers to 8% or lower, we will probably see housing prices flat to low single digita gains. If unemployement stays around 10% or increases, then housing will continue its downward trend (5-10% decline). If we have a so called weak recovery where unemployment stays in the 8-10% range, we’ll probably see housing flat to low single digits fall.

    Local events such as major layoffs at Boeing, Microsoft and other companies are of course an even bigger influence.

    The only other factor in all of this is inflation. If the fed permanently monetizes the 1.5 Trillion added to its balance sheet in the emergency stabilization program, then we’ll likely see increasing inflation (probably with increasing interests rates), in which case, housing prices could increase even while the economy continues to be weak.

    I’m personally figuring for a weakish recovery with increasing inflation happening towards the end of the year, meaning probably about flat housing “recovery”.

  14. 14
    Groundhogday says:

    I figure we have a 5% drop with the end of tax credit and subsidized mortgage interest. But then it will be a long, slow slog to the bottom from there… perhaps 10% total over 5 years. Banks seem determined to let the foreclosures trickle out which will keep prices depressed for 5-10 years… particularly when some of the knife-catchers repeat the cycle after a few years.

    Median price is much harder to predict. If the higher end starts to cave, median prices could actually go up due to a composition change, even when Case-shiller goes down.

  15. 15
    explorer says:

    Deflation, as jobs do not recover, and the number of potiential new, first time buyers with no job, or reduced spending capabilities, increases. Stubbonness in the RE and other markets will only cause more resistance to paying more for less.

    The other shoe of ARM resets, this time without a bailout (I am guessing), will kick things into gear. The inevitable has only been delayed, not completely avoided.

    Might see signs of actual intelligent life around 2012, when there is no where to go but up.

    Armchair predictions are as good as the “expert’s” at this point.

  16. 16
    Steve Tytler says:

    Tim,

    Thanks for giving me credit on my predictions.

    I have taken a lot of flack here over the years, but I appreciate you pointing out that I have been willing to stick my neck out and I have been more right than wrong.

    I really enjoy your charts and statistics but as we have discussed in the past, there is more to predicting real estate trends than simply crunching numbers. Buying a home is a very emotional decision and very people
    sit down and analyze the deal to get the best ROI. They buy a house because they like it and it improves their lifestyle. So you have to have a “feel” for the psychology of the market as well as an analysis of the numbers.

    Don’t get me wrong, your numbers are GREAT, Nobody has ever provided the detail of stats that you generate on this site. I would have loved to have this kind of info 20 years ago when I was writing a subscription newsletter for Puget Sound real estate investors!

    But I also believe that history tends to repeat itself. For years I consistently said the Seattle area housing market would go down, but NOT as far as San Diego, Phoenix, Las Vegas and other traditional “boom/bust” cities.
    I said that because that is exactly what happened during the last housing boom/bust in 1989-90. San Diego dropped about twice as much as Seattle back then and the same thing happend this time. It seem to recall that many commenters on this blog thought Seattle would follow San Diego right down the rat hole and home prices would drop 50% … and based on raw numbers that seemed possible … but history said otherwise and I now think it’s safe to say that won’t happen.

    Another problem with predicting what the housing market will do is that there really is no single “housing market” in the Puget Sound region. The market varies widely from neighbood to neighborhood.

    For example, the Green Lake area of Seattle has done much better than Puyallup in terms of home values holding up during the crash of the “Credit Bubble.”

    So whenever you make a prediction you have to put it in terms of a range.

    In my published prediction for next year’s housing market I said this:

    “So what will happen to Puget Sound area home prices in 2010? I think average home prices will continue to drop a little, but the pace of home price depreciation will continue to slow. Overall, average home prices may fall about 5 percent, but as always the rate of depreciation will vary from neighborhood to neighborhood. In general, highly desirable neighborhoods, especially those close to major job centers, will do better than outlying areas.”

    [url]http://www.mortgageguru.org/archives/date/2009/11/[/url]

    I think this is beginning of a “flat” period that will last for a few years with very little appreciation or depreciation. This would be one of the “steps” in my infamous stair-step theory of the Puget Sound housing market which will eventually lead to another jump in housing prices at some point.

    I believe the “Credit Bubble” (I don’t call it a real estate bubble) was an anomaly that screwed up the natural order of the local real estate market.

    I think we are getting back into a more “normal” market becasue the days of giving out mortgages to home buyers who could not really afford them are long gone. The foreclosure rate will return to normal levels in a couple years because everybody who has bought a home recently has been thoroughly screened for income and credit and appraised values are very conservative.

    My biggest fear right now is inflation, which means higher interest rates. The government has spent trillions of dollars that it doesn’t have and inflation seems to be the only way out of the mess. A massive jump in mortgage rates could cause a second down draft in the housing market. We’ll have to wait and see on that one.

    So unless we get hit with a major jump in rates, I think 2010 is a very good year for home buyers and a relatively good year for home sellers as well. From the seller’s perspective the worst seems to be over (for now) so they don’t have to worry about home prices falling much farther and buyers can now buy homes at 2005 prices and lock in very low fixed rate mortgages — and they don’t have to worry about real estate agents pressuring them to “buy NOW or home prices will be much higher next year!”

    I think that’s a win-win market.

  17. 17
    David Losh says:

    This year will be down 10%. It looks like we are about at 2005 pricing and 2003 is where we should be.

    However I think we will be giving up more, and that pricing will continue to decline to about 1998 pricing.

  18. 18
    Ray Pepper says:

    “I think 2010 is a very good year for home buyers”

    Okay, Tim……….You heard it hear 1st. Get out there and buy and get off the fence. Hopefully in February…..

    “I think this is beginning of a “flat” period that will last for a few years with very little appreciation or depreciation. ”

    May I please emphasize for everyone “VERY LITTLE APPRECIATION” = NONE to negative. Don’t forget to factor in the cost to sell Buyers.

    So after this “flat” period were going up Steve? ……..Outstanding!

    This would be one of the “steps” in my infamous stair-step theory.” Are you kidding me?

    ” will EVENTUALLY lead to another jump in housing prices at SOME point ” –Yes, it will be cloudy tomorrow at some point as well……..Think so Tim?

    Seriously, Tim…Why do you engage Steve Tytler? Is it to annoy me? Is he doing your Mtg? I don’t know Steve and maybe its just me but is this guy full of himself or is it his predictions are just so VARIABLE and have no basis on fact and the economic crisis we are in…….His posts ALWAYS cause me intestinal problems.

    http://www.youtube.com/watch?v=akX8MvQPtT8&feature=related

  19. 19
    patient says:

    I felt that Steve Tytler managed to dig himself up of the hole he’s been digging hmself into every time he visits this site by giving poor advice ( to support his business I guess ) and shamelessly beting his own drum. But man with your post above your back in the hole as far as I’m concerned.

  20. 20
    Ray Pepper says:

    I mean seriously Steve and I are both in the business of servicing buyers and sellers in real estate.

    Do statements like this make ANYONE here just laugh or is it just me?

    “This would be one of the “steps” in my infamous stair-step theory of the Puget Sound housing market which will **eventually** lead to another jump in housing prices at **some** point.”……

    From the seller’s perspective the worst seems to be over (for now)…I ask you Bubble Heads. DO ANY OF YOU know a seller who thinks the WORST is over for now?

    “I think we are getting back into a more “normal” market because the days of giving out mortgages to home buyers who could not really afford them are long gone”…Steve everybody hear at Bubble (lurkers included) know this. We are not a 1st time Home Buyers Seminar.

    “In general, highly desirable neighborhoods, especially those close to major job centers, will do better than outlying areas.” I simply cannot comment on the obvious anymore……..

    Tim, can you please ask Steve Tytler about his recommendations for clients on Strategic Default and the ramifications in desirable areas keeping a lid on prices. He never responds to me and I’m about to have the secretary send him a 500 Realty T Shirt but I must know his HONEST opinion for the financial well-being of his clients.

    Steve how long till our PNW homeowners, who are upside down 20%, can sell their homes and move on with their lives? Tell the masses something they want to hear and can learn from Tim! Don’t forget about the 10% to sell, when you give us your answer. You are one of Tim’s PROFESSIONALS! HELP!

  21. 21
    AMS says:

    RE: Steve Tytler @ 16 – “I think that’s a win-win market.”

    When you have a sale, both parties are, presumably, happy on the day the deal is done. If a party is not happy, why is the deal being done? All deals are, at least initially, win-win.

    The larger question is what happens next.

    Those who are underwater, gasping for air, generally are not so happy down the road.

  22. 22
    Scotsman says:

    RE: Ray Pepper @ 18

    So you’re saying Steve Tytler is the “Claim Jumper” of the mortgage world?

  23. 23
    Jonness says:

    By softwarengineer @ 5:

    one thing’s for certain, a price rebound in 2010 just isn’t possible, as the mainstream economists were predicting last summer. Wishful stimulus thinking and unemployment denial, IMO.

    And these rebound predictions are being spouted by the same people who denied we were amidst a housing bubble in the first place.

    I was reading about a famous economist who recently died. I can’t remember his name. He was a contrarian thinker who said something the effect of “guessing the future economy is difficult, but knowing what won’t occur is easy. The mainstream economic forecast will always be wrong.”

    I don’t know if the bandwagon economists will always be wrong, but I am guessing most of them went to college on Mommy and Daddy’s dime. Having come from perfect Beaver Cleaver families, these folks never formed the neural networks (during their critical period) to allow them to understand a real-world dynamically unfolding “Leave it to Beaver” episode can end on a sour note.

    Yet they’ve all been force fed history, which is chock full of bad Beaver Cleaver episodes.

    I’d say when training economists, they should attempt to teach them that history is not just some story that happened to stupid unkempt people years ago. I’d start by putting the economists in concentration camps for 5 years. Then bring them out and give them economic lessons. That should bridge the gap between historical story telling and what they watched on TV while growing up during their critical time their brain was wiring up to interpret the world around them.

  24. 24
    Fran Tarkenton says:

    RE: Steve Tytler @ 16

    Thanks for giving me credit on my predictions.

    Emphasis on the plural.

  25. 25
    brady says:

    5-10% drop in median price. Depends on what happens with interest rates. If they go up steadily it will be closer to a 10% drop in the median, but some of that could carry over to 2011.

  26. 26
    Jonness says:

    With all due respect, Tytler did win the prediction contest and should be commended for his accurate percentage down forecast.

    “I think we are getting back into a more “normal” market because the days of giving out mortgages to home buyers who could not really afford them are long gone”

    OK, I have to totally disagree with that outlook though. What is FHA, $1.25 trillion in govt MBS, and an unlimited cap on Fannie/Freddie about if we are no longer providing mortgages to people who can’t afford them? Have you checked out the distress rate on new govt-backed loans these days?

    This is anything but a normal market where only people who can afford to buy homes are cleansing the existing inventory. Without massive unprecedented govt. intervention, your $million home would be worthless. I’m keeping in mind that Keynes plan only worked in the depression after about 15 years of prior normal market correction.

  27. 27
    AMS says:

    RE: Jonness @ 25 – How much of Tytler’s prediction was based on luck?

