May Stats Preview: No Improvement for Buyers

With May 2015 now in the rear view mirror, let’s have a look at our monthly stats preview. First up, here’s the snapshot of all the data as far back as my historical information goes, with the latest, high, and low values highlighted for each series:

King & Snhomish County Stats Preview

Inventory went up again month-over-month in both King and Snohomish counties, but by less than it did last year over the same period. Meanwhile, sales also rose in King County, but fell slightly in Snohomish. Year-over-year sales were up in both counties, while inventory was down double digits again. Foreclosure notices declined yet again from 2014 in both counties.

Next, let’s look at total home sales as measured by the number of “Warranty Deeds” filed with King County:

King County Warranty Deeds

Sales in King County rose 6 percent between April and May (in 2014 they rose 10 percent over the same period), and were up 13 percent year-over-year.

Here’s a look at Snohomish County Deeds, but keep in mind that Snohomish County files Warranty Deeds (regular sales) and Trustee Deeds (bank foreclosure repossessions) together under the category of “Deeds (except QCDS),” so this chart is not as good a measure of plain vanilla sales as the Warranty Deed only data we have in King County.

Snohomish County Deeds

Deeds in Snohomish fell 8 percent month-over-month (vs. a 4 percent decrease in the same period last year) and were up 14 percent from May 2014.

Next, here’s Notices of Trustee Sale, which are an indication of the number of homes currently in the foreclosure process:

King County Notices of Trustee Sale

Snohomish County Notices of Trustee Sale

Foreclosures in King County were down 28 percent from a year ago, but Snohomish County was down 18 percent from last year.

Here’s another measure of foreclosures for King County, looking at Trustee Deeds, which is the type of document filed with the county when the bank actually repossesses a house through the trustee auction process. Note that there are other ways for the bank to repossess a house that result in different documents being filed, such as when a borrower “turns in the keys” and files a “Deed in Lieu of Foreclosure.”

King County Trustee Deeds

Trustee Deeds were down 52 percent from a year ago, falling to their lowest point since March 2008.

Lastly, here’s an update of the inventory charts, updated with previous months’ inventory data from the NWMLS.

King County SFH Active Listings

Snohomish County SFH Active Listings

Inventory inched up again slightly in both counties month-over-month. King is currently down 20 percent from last year and Snohomish is down 18 percent.

Note that most of the charts above are based on broad county-wide data that is available through a simple search of King County and Snohomish County public records. If you have additional stats you’d like to see in the preview, drop a line in the comments and I’ll see what I can do.

Stay tuned later this month a for more detailed look at each of these metrics as the “official” data is released from various sources.

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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

    About the Only Listings to Hit the Market

    Are sales needed to pay other bills? The rest will hold out for more cash or higher prices, to afford a sale? Estate sales as owners die?

  2. 2

    RE: softwarengineer @ 1 – If you’re in an area that is really hot with listings bid up, waiting might be a mistake even if prices in general rise from here. Bidding wars can get incredible results for sellers so with a rise in inventory you might end up in a situation where prices in general rise, but the price for a particular property falls. Of course if inventory gets worse . . ..

  3. 3
    Erik says:

    Note to buyers: If you want to own a home, you need to either cash in your retirement, try to borrow money from your parents or cash out your kids college fund. I talked to other potential sellers and we aren’t selling at this price. We want approximately double.

    Bidding wars are a better option for you than what we will do to you if you wait.

  4. 4

    The Future is Foggy for Seattle Real Estate

    Snippet:

    “…mortgages on their balance sheet.

    In their latest call reports filed with the FDIC, these three banks show the following mortgage delinquencies:

    Wells Fargo – 13.8%
    JPMorgan Chase – 13.3%
    Bank of America – 12.9%

    How could the delinquency rate of these huge banks be more than three times the CoreLogic figure? Let me explain.

    First, the delinquency rate for these banks is based on the total outstanding balance of their mortgage portfolio. So 13.7% of the outstanding mortgage balance of Wells Fargo’s portfolio is delinquent. The same is true for the other two banks.

    The CoreLogic data is completely different. Their delinquency rate of 3.9% is based on the number of loans. So 3.9% of the outstanding loans in CoreLogic’s massive database were delinquent as of March 2015. It has nothing to do with outstanding balance.

    Why is this important? The vast majority of outstanding mortgage loans are relatively small loans originated in smaller towns, cities or metros that never experienced a housing bubble. You can see this in the size of the average loan guaranteed by Fannie Mae – $159,000….”

    http://www.advisorperspectives.com/newsletters15/23-housing1.php

  5. 5
    greg says:

    it really is a shame that the current system allows markets to get so out of wack.

