NWMLS: Flat, Boring Summer Drags On Through August

August market stats were published by the NWMLS this afternoon. Here’s their press release: Northwest MLS brokers notch this year’s best monthly tally of sales during August

“For the first time in a long time, I can say with confidence that things feel better,” said Northwest MLS director OB Jacobi, president of Windermere Real Estate. “We shouldn’t get too distracted by the large increase in pending sales,” he cautioned, noting, “It’s a positive sign, but these figures are being compared to last summer’s post-tax incentive doldrums. With that being said, we’re excited about the positive momentum in the market.”

Commenting on the latest numbers, NWMLS director Frank Wilson emphasized, “A real estate market is about activity and momentum.” He also noted historic affordability, with the cost of a home better matching income levels and extremely low interest rates contributing to favorable conditions. “We continue to live in a real estate market of extreme affordability, affordability levels that have not been seen in decades,” he stated.

We’ll wait until tomorrow’s reporting roundup to comment on their press release. For now let’s get to the stats.

CAUTION

NWMLS monthly reports include an undisclosed and varying number of
sales from previous months in their pending and closed sales statistics.

Here’s your King County SFH summary, with the arrows to show whether the year-over-year direction of each indicator is favorable or unfavorable news for buyers and sellers (green = favorable, red = unfavorable):

August 2011 Number MOM YOY Buyers Sellers
Active Listings 7,995 -2.3% -23.1%
Closed Sales 1,775 -5.8% +35.2%
SAAS (?) 1.42 -20.2% -36.9%
Pending Sales 2,329 +1.4% +31.1%
Months of Supply 3.43 -3.7% -41.3%
Median Price* $350,000 0.0% -7.9%

Feel free to download the updated Seattle Bubble Spreadsheet (Excel 2003 format), but keep in mind the caution above.

Here’s your closed sales yearly comparison chart:

King County SFH Closed Sales

Definitely a divergent path compared to the last four years. The last year that closed sales increased between July and August was 2006, when we were still in the midst of the bubble. Of course, when you compare the actual volume of closed sales this August to any year other than the last three years, it still looks pretty dismal.

Here’s the graph of inventory with each year overlaid on the same chart.

King County SFH Inventory

Looks like we’re heading down for the winter about two months earlier than typical years.

Here’s the supply/demand YOY graph. In place of the now-unreliable measure of pending sales, the “demand” in this chart is represented by closed sales, which have had a consistent definition throughout the decade.

King County Supply vs Demand % Change YOY

Sales are still pretty wonky on here thanks to last year’s expiration of the tax credit, and my guess is that inventory is heading down because most of the stupidly optimistic sellers have finally gotten the message that they really can’t get bubble prices for their homes anymore, so they’ve given up listing entirely.

Here’s the median home price YOY change graph:

King County SFH YOY Price Change

Slight improvement over last month, but still firmly in negative territory here.

And lastly, here is the chart comparing King County SFH prices each month for every year back to 1994.

King County SFH Prices

August 2011: $350,000
April 2005: $355,000

Here are the headlines from the Seattle Times and the Seattle P-I. Check back tomorrow for the full reporting roundup.

Seattle Times: Local home sales on an upswing
Seattle P-I: Home sales surged in August, while prices fell

(Wow, “surged”? Really?)

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About The Tim

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

49 comments:

  1. 1
    Scotsman says:

    What’s wrong with this picture? All the little green arrows suggest it’s a seller’s market, yet prices are down 8%. True, last year’s buyer- on avarage- has almost lost his 10% down payment. But what exactly have the sellers gained?

    Is it time to weight the arrow indicators and calculate a net average?

  2. 2

    RE: Scotsman @ 1 -I know some people here like to pretend that REOs and short sales don’t sell for less, but . . .

    If you back out REOs and short sales the mean and median were relatively flat between August 2011 and August 2010 (actually, I’m showing the median being the same). There were approximately 2x as many REOs and short sales in August 2011 as August 2010 (most of the increase being REOs). That change in mix drove down the mean and median.