  28. 28

    RE: Scotsman @ 22
    Maybe both Claim Jumper and Steve Tytler leave Ray with a nauseous feeling, but he keeps on going back to Claim Jumper. If only Steve served BBQ ribs with every loan…

  29. 29
    corncob says:

    I would like to call for a word filter on “claim jumper” due to that thread. I suggest “ray’s situation”.

  30. 30
    Scotsman says:

    Where’s Phht? Maybe he can explain to me what this little bit of news means for the recovering economy and home prices in 2010. I already know Ray’s take on it. ;-)

    “One in every 7.5 homeowners in the United States is either behind on their mortgage or in foreclosure, according to new data released by Lender Processing Services (LPS) Monday. That equates to a record high 13.2 percent of the nation’s home loans.

    LPS’ December Mortgage Monitor report, which analyzes 40 million residential mortgages across the spectrum of credit products, paints a dismal picture of loan performance. Total delinquencies, excluding foreclosures, increased to a record high 9.97 percent as of November 30, 2009. That represents a month-over-month increase of 5.46 percent and a year-over-year increase of 21.29 percent.

    Loans rolling to a more delinquent status totaled 5.01 percent, compared to just 1.52 percent of loans that improved. Of loans that were current in December 2008, 4.37 percent were either 60 or more days delinquent or in foreclosure by the end of November 2009, a rate higher than any other year for the same period, LPS said.

    Foreclosure inventories also continued to climb to new highs, with November’s foreclosure rate at 3.19 percent – a month-over-month increase of 1.46 percent and a year-over-year increase of a staggering 81.41 percent.”

    http://www.dsnews.com/articles/non-current-mortgages-hit-record-high-132-lps-2010-01-11

  31. 31
    David Losh says:

    It’s late and I was looking for the article that I read today about now being a reat time for the mortgage industry. Good mortgages are being generated.

    The problem is that those good mortgages are being done in a stable market place that has room for future declines. The article was saying that if home price decline and stay declined over a period of time these 2008 and 2009 buyers,and people who refinanced, wil be walking away in the future.

    Basically, the point being made is if you are paying interest for the privledge of paying off a home that needs continued upkeep, most people would prefer to rent.

  32. 32
    mr.finviz says:

    I think most of you will be surprised by the lull in the market after the Tax credit is allowed to expire and mortgage rates go up. I predict 2010 will be worse than 2009. Price drop will be around -10% (CS data of course).

  33. 33
    Trigger says:

    RE: Scotsman @ 7 – Scotsman – what if Obama and Bernake go on a rampage and subsidize housing by 20%. So you purchase a shack for 500K – Obama gives you 100K co-pay. Probably will not happen but the govt is pretty determined to end all of the declines. Just like they were determined to avert the possibility of stagflation.

  34. 34
    AMS says:

    RE: Trigger @ 33 – At what point does the rampage become excessively inflationary?

  35. 35
    Scott Weitz says:

    RE: Trigger @ 33

    That would be political suicide…no way they go so far as to have a 100k tax credit.

    For the record, I have no idea what prices will be in 2010. If the govt gets out of the market, and banks start foreclosing more expediantly, it could be ugly.

  36. 36
    What the Heck says:

    This is an election year. There is no way the government will stand by and watch the housing market become subject to free market conditions.

    Credits, interest rate subsidy, programs will remain/be developed to at least hold the overall market steady.

    Reality probably won’t hit until early 2011 – after the elections and when the govt spending bubble has to pop cause there’s nothing left to give.

    Based on these assumptions, I believe we’ll see flat to modest (2%-5%) appreciation in 2010. Press will play it up and our fearless leaders will tell us not to worry about a jobless recovery. We’ll get the “psychology” bounce.

    God help us all in 2011. I’m seriously considering selling the home I own outright and become a renter.

  37. 37
    Broderick says:

    My predictions: We won’t see increases this year – prices will continue to decline, I’m in the 5-10% down mind frame. I am watching 10 year UST yields (deficit fears will push up yields driving up the risk free rate), so higher rates will mean more of your money towards interest…prices will adjust for this when it happens. Meanwhile unemployment is not going down fast enough to justify a boost. I also believe the government just helped steal future demand with the credit…so we will feel some effect from this. That said, i will probably look to buy this year with the intent that i’ll live in the house for at least 5 years.

  38. 38
    patient says:

    If a permabull like Trigger thinks we need a $100k tax credit to sustain the market thinks must be worse than I thought.

  39. 39
    patient says:

    RE: Broderick @ 37

    “That said, i will probably look to buy this year with the intent that i’ll live in the house for at least 5 years. ”

    It would be interresting to hear why someone other then a re-agent thinks this is a good idea. I.e buying with a predicted 5 year holding time when you think prices will fall up to 10% this year? Add to that the near 10% in selling costs. You must believe that prices will start rocket up in the near future to make that anything but a bad deal?

  40. 40
    Researcher says:

    2010 PREDICTIONS

    Steady, slow depreciation of the general RE market into Q1. In Q2 the RE depreciation increases as about $1.2 trillion in mortgage loans begin to reset, creating a massive wave of foreclosures. Inflation creeps up and the Fed does NOT raise interest rates, and the US dollar begins to deteriorate quickly due to the last of the foreign debt purchasers fleeing the exits.

    California, New York, Illinois and several other bankrupt states are bailed out by the Federal Reserve. The US dollar is diluted by another $1 or $2 trillion, or more.

    Chance of a 50% or greater US dollar currency devaluation and bank holiday = 50% to 70% in Q3 or Q4. Remember that the US govt is currently purchasing 85% of its own Treasury debt, in order to keep the dollar afloat. Americans will be side-swiped as they realize their heavy investment in US bonds was the worst place to be invested. US Treasury debt is then downgraded to below AAA status and hundreds of US banks fail.

    The collapse of the US dollar and the banks will obliterate the housing market in the US and worldwide. Currencies worldwide will also be substantially devalued and “reset.” The new economy in the US that evolves in 2011 and 2012 will be barter-driven and will gradually move to local-based currencies. The United Nations will work with the World Bank to provide a new global currency for world trade, possibly named the “Terra.”

    Commodities and agriculture will rise in value as food and resources become scarce, due to hording. Silver will go through the roof due to a shortage in the metal and its use as a local currency.

    The new jobs will be created in the green sector, which serves to protect the environment from manmade global warming.

  41. 41

    RE: patient @ 39
    Know it all real estate agents are hard to shut up:
    I think buying a home with a five year holding time is way too risky. To put numbers on it, suppose you bought a home for 500,000 dollars right now. And let’s say you have it in cash. You’ll still pay 2-3 thousand in title and escrow and recording fees, etc, so let’s call it 503. Let’s further assume a 5% drop in ’10, completely flat in ’11, and a 2% increase in 12, 13, and 14. That adds up to a selling price of about 504. Then subtract 6% to pay both listing and selling real estate agents, about 2% real estate excise tax, and about 1% title, escrow, and other fees, so you end up with 459. …Of course this isn’t set in concrete. It’s possible that prices will drop more than 5% in ’10, or that prices will increase more than 2% a year when they start to increase. But I think my assumptions are fairly mainstream.
    If you’re going to buy, you need to think about a longer holding period than five years, probably 7-10 or more.

  42. 42
    patient says:

    RE: Ira Sacharoff @ 41 – Thanks for the example Ira. I was especially interrested in hearing Broderick’s line of thinking since he is not a re-agent ( or are you? ) and thinks it’s ok to buy when he expects a 5-10% drop in prices this year and he talks about a holding period range from 5-years. It doesn’t make much sense to me so I was interrested in his thinking, perhaps he has some reason that validates the huge risk for significant losses with his own prediction.

  43. 43
    patient says:

    RE: Researcher @ 40 – The need for that CHF ETF in my 401k just skyrocketed…

  44. 44
    AMS says:

    RE: patient @ 42 – I think I have made my position clear: Don’t buy in a down market if finance is important. If you’re spending pocket change, who cares.

    That said, there is a break-even point between pocket change and where finance becomes important enough. It will be different for each person. There are people who seek to invest in the local community by taking an ownership position. For example, who cares if the market is going down 10% per year if you’re in a home that starts at 1x annual income. So it costs 10% of your annual wages the first year, 9% the second year, 8.1% in year three, and so on.

    It’s a bit problematic when a person is living in a home that’s 6x income and the value goes down 10% per year. That’s 60% of the annual earnings the first year, 54% the second year, and so on.

    If there is financing involved, then the total expense, some realized and some unrealized, some required cash flow, some did not require cash flow, is approaching 100% of a person’s annual income.

    Interest is both an expense and requires cash flow
    Roof/water heater/furnace use is an expense and does not require cash flow
    Market value change is unrealized and requires no cash flow, until sale
    Capital investment (improvements) requires cash but is not an expense.

    So while the drastic market value changes do not require immediate cash, and in the case of most bankrupt owners will never require cash, there is a problem.

    In a down market, the use of leverage amplifies losses just as leverage was used to amplify the gains during the bubble period. What about risk?

  45. 45
    Willy Nilly says:

    RE: Researcher @ 40

    Researcher, You have a much more sophisticated understanding of economic factors than I do. The only prediction for 2010 I am concerned with is relative to my own choices.

    Why renting in 2010 and beyond is a good idea for me.

    1. Alt-A – resets beginning this year through 2012. Will the Gov. take action to mitigate these in some way – extend and pretend some more? Regardless of Gov. action, more supply will come onto the market. Although the majority of these are in CA, that states malaise affects the rest of the country and puts additional strain on federal resources.

    2. Interest rates – free money cannot continue forever. When rates increase, affordability drops even lower, driving down prices. Massive new Gov. debt has to be serviced somehow – eventually.

    3. Income to housing parity – average area home prices are still way out of whack with average incomes. To get to 2000 average prices would be best case parity (another 36% drop?)

    4. Short sales & foreclosures – An abnormally high percentage of distressed properties on the market increases supply. Both individuals and banks in compromised positions with have to accept further losses.

    5. Unemployment – The longer people are out of a job the less they can exist off of their reserves. Increased situational living density will further increase supply (both mortgaged and rented).

    6. Commercial real estate – Higher vacancy rates and leveraged property owners puts additional strain on the financial system and chances of any economic recovery.

    7. Inflation – This one I do not have a firm understanding of, but increasing prices across the board will drive people to make choices. With lowered expectations and standard of living, more people will give up their mortgages and rent. Eating is one of the last things to go, first goes the biggest expense – housing . Although the devaluation of money will increase the price tag, ultimately quality of life goes down. Thank you – The Creature from Jekyll Island.

    8. Economic clarity – A diverse set of conditions are muddling the future (especially the next 3-5 years). There are too many interdependent systemic factors that render traditional metrics much less effective. Anyone who can say they know with certainty how things will play out in the future is sorely mistaken.