    I really like auctions over escalator bidding wars. At least at auction a buyer can be sure nobody knows his limit accept the house and him. I don’t know that I trust someone else to handle my monies and act in my true interest.

    Years ago a wealthy buddy told me the key to his success. He said “I focus on people who are spending other peoples money, because they don’t mind spending nearly as much as the people who own the money”. I am sure it was old as the hills, but it was the first time I had heard it. I quickly looked through my client list and saw he was almost exactly correct , all my higher margin clients were spending corporate money or employer money, the low margin clients were the business owners and employers who had real skin in the game.

    we need to find a way to put agents skin in the game, and have their real interests aligned with clients. At the moment there is very little alignment .

  6. 6
    Anonymous Coward says:

    By softwarengineer @ 4:

    Why is this important? The vast majority of outstanding mortgage loans are relatively small loans originated in smaller towns, cities or metros …

    I think time is driving the statistics where the delinquent loans have a higher than average balance, not geography. I would suggest that new loans are more likely to become delinquent than old loans. Inflation doing its thing (even at 1-2% a year) means that for most people the last 10 years of payments are going to be significantly easier to make than the first 10 years. Amortization means that “early” delinquencies would be higher value on average, rather than later ones.

    To say nothing of the fact that the “10 years to go” buyer has the opportunity to refinance into significantly significantly lower payments by extending the number of payments as well as taking advantage of historically low rates.

  7. 7

    The Baby Boomers aren’t Selling, They’ Remodeling for Age Improvements
    Don’t expect the listings to improve anytime soon. Retirees are staying put.

    Snippet:

    “…So the Owens looked around and decided that if they ever need a bedroom on the first floor, it will be their parlor. A full bathroom that’s already nearby makes them golden.

    Today, there are no steps anywhere on the first floor and expansive spaces to move about. “As soon as you walk through the door, you know something is different,” Mr. Owens says.

    To prevent tripping, the rugs and entry mat in the new space are recessed into the hardwood floor. The wood is good for walking and wheelchairs, holds up well, and is easy to maintain. A heated-tile floor, great for cold mornings, is also flush with the hardwood in another area.

    Kitchen counters have variable heights for sitting (if a person wishes to sit, or if someone is in a wheelchair) and standing. Upper cabinets are few; that helps eliminate heavy lifting, reaching for items, and potentially falling. Drawers and doors underneath the counter close automatically, requiring no hand strength….”

    http://finance.yahoo.com/news/homeowners-ready-age-place-030100801.html

    Rather than bend down to reach plugs, the couple put outlets at least 18 inches off the floor. A keyless entry means one less thing to worry about, too.

    About one-third of the $170,000 price tag for the addition (which would have run $220,000 if Mr. Owens wasn’t in the building business) was spent on age-friendly features, but guests and family of all ages are benefiting. He points out that his three children, ages 17 to 23, will “especially appreciate the no-step entry if they blow out their knees skiing!”

  8. 8
    Erik says:

    People that own in Seattle kinda have buyers pinned. If owners and landlords would get on the same page, they could both make a load of money. Raise prices and rents at the same time and watch buyers squirm. Buyers are complaining now, just wait a few years and they will be crying.

  9. 9
    Blurtman says:

    RE: Erik @ 8 – Overload them with debt. Make them pay!

  10. 10
    Mike says:

    By Anonymous Coward @ 6:

    By softwarengineer @ 4:

    Why is this important? The vast majority of outstanding mortgage loans are relatively small loans originated in smaller towns, cities or metros …

    I think time is driving the statistics where the delinquent loans have a higher than average balance, not geography. I would suggest that new loans are more likely to become delinquent than old loans. Inflation doing its thing (even at 1-2% a year) means that for most people the last 10 years of payments are going to be significantly easier to make than the first 10 years. Amortization means that “early” delinquencies would be higher value on average, rather than later ones.

    To say nothing of the fact that the “10 years to go” buyer has the opportunity to refinance into significantly significantly lower payments by extending the number of payments as well as taking advantage of historically low rates.

    New loans are performing significantly better than those from a decade ago. The older loans *should* be further along in the amortization schedule than newer loans, but a lot of them aren’t because they weren’t fully amortized or fixed rate – and more importantly, they have been delinquent for a LONG time so they haven’t been amortizing at all. Instead they’re piling on late payments and fees, sometimes for 4, 5, 6+ years at this point. Anyone still carrying a loan from the bubble era is likely doing so because they can’t afford to refinance. There are very few instances where a bubble-era loan is a better deal than the 3.5% fixed rates that have been available periodically over the past 3 years. Anyone with the credit, income and equity to refinance at 3.5% did so, the others more than likely were in some sort of financial hardship preventing it.