    Numbers from NWMLS sources, but not compiled or guaranteed by the NWMLS.

  3. 3

    RE: Kary L. Krismer @ 2 – Just to be clear, that affects two of the arrows–price and volume. Price for sure, but with volume you don’t know whether those buyers would have bought something else if they hadn’t found an REO or short sale.

  4. 4
    Scotsman says:

    RE: Kary L. Krismer @ 2

    Yeah, it’s funny how there are just enough idiots out there to have a few sales be non-distressed homes. They keep the median and average artificially inflated. Without them the statistics would be much worse than they are. Why anybody would buy a non-distressed home when they are sure to lose money completely escapes me. I’m looking at homes to buy, but only when they are priced at a significant discount, have the potential for upgrades, and offer something unique. Did I mention they have to cash flow with 3% down should I decide to move? Surprisingly enough, I’m finding them. And I expect that by next spring there will be even more.

  5. 5

    By Scotsman @ 4:

    Why anybody would buy a non-distressed home when they are sure to lose money completely escapes me..

    You realize that your claim that those who bought last year lost money is based on the statistics that are affected by a change in the mix. If you just look at the median of non-distressed homes, they are still even. That’s note really accurate though, because there could be other changes in mix and some areas undoubtedly did better and some worse.

    Nothing is sure. Also, it does depend on your time frame.

  6. 6
    Scotsman says:

    RE: Kary L. Krismer @ 5

    You’re too funny. Are we really that far down the rabbit hole? You realize that by insisting on changing how a statistic is calculated renders any trend information useless? Let’s just get it over with and do away with this measure of home values that don’t show stability or increase. You should work for the government- they need guys like you to keep this economy going.

    This just in from the government office of home statistics- excluding all sales under a million, homes are still selling for a $million or more! If you didn’t buy, you’re probably priced out forever!

    Remember, the first step to recovery is admitting the illness. “Hi, my name is Kary- I’m a deluded realtor with a penchant for statistical manipulation. My data shows the bottom is in and prices should be heading up soon.” ;-)

  7. 7
    David Losh says:

    RE: Scotsman @ 1

    Good for you, you hit on exactly the problem with statistical analysis of Real Estate.

    It’s all based on sales data. It’s based on the sales, so it is all to the sellers advantage. The seller unloaded a property dropping in price, so in that way, it is a sellers market.

  8. 8
    whatsmyname says:

    By Scotsman @ 6:

    RE: Kary L. Krismer @ 5

    You’re too funny. Are we really that far down the rabbit hole? You realize that by insisting on changing how a statistic is calculated renders any trend information useless?

    Are you talking about your own post #1?

  9. 9
    Mike says:

    Have to sort of agree with Scotsman on this one. The majority of buyers are buying the REO and short sale homes. If those weren’t out there at reasonable prices the overall sales volume would fall off a cliff and non-distressed sales would have to correct faster. I think it is wishfull thinking to assume that if the REOs would just stop coming on the market everyone would just magically decide that the non-distressed pricing was a good value compared to renting.

    We are looking in the Kirkland/Kenmore area and are starting to see more homes in the 350 range starting to show up that aren’t pure garbage, nothing very good yet, but at least starting to see things listed that are worth going to drive by at least. It’s a shame we couldn’t have gotten here faster, but the distressed sales price of today is just telling you where next year’s non-distressed prices are heading. With the Fed promissing to keep rates low for years to come its hard to really feel motivated to do anything but wait for overall prices to keep getting better or for a rare quality distressed home to come on.

    Also more on point to the post, are mortgage closings running slower than normal still? Would that partly explain why August closings look higher if more June and other later spring offers are taking longer to appraise and close?

  10. 10
    tony clifton says:

    Got my tax assesment from King County today. Assesed value down 19% from last year. Yes, that is correct, 19%.

    Down about 33% from the peak!

  11. 11
    tony clifton says:

    Oops! I should have said the assesed value has dropped by 42% from the peak!

    520K in 2008 to 300K in 2012.

    That has to hurt for some of the tards that paid over 600K a few years ago!