    9. Consumer trends – Human behavior will usually trend in a direction, both individually and collectively. The last 20+ years (especially the last 10) has created lifestyle windfalls that have permitted excessive consumption. The expectations of how life is and how one behaves in it will become tempered, and ultimately people will cut back (yes, even more). If problems are not dealt with appropriately and in a timely fashion, eventually the problem deals with you on its own terms. With a bulk of our economy consumer driven, even a slight easing of pressure by consumers to spend should yield anemic growth at best, and perhaps a contraction. Adjustment in lifestyle and expectation should further reduce demand for housing.

    10. Election year – policy makers will maintain the fragile stability so their pals can stay in office as much as possible.

    Numbers 3, 4, and 5 are the primary ones for me that cannot be denied. Number 1 and 6 are the elephant in the living room. My prediction – If the Fed Gov. keeps putting fingers in the dike a 7% drop. If the Fed Gov. runs out of fingers, then a +20% drop here in the PNW.

  46. 46
    One Eyed Man says:

    RE: patient @ 39RE: Broderick @ 37RE: Ira Sacharoff @ 41

    When AMS and I were discussing Rent v Buy calculations, this was one of the better on-line calculators I could find. Even so, it has a number of limitations that I won’t take time to discuss with the exception of the following. Unfortunately the calculator just gives a bottom line number without giving a break down for each line item. It does have a description for its methodology, but I never checked it enough to tell if it did all the present value calculations and its difficult to check that without the calculation for each line item.

    Even if you assume a 3% increase in home prices each year (slightly above the long term historic norm), it says it will take 7 years for owning to come out ahead of renting given the assumptions I used. I tried to use what I considered to be historic norms and/or current rates for all the variables it allows you to input (ie Gross Rent Multiplier of 20 or 240 months, current 30yr fixed rate of about 5.2, etc.). If you had a 5% drop in prices in the first year, that would push the break even point out to about 10 yrs even with 3%per year increases in home prices starting in year 2.

    http://www.nytimes.com/2007/04/10/business/2007_BUYRENT_GRAPHIC.html?_r=1#

    If you use it, don’t forget to use the Advanced Settings at the top right.

    If someone has a link to a better calculator, let me know because I’d like to have a better one. I use this one to show people it will probably take a lot longer than they think to break even if they buy in todays market, even with somewhat optimistic economic assumptions.

  47. 47
    AMS says:

    RE: One Eyed Man @ 46 – I’m still thinking this rent versus buy over. I continue the quest seeking a relatively simple solution to a relatively complex problem.

  48. 48
    Drone says:

    I worry that maybe we’re missing the inflation argument.
    I agree that home VALUES must fall, but I’m not convinced that home PRICES must fall. If we’re in for a multi-year bout of high inflation, wouldn’t the best solution be to exchange your high-value dollars for an asset? The value of the asset decreases over time, but so does the debt load. When interest rates increase, you have a pile of debt taken at low rates where the payoff value gets easier every year.

    Alternatively, one holds their dollars, and the value of savings decreases with the value of the unpurchased property. You’d be in the same position ~5 years later as if you had purchased, but now with higher interest rates for the borrowed portion.

    And before everyone jumps in to say “just buy gold!”, remember that metals are also an investment class just like cash and RE, with their own risks of speculation and euphoria. I’m trying to figure out why any particular investment class is better than the others.

  49. 49
    Scotsman says:

    RE: Researcher @ 40

    Sounds like my initial predictions for… 2008. Unfortunately, I seriously underestimated the ability of those in power to change the rules, temporarily alter reality, game the system, exercise corruption, and keep the sheeple in line while never getting noticed by the traditional media.

    I don’t doubt much of what you claim will come to pass, but suggest you push the date out until at least 2011.

  50. 50
    Scotsman says:

    RE: Drone @ 48

    I’m still not sold on inflation as long as total credit, and especially consumer credit, continues to shrink. The new way of looking at the money supply includes not just traditional money, but also credit and assets that can serve as collateral for new credit. Remember, your visa spends the same way cash does, and the HELOC “home atm” has also been a source of “new money.” So far, both credit and assets have been shrinking far faster than the Fed has been adding to the money supply with the net effect of less money in circulation- hence deflation.

  51. 51
    AMS says:

    RE: Drone @ 48 – Yes, if you think high inflation is going to hit, then hard assets are generally the way to go. Equities do well to, as the future profits are higher. Avoid relying on annuity payments, holding cash, bonds, and so on. Those who rely on savings, such as the elderly, take a big hit when inflation hits. Don’t be surprised, however, if housing continues to go down in nominal dollar value even in an inflationary environment.

    I’ll leave it to others to discuss the future value of the dollar.

  52. 52
    Willy Nilly says:

    RE: Scotsman @ 49

    The Mayans were right. You just have to push your date out one year Scotsman!

  53. 53
    CCG says:

    By David Losh @ 17:

    This year will be down 10%. It looks like we are about at 2005 pricing and 2003 is where we should be.

    However I think we will be giving up more, and that pricing will continue to decline to about 1998 pricing.

    This one works for me. Bubbles tend to unwind 100%+ in real terms.

  54. 54
    Bubble Gum says:

    RE: David Losh @ 17 – By David Losh @ 17:

    This year will be down 10%. It looks like we are about at 2005 pricing and 2003 is where we should be.

    However I think we will be giving up more, and that pricing will continue to decline to about 1998 pricing.

    Hi

    Do you have any data which supports that Seattle should be at 2003 level rather than 2005 level?
    If so, I’d love to see your analysis of why :)

  55. 55
    rentRloser says:

    Gold and crude are up for 4x since the beginning of 21 centry. In USD terms, house price only up by how much? National debt and interest will crush the dollar in your checking account. Your wages will be millions and your guys are still talking about housing price reduction in paper amount. The end will be a new money standard based on hard asset (gold, silver, crude, etc). The house is still a house made of metal, lumbar, cement, and labor. You old USD has to be converted to new whatever new money standard will be. Savings, pension and annunity will be penny for the old Dollar. we will all join millionaire club then and your guys still talking about 1/2 million dollar house expensive?

  56. 56
    Scotsman says:

    RE: rentRloser @ 54

    “Gold and crude are up for 4x since the beginning of 21 centry. In USD terms, house price only up by how much?”

    Yeah, baby! To infinity, and beyond!

    Hey, how much are wages up since the beginning of the century? How about “real” wages, adjusted for inflation, taxes, blah, blah, blah… How about real wages since 1970?

    Oh, I see.

    P.S. The new currency will be fresh vegetables and ammo. Snark!

  57. 57

    RE: One Eyed Man @ 46
    Yet to some people, it’s worth paying extra money each month to own a home rather than to rent.
    If you really want to own a home, how much extra per month makes it worth it?
    For me, if I saw that the historic price/rent ratio was way out of whack, I’d exercise caution before I bought.
    If it seemed likely that home prices were likely to keep dropping, maybe even significantly, I’d exercise caution before buying.
    But if I really wanted to buy a house, felt comfortable that I could easily afford a few hundred dollars extra per month in order to do so,felt like I wanted to stay in this home 7-10 years plus, and felt like we were near the bottom, I’m not sure I would care whether it was cheaper to rent or cheaper to buy.

  58. 58
    Scotsman says:

    RE: Ira Sacharoff @ 57

    What you say is true, and to some extent we’ve done a disservice here by not recognizing it. In talking with folks these days I suggest that you can buy a home now, but should look at ownership as a luxury. Not everyone drives a Kia- some folks drive Mercedes. And while perhaps not everyone who drives a Mercedes can easily afford one, it’s a choice they make in setting their personal priorities. As long as they understand the trade-offs and real costs, as long as they willingly chose that path and can handle the cost, so be it. It’s still a somewhat free country where individualism can be expressed.

    But if your priority is maximizing wealth over the long run, now is not the time to buy.

  59. 59
    Ross Jordan says:

    By Scotsman @ 50:

    RE: Drone @ 48

    […] So far, both credit and assets have been shrinking far faster than the Fed has been adding to the money supply with the net effect of less money in circulation- hence deflation.

    Do you have numbers on that? I’ve been looking for a while, but haven’t found anything broad and extensive enough.

    We know that credit imploded in late 2008/2009, and leveraged lending unwinded in a massive way … but its not clear to me how much unwinded. Banks were certainly trying to get their reserve ratios to conservative figures. At the same time, the fed’s balance sheet expanded 1.5Trillion, as well as the fed loosening in several ways (overnight rate, special funds to banks etc.) No doubt many of the banks just hoarded the cash they got, but some amount of new lending occurred based on the Fed’s injection (which is a creation of new money). And several hundred billion of the Fed’s new lending went to buy “mortgage backed securities”, which is why mortgage rates dropped to historic lows (that input is real new money in the economy … making up for money that previously coming from banks and investors). Now, a year and a half after the implosion, there’s signs some banks and financial firms are leveraging up again, though to decidedly more conservative ratios.

    Summary:
    – Implosion of financial markets: mortgage, insurance, financial companies implode [ Large reduction in money supply, at top of stack ]
    – Reduction in housing values, consumer/business credit lines, tightening of lending standards [ Large reduction in money supply, at top of stack ]
    – TARP and other rescue efforts by federal government [ Small/Medium increase in money supply at top of stack ]
    – Federal reserve buying spree [ approx 1.5 Trillion new money at the bottom of the stack ]
    – Federal reserve loosening rates and other loosening measures [ new money ]
    – Relaxing of some of the lending standards [modest new money]
    – [Future] Federal reserve mopping up excess liquidity (can they do it?) [ removes money at the bottom of the stack ]

    How that all adds up is the trillion dollar question, and defines the direction and degree of future inflation. My thinking was originally deflation short term, moderate (~5%) inflation longer term. Bill Gross seemed to be hinting something similar in his latest january outlook.

  60. 60
    The Tim says:

    RE: Ross Jordan @ 59 – Here are a couple of charts that show the shrinkage in outstanding debt.

    Debt in the United States: 2000 – 2009

    Absolute Debt to GDP, 1980 – Present

  61. 61
    AMS says:

    RE: The Tim @ 60 – Any idea what impact bankruptcy has on the decrease? How about non-recourse mortgage debt, maybe?

    Other factors?

  62. 62
    patient says:

    By Scotsman @ 58:

    RE: Ira Sacharoff @ 57

    What you say is true, and to some extent we’ve done a disservice here by not recognizing it. In talking with folks these days I suggest that you can buy a home now, but should look at ownership as a luxury. Not everyone drives a Kia- some folks drive Mercedes. And while perhaps not everyone who drives a Mercedes can easily afford one, it’s a choice they make in setting their personal priorities. As long as they understand the trade-offs and real costs, as long as they willingly chose that path and can handle the cost, so be it. It’s still a somewhat free country where individualism can be expressed.

    But if your priority is maximizing wealth over the long run, now is not the time to buy.

    Even if you can afford it and it was cheaper than renting, would you in the case of the Mercedes buy an E-class today if you could get an S-class next year for the same money? Your E-class would probably trade for about half what you paid…It’s not just about being able to afford it or priority, it’s also a lot about value for money.

  63. 63
    patient says:

    In short, imo buying depreciating assests of this magnitude is nasty anyway you see it, especially if you leverage with a mortgage.