    The other missing piece as to why the bank portfolios are more heavily delinquent than CoreLogic industry stats – it isn’t just due to more jumbos. It’s because the bank portfolios had more loans that couldn’t be sold to the GSEs in the first place. Combine that with putbacks (loans kicked out of the GSE portfolio back to the issuing bank) and bad loans inherited from bankrupt institutions during the spate of forced mergers in 2009 and it’s not surprising that the big banks have a much larger % of delinquent loans than the industry as a whole.

  11. 11

    RE: greg @ 5
    So True Greg

    Savvy investors generally use their own cash they accumulated, that’s why they’re savvy investors.

    When you are given a golden spoon in life you can get lazy and can spend too much for things.

  12. 12

    RE: Erik @ 8
    The “I Love Seattle at Any Cost” Crowd will Buy Up Overpriced Homes in a Frenzy

    Many with inheritance or bad advice. Some, just because that’s where they want all their equity and living here makes them happy, so they sign the mortgage noose papers. I imagine the mortgage buyers have little savings for retirement and the high property taxes and maintenance costs will assure that their savings rates for retirements is mitigated.

    I’m glad I lived here all my life and don’t see the Seattle area as an unique America Gem anymore. I watched overpopulation destroy much of the trees, over crowd the parks, jam up the 1960 freeway systems and make 1000 acre woodsy areas asphalted housing developments. It may be a good area to drive out of to more depopulated scenic spots, but let’s face it, we spend most of our time in the over crowded bulldozed cities and suburbs, and relax [or give up trying] in the over crowded parks where there’s no where to park. The new arrivals have nothing to compare to.

    The intelligent investors move to greener pastures.

  13. 13

    RE: softwarengineer @ 7

    Seniors Are Underwater and in Debt Too

    I imagine 2nd mortgages are a lot of the blame.

    Snippet:

    “…Of all the financial threats facing Americans of retirement age — outliving savings, falling for scams, paying for long-term care — housing isn’t supposed to be one. But after a home-price collapse, the worst recession since the 1930s and some calamitous decisions to turn homes into cash machines, millions of them are straining to make house payments.

    The consequences can be severe. Retirees who use retirement money to pay housing costs can face disaster if their health deteriorates or their savings run short. They’re more likely to need help from the government, charities or their children. Or they must keep working deep into retirement….”

    http://news.yahoo.com/more-older-americans-being-buried-housing-debt-071507845–finance.html#

    I knew a recent retiree in Seattle who was bragging she had borrowed $250K at retirement for real estate and this was a good financial decision for her. Talk about financial suicide. If you aren’t debt free by age 50 or so, screw your head on right….your retirement plans are destroyed.

  14. 14
    Erik says:

    RE: Blurtman @ 9
    Great idea. I get tired of these buyers whining. They need to show us how bad they wasn’t shelter by making a major sacrifice.

  15. 15
    David B. says:

    RE: Erik @ 3 – That’s nice, dear. I bought last fall and did none of the things on your list.

  16. 16
    greg says:

    By softwarengineer @ 12:

    RE: Erik @ 8
    The “I Love Seattle at Any Cost” Crowd will Buy Up Overpriced Homes in a Frenzy

    Many with inheritance or bad advice. Some, just because that’s where they want all their equity and living here makes them happy, so they sign the mortgage noose papers. I imagine the mortgage buyers have little savings for retirement and the high property taxes and maintenance costs will assure that their savings rates for retirements is mitigated.

    I’m glad I lived here all my life and don’t see the Seattle area as an unique America Gem anymore. I watched overpopulation destroy much of the trees, over crowd the parks, jam up the 1960 freeway systems and make 1000 acre woodsy areas asphalted housing developments. It may be a good area to drive out of to more depopulated scenic spots, but let’s face it, we spend most of our time in the over crowded bulldozed cities and suburbs, and relax [or give up trying] in the over crowded parks where there’s no where to park. The new arrivals have nothing to compare to.

    The intelligent investors move to greener pastures.

    I took my family to the Washington park arboretum in Montlake area at the weekend. there was no parking and cars circling all over the place, while trying to turn I stupidly got myself back on the highway and no choice but to cross the bridge again…. it was so bad it was funny . Way too crowed to be fun, and too grubby to enjoy.

  17. 17
    Mellon says:

    @greg

    This has been my experience almost everywhere in the region. Drive two hours outside of the city and there’s a line to park at a trailhead. And still someone to smash your car window to boot (substitute disability methhead for homeless junky I suppose).

    I don’t think you can overlook the hot streak of warm weather in the past few years. A couple years of reversion to the mean will change some hearts.

  18. 18
    Erik says:

    RE: David B. @ 15
    I think things have gotten worse since you bought. If you’ve been reading these comments, you’d see recently buyers that want to live in Seattle are pissing and moaning about how houses are bid up. Owners need to give them something to cry about.

