NWMLS: Inventory, Sales, & Prices Head South For Winter

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September market stats were published by the NWMLS this morning. Here’s what they have to say about their numbers: Housing market rebound continues, with "slow, unprepared buyers" settling for "2nd choice" homes.

The imbalance between supply and demand is “wreaking havoc” with some buyers and sellers, said Northwest MLS director George Moorhead, branch manager at Bentley Properties in Bothell. Some sellers are lamenting “missed opportunities,” but he believes positive momentum will continue with the combination of below-normal inventory, record-low interest rates and changing views on home ownership. “We are seeing clients’ views change from a home being a short-term investment vehicle to being a place where we raise and teach our families,” Moorhead remarked.

Another unsurprising month. Sales dropped off quite a bit from August, as they do nearly every year. Prices ticked down slightly, and inventory remains dismal.

All righty, on with our usual monthly 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):

September 2012 Number MOM YOY Buyers Sellers
Active Listings 5,007 -1.9% -35.5%
Closed Sales 1,798 -16.8% +13.2%
SAAS (?) 1.30 +0.3% -10.9%
Pending Sales 2,426 -7.5% +14.9%
Months of Supply 2.06 +6.1% -43.8%
Median Price* $375,000 -0.8% +7.3%

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

Nothing surprising this year as sales dropped of from August to September just like they do almost every year.

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

King County SFH Inventory

Still rolling along in the gutter.

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

Same story yet again. Sales up, listings down.

Here’s the median home price YOY change graph:

King County SFH YOY Price Change

The year over year increase seems to have leveled off somewhat around 7%. It will be interesting to see how this number changes once we start getting year-over-year numbers that compare similar shares of bank-owned sales.

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

King County SFH Prices

September 2012: $375,000
July 2005: $375,000

Here are the Times and P-I headlines.
Seattle Times: King County home prices, sales in September ahead of last year’s pace
Seattle P-I: King County home prices, sales up; inventory down

Check back tomorrow for the full reporting roundup.

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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.

34 comments:

  1. 1
    corndogs says:

    I would respectfully disagree with “The Tim” that the data presented indicates that prices are headed south for the winter…. looks to me prices are flat June through September. In 2007,8,9,10 prices had marked declines by August. This year prices ticked UP in August…

    Given low inventory and low levels of foreclosures…. I’m guessing you’ll be wrong about that…

  2. 2

    RE: corndogs @ 1 – It will probably depend on the distressed inventory transactions. REOs were down quite a bit, but the short sales were still at relatively normal recent levels, but not as high as the unusual numbers the prior two months.

    If distressed again become a higher percentage of total sales in the slower winter months, the prices will likely drop as a result of that.

  3. 3
    whatsmyname says:

    Per the stats preview, there were 2,751 warranty deeds for the month in King County, but today only 1,798 SFH closed sales for the month in King County. That’s a very big difference. I’ve noticed this before, and It can’t remotely be all condos. What do you suppose it is?

  4. 4
    ray pepper says:

    Will be lousy at Trustee Sales tomorrow..Taking day off. 3 set for sale in Pierce and 14 in King. All crap except for this “possible” gem of the week:

    http://www.vestus.com/WA/King/FEDERAL-WAY/Login-98023/219390 someone will probably scoop up this one..

  5. 5
    ray pepper says:

    ooops..lets try it this way: http://www.homes.com/Home-Prices/ID-300018569080/33112-12TH-CT-SW/

    **174k** taxes current…not bad

  6. 6
    gardener1 says:

    ^^^
    A McMansion indeed, but who the hell wants to live in Federal Way?

  7. 7
    David Losh says:

    RE: ray pepper @ 5

    You know that some idiot will come in and bid this up, so it’s not really a Gem.

  8. 8

    By whatsmyname @ 3:

    Per the stats preview, there were 2,751 warranty deeds for the month in King County, but today only 1,798 SFH closed sales for the month in King County. That’s a very big difference. I’ve noticed this before, and It can’t remotely be all condos. What do you suppose it is?

    Unimproved property
    Commercial property
    Re-recording of deeds
    Other

  9. 9
    wreckingbull says:

    RE: gardener1 @ 6 – I found myself falling into this trap, getting all excited about a great deal, but then at the last minute, I realized “I’m going to have to live in this thing after I buy it”. That realization saved my ass a few times during the buying process.

  10. 10
    ray pepper says:

    RE: David Losh @ 7 – @ 170k-180k its a GEM…easy flip at 249k..