  64. 64
    Scotsman says:

    RE: Ross Jordan @ 59

    Without taking the time to hunt down more specific estimates my recollection is that the total loss in asset value for the U.S.- housing, equities, commercial, etc. is somewhere on the order of $30-50 trillion. Yes, it’s measured in the tens of trillions, well over the amount of TARP, treasuries, etc. The consensus I’ve read is that it’s pretty much impossible for the Fed to print enough money to even begin replacing the asset values that have been lost. The key is credit expansion, not printed dollars. As long as credit continues to contract it will dwarf the Fed’s efforts at injecting money into the system. remember, the Fed’s balance sheet is still under $3 trillion, a drop in the bucket, everything considered.

    For a quick reference, here’s a bit that places housing value losses alone at over $4 trillion just for 2008 and 2009. Add in the drop in stocks and you can see we’re well on our way to a big number.

    http://www.reuters.com/article/idUSTRE5B80HU20091209

  65. 65
    Scotsman says:

    RE: patient @ 62

    Great point. Maybe cars are the perfect example/analogy because they depreciate so quickly! ;-)

  66. 66
    Researcher says:

    RE: Drone @ 48

    Gold does not go up or down in price. Gold remains at the same value, globally. Currencies, however, move in relation to gold. If gold is going “up” that generally means the US dollar is declining, if you are an American. Gold is an asset class that does not lose its value since it is in limited supply and its value is recognized worldwide. It has been this way since the earliest civilizations. No other asset has the same qualifications.

    Silver, however, is similar to gold and is expected to be in shorter supply than gold in the near future. Traditionally, silver moves higher (%) than gold when both move up.

  67. 67
    Jonness says:

    By patient @ 39:

    RE: Broderick @ 37

    “That said, i will probably look to buy this year with the intent that iâ��ll live in the house for at least 5 years. ”

    It would be interresting to hear why someone other then a re-agent thinks this is a good idea. I.e buying with a predicted 5 year holding time when you think prices will fall up to 10% this year? Add to that the near 10% in selling costs. You must believe that prices will start rocket up in the near future to make that anything but a bad deal?

    How about buying a cheapo, fixing it up a little, living there for 5 years until it is paid off (remember it’s cheap)? Then rent it out and move on. At that point, you have a permanent income stream that will probably keep pace with inflation from then on.

  68. 68
    Jonness says:

    By AMS @ 27:

    RE: Jonness @ 25 – How much of Tytler’s prediction was based on luck?

    Maybe all of it. My point is a contest is a contest, and whatever methods were used by all competitors, Tytler won. If he won purely with a lucky guess, then a lucky guess proved to be the best methodology for predicting the future of house prices. That being said, I do remember some logic being supplied along with his prediction. Whether any of it turned out to be relevant I’m unsure as I don’t recall the particulars. It would be interesting to reread his prediction to see how much merit it really had. I’m not going to go quite that far though :)

  69. 69
    AMS says:

    RE: Jonness @ 68 – Fair enough.

  70. 70
    Scotsman says:

    RE: Researcher @ 66

    An interesting take and perhaps true, IF one used a long enough running average to smooth the ups and downs driven by speculation and industrial demand as opposed to currency variations. In any multi-variate model it’s generally not particularly useful to hold the output constant while attempting to reverse engineer the inputs.

    I’m always amused by the idea of gold as some unassailable store of value in the modern world. While it does have industrial and artistic value, it’s usefulness as a day-to-day currency faces a host of issues. And you can’t eat it, shoot it, or use it as a tool, so what real value does it have in the apocalyptic world it’s supposed to protect you from? In far to many ways gold has become the alternate fiat money and speculative instrument of the modern world.

    You are correct though in suggesting those who want to speculate (and/or protect value) would do better to focus on silver as a store of value.

  71. 71
    ARDELL says:

    Home prices are not down 5% to 10% in King County From Jan 2009 to year end. In fact the median price is up.

    http://raincityguide.com/2010/01/12/king-county-home-prices-2010/

    Median price bottomed in March at $362,700 and ended the year at $380,000.

  72. 72
    David Losh says:

    RE: ARDELL @ 71

    An artificial bump in pricing due to the tax credit, and other Fed influences on the mortgage markets.

    A bottom is bed rock, where prices move up from.

  73. 73
    Realtycheck says:

    RE: Ray Pepper @ 20

    Ray seems very frustrated. Must have a problem with Steve. Ray sells homes and I wonder if he shares his views about, in Rays opinion, the maket is going down. Odd. The market is trending downward in Ray’s opinion yet he collects commissions from seling homes to buyers. He must only be selling thoses GEMS.

    Hey buyer the market is gong down. You are probably going to end up upside down. Press hard with your signature, I use cheap carbon.

  74. 74
    AMS says:

    RE: ARDELL @ 71 – Using this data set:

    http://www.housingtracker.net/asking-prices/seattle-washington/

    For 2009, the high median asking price in the Seattle area was August 2009 at $365,300.
    The low was December 2009 at 331,088.

    So far January 2010 is at $327,000 (2 of 4 data points).
    January 2009, about a year ago, came in at $364,045.

    Generally speaking, the asking prices are trending flat to lower.

  75. 75
    Scotsman says:

    Wow, is RCG dead, or what? There sure isn’t much going on over there. Is a lack of credibility driving away posters?

  76. 76
    AMS says:

    RE: Scotsman @ 74 – “Is a lack of credibility driving away posters?”

    Maybe it’s driving away readers?

  77. 77
    Everett_Tom says:

    RE: AMS @ 76
    RE: Scotsman @ 75

    I don’t know about anyone else, but I stopped going to RCG after the layout changed. I had found the post interesting, but not interesting enough to try and navigate the new format, which made it difficult to follow the conversations in the comments. I also was turned off by the Facebook add-in, and the heavy emphasis on home search.

    I guess it just felt like they got away from their primary service (in my mind), which was Real Estate news / commentary for RE folks by RE Folks.

  78. 78
    patient says:

    RE: Scotsman @ 75 – RCG used to be somewhat consumer friendly where interactions with readers washandled with a semi-decent attitude towards contrary opinions but turned into just another industry group hug site that shuns the consumer in favour of self-serving cherry picking propaganda. To be fair it’s probably the intenton of the site but it no longer have anything special to us consumers imo. Just another one site in the re-jungle. At Seattlebubble the industry and the consumer meetup on more equal terms but with more of a consumer bias which makes it soooo much more appealing.

  79. 79
    ARDELL says:

    RE: David Losh @ 72RE: David Losh @ 72

    In real estate “bottom” can stay at “bottom for 3 – 5 years. If we get below a median of $360,000 to $363,000 in King County, we will have established a new “bottom”. Until then my “bottom call” still stands as correct.

    Real Estate is always an L shaped recovery and not a V shaped recovery, due to appraisal considerations.

    As I said in my post, the new County Assessed Values could create a new down cycle in 2010. That’s a big IF, but clearly the one I am most concerned with at present.

  80. 80
    ARDELL says:

    RE: patient @ 78

    When the market was going down, and I was reporting that honestly, certain people visited both RCG and Seattle Bubble. When the market bottomed IMO and came off the heavy decline, many were disappointed with that “news”. Those who want prices to go below 2005 levels, do not “like” evidences to the contrary. I’m not saying what some people want to hear. Prices will stay in 2005 to 2007 zone for years. Hitting the 2004 line in my graph will be an unexpected event, and those who want prices to receded to 1999 to 2003 levels do not want to hear that I do not expect that to happen, barring some unforeseen new cataclysmic event.

    I fully appreciate why some would want 1999 prices. I just don’t see that happening in the next 3 years and is mostly wanted by people with no compelling reason to buy at all.

  81. 81
    ARDELL says:

    RE: Everett_Tom @ 77

    I agree wholeheartedly, as to the other writers…but not the owner of the site. I will send your comment to him.

  82. 82
    Everett_Tom says:

    RE: ARDELL @ 71

    That doesn’t seem quite right. From “The Tim”‘s cached NWMSL data (e.g. the excel sheet linked from the post below:

    King County SFH Median (Jan 09) :$382,500
    King County SFH Median (Dec 09):$380,000 (drop of $2,500)

    King County SFH & Condo (Jan 09): $364,137
    King County SFH & Condo (Dec 09):$350,000 (drop of $14,137)

    And the Year over year (Dec 08 -> Dec 09) is down the -5.8% listed above…

    I’m assuming your numbers are from one of your custom searches?

    Seattle Bubble median SFH price. , from Seattle Bubble Dec NWMLS data post. .

  83. 83
    Everett_Tom says:

    RE: ARDELL @ 81 – Thanks. I actually miss your post and the Friday mortgage rate update post.. just not enough to fight with the new interface.

  84. 84
    AMS says:

    RE: ARDELL @ 80 – “Prices will stay in 2005 to 2007 zone for years. Hitting the 2004 line in my graph will be an unexpected event, and those who want prices to receded to 1999 to 2003 levels do not want to hear that I do not expect that to happen, barring some unforeseen new cataclysmic event.”

    You describe a band where prices can go no lower than today’s level, and go no higher than the 2007 peak.

    I am not so convinced that today’s prices, which are similar to 2005 prices, are on firm foundation. Rents are low relative to purchase prices, distressed sales, based on over-leverage, are still plentiful. While I think prices can go down a long way from today’s prices, I am not saying that it will happen. I’m giving it a high likelihood of happening, but at the same time I have seen high prices linger for years.

  85. 85
    patient says:

    RE: ARDELL @ 80 – “Prices will stay in 2005 to 2007 zone for years”
    This comment clearly shows one of many problems with RCG posters. Predictions are stated as facts. It’s not facts Ardell, it’s your best guess nothing more nothing less. I think you are wrong and that prices will go below 2005 levels, it’s two different predictions but Imake no claim that mine is a fact, it’s what I think is likely due to that we still haven’t fully deflated the loose credit part of prices and we haven’t even started deflate the part that is built on that a home always appreciates and then we have the unemployment and foreclosure problem. Take your picks.

  86. 86
    patient says:

    RE: patient @ 85 – And I also believe that FHA will blow up before we bottom out and that downpayment requirements will rise and so will interest rates ( due to other macro economic issues). None which is bullish for home prices.

  87. 87
    ARDELL says:

    RE: AMS @ 84RE: patient @ 85

    “The Band” is at 2004 level, which we are not AT, as shown in the graph. We have not touched the 2004 line and I don’t expect we will.

    http://raincityguide.com/2010/01/12/king-county-home-prices-2010/

    We were at $380,000 median price in December 2009 and at $362,700 at the end of March 2009, which I called as “bottom”.

    You have to wonder why, since my bottom call in hindsight is still correct, that the person listed as saying 2009 prices would go down 5% to 10% is listed as “the winner”, when that is not correct. Why would someone want to report that home prices went down 5% to 10% in 2009, when they did not?

  88. 88
    rentRloser says:

    Inventory is still low in this region. People need a roof and don’t want to sell to realize the loss. Fed will make sure the situation won’t get any worse by using tax money. Unless economy got worse to force people to sell, housing price will stayed this level except hardship sell. Banks are holding foreclosures until market stabilizing. Good deals are grabbed everyday by people. Global economy in clude US is slowly recovering. Gold and crude are all up in dollar terms. Once people realize that recovery is real and there are more sideliners waiting to chase limited asset or goods, housing price will be up again.