  19. 19
    Erik says:

    RE: greg @ 16
    Hahaha!! Sukka!!!

    There is a sign that tells you it’s your last chance before you pay too. I would have laughed in your stupid face.

  20. 20
    Obtusa says:

    RE: Erik @ 19

    Stupid face? When is the last time you looked in a mirror, Erika?

  21. 21
    Joe says:

    The higher costs of living in Seattle and the congestion are big problems that take away the enjoyment. A reasonable commute and a nice clean home are huge factors in overall happiness. Seattle is now rating poorly on both those criteria. Arguably these offset the natural beauty of the area and the diversity of activities, and maybe the slightly better jobs picture, depending on your perspective.

    Driving 5-10 miles during rush hour shouldn’t take 90 minutes, but it often does in Seattle.

  22. 22
    Erik says:

    RE: Obtusa @ 20
    Good one. Greg shared a moment with his family with us. I think he expected us to embrace him. Instead I ripped his head off and sh!t down his neck.

  23. 23
    Erik says:

    RE: Joe @ 21
    Stay out then and keep commuting. We like Seattle and that’s why we live here.

    You complain about commuting to my city so you hate it because everyone else commutes here. You make no sense. Move to Seattle if you can afford it. If not, rot in everett, spa away, or parkland and commute the opposite direction. We don’t want your kind if you are going to commute to my city for a job we gave you and then complain because everyone else is doing the same thing.

    You know what…actually stay out of my city because you are no longer welcome here. Pop off! Don’t let me catch you in Seattle joe because I will toss you out with the trash.

  24. 24
    wreckingbull says:

    Quality comments here on SB, today. I was always amazed we went as many years as we did before the rot set in.

  25. 25
    Bob says:

    Erik,

    Are you a two year old?

  26. 26
    MD says:

    It’s only going to get worse for buyers from now until August, when the real estate transactions (and prices) peak for the year.

    It’s important for any potential buyer to look at the broader macroeconomic picture, though. Retail sales are down (and the big employer, Amazon, is first and foremost a retailer with thin margins). Freight shipping is down. Q1 GDP fell by 0.7%. The Fed may be raising rates soon. China is hitting the skids.

    It may take a year or two, but the stuff is going to hit the fan. And when it does, home prices will become more affordable. The crazed, “Seattle at ANY COST” mentality is a good indicator to me that we may be nearing a top.

  27. 27
    Obtusa says:

    RE: Bob @ 25
    I suspect not, but he has computer privileges in the penitentiary where he spends his time.

  28. 28
    Saffy The Pook says:

    Between the stream of consciousness navel gazing and naked trolling on this site, I think it’s time for an “ignore” function. Without it, I fear that Seattle Bubble has burst.

  29. 29
    boater says:

    By Saffy The Pook @ 28:

    Between the stream of consciousness navel gazing and naked trolling on this site, I think it’s time for an “ignore” function. Without it, I fear that Seattle Bubble has burst.

    I second that suggestion.

  30. 30
    boater says:

    RE: MD @ 26
    if the economy if faltering why would the feds raise rates?

  31. 31
    MD says:

    RE: boater @ 30 – Yellen has recently commented that we should expect a rate increase by the end of the year.

    Your comment suggests that the Fed’s rate hikes are perfectly timed to match economic conditions. They’re not – the Fed has screwed up on numerous occasions. For example, last time around, the Fed was raising rates all the way through 2008, after the economy had been faltering for close to a year!

  32. 32
    Erik says:

    RE: boater @ 30
    No love from seabub.

    I just get tired of people coming to the city I live in and complaining about it. Computer people are notorious whiners. It’s exhausting.

  33. 33
    boater says:

    RE: MD @ 31
    yeah no ones perfect but it seems like for the last several years they’ve been saying they will raise rates when the economy shows real signs of recovery. Maybe they’ll jump the gun hoping a recovery is strong enough to withstand a rate increase. It should be since rates are so low. I don’t know i think if rates increase you’ll see even greater foreign capital inflows. That seems likely to increase asset prices even more.

  34. 34
    Octavius says:

    With a handful of large successful corporate headquarters hiring like mad here (Amazon, Microsoft, Expedia, T-Mobile, etc, etc) and other corporations building satellite campuses here and also hiring like mad (Google, EBay, Facebook, etc, etc) and all of the additional economic growth this drives — is it any wonder that thousands of six-figure income individuals and couples are flocking here and driving up demand? This “bubble” is nothing like the 2006 bubble which was nation wide and driven by speculative lending. This is simple supply and demand. Demand is exploding, and supply can’t keep up, and supply won’t keep up any time soon.

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