    ***update** postponed late last night! thereby no deals at king or pierce this week sub 300k…Go Hawks! Go Dawgs!

  11. 11
    David Losh says:

    RE: ray pepper @ 10

    You know as well as I do that this Vestus thing has changed the dynamic of the auctions. Any home buyer can come in, borrow the money, or pay cash from another source, refi, or not, and pick up that Gem for retail pricing, and figure they are coming out ahead.

  12. 12
    ray pepper says:

    RE: David Losh @ 11

    well not quite right David…Yes anybody can come in and buy anything..However, if your gonna buy anything and BORROW the money you MUST have 20% of your own. Then in addition you must have an “escape plan” or you can not borrow. For exp. your credit score must be high enough for you to refi the home as a rental or primary within a 9 month time frame if the home does not sell on the flip. Your gonna pay about 12% int only and a few points but again if you were looking for a primary residence and needed quick dough for a quick sale your good to go IF U QUALIFY! many cannot and are forced to partner up… That Fed Way house would be a SMOKIN deal under 200k but the ASTUTE buyer doesn’t need any of those Vestus, data Snap, companies….Its all out there for everyone but having the dough is essential!

  13. 13
    wreckingbull says:

    RE: David Losh @ 11 – Based on your argument, the only reason something was a ‘gem’ was that it was being sold in a non-transparent, inefficient market. Thirty years ago, it was very difficult for ‘any buyer’ to directly purchase commodities or securities. I see this as natural evolution of the market. If that means flippers are getting squeezed by retail buyers, too bad.

  14. 14
    David Losh says:

    RE: ray pepper @ 12

    Ray, any buyer in the market place can play the flipper game. Banks are already asking for 20% down and golden credit, so why would that buyer be barred from the auctions?

  15. 15
    David Losh says:

    RE: wreckingbull @ 13

    That’s been exactly my point for a couple of years. I don’t see a distressed market place.

    Buyers can choose whatever they want, and don’t need to buy into a flippers game. Sure, it takes cash, but there is plenty of cash in the system for those that qualify.

  16. 16

    By David Losh @ 14:

    Banks are already asking for 20% down and golden credit, so why would that buyer be barred from the auctions?

    Don’t believe what you read in newspapers (or NAR announcements). Buyers need 3.5% down, and the credit required to get that loan is hardly what I would call golden.

  17. 17
    ray pepper says:

    RE: Kary L. Krismer @ 16 – 3% down??…try 500.00 down with City Qualified assistance programs…

  18. 18
    ray pepper says:

    RE: David Losh @ 14 – barred from auctions? read the post again…its a free country..anyone can go to the auctions…some can buy and qualify with 20% down to buy a trustee sale property. But, I disagree that “any buyer” can do it. So many are 1 and done because they overpay or get their money in bad. I see it all the time. A year later the home they bought, all fixed up, is stream-lined returned to the hard money lender and back on the court yard steps it goes.

  19. 19
    Howard says:

    By ray pepper @ 18:

    RE: David Losh @ 14 – barred from auctions? read the post again…its a free country..anyone can go to the auctions…some can buy and qualify with 20% down to buy a trustee sale property. But, I disagree that “any buyer” can do it. So many are 1 and done because they overpay or get their money in bad. I see it all the time. A year later the home they bought, all fixed up, is stream-lined returned to the hard money lender and back on the court yard steps it goes.

    For primary residence auction buyers, there are multiple hard money lenders willing to do auction loans with only 10% cash. Buy smart and refinance and you could have another 10-20% equity.

  20. 20

    By ray pepper @ 17:

    RE: Kary L. Krismer @ 16 – 3% down??…try 500.00 down with City Qualified assistance programs…

    There’s also zero down with VA, and reduced closing costs if you’re a disabled vet. But I was trying to use something virtually everyone with decent credit qualifies for.

  21. 21

    By ray pepper @ 18:

    RE: David Losh @ 14 – barred from auctions? read the post again…its a free country..anyone can go to the auctions…some can buy and qualify with 20% down to buy a trustee sale property. But, I disagree that “any buyer” can do it. So many are 1 and done because they overpay or get their money in bad. I see it all the time. A year later the home they bought, all fixed up, is stream-lined returned to the hard money lender and back on the court yard steps it goes.

    I would agree. Those that tried it one time and succeeded just got lucky. There are a lot of potential pitfalls.

  22. 22
    2kt says:

    RE: ray pepper @ 4

    They are all coming back, Ray. Although it seems like at a higher price, eh?

  23. 23
    ray pepper says:

    RE: 2kt @ 22 – oh yes…they r all coming back…about 7 years worth on the horizon…all getting written down to current market value through trustee sale, short sale, conventional sale, and deed in lieu’s.

    BANK IT!

  24. 24
    2kt says:

    RE: ray pepper @ 23 – You mean all of the whopping two months’ worth of inventory, Ray? They sure do take their time, don’t they.