  12. 12

    By Scotsman @ 6:

    You’re too funny. Are we really that far down the rabbit hole? You realize that by insisting on changing how a statistic is calculated renders any trend information useless?

    Gee, what is one of the supposed advantages of Case Shiller again? That it supposedly isn’t affected by the mix the way median and mean can be? I guess that’s only important when the mix affects things in a way you don’t like.

    But don’t be dense. When you have a lot of low end REO sales, that’s going to affect the median downward. It’s basic math that you cannot argue with unless you have your head in the sand.

  13. 13

    By whatsmyname @ 8:

    By Scotsman @ 6:

    RE: Kary L. Krismer @ 5

    You’re too funny. Are we really that far down the rabbit hole? You realize that by insisting on changing how a statistic is calculated renders any trend information useless?

    Are you talking about your own post #1?

    LOL. Scotsman can’t figure out why all the arrows face green for the seller, but the prices are down. An explanation is given, and he still doesn’t understand. It’s simple math. If you have about 88% of REOs in a month priced at $350,000 or less, that has an effect.

    Also, he totally missed the point that the volume effect I mentioned is a negative adjustment to today’s stats. That green arrow for the sellers for volume probably should be a red down arrow benefiting buyers. There I go again, pumping up the market by claiming that the current volumes numbers are inflated! ;-)

    Percentage from NWMLS sources but not compiled or guaranteed by the NWMLS.

  14. 14

    By Mike @ 9:

    Have to sort of agree with Scotsman on this one. The majority of buyers are buying the REO and short sale homes. If those weren’t out there at reasonable prices the overall sales volume would fall off a cliff and non-distressed sales would have to correct faster. I think it is wishfull thinking to assume that if the REOs would just stop coming on the market everyone would just magically decide that the non-distressed pricing was a good value compared to renting.

    First, you’re way off on the majority of buyers buying REO and short sale. Unless majority somehow means about 30%. From memory I don’t think they were a majority even during any month last winter, when normal sales were lower. With the banks ramping up REOs though, it’s possible that there might be a month coming up when they are the majority.

    Second, it’s not about wishing what will happen. It’s about understanding what has happened.

    Third, I already addressed the volume issue in post 3, noting that REOs have probably increased the volume, but that you don’t know that for sure like you do with the fact that the REOs did drag down the median. Those buying an REO might have bought a normal sale if they hadn’t found an REO. You won’t know that for sure, but you will know for sure that approximately 88% of REOs sold for $350,000 or less, and how that affected the median.

    Percentages from NWMLS sources, but not compiled by or guaranteed by the NWMLS.

  15. 15

    By Mike @ 9:

    Also more on point to the post, are mortgage closings running slower than normal still? Would that partly explain why August closings look higher if more June and other later spring offers are taking longer to appraise and close?

    Purchase loans get priority and you can easily get financing to close in about 30 days.

  16. 16
    Scotsman says:

    RE: Kary L. Krismer @ 12

    “I guess that’s only important when the mix affects things in a way you don’t like.”

    You make an error in assuming I have a preference. I really don’t care if they go up or down- I have strategies for both. But I do want to know what’s happening so that I can plan accordingly.

    You, however, seem to have an agenda.

  17. 17
    Scotsman says:

    RE: Kary L. Krismer @ 13

    Um, Kary- I get it. What you don’t get is the humor in having the “arrow system” seem to favor the sellers while they are in fact suffering.

    What’s more fun at a party than a literalist lawyer? Just about anything. ;-)

  18. 18
    Scotsman says:

    RE: Kary L. Krismer @ 14

    Please, Kary- if we’re going to play lawyer on the web let’s be precise: REOs don’t drag down the median. Lower prices do. What a concept.

  19. 19
  20. 20
    MichaelB says:

    RE: Scotsman @ 1

    Right now there’s only one arrow that matters and it is price – just weight price at 80% If price is unchanged or within a small range of variance, then the other indicators may have some significance, then again, they may not.

  21. 21
    MichaelB says:

    By Kary L. Krismer @ 12:

    By Scotsman @ 6:

    You’re too funny. Are we really that far down the rabbit hole? You realize that by insisting on changing how a statistic is calculated renders any trend information useless?

