NWMLS: Housing Market Already Hibernating for Winter

November market stats were published by the NWMLS today. They haven’t published their press release to its typical location yet [update: it has been posted now], so let’s just dive right into 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):

November 2014 Number MOM YOY Buyers Sellers
Active Listings 3,658 -18.8% -4.2%
Closed Sales 1,870 -16.4% +5.4%
SAAS (?) 1.00 -13.1% -6.6%
Pending Sales 2,128 -19.4% +3.9%
Months of Supply 1.96 -2.8% -9.1%
Median Price* $440,000 -1.6% +6.3%

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

Up until this month there was still at least one category that was trending in buyers’ direction, but this month it’s all shifting toward a sellers’ market. This is quite the change from a year ago, when nearly every indicator was moving in buyers’ favor.

Closed sales slipped in November, in typical fashion for this time of year. Prices dipped back down a bit more, and listings continued to decrease as they do at this time every year, while staying below last year’s levels for the third month in a row.

Here’s your closed sales yearly comparison chart:

King County SFH Closed Sales

Closed sales fell 16 percent from the previous month, but came in 5 percent above last year’s level—the largest year-over-year gain since October of last year.

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

King County SFH Inventory

Inventory continued its seasonal slide with the biggest month-over-month decrease since December of 2012.

Here’s the supply/demand YOY graph. “Demand” in this chart is represented by closed sales, which have had a consistent definition throughout the decade (unlike pending sales from NWMLS).

King County Supply vs Demand % Change YOY

Both supply and demand are moving back in sellers’ favor, with increasing sales and decreasing listings.

Here’s the median home price YOY change graph:

King County SFH YOY Price Change

Hovering around where it’s been for most of the year.

And lastly, here is the chart comparing King County SFH prices each month for every year back to 1994 (not adjusted for inflation).

King County SFH Prices

Home prices have been basically flat since May.

November 2014: $440,000
October 2006: $440,000

I haven’t seen articles posted on the Seattle Times and P-I yet, but I’ll update this post when they’re published.

[update: here they are]

Seattle Times: King County median home price up 6.3 percent over year ago
Seattle P-I: Still few homes for sale, many buyers in Seattle area

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.

20 comments:

  1. 1
    Deerhawke says:

    The headline says that the market is already hibernating for winter but the stats seem to tell a different story. Year on year, sales, pendings and prices are up by a healthy margin despite the fact that inventory is down for the third month in a row.

    Here in Greenlake, a house went up for sale this past weekend. It was priced $50K more than I thought possible, but there were still more than 100 groups though the house. It seemed like they were having a huge party at the house 12 hours a day for 3 days. It was impossible to find parking on the block. You can say what you like, but the buyers were certainly not hibernating.

    Five offers and the price came in 5% over asking. A 1700 sf 1920’s partially restored bungalow on a 3000 sf lot for mid $7’s??? I kind of thought this spring was when we would get back to normal, but maybe San Francisco is our new normal.

  2. 2
    Erik says:

    Great data here. The most important data in my opinion is that inventory is still super low. When supply is low and demand is high, there is only one direction for housing prices to go and that is up. As long as interest rates don’t skyrocket up or unemployment increases dramatically, us homeowners can feed off of our equity this year and hopefully next year.

  3. 3
    Mike says:

    RE: Deerhawke @ 1 – Not quite SF prices. Driving to dinner in San Carlos (way out in the burbs) we were guessing how much some of the extremely modest homes on traffic clogged arterials were selling for. Even the guys who live in the area were shocked at the prices. $850K on a busy street. 2 blocks in $200K+ more. The Greenlake house sounds luxurious and affordably priced by comparison.

    And here you can just go a few miles up to Shoreline and find something similar for half that. It’s not Greenlake, but it’s not a bad place to raise a family either.

  4. 4

    By Deerhawke @ 1:

    The headline says that the market is already hibernating for winter but the stats seem to tell a different story. Year on year, sales, pendings and prices are up by a healthy margin despite the fact that inventory is down for the third month in a row. .

    Not only that, but it’s now three months in a row with a record high for the median price for the particular month. Given the fact that short sales and bank owned sales are still occurring at greater numbers than 2006 and 2007, that’s significant.

    Still, not all areas have recovered, so that says something too.