  89. 89
    ARDELL says:

    RE: Everett_Tom @ 82

    To include 2008 drop is not predictive if said as to 2009 “drop”. It was old news and had already happened. There was no 5% to 10% drop IN 2009. If you want to use Jan before my call vs. March which I did call…fine. I’ll give you a .006% “drop” if you want to split hairs.

  90. 90
    ARDELL says:

    RE: Everett_Tom @ 82RE: Everett_Tom @ 83

    I don’t call the condo market, nor does Seattle Bubble as far as I know. It’s too unpredictable given the changes in WA Law as to Reserve Studies being required, and the change in FHA requirements for condo financing. It’s a bloodbath with no bottom in sight.

  91. 91
    patient says:

    RE: ARDELL @ 87

    “You have to wonder why, since my bottom call in hindsight is still correct, that the person listed as saying 2009 prices would go down 5% to 10% is listed as “the winner”, when that is not correct.”

    Maybe because the yearly prediction thread has always been defined as YoY median Dec – Dec? It would make sense that the person who guesses correctly on the defined question wins, no?

  92. 92
    AMS says:

    RE: ARDELL @ 87 – Metric spaces are often a challenge.

    There’s King County, Seattle Proper, Seattle Area, Puget Sound area, and so on, and so forth. Then there are all kinds of metrics within geography. And by no means am I suggesting that geography is the best way to go, but it’s convenient. Instead of geography, some people look at single family homes, others look at condos. Some look at homes greater than 2,500 square feet. Selling prices, asking prices, foreclosure prices, short sale prices, the list goes on.

    The “winner” is based on a specific metric.

    See the Monday open thread for difficulties in defining metrics.

    So I’ll write you down as $362k bottom call (King County Sold), with another 5-10% for a tolerance. No, I am not going to suggest you were wrong if prices touch $361k. That’s not the point at all. If prices get down to $330k, your bottom call won’t be looking good at all. Also if prices linger for a long period of time below $362k, such as $350k for 4 or 5 months, the bottom call won’t look so good. Once again, I am not looking to call you out on any technicality. It’s really not my style.

    The time frame is three years is long enough, but once again, if it holds for 2.5 years, you made a good call, even if prices go down close to year 3. Three years is sufficiently long that I’ll give a decent level of tolerance.

    Right now, unless something changes, I see persistent downward pressure on prices. In other words, the downward pressure exceeds the upward pressure, so prices will trend lower. It’s a bumpy ride, and upward spikes won’t surprise me, nor would unusually low downward spikes. The larger trend is what I will be watching, and I expect prices to generally go lower.

    By prices I mean prices in general. Not a specific property. Not a small area. King County is large enough, but I also see prices trending lower in the Seattle area/Puget Sound Area. Prices could remain flat, but I don’t see any significant, long-term, sustained price increases. Things might change. I’ve heard suggestions about $100k tax credits for home buyers. Who knows, stranger things have happened.

    Looking elsewhere, there are so many markets that continue to struggle. I don’t think Seattle can avoid the larger landscape.

    For those who want some of the factors that:

    1. Unemployment rate is too high
    2. Total wages in the area are stagnant
    3. Bankruptcy filings are increasing
    4. Current level of leverage (total leverage and home mortgage leverage) is too high
    5. Cost of home to cost of rent ratio is too high
    6. Availability of labor/housing in other markets (The threat of Boeing moving more operations, for example). The opportunity for equal labor and available infrastructure in other markets, both domestic and abroad, is simply too great.
    7. The relative cost of housing in the Seattle market to other markets. Seattle is relatively high in the cost of housing, even if wages are higher, see #2 and #6 regarding high wages.
    8. The number of desperate sellers/distressed sales. The number of sellers wanting to simply sell is just too high. This puts a downward pressure on all homes. See also #3.

    The above is a partial list; the list is meant to provide an idea of the basis of the downward pressure on home prices.

  93. 93

    RE: ARDELL @ 71
    Ardell,
    I’m trying to find your logic here. Do I assume correctly that your assertion that prices are actually up in 2009 because we hit a bottom of 362,000 in March, but the year ended with 380,000, therefore we’re up for the year?
    I’m probably not following your logic correctly, but shouldn’t a year be twelve months long?
    I’m assuming a year starts January 1st, therefore the Dec 08 figure is the number you’d have to use, because that would be the closest figure you’d have to Jan 1, 2009, and the Dec YOY comparisons is one most people would go with.
    Yes, Dec 09 finished higher than March ’09, but I’m not sure what that indicates.

  94. 94
    David Losh says:

    RE: ARDELL @ 79

    You went into the spring selling season with a bottom call that you sent out in a press release. It coincided with the tax credit offered by the federal government and a huge propaganda campaign by the National Association of Realtors. Prices did increase 3%.

    I would never encourage any one to buy based on a tax credit. People with properties should either sell or walk away from a mortgage, but now is the time to do that if you can find some one who is gullible, or is willing to pay off a mortgage.

    We are in a dead Real Estate market here in the Seattle area. Some people think it’s actually a nation wide dilemma.

    Good borrowers are putting down payments of up to 20%. They are paying higher prices based on cheaper interest rates. It’s the opinion of some that those who have purchased this past year will be a bigger problem for the foreclosure market than the people who had sub prime mortgages.

    The dilemma is that these “good” borrowers will be discouraged by the continued decline in Real Estate pricing.

  95. 95
    David Losh says:

    http://en.wikipedia.org/wiki/United_States_housing_bubble

    If you look at the chart on this wikipedia page you get an idea of the problem. There are more comprhensive charts and graphs that show that the price of housing far exceeded inflation, which is actually what the price of housing is tied to.

    Because of the complex nature of housing it is not included in the Consumer Price Index which is another strong indicator of the price of housing.

  96. 96
    ARDELL says:

    RE: David Losh @ 94

    LOL DAVID! You are so funny. Where do you get this crap?

    “You went into the spring selling season with a bottom call that you sent out in a press release”

    I don’t send out press releases…I blog. Aubrey Cohen of the PI read my blog and considered it not only newsworthy, but front page news.

    Do you just make this stuff up? Where do you get “you sent out in a press release”? Do you just imagine this stuff and then call it “fact”? Talk about “credibility”.

  97. 97
    David Losh says:

    RE: ARDELL @ 96

    I see, so Aubrey read you post, OK, I’ll buy that, but it still remains that the bounce you predicted was based on a tax credit and ad campaign.

    I have another set of charts for you from your area: http://www.eastbellevuere.com/index.php/category/weekly/

  98. 98
    Ray Pepper says:

    RE: Realtycheck @ 73

    Ray is always frustrated but not from housing. I get frustrated by Coaching my Soccer and basketball teams and extracting motivation from my players. Thats frustrates me.

    It is my belief the market is flat-trendline down for years to come but homes will always sell. People must always move due to job,illness,family,divorce, etc. Short sales will present themselves for many years. Some are Gems, some are GemLike, and some are not. I provide an option for Buyers and Sellers who wish to use their brain.

    When you choose to buy its ALWAYS an investment. I’m finding MANY Gems in the Short sale and foreclosure markets and if the Buyer secures one of these GEMS as their home for the next decade+ they will be fine.

  99. 99
    Civil Servant says:

    RE: Ira Sacharoff @ 57

    Not to pick on Ira, of course. Never that! Regarding the statement below I agree with him.

    “But if I really wanted to buy a house, felt comfortable that I could easily afford a few hundred dollars extra per month in order to do so,felt like I wanted to stay in this home 7-10 years plus, and felt like we were near the bottom, I’m not sure I would care whether it was cheaper to rent or cheaper to buy.”

    There’s a missing condition, though, and that’s income security. As of this moment, I feel well compensated and my job seems solid. But if a certain set of conditions — not even an outlandish one, in this economy — came into being, those things would change. All of the factors Ira names are true of me and buying feels more hypothetical to me than it has since I started visiting SB. I’m in a great spot right now, hooray for me, and I don’t want to jeopardize it even though from an affordability/time horizon outlook I arguably should start looking. Am I the only one on this thread with income security concerns, apart from you professional investors? Now I’m really curious.

  100. 100
    Scotsman says:

    I’m sorry, but really, Ardell- it’s impossible to take you seriously. There is a huge logical disconnect in your approach to forecasting. You put all this effort into charting past price behavior which creates an aura of academic expertise, then just shoot from the hip with some prognostication of what the future holds. The problem is that none of your future predictions are ever backed up by, or even related to, trends in income, employment, rent/buy ratios, interest rates, etc., let alone the national macro environment- there’s nothing. You just pull them out of your *%$ or something. It’s really quite clever- the appearance of academic rigor catches one’s eye, but then there’s no foundation or support for the conclusions that follow. You might as well say real estate always goes up (in the long run), so buy now or be priced out forever. But don’t waste people’s time if you aren’t even able or willing to offer logical foundational support for your skills as a seer.

  101. 101
    One Eyed Man says:

    RE: ARDELL @ 71

    First Ardell, I believe that the predictions in this post are being judged based upon the change in Residential NWMLS median price from Dec 2008 to Dec 2009. If you pull the stats, you can confirm the change for that period is -5.8%. I grant you that it may well be a smaller decrease if Jan 2009 to Jan 2010 were used but that’s not the time period being used as the criteria.

    As The Tim pointed out in this post, the decrease would likely be greater if the decrease in the Dec 2008 to Dec 2009 Case/Shiller Index were used. The Tim also says he thinks he would probably win if CS were used but I think that’s not necessarily true either. If one uses -7.5% for Steve Tytlers prediction, then -8.75% would be the mid point between the perdictions of Steve and The Tim. I think that its even money on which one is closer to the CS because I think -8.75 is pretty close to what the change in the CS will end up being for that period. I won’t go thru the math unless someone wants me to but my logic isn’t very complicated.

    Although I appreciate Scotsmans point of view and acknowledge his conclusion that economic issues will cause housing prices to trend lower for an extended period, I also commend you for standing by your guns regarding your prediction. While I think that MLS median is less relevant than the CS Index, even the CS Index has been flat for the last 8 months (all be it with tax credit help). Clearly there are also seasonality issues which have helped your prediction. But never the less, the March low which was a 23% drop has held until now.

    But we’ll see what happens with the normally slow winter season, the increases in REO’s and short sales and the end of the tax credit, assuming it isn’t extended again this spring. You’ve got to admit that these items could push prices lower, and although the economy is in better shape than Oct 2008, it’s still not very rosey.

  102. 102

    RE: Civil Servant @ 99
    First of all, I’m fair game. Feel free to pick on me.
    But when I said “, felt comfortable that I could easily afford a few hundred dollars extra per month in order to do so”..
    I meant that in feeling comfortable you’d also feel that your source of income was secure. If I felt that there was a chance that I was going to lose my job, I’d continue saving money and renting.
    Of course, something can always happen. You could get run over by a streetcar and suffer brain damage, preventing you from going to work. But if co-workers were getting laid off, if I saw that my employer was bleeding cash, if I was involved in an industry whose technology was being quickly supplanted, I’d stay a renter.