    Gee, what is one of the supposed advantages of Case Shiller again? That it supposedly isn’t affected by the mix the way median and mean can be? I guess that’s only important when the mix affects things in a way you don’t like.

    But don’t be dense. When you have a lot of low end REO sales, that’s going to affect the median downward. It’s basic math that you cannot argue with unless you have your head in the sand.

    Kary, please back up your statement with some statistics. Assuming the number of REO’s sold has not increased as a percentage of total sales, there should be no downward pressure on the median.

    Example:
    2010: 100 houses sold. 75% REOs sold for $100K rest sold for $200k, Median is $125K
    2011: 100 houses sold. 75% REOs – How did we end up with a 8% drop in the median? Are REOs dropping in value? Has the % of REOs sold increased?

    Kary, what is the basis of your claim? Or do you just enjoy pulling this out of your bottom every month?

  22. 22
    Jonness says:

    By Scotsman @ 6:

    RE: Kary L. Krismer @ 5 – “Hi, my name is Kary- I’m a deluded realtor with a penchant for statistical manipulation. My data shows the bottom is in and prices should be heading up soon.” ;-)

    I was out looking for a house to buy in 2007 but was too fearful to pull the trigger. I’ve seen several of the homes I considered buying back then that have come back as REO’s or short sales at greatly reduced prices (sell for about 40% lower). Every time this occurs I get a really sick feeling in my stomach as if I had been hiking at the top of a cliff and gotten just a little too close to the edge. I can’t even imagine how I would feel right now had I bought a house back then. It would have completely financially devastated me.

    I strongly suspect that, since Kary bought a house in 2007, his constant insistence that non-distressed prices have not fallen in value has less to do with his being a RE agent and more to do with his personal situation. If I had bought back then, I’d probably deny that obvious as well.

  23. 23

    By Scotsman @ 16:

    RE: Kary L. Krismer @ 12

    “I guess thatâ��s only important when the mix affects things in a way you donâ��t like.”

    You make an error in assuming I have a preference. I really don’t care if they go up or down- I have strategies for both. But I do want to know what’s happening so that I can plan accordingly.

    You, however, seem to have an agenda.

    I call bull on that. You clearly have a preference for lower numbers.

    And how do I have an agenda when I’m simultaneously pointing out that the prices are really higher but that the volumes should probably be lower? If I had an agenda, I’d only be pointing out the former.

    This is simple math stuff. I’m just pointing out something that is very simple to understand.

  24. 24

    By Scotsman @ 17:

    RE: Kary L. Krismer @ 13

    Um, Kary- I get it. What you don’t get is the humor in having the “arrow system” seem to favor the sellers while they are in fact suffering.

    What’s more fun at a party than a literalist lawyer? Just about anything. ;-)

    Wow, you still don’t understand. The non-distressed median is flat from August to August. That is hardly “suffering” if you’re a non-distressed seller. It’s neither an up or down arrow for non-distressed sellers.

    And again for the third or fourth time, the volume arrow should possibly, if not probably,. be pointed the other direction. The low priced REO sales are certainly boosting the volumes, but are not necessarily helping the non-distressed sellers. In fact they are creating competition, so they are likely hurting the non-distressed sellers.

  25. 25

    By Scotsman @ 18:

    RE: Kary L. Krismer @ 14

    Please, Kary- if we’re going to play lawyer on the web let’s be precise: REOs don’t drag down the median. Lower prices do. What a concept.

    First, that has nothing to do with being a lawyer.

    Second, REOs have lower prices for similar style houses, because they are typically of lower condition, always of an unknown condition, and don’t come with the same warranties of condition or title.

  26. 26

    By MichaelB @ 21:

    Kary, please back up your statement with some statistics. Assuming the number of REO’s sold has not increased as a percentage of total sales, there should be no downward pressure on the median.

    Here’s a clue–whenever I end a post with a statement that the numbers are not compiled or guaranteed by the NWMLS, there are statistics in the post.