  5. 5

    RE: Deerhawke @ 1

    One Green Lake House is Not a General Trend

    Nor is an observation of one’s own neighborhood a good indicator either [it can likely be biased, that’s why we have independent assessors]. I can tell you of all the unsold HUD homes sitting for months/years in my HOA as a negative observation [but why bother], how about Greenlake? They have the same percentage of foreclosures as SE King County, have you observed any empty homes [or even homes with rent free squatters awaiting foreclosure litigation?] or is this not transparent in your neighborhood? It is transparent to a good assessor.

  6. 6

    RE: softwarengineer @ 5 – Assuming you’re talking about the Maple Valley area, that is entirely different than Green Lake. Go further south to parts of Tacoma and the market is like 2009. It’s sort of like how you used to be able to (or maybe still can) go down to Evergreen College and step into the 1970s.

  7. 7
    Deerhawke says:

    Really good points Kary. You are also right that not all areas have recovered.

    Greenlake may just be the epicenter of real estate madness right now. In fact I do not think it is entirely representative. And along those same lines, I do not believe the north end neighborhoods have anywhere near the same percentage of foreclosures as south King County. Empty homes get my full attention because I really want to buy them as tear down/rebuild opportunities. Most of the time, I find those vacant properties are tied up in litigation among heirs who are squabbling about their big payday after Nana breathed her last.

    But this may be the one of the take-aways of the recent statistics– the divide between hot and not hot. While Seattle prices are up YOY 9.7% and central Seattle neighborhoods like Green Lake are probably up 15%, Southeast King County is down 1.9%. Where it is hot, it is really hot. Where it is not…well, you know. Those new Amazon hires want to be close to their artisanal lifestyle and Whole Foods. They do not want to schlep down to Burien.

    On the brighter side it does seem that condo sales in some areas are coming back fast– up 21.4% in Southwest KC and 42.8% in Southeast KC! The dollar figures are low, but the percentages are impressive. Hang in there softwarengineer. This market may bail you out yet.

  8. 8

    RE: Deerhawke @ 7

    I Have a SE King County Realtor Living Next Door to Me

    She tells me from her local experience the low tier SE King County units [like mine] have the best hope, versus the $200K+ new homes. They’re the only ones the lion’s share of the available buyers barely qualify for. I predicted this in 1999 when I bought in well below what I qualified for, you can’t fool an engineer that understands wage deterioration with non-stop overpopulation on-going and I wasn’t going to get fooled into buying a completely dead horse [like renting, actually worse]. I predicted the Bubble pop soon in 1999 too, for the same demographic science reason too.

    She thought my recent $26K foreclosure purchase was the “cat’s meow” too.

    SE King County Condos may be doing well for the same reasons, albeit its mostly large new construction out there, as the condo supply is almost non-existent.

  9. 9
    Deerhawke says:

    You predicted the Bubble in 1999– wow, impressive. Only off by 8 years. On a geologic time scale, you were practically right on the money.

    Say, for those of us who follow the Seattle market, the PI has this to report, “Within Seattle itself, the median house sales price was $498,950, up 9.7 percent from a year earlier but down 3.1 percent from October. Seattle had 1.25 months of inventory in November, down from 1.51 months a year earlier and 1.35 months in October. Seattle sales were up 5.4 percent, while pending sales rose 1.2 percent.”

    Does anyone know the MOM and YOY percentage change in Seattle inventory?

  10. 10
    Erik says:

    RE: Deerhawke @ 9
    From your data you posted, MOM percentage change is (1.25/1.35-1)*100 = -7.4% change MOM

    YOY = (1.25/1.51-1)*100 = -17.2% change YOY

    This gives you MOM and YOY percent changes in terms of months of supply from the data you posted.

    Tim has different data than the PI, so you first need to figure out why. You can apply this equation to any data to get percent change. ((Current Inventory/Previous Inventory)-1)-100. Now I have taught you to fish, so enjoy this new tool.

  11. 11

    RE: Deerhawke @ 9

    You’re Right

    I had no idea Greenspan would reduce our savings interest rates to zombie 0% like Japan to prop up bad loans to anyone that breaths, I got that wrong on the Bubble timing…..who did get it right in 1999?

  12. 12

    RE: Erik @ 10

    Ahhhhh Erik

    Our renown Seattle flipper is giving out some of his real estate secrets. Be careful though, its likely pearls to swine if the help doesn’t get them to their pre-conceived scenario….they’ll just likely ignore it if it does.