  103. 103
    Researcher says:

    RE: Scotsman @ 100

    The best predictive mechanism that can be used on raw historical data alone is a monte carlo analysis. It doesn’t matter what your data set is, when it comes to the economy and the markets, this is the only tool that offers any level of statistical significance when it comes to predicting the future. Anything less has already been proven by the scientifical community to be like throwing darts at a dartboard.

  104. 104
    AMS says:

    RE: Researcher @ 103 – Monte Carlo Analysis has its limitations too.

    Essentially your putting some form of trend analysis against the Efficient Market Hypothesis (EMH).

  105. 105
    EconE says:

    RE: Scotsman @ 100

    Remember back in 2007 when she claimed she could “smell the appreciation” for 2008 in Kirkland?

    I wonder how many of her past clients will end up losing their homes?

    If/when they do…how will they get their pound of flesh from Ardell?

    What’s that saying…

    “Revenge is a dish best served cold”

    I’d hate to be a realtor these days. Will our tax dollars be used for the “realtor relocation protection program”

    ;^)

  106. 106
    Scotsman says:

    RE: AMS @ 104RE: Researcher @ 103

    Well yeah, but..! And there’s the dilemma- at this point economics doesn’t work like a true science where relationships always hold true, probably because we can’t or don’t adequately define all of the inputs and their subsets and relationships. I was lucky enough to take some econ classes from Paul Samuelson when he was around. One point he kept hammering home was that econ would probably never be neatly quantified- there was too much to try and capture. While some of the gross parameters could be modeled (and I worked in this area) there was a bit to much humanity involved to ever come up with a full set of reliable causal relationships. In short, it was good to look at the data, but we had to think our way forward from there using the data as guidelines along with our knowledge of the human condition and psychology/sociology to at best determine a range of possible outcomes. Seen another way, it’s not that hard to pick the direction and eventual destination, but the actual path is nearly impossible to know. I think most would agree that’s where we find ourselves now- we know the direction, we have some idea of where the bottom may lie, but we have little certainty in discerning how we’ll get there, or when.

  107. 107
    Scotsman says:

    RE: EconE @ 105

    RRPP? Smells like realtor spirit?

    Starving realtor- the new grunge.

  108. 108
    deejayoh says:

    When I’m finding places in Medina that I can afford, I’m thinking prices aren’t going much lower

  109. 109
    David Losh says:

    RE: deejayoh @ 108

    Medina’s a big area, and yes you should have always been able to buy there.

  110. 110
    One Eyed Man says:

    RE: Scotsman @ 106

    So Scotsman, are you a Beaver? The closest I got to Samuelson was the royalty he got on my text book, but one of my high school buddies was Eric Rosenfeld’s room mate in the early 1970’s. Rosenfeld’s name may not ring a bell, but he was one of the Long Term Capital guys.

  111. 111
    ARDELL says:

    RE: EconE @ 105

    That was referring to April 2005 not 2007 or 2008. Glad you remembered, but remembering it correctly would be better.

  112. 112
    ARDELL says:

    RE: AMS @ 92

    “Also if prices linger for a long period of time below $362k, such as $350k for 4 or 5 months, the bottom call won’t look so good.”

    I totally agree. How could I not.

  113. 113
    EconE says:

    RE: ARDELL @ 111

    I wasn’t even around in 2005.

    Here’s your 2007 post after asked what you “smelled” for 2007

    I’ll start with Eleuas post…

    http://raincityguide.com/2007/02/26/seattle-area-appreciation/#comment-101551

    Ardell,

    Hi, it’s me, your “center,” and I was just wanted you to know that I’m still thinking of you.

    I too have a feeling in my bones. I smell a banking crisis. Do you have any friends in the industry, and what are they telling you?

    All the best,
    E

    Then…Mark asked…

    http://raincityguide.com/2007/02/26/seattle-area-appreciation/#comment-101553

    Ardell,

    I like the comments-

    “I could feel it. I could taste it. I could smell it. The ground was swelling.”

    so, that was June 2005. what do you smell now? what do you think, market is heading north or south in Seattle?

    Mark

    To which you replied…

    http://raincityguide.com/2007/02/26/seattle-area-appreciation/#comment-101565

    Mark,

    As I’ve said before, 2007 feels the same as 2006 and not like 2005. But there is a huge backlog of buyers who want what the market isn’t readily offering. I have my finger on a few pulse points. If inventory expands in the right places, we’ll see a 25% increase by August. If it doesn’t, we’ll see a 15% increase.

    You were “smelling” 2007 in that post.

  114. 114
    deejayoh says:

    By David Losh @ 109:

    RE: deejayoh @ 108

    Medina’s a big area, and yes you should have always been able to buy there.

    I’m at a loss for words. Perhaps you have it confused with Kent.

  115. 115
    Everett_Tom says:

    RE: deejayoh @ 114 – A guide.. Redfin’s list of currently least espensive homes in Medina. . Maybe this two bedroom one bath $578,000 is what David had in mind?

  116. 116

    RE: deejayoh @ 114
    Dang! I was sure the Gates mansion was on Lake…..Meridian?

  117. 117
    deejayoh says:

    By Everett_Tom @ 115:

    RE: deejayoh @ 114 – A guide.. Redfin’s list of currently least espensive homes in Medina. . Maybe this two bedroom one bath $578,000 is what David had in mind?

    Apparently, $688 a square foot is very affordable. After all, it’s only, what – about 3X the average for the area?

    I don’t pretend to understand what he has in mind.

  118. 118
    ARDELL says:

    RE: One Eyed Man @ 101

    “First Ardell, I believe that the predictions in this post are being judged based upon the change in Residential NWMLS median price from Dec 2008 to Dec 2009. If you pull the stats, you can confirm the change for that period is -5.8%.”

    However I refute the implication that the market went down 5% to10% in 2009, because it didn’t. The market was flat not down in 2009, with a low point of $362,000 and a high point of $400,000 that started and ended at $380,000. To take a one month variance from Dec 08 to Jan of 09 and call it 2009’s performance level is misleading at best.

    2009:

    Jan 09 – $380k
    Feb 09 – $377k
    Mar 09 – $362k
    Apr 09 – $380k
    May 09 – $380k
    Jun 09 – $399k
    Jul 09 – $375k
    Aug 09 – $385k
    Sep 09 – $374k
    Oct 09 – $379k
    Dec 09 – $380k

  119. 119
    The Tim says:

    By ARDELL @ 118:

    However I refute the implication that the market went down 5% to10% in 2009, because it didn’t. The market was flat not down in 2009.

    From Redfin’s King County stats page:

    Sorry, that’s not “flat.” Oh, and March wasn’t the bottom, either.

  120. 120
    patient says:

    RE: ARDELL @ 118 – Ardell, this friendly competition has been running for years with the same criteria, to change it after the results are in would have been unfair and misleading, get over it.

  121. 121
    AMS says:

    RE: ARDELL @ 118 – That’s not all 12 months! You’re missing the starting point.

    2009:

    (EOM) Jan 09 – $380k

    (EOM) Dec 09 – $380k

    = 11 months.

    (And you didn’t include November in your original post, but EOM Jan 09 to EOM Dec 09 is 11 months–How much did prices change in January?)

  122. 122
    The Tim says:

    RE: ARDELL @ 118 – Also, Zillow charts (only updated through Nov.) look similar:

    Raw median (all sales, not just NWMLS):

    Median Sale Price
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    Median $/sqft:

    Median Sale Price / sq. ft.
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  123. 123

    RE: patient @ 120

    I Still Hear This From Some Homeowners Still in Bubble Denial

    My home is special and it actually went up in price, my assessment proves it. The homeowner was standing next to a haughty realitor smiling and shaking his head “yes”.

    I countered to both of them the fact that home appraisors either work for the seller/buyer to bank loan qualify or work for the owner to lower property tax in court…..the results are totally different [IMO, one assessment includes foreclosed and short sales and the other conveniently omits the low neighborhood data].

    They read the newspapers too, about bad bank loan approvals based on bad assessments….the haughty realitor walked away and the homeowner in denial quickly changed the subject. LOL

  124. 124
    AMS says:

    RE: softwarengineer @ 123 – “I Still Hear This From Some Homeowners in Still in Bubble Denial”

    More potential members for my new Church of Real Estate. If you think prices have gone down, it’s only a test of your faith in Real Estate!

  125. 125
    AMS says:

    RE: The Tim @ 122 – Let’s see if she’ll add the starting point so all 12 months are present. It’s her attempt at a sleight of mathematics to exclude the starting point. Many unsuspecting people might fall for it, ignoring the starting point, initial value.

  126. 126
    ARDELL says:

    RE: Scotsman @ 100

    I agree Scotsman that there is always a difference between someone working in the field applying a myriad of factors to the end result, and simply using data. But if data were the only method, then all markets would be predictive via computer. I think we both agree they are not.

    There comes a point where you say “given all that” (data) what should we do today, and what can we reasonably expect to happen? You call that “shoot from the hip”, and maybe it is. When I received all the data with regard to given stocks and sectors from analysts back in my former career, it was my job to apply that data effectively to each portfolio. Who should buy what and when did not rely entirely on the data, but on the data coupled with the specifics of each person and portfolio’s objective. Real estate is really no different.

    I absolutely agree that you are most always right, because you are dealing from a total return basis compared to alternative investments. But the reality of residential real estate is that most people do not buy and sell homes based on total return factors. No one likes to lose money regardless, but they also do not like to buy that which will give them the best total return. If one would determine that the best total return was in Bellingham, it wouldn’t make everyone want to move to Bellingham.

    To take a residential market and ignore the factors that move it is like trying to force a large square peg into a small round hole. Wanting a market to operate based on statistical calculation and ignore emotional factors, will not make it so. I am largely influenced by “the prudent man rule” which never equated to moving everyone to an all cash position. Translated to real estate, it never equals no one should buy or no one should sell. The “shoulds” usually fall on the emotional side, taking into account statistical and empirical evidence.

    It is never my “job” to convince people to buy or sell homes. It is only my job to help people who want to do those things, consider all of the factors and make informed decisions.

    As much as people may see a bias in me toward people buying and selling, I see a bias in many who want no one to buy, so that prices will go down to a point where they can buy cheaper. Where once peers looked down on renters, now peers look down on those who are buying and blame them for prices not going down to where they want them to be. There is no observation without bias.

    Perhaps it is an underlying bias for all bubble blogs to want to stack the data toward the negative and for all agent blogs to want to stack the data toward the positive. Perhaps we can never be purely objective…we agent blogs or we bubble blogs. But to suggest a bubble blog has no bias and only an agent blog has bias, well…it just isn’t so. Perhaps a bubble blog ignores any positive news as much as an agent blog ignores negative…no more and no less.

  127. 127
    AMS says:

    RE: ARDELL @ 126 – Are you going to give us the starting point, or shall we just dismiss your claims based on an attempt at a sleight of mathematics?