    But if you want more, here are the numbers.

    In August 2010, REOs made up about 12.8% of the KC SFR sales, with a median price of about $230,000.

    In August 2011, REOs made up about 20.5% of the KC SFR sales, with a median price of about $193,750.

    So there are both more of them (both numerically and as a percentage), and they are selling at a lower price. That drags down the median.

    Percentages from NWMLS sources, but not compiled or guaranteed by the NWMLS.

    Further disclaimer–I don’t include late reported sales in my data, the way the official data is reported, so there may be variances between what I report and the NWMLS, but I think The Tim would argue against the NWMLS way of reporting late reported sales, so I don’t think that really matters.

  27. 27

    By Jonness @ 22:

    I strongly suspect that, since Kary bought a house in 2007, his constant insistence that non-distressed prices have not fallen in value has less to do with his being a RE agent and more to do with his personal situation. If I had bought back then, I’d probably deny that obvious as well.

    You forget that we moved from one house to another, and that renting is not an option for us. Given what’s happened in the other neighborhood (Skyway) to houses of that type, we’re probably pretty close to being even on the recent downturn (we would have lost just as much there as here). But in any case, as I mentioned before, timeframe is important. Since we’re planning on living here at least 10 years, it doesn’t really matter what the value of it is now, and that’s the type of thing I was pointing out during the upturn. Then I would say that increased property values only were beneficial to people if they were doing to downsize or retire and move out of the community.

    Finally, again, please explain to me how my stating the issue regarding volume (something all the “experts” here missed) is denying the obvious. You people are denying simple math. You’re the ones in denial.

  28. 28
    Pegasus says:

    RE: Kary L. Krismer @ 27 – “You people”?

  29. 29

    RE: Pegasus @ 28 – Jonness and Scotsman.

  30. 30
    Scotsman says:

    RE: Kary L. Krismer @ 27

    “You people are denying simple math. You’re the ones in denial.”

    No, Kary- you are. You’re the guy inventing new definitions of median and average by eliminating the data you don’t like when calculating the numbers. It’s a complete farce. But if that’s the last bit of hope you can hang onto go for it. Just don’t try to convince the rest of us to play along.

  31. 31

    By Scotsman @ 30:

    No, Kary- you are. You’re the guy inventing new definitions of median and average by eliminating the data you don’t like when calculating the numbers. It’s a complete farce. But if that’s the last bit of hope you can hang onto go for it. Just don’t try to convince the rest of us to play along.

    You do realize that you can have medians of different things, right? The NWMLS publishes the medians for all residential, condo, new contruction, etc.

    I’m just breaking that out further for residential. All sales, short sales, REO and non-distressed.

    Why are you so threatened by information? Is it because the information is not what you want to see? Do you have an agenda? ;-)

    Again though, for the individual owner of a piece of property this is all irrelevant. What would be relevant would be an appraisal or CMA on their specific property. And to do that, if you’re non-distressed you would typically ignore REOs if in your area they made up only 20% of the sales. Also, I mentioned earlier that a lot of REO properties tend to be in bad locations, near airports, freeways and other busy roads. If you’re a non-distressed property owner not near such things, you would look for comps that are also not near such things.

  32. 32

    I just did a search of closings within the past year for the Fairwood area. I used an entire year to get a sufficient number of REO sales. To limit the mix I searched only for 1.75+ bath SFR homes between 1800 and 2700 square feet built between 1969 and 1985.

    There were 24 non-distressed sales, with a median of $286,000 and a low price of $210,000, which sold in 4 days (the house was listed at $225,000 and they took a $210,000 offer made four days into the listing). The second lowest non-distressed price was $233,000

    There were 3 REO sales, with a median of $190,000 and a high price of $215,000, which probably contained seller financing concessions since it sold for $10,000 over list.

    So Scotsman, tell me how in such a market the REO sales are relevant to the owner of a non-distressed property? After considering likely seller concessions, there’s very little overlap between the markets here, and the lowest price non-distressed was possibly due to a seller being too quick to jump on an offer.

    Ignoring the difference between REO and non-distressed is like sticking your head in the sand.