  25. 25
    David Losh says:

    RE: ray pepper @ 18

    Grow up Ray, stop playing. The auctions and short sales are a farce. Those are the fair market values.

    There’s no profit as soon as people wise up and start buying like any other idiot in the distressed property market.

    As a matter of macro economics those auction prices will be under water in another four years. Watch the market, all the financial markets. Low interest can work for a long time, but buyer confidence doesn’t sustain.

  26. 26
    David Losh says:

    RE: 2kt @ 24

    No, it means any one who bought in the past seven years will be looking for a way out before taking a bigger loss than they already have. Once it dawns on people Real Estate is no longer going up in value, and as a matter of fact it’s way over priced, people will have a choice to pay the property off or sell below purchase price.

    You choose.

  27. 27

    By David Losh @ 25:

    RE: ray pepper @ 18 – Grow up Ray, stop playing. The auctions and short sales are a farce. Those are the fair market values.

    Show me one definition of fair market value which includes forced sales.

    Beyond that, the lack of information available at auctions regarding the property further reduces the price paid.

    You’re the one who needs to wise up. Just because you think some things are overpriced, it does not mean they are overpriced. It just means you don’t know how to determine value.

  28. 28
    corndogs says:

    RE: David Losh @ 26 – It really is a shame that when you say something stupid that you are not tazzed or somehow caused pain…I think it would help you learn. I believe the reptilian core of your brain is probably still functioning but your cerebral cortex is shot…. you need to stop watching the popcorn while it’s popping in the microwave… something’s wrong with you!

  29. 29
    whatsmyname says:

    By ray pepper @ 23:

    RE: 2kt @ 22 – oh yes…they r all coming back…about 7 years worth on the horizon…all getting written down to current market value through trustee sale, short sale, conventional sale, and deed in lieu’s.

    BANK IT!

    One of the nice things about a site like this is that Tim has a link to his historical spreadsheets. This means you can easily add up the number of closed sales for the last 7 years. If you start at October 2005, that number for King County is 141,974.

    What is your prediction for how long it will take about 141,000 King County SFR’s to hit the trustee sales, short sales, conventional sales and deed in lieu’s?

  30. 30

    RE: whatsmyname @ 29 – That would be very neighborhood/property type specific. For example, new construction (post 2005) in Seattle or Kent might have more turnover than older homes in Bellevue.

    But on top of those sales you counted, you’d also need to add in the house as ATM property. That would also fit in Ray’s target group.

    Countering Ray’s theory would be the impact of the National Mortgage Settlement and similar future settlements with more entities.

  31. 31
    David Losh says:

    RE: corndogs @ 28

    Prove it. You make these outrageous claims all the time.

    The banking system is severally crippled at best, and they continue to make loans, now based on the Bernanke promise to buy mortgages.

    No matter who gets elected people have limited options in unloading the debts they have, and that includes mortgages. Without substantial appreciation, buying a house is just debt with a promise of a back end in fifteen to thirty years.

  32. 32
    David Losh says:

    RE: Kary L. Krismer @ 27

    It’s all in the profitablility. Margins are tight on your claim of a forced sale.

  33. 33

    By David Losh @ 31:

    Without substantial appreciation, buying a house is just debt with a promise of a back end in fifteen to thirty years.

    You say that like it’s a bad thing, but I have to ask: What’s wrong with that?

    Buying has some advantages, but one of the main ones is the ability to eventually own an asset free and clear. The alternative is renting, and that’s a good option at times, but not always. It’s like the idea of buying a car versus leasing a car.

    I still remember the conversation another customer was having at the Ford dealer when I bought my truck almost 24 years ago. The salesman was trying to talk the customer into leasing, pointing to the lower payments, but the customer was correctly pointing out that after three years he’d still have payments to be making. I bought that day almost 24 years ago,and I’ve owned that same truck without making a payment for almost 22 years. Renting a house has the same issue in that you’ll continually be paying rent. Of course there are many situations where renting makes the most sense, but for people without a lot of expected changes in their life going forward, buying probably makes a lot more sense in more situations.

    The expectation of appreciation is exactly what got us into a lot of the problems we ran into. People expected future appreciation and bought places with the idea that they would only own them for 2-3 years and them get something different–usually something substantially better. They wanted to leverage their way up the ladder to a dream house. But for the lure of appreciation, many people wouldn’t have bought the places they bought in 2005-2007.

  34. 34

    By David Losh @ 32:

    RE: Kary L. Krismer @ 27

    It’s all in the profitablility. Margins are tight on your claim of a forced sale.

    Nonsense. Literally, nonsense.

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