  128. 128
    ARDELL says:

    RE: ARDELL @ 118

    Correcting for the “missing” month:

    ***
    However I refute the implication that the market went down 5% to10% in 2009, because it didn’t. The market was flat not down in 2009, with a low point of $362,000 and a high point of $400,000 that started and ended at $380,000. To take a one month variance from Dec 08 to Jan of 09 and call it 2009’s performance level is misleading at best.

    2009:

    Jan 09 – $380k
    Feb 09 – $377k
    Mar 09 – $362k
    Apr 09 – $380k
    May 09 – $380k
    Jun 09 – $399k
    Jul 09 – $380k
    Aug 09 – $375k
    Sep 09 – $385k
    Oct 09 – $374k
    Nov 09 – $379k
    Dec 09 – $380k

    ****

    For those who say that is not 12 months, let’s agree to disagree on that. That is a 365 day period and 12 months to me. It is a flat year that began and ended in the same place with 5% fluctuation this way and that during the year.

    To study “a market” one must determine when it is moving in and out of norms and expectations. To do otherwise is misleading, and capitalizing on sensationalizing modest and expected movements. “It’s UP; It’s Down!” is erroneous within a given pattern of expectation. Technically correct, but as ludicrous as yelling everyday that the Dow isn’t a constant.

    People do not “day trade” in residential real estate markets. The natural ebb and flow of a 12 month period should be a non issue. As long as the market stays between $360,000 and $400,000 as to median, there’s not much to say. 5% this way or that from $380,000 is my current expectation. Some consistent evidence outside that vs a minor monthly aberration, will be something to take note of.

    Until then we bobble along the bottom.

  129. 129
    AMS says:

    RE: ARDELL @ 128

    1. In February 2009 prices went down $3k. [=$377-$380]
    2. In March 2009 prices went down $15k. [=$362-$377]
    3. In April 2009 prices went up 18k. [=$380-$362]
    4. In May 2009 prices didn’t go up or down. [=$380-$380]
    5. In June 2009 price went up 19k.
    6. In July 2009 price went down 19k.
    7. In August 2009 prices went down 5k.
    8. In September 2009 prices went up 10k.
    9. In October 2009 prices wen down 11k.
    10. In November 2009 prices went up 5k.
    11. In December 2009 prices went up 1k. [=$380-$379]

    -3k-15k+18k+19k-19k-5k+10k-11k+5k+1k = ZERO, but note we only have 11 months.

    What happened during January 2009?

  130. 130
    ARDELL says:

    RE: EconE @ 113RE: EconE @ 113

    Econ E – There is always a backlog of buyers in January waiting for inventory to increase and for better things to come on market. That is true both in weak markets and strong markets, and is as true today as it was then. The expansion of inventory in that quoted year moved median price from $430,000 to $485,000 by August. Did I predict that in August the mortgage criteria would institute a dramatic change in qualifying criteria? No. But I see nothing in your “quote” of me that was incorrect.

    I do have to say it freaks me out a bit that you seem to be my personal transcriber having access at will to just about everything I have said to anybody. Feels a bit stalkerish :)

  131. 131
    AMS says:

    RE: AMS @ 129 – Technical correction:

    Add +0k, which clearly does not change the sum:

    -3k-15k+18k+0k+19k-19k-5k+10k-11k+5k+1k = ZERO, but note we only have 11 months.

    Now all 11 months are present.

    Once we know what happened during January 2009, we’ll have the full 12 months of the calendar year 2009.

  132. 132
    AMS says:

    RE: ARDELL @ 130 – “I do have to say it freaks me out a bit that you seem to be my personal transcriber having access at will to just about everything I have said to anybody. Feels a bit stalkerish :) ”

    Google is your stalker!

  133. 133
    Fran Tarkenton says:

    Without specifying why this thread brought it to mind, I’m reminded of a quote from Casino, where the Robert DeNiro character is firing a flunkie:

    “Listen, if you didn’t know you’re bein’ scammed, you’re too f-wordin’ dumb to keep this job. If you did know, you were in on it. Either way, you’re out. Get out! Go on. Let’s go. “

  134. 134
    patient says:

    RE: ARDELL @ 128 – Aaah, the negative ninny, tin hat etc. attempt to discredit bubble blogs as negative pops up again. What is probably true is that bubble blogs tend to focus on what is Positive for consumers ( lower prices for example ) and agent driven sites tend to focus on what they think are positive for them. The inconvinience for agents though is that they mainly been spectaculary and conistently wrong about home prices and the bubble while bubble bloggers have mainly proven to be right.

  135. 135
    David Losh says:

    RE: deejayoh @ 114

    You are obviously a man of means so I figure you can afford just about anything.

    Just kidding.

    There are homes along the water in Medina, Hunts Point. area that should command a premium price. In my opinion this is one of those areas where appraised value can splill over into all housing units in an area.

    Why would a house in Medina, that is not on the water command such a high price per square foot? I think in time reason will win the property value argument.

    By the way, what is the added value for a home in Medina?

  136. 136
    ARDELL says:

    RE: patient @ 134

    Patient,

    You say: “bubble blogs tend to focus on what is Positive for consumers ( lower prices for example )”

    I absolutely agree, and that is my claim, that bubble blogs have a bias toward prices being and getting lower, as you state. That is a bias toward the negative, and possibly a small one, but a bias nonetheless. I am not “discrediting” Tim or myself to say that we each have a slight bias. To suggest neither of us has any bias, is not likely realistic. I accept our bias is about the same in opposite directions, and we each strive to omit that bias, but eradicating it entirely may not be possible.

  137. 137
    AMS says:

    RE: ARDELL @ 128 – “To take a one month variance from Dec 08 to Jan of 09 and call it 2009’s performance level is misleading at best.”

    Initially I didn’t understand what you were talking about here. Now I get it.

    Kobe Bryant has often been called a “Buzzer Beater.” You know, he makes the game winning shot just before the buzzer. Why play the whole game? Instead, why not just hand Kobe the ball and give him one shot?

    If he makes the shot, the Lakers win the entire game.
    If he misses, it’s a tie game.

    Why is it that the entire game comes down to that last shot? Why don’t shots after the buzzer count?

  138. 138
    AMS says:

    RE: ARDELL @ 136 – I am not so sure that The Tim has a bias toward 13 months in a calendar year.

  139. 139
    ARDELL says:

    RE: AMS @ 129

    AMS,

    You ask: “What happened during January 2009?”

    In the 1st week closed sales had a median price of $352,500
    In the 2nd week closed sales had a median price of $363,700
    In the 3rd week closed sales had a median price of $408,000
    In the 4th week closed sales had a median price of $375,000
    In the final days closed sales had a median price of $399,000

    The net result being that January 09 median price for closed sales came in at $380,000 the same as December 09.

  140. 140
    ARDELL says:

    RE: AMS @ 138

    I do have a bias toward there being 12 months in a calendar year. I’m odd that way :)

  141. 141
    AMS says:

    RE: ARDELL @ 139 – I don’t get it. If January 1 was $380k, just like January 31, why has it been so long coming with the data? You kept claiming that the start of January had nothing to do with the year’s numbers, and now it’s exactly the same as the end of the month? Even if it had nothing to do with the numbers, you could have come forward with the $380k and suggested it makes no difference, since the beginning is the same as the end… So, no change in January 2009, huh? I smell a deception here.

  142. 142
    Matthew says:

    I’d say down 10% or so… Look for rising interest rates to put additional pressure on prices.

  143. 143
    ARDELL says:

    RE: AMS @ 141RE: AMS @ 141
    AMS,

    Sorry, no. I haven’t been “long coming with the data. I started with the premise that the year started at $380,000 and ended at $380,000 and so was flat.

    The last ten days of December 2008 were also at $380,000. (well $379,000 to be exact) so anyway you slice it, 2009 was not a year of 5% or 10% declines as has been initimated. 2008 was a down year, 2009 was not. There really is no other way to look at it, unless you are looking for a way to say 2009 was down. It simply was not a down year.

    There are times when the issue is gray: And we may run into that in the near future:

    http://www.realtown.com/Ardell/blog/tracking-the-market/what-you-need-to-now-about-the-real-estate-market

    As you can see in the graph in the above link, if we run into early 2005 territory, we can argue the point of whether that is 2005 or 2004 prices. But as to 2009, there is no ambiguity. It started and ended in the same place. That graph also pinponts 2009 activity and its seasonal variances. But all in all, 2009 was the year of nada movement one way or the other.

  144. 144
    ARDELL says:

    RE: AMS @ 137

    “the buzzer” of 2008 was $379,000. close enough to $380,000 to call it a wash.

  145. 145
    AMS says:

    RE: ARDELL @ 143 – Simply put, I’m not buying it. You’ve played your games, and now it’s over. Buzz.

  146. 146
    David Losh says:

    The point about the median price was nice, but it is only one indicator. Tim put in some charts that haven’t been addressed, i put in some charts that were never addressed, and there is a large contingent of other opinions that think that prices will decline 10% this year.

    My point was, and still is, that the selling season last year lifted housing unit prices about 3%, about the price of the tax credit. It was artificial, but a pretty safe bet to say that prices had stabilized. In my opinion that was the point of the government intervention.

    Now with Obama asking for repayment of TARP money, and a tax on banks, I think that banks will move further away from residential lending to punish us all. I think they will continue to cherry pick the buyer pool, and more importantly stock holders will want to see that the assets used a collateral have a marketable value.

    I’m going over to the foreclosure thread now because foreclosure prices are going to be a greater indicator of what actual value is, or will be in the near future.

  147. 147
    David Losh says:

    One of the factors keeping core inflation under control is housing costs. They dropped 0.3 percent for the 12 months ending in December, the biggest annual decline on records dating to 1968. A glut of single-family homes on the market and record apartment vacancy rates have put pressure on housing prices.

  148. 148
    AMS says:

    RE: David Losh @ 147 – Please keep in mind that the housing costs used for inflation is based on rents. For a long time housing prices went up far faster than rents. Given the high purchase price to annual rent multiples, I suspect that housing prices will drop far faster than rents.

  149. 149
    ARDELL says:

    RE: David Losh @ 146

    Depends how you want to stack the deck. Yes, Housing Prices can decline 10% from June median of $399,000 and still be at the same “bottom” of roughly $360,000. A better bet is will prices go lower than 2009’s bottom number, not 2009’s top top number. 5% down from 2009 median is a given as to possible and likely at some point in 2010..

  150. 150
    AMS says:

    RE: ARDELL @ 149 – “Depends how you want to stack the deck.”

    I don’t think you’re bluffing about stacking the deck!

  151. 151
  152. 152
    Renter in Bellevue says:

    RE: AMS @ 92

    Thanks for your comment.

    I have a question for all of you.

    What are some of the factors that might bring the home prices up in the future?

    Some of the factors that I can think about are as follows:

    1. The Obama recovery factor.
    They have spent A LOT OF MONEY in hopes of sustaining this price level for homes in America.
    Even if the tax credit expires in June, if we were to see signs of trouble, I don’t see how the gov’t would oppose bringing back the tax credit. If the gov’t simply ignores the further deterioration of the housing prices, all the efforts of Obama admin since Jan 2009 will have been simply wasted.