  33. 33

    […] Bubble calls it a “flat, boring summer” and notes that King County’s median home price of $350,000 has rewound to roughly […]

  34. 34
    MichaelB says:

    RE: Kary L. Krismer @ 26

    Kary, That’s an interesting point that REOs pull down the median price. However, on thing to consider is that there is no shortage of REOs and there is a finite amount of dollars and debt available to purchase real estate. REOs are not so different from normal homes that they cannot impact the price of non REO assets.

    REOs as a separate market segment is an interesting concept as there has traditionally been more perceived risk around the purchase of a REO.

    On the other hand, once 20% of sales are REOs, haven’t we reached some sort of tipping point, where buying REOs is going to move mainstream? I see Redfin is now selling foreclosures…Perceptions change rapidly!

    Imagine the impact on the market of banks releasing shadow inventory in the next few years. Seems like it would put significant downward pressure on all house prices. What would be the impact on the real estate market if 40% of homes on the market were REO?

    I see houses in Edmonds that were asking around $500K+ in 2009, now pending at around $400K. Some of those homes have been on the market for 3 years! Sooner or later the sellers will cave and drop their price to sell and that is happening now. I predict we will see a big drop in the median for September.

  35. 35

    RE: MichaelB @ 34 – I think you need to go to smaller areas. There are some neighborhoods already that are well above 20% REOs and thus more affected by them. Then there are other areas which only had a few or even none.

    I’ll need to track down what happened, but there was a small neighborhood of stand alone condos up in Snohomish I ran into a couple of years ago. Just about everything in there was a short sale because it was relatively new, and they had the double whammy of being condo, making financing more difficult. Let’s say you were the sole non-distressed listing in the neighborhood. You could almost certainly get some sort of a premium, but it would be a premium off of a very low number.

    BTW, I had heard that Redfin didn’t do short sale purchases, but I don’t remember hearing they didn’t do buyers on REOs. I’m not sure why they wouldn’t.

  36. 36
    MichaelB says:

    RE: Kary L. Krismer @ 35

    Kary, think about this. REOs are about 1/7 of the shadow inventory. Either REOs are going to be around for a very long time, or more REOs are going to be coming onto the market within the next few years. As more REOs come onto the market, more owners will become upside down on their mortgages as home prices are depressed further.

  37. 37

    RE: MichaelB @ 36 – If the demand isn’t there, that definitely could happen. Remember, price is determined by supply and demand.

    Of course with Mr. Yun of the NAR trying to influence legislators by spreading falsehoods about the availability of financing and the quality of appraisals, the demand might not be there! ;-)

  38. 38
    ARDELL says:

    RE: Kary L. Krismer @ 35

    There was an announcement on September 1st on the Redfin Corporate Blog that they are now doing short sales.

    http://blog.redfin.com/blog/2011/09/buy-short-sales-with-redfi.html

  39. 39

    RE: ARDELL @ 38 – Thanks, but was there ever a time they didn’t do REOs?

  40. 40
    deejayoh says:

    By Kary L. Krismer @ 39:

    RE: ARDELL @ 38 – Thanks, but was there ever a time they didn’t do REOs?

    AFAIK they used to not even offer tours. but I guess it’s hard to compete when you don’t offer a service that covers 30% of the transaction volume…

  41. 41

    RE: deejayoh @ 40 – What I would suspect is driving the short sale policy change is that a lot of Redfin’s buyers are higher price range buyers, and a lot of the best short sales are higher priced listings.

  42. 42
    Bingo says:

    RE: MichaelB @ 36

    I wonder if there is any “shadow demand?” From the comments on Seattle Bubble, it sounds like there might be some buyers if prices were lower and selection was better?

  43. 43
    ARDELL says:

    RE: Kary L. Krismer @ 39

    Interesting question. Is it even legal to “shun” a portion of the marketplace based on who the seller is? I have never heard of any Brokerage doing that. Bank Seller, Estate Sale, Corporate Relocation…many types of no recourse after closing properties. I don’t think you could exclude any of those based on who the seller is, or because the seller is not a private party.