  13. 13
    Deerhawke says:

    Erik, I had done the same math but the percentage change figures seemed too big and so I disregarded the numbers. On second thought they pretty much have to be correct.

    The real question is what has happened to inventory levels. There is a column topic for you Tim.

    Anybody have a theory?

  14. 14
    Erik says:

    RE: Deerhawke @ 13
    My theory is that less houses have been coming on the market than are being sold.

    Whoever reads this, please don’t put your house on the market this month. I would like to see inventory slump to an all time low. I really want 2015 to be the lowest inventory year of all time.

  15. 15
    Erik says:

    RE: Deerhawke @ 13
    This is what Tim posted regarding inventory and then he continued to plot actual values against it every month until it was apparent that his prediction, I mean theoretical line was wrong. Point is that I don’t think Tim has any idea where inventory is headed or where it is going, so there is no reason to try and have him write a post on it.

    https://seattlebubble.com/blog/2013/07/02/inventory-now-on-track-to-beat-2012-by-august/

    Inventory did not beat 2012 by August. Instead, it sunk lower.

    I think inventory will most likely follow the same path it did last year and prices will most likely follow a similar path as long as nothing big changes like interest rates sky rocket over 6% next year.

  16. 16
    Mike says:

    By softwarengineer @ 5:

    RE: Deerhawke @ 1

    One Green Lake House is Not a General Trend

    Nor is an observation of one’s own neighborhood a good indicator either [it can likely be biased, that’s why we have independent assessors]. I can tell you of all the unsold HUD homes sitting for months/years in my HOA as a negative observation [but why bother], how about Greenlake? They have the same percentage of foreclosures as SE King County, have you observed any empty homes [or even homes with rent free squatters awaiting foreclosure litigation?] or is this not transparent in your neighborhood? It is transparent to a good assessor.

    Except that foreclosure rates aren’t even remotely similar between those areas.

  17. 17
    Corndogs says:

    Corndog has explained on here many times why inventory was low and would remain low. It takes the ability to understand an additional dimension of thought. No one on here is that smart. It was hilarious to watch “theTim” timidly advance a narrative that inventories would rise. Corndog tore him apart and explained why it would not… “the Tim” later pretended that he hadn’t made the prediction of higher inventory… with Corndog watching in, the Tim is afraid to make any predictions…. so don’t expect any hard predictions from the Tim, now or ever.

  18. 18
    Erik says:

    RE: Corndogs @ 17
    When you say “No one on here is that smart,” what I think you mean is “Software engineers are not that smart.” Their brains are too small to forsee what will happen in the future. When Tim makes a prediction, all the code monkeys jump on board and start pushing the prediction. When it turns out Tim is wrong, all the code monkeys pretend it never was a prediction.

    Tim made a prediction and he was wrong. Instead of saying “oops, i was wrong,” he tried to pretend he never predicted that when he clearly did. That is why this keeps coming back up. It’s like Tim thinks we are a bunch of idiots.

    Johness came on here and said since Tim never said “here is a prediction I am about to make,” so it isn’t a prediction. What an f-ing joke. He drew a theoretical curve predicting what he thought would happen and plotted actual values against it until he realized he was wrong and then stopped. If that isn’t a prediction, I don’t know what is.

  19. 19
    Shoeguy says:

    George: “HEY! JIMMY!!! ha ha ha……..Great game.”

    Jimmy: “OH yeah…….Jimmy played pretty good.”

    George: “Hey you know , I felt we had like a synergy out there,you know,

    like we were really helping each other.”

    Kramer: “What d’you got there?”

    Jimmy: “These?”

    Kramer: “Yeah”

    Jimmy: “These are Jimmy’s training shoes.”

    George: “Yeah,yeah yeah yeah! I’ve seen these…..they sorta ..they make

    your legs..stronger.”

    Jimmy: “Oh yeah! Jimmy couldn’t jump at all before he got these. Jimmy was

    like you (looks at G.)

    Kramer: “They’re Plyometric.”

  20. 20
    Jonness says:

    By Erik @ 18:

    When you say “No one on here is that smart,” what I think you mean is “Software engineers are not that smart.” Their brains are too small to forsee what will happen in the future..

    OK Einstein, do you “foresee” what will happen to others if they attempt to use your math formula?

    ((Current Inventory/Previous Inventory)-1)-100

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