    2. The Real estate in Seattle has not seen the bubble which is equivalent to that of Las Vegas, Pheonix,California and etc. If I am not mistakening, LV price is at 40% from its peak, Cal price is at 35% from its peak. If the Seattle price is about 25 ~ 30% from its peak, it leads me to believe that it might not be too bad from here and on.

    3. Local economy
    In 2008, 2009, many companies including Boeing, Microsoft announced layoffs. Although there are smaller companies having trouble, I just have not seen the increasing number of layoffs in Seattle. The uneployment rate is still high (both national and local) but there are signs of improvements.

    I am a potential buyer, and I would love for home prices to go down to 2000 level. The factors for deciding to buy a property will come down to weighing the negatives vs positives.

    I am a bear as well but I think we also need to think about the positives and weight the “+” vs “-“.

    All of your opinions will be appreciated.

  153. 153
    David Losh says:

    RE: Renter in Bellevue @ 152

    The term is housing units, places to keep your carp while you are at work. Very quietly the cost of construction went down while the price for the housing went up. I’ve included the link showing inflation, construction cost and home prices http://en.wikipedia.org/wiki/United_States_housing_bubble

    So let’s take thousands of town houses, at a price of $180K, that actually sold for $310K, or even $280K. Somebody made a lot of money for nothing. If you were smart you took the money and walked away. If you were stupid you continued to build the housing units, buy land, and pay on bank loans.

    Once the whole appreciation in pricing stopped we were now saddled with a bunch of housing units people over paid for. So if you own a town house in Seattle, Everette, Tacoma, Puyallup, or Issaquah you’re out of luck.

    People are bidding on what they think are houses. They are just buying detached housing units that will need to be maintained. for cash. No more equity to fix the roof, the flashing, the plastic plumbing, strand board sheathing, 24 inch on center construction, plastic widows, doors, MDF trim, nail pops, strand board beams, and possible sub contractor mistakes.

    Let me throw in land use issues, with ground water, zoning density, infrastructure of roads that may mean traffic congestion, and the ability to build today, for less, with cheaper labor, and materials, especially when you buy the land from the bank after a foreclosure.

    These new housing units will drive the price for real family homes up, for those who can afford them, but slums are developing in every city in the country by these new construction housing units.

    Housing is done, over, forget about it, it’s like a 1957 Chevy or a Hyundai. You buy it, love it, refurbish it, or you buy it, use it, and throw it away. Either way it’s a drain on your resources.

  154. 154
    AMS says:

    RE: Renter in Bellevue @ 152 – Yes, I think we need more positive factors. The problem is that most reports of positive factors have major problems, flaws. When I see solid positive data, I report such.

    This does, however, bring me to a discussion about risk. For the purposes of this discussion, risk can be in either direction: favorable or unfavorable. Also let’s take an ownership position. We could have the same discussion from a buying perspective, but prices going lower is favorable for buyers but unfavorable for sellers.

    Many of us have entered into a Casino, the place were they have little blocks with dots that are tossed in a game known as Craps. There are many other ways the casino takes the players money with different games, machines, and so on. There are people who love to gamble, even if they are going to lose. Don’t ask me why, but huge buildings are built on the desire to lose. Of those who love to gamble, we know there are some people who have a problem. They know they are going to hit on the next play. It’s a sure thing. Just one more hit.

    In the case of housing there is upside risk for the owner, but there is also downside risk, as we have seen as of late.

    If a gambler has the money, and enjoys gambling, then what’s the big deal? When that same gamble casts tremors throughout the entire world economy, there’s a problem, even if there are some positive factors.

    The other day I posted about Marin County. The information came from an article about property taxes.

    https://seattlebubble.com/blog/2010/01/16/weekly-twitter-digest-link-roundup-for-2010-01-16/#comment-91996

    What concerns me is not only that a median home costs 10x the median household income, but I am not sure that the household income has a great outlook of increasing.

    In summary, housing prices are not on firm foundation.

    Castles in the sky.

    Have we reached escape velocity? …or are these efforts only slowing the descent? That sudden stop might be a killer, so we’d better delay it as much as possible. The problem is that many have on a personal level crashed, even if the future is so bright for the others.

    So, yes, let’s have some positive data, but let’s be sure that it’s genuine.

  155. 155

    “What are some of the factors that might bring the home prices up in the future?”

    If sales continue to pick up, and inventory stays low, home prices could pick up, especially if employment picks up.

    I don’t see it as likely anytime real soon, but it’s clearly possible.
    But, back in 05′-06′, inventory was rising and sales were slowing. That was the screaming indicator to me that prices were going to drop. It just took much longer than I thought. And of course those aren’t the only factors that influence house prices.
    At some point house prices will see a sustained rise. I’m guessing that if you bought a house right now it would be worth more in ten years. Still, I consider myself a bear too. Maybe not a grizzly, more like a panda.
    Still, it’s hard for me to see the immediate future of home prices as being anything other than flat to down.

  156. 156
    mukoh says:

    RE: Researcher @ 40 – Sounds a like like Software Engineer. CAN YOU TYPE LIKE THIS MORE?

  157. 157
    mukoh says:

    RE: deejayoh @ 114 – To Dave Medina is Kent. Its like Chuck Norris.

  158. 158
    Renter in Bellevue says:

    RE: AMS @ 154

    Thanks!!

    Like I stated earlier, I am a bear.

    I believe # of Foreclosure in the near future, Mortgage rate increase and unemployment rate alone should prevent the housing prices from going up (more likely going down 5% – 10% in the next year or two)

    But this is what I am beginning to wonder.
    1. The housing price is likely to go down another 10% in the next two years (which I believe is the consensus on this forum)
    2. After two years, no one really knows what will happen but this we know.
    Unemployment goes down, US economy will continue to improve, most of the foreclosures/distressed properties will have been cleaned up.
    3. Thus, we don’t really have a scenario where we will see another housing price crash (barring some sort of cataclysmic event, geopolitical event, MS/Boeing going bankrupt, US economy collapse)
    4. I am beginning to wonder if it might actually be a good time to buy if I am willing to take 5%-10% depreciation. (Or especially if I can get 5 – 10% discount from what I believe is today’s fair market value of the home)

    Please correct me wrong if I have been wrong in any of my assumptions or my take on potentially buying a house in 2010.

    I love all the debates on this forum.
    Thanks!

  159. 159
    Renter in Bellevue says:

    RE: The Tim @ 122RE: AMS @ 154

    Tim,

    How about a POLL on “At what price would you be comfortable buying a SFR home in King County”?

    1. Price in 2005
    2. Price in 2004
    3. Price in 2003
    4. Price in 2002
    5. Price in 2001

  160. 160
    AMS says:

    RE: Renter in Bellevue @ 158 – Let’s talk exit strategy.

    I’d like to see an exit strategy with the percentage. How about 25%? If the market declines 25%, then you exit. No, I am not suggesting exactly 25%.

    Part of the problem, as outlined in my Church of Real Estate, is that you never want to get whiplash buying high and selling low. The 25% exit strategy is a point where you exit because you must, unless you are a member of my Church, and then there’s no need for an exit strategy. If you have eternal faith in Real Estate, then losses are of no mortal consequence.

    Then there is another factor which has been discussed. It’s the “enjoyment” factor. I’ve discussed how I walk into Starbucks to leave with a $5 cup of coffee. Without getting into more complicated issues, let’s agree the coffee is overpriced. The $5 cup of coffee is worth $0 once I accept it. Does that make it a bad buy? No, as I am going to gain more than $5 worth of enjoyment from it, or at least I think so when I made the purchase.

    Imagine, for a moment, if Gates paid $2M for a $1M home. Sure he over paid by 100%, but who cares? It’s just pocket change. If he gets $2M worth of enjoyment, then it really does not matter that he overpaid by $1M. As always, rational players seek to pay as little as possible, so if Gates would have paid $1.2M he would have an even better deal, even if he still over pays by $200,000. When I over pay by a few cents, and it happened the other day at a major home improvement store, it’s no big deal. The specific situation was I needed a couple of screws. The bin was marked with the item number and price, which I carefully wrote both down. Item XXX, 15 cents each. When I arrived at the register, the price became 17 cents. I could have brought up the sign issue, and I am sure they would have adjusted the price down by 2 cents each times 2, for a total of less than a Nickel. I instantly did a computation on my time, and said to the cashier, as he was picking up the phone to call a manager, “I will pay the 17 cents each; it’s really no big deal.” I was out of there right away. I also have been known to pay 5 cents per gallon to avoid a busy station. My time is limited. Am I right or wrong, you make the call.

    So, if you are buying and the finance is important, have a plan. If it’s pocket change, paying too much is not so important.

    As far as your poll, I think this message outlines why everyone might have a different price level. There are some people who might be comfortable buying at 2007 prices.

    What many people did, especially at the peak, was to buy as much as possible with as little down as possible. These were all potential members of my Church of Real Estate. They had eternal faith in the housing market. Many still have the faith, and that’s why my congregation, while coming under pressure, still has members.

    Does this answer your question?

  161. 161
    David Losh says:

    RE: mukoh @ 157

    Another comment that makes no sense, but it worries me that I understand what you are trying to say.

    Kent is more like Edmonds.

    My point is that Medina is the water front, like Kirkland is the Marina.

    The price of housing there makes no sense to me and I’m asking why anyone would pay a premium price to live there, other than on the Water, or the houses with the Views.

  162. 162

    RE: AMS @ 160
    1. No cup of coffee is worth five dollars, unless maybe it has whiskey in it, and…
    2. People don’t have these urges to own a cup of coffee and put their mark on it. There’s not much you can do to improve a cup of coffee after you’ve purchased it, other than adding cream.But drinking it will last ten minutes, while you could have a lifetime gardening and doing creative things to your home.
    If you regret buying the cup of coffee, you’re out a few dollars. If you regret buying the house, it could cost hundreds of thousands of dollars. Plus, you’re not going to be paying off the cup of coffee over thirty years, though with Starbuck’s prices, they might want to consider a seller financed option.

  163. 163

    RE: David Losh @ 161
    I think people who want to live in Medina put a premium on being able to ” live among their own kind”, so they don’t have to mingle with the riff raff.

  164. 164
    AMS says:

    RE: Ira Sacharoff @ 162 – Life is too short to drink cheap coffee.

  165. 165
    Scotsman says:

    RE: Ira Sacharoff @ 163

    This kind of “Riff Raff?” There’s probably more of it in Medina than you know…

    http://www.youtube.com/watch?v=U4D1xYoF1Pk

  166. 166
    Renter in Bellevue says:

    RE: AMS @ 160

    I was hoping for a reply with buyer’s perspective, not a seller’s exit strategy.

    But I know where you are getting at and I appreciate your comment!

    Unfortunately I am not as loaded as B Gates.

    I know I can’t time/pick the bottom but would like to come close to it if possible :)

  167. 167
    AMS says:

    RE: Renter in Bellevue @ 166 – It is written from the buyer’s perspective. The exit strategy needs to be in place before purchase.

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