    Short sales are different, as the seller does not really have full authority to sell. I would not equate anything to do with short sales with other types of sales where the seller, regardless of who the seller may be, has full authority to accept a contract and close escrow.

  44. 44

    RE: ARDELL @ 43 – I suspect an individual agent could decide not to deal with a certain seller, but there might be problems with an entire brokerage making that decision for their agents. It is an interesting question.

  45. 45
    whatsmyname says:

    Kary, you are clearly crazy for trying to disaggregate the median into potentially semi-independent components. No one would try to do such a thing excepting maybe this kooky blogger from way back in August 2007:

    https://seattlebubble.com/blog/2007/08/14/median-price-not-telling-the-whole-truth/

  46. 46
    ARDELL says:

    RE: Bingo @ 42

    Yes and no. Often that is always the case and it settles itself out. Most of the complaints are from people saying the best ones are “gone in 2 days!”. What usually happens is they become one of those who gets it in two days. The market doesn’t have to shift, and likely won’t, to address the concerns. It really can’t because there is nothing to compel the sellers of the best homes to come out in droves. They will continue to “drip” out as they are, and those who get motivated just get better at not losing them in the first few days.

    The Pending Inspection I am working on now in Redmond says “4 days on market”, but it came on Thursday around 1 p.m. and I wrote the offer on Friday. The one I closed on yesterday was on market about 20 days or so, but that was my listing and we were pushing the high edge of reasonable as to price. Not “overpriced”…but not a screaming deal either.

    Sometimes you just have to be more reasonable than the unreasonable…

  47. 47
    ARDELL says:

    RE: Kary L. Krismer @ 44

    Banks aren’t a “protected class”…but…it would be quite odd for a Brokerage to exclude REO’s by policy. Though I do think they are more liability for a selling brokerage, since the only one to complain to or about after the fact is the Agent for the Buyer, with no recourse against the seller.

    I think that is why the Listing Brokerages go out of their way to make them look as “real” as possible. No phony blue skies…no photoshopped green grass of home. Some with only one ugly photo to meet the minimum requirement. They don’t want to make “any representations” as to condition, especially in photos that the buyer can later show as proof.

    I once had a buyer of one of my listings try to sue over a small rock being missing on the lawn that was in the photo on the flyer but gone when we closed. They brought in the flyer and said “where is that rock?”. I was not their agent…I was the agent for the seller. I was with Coldwell Banker at the time and they settled. I think they paid them $250 for a missing rock that was six to eight inches. The seller probably moved it when he mowed the grass so it wouldn’t break his lawnmower. :)

  48. 48

    By whatsmyname @ 45:

    Kary, you are clearly crazy for trying to disaggregate the median into potentially semi-independent components. No one would try to do such a thing excepting maybe this kooky blogger from way back in August 2007:

    https://seattlebubble.com/blog/2007/08/14/median-price-not-telling-the-whole-truth/

    Yeah, well we all know that guy is a total nutcase. :-D

  49. 49
    MichaelB says:

    RE: Bingo @ 42

    According to Kary, REOs are 20% of the sales in the market. REOs are approximately 1/7 of the shadow inventory. That is millions of homes! Are millions of Americans willing and able to purchase homes at current prices today? That would require them to take on significant debt. Most people will not be willing to take on debt to purchase an asset class that is declining in value unless it is much cheaper than renting and the price is a reasonable multiple of wages. I believe that rents will actually go down over time.

    Demand is driven by employment and wages and this is not going to improve for at least several years. Meanwhile, supply is huge. Consumer debt is still a huge issue…

    Historically, there have been periods when median house prices were 2 to 2.5 x average wages. That is not impossible in the current environment. There is no magic number that house prices have to get to to hit bottom. If average household income in WA is $65k, then the median home price could certainly hit $130K to $200k. That would be a good thing, because people would have money to invest in revenue generating assets like small businesses instead of becoming debt slaves to the finance industry.

    Think about it…. $200k is a lot of money for the average household if you don’t borrow 80% of it from a bank!

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