NWMLS: 2015 Was the Worst Year Ever for Home Buyers

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December market stats were published by the NWMLS yesterday. Before we get into our monthly stats, here’s a quick look at their press release.

Puget Sound area home sales, prices still strong
Home prices have “clearly recovered” in King County and a few other areas served by Northwest Multiple Listing Service. Many member-brokers say prices are likely to keep rising as a backlog of buyers competes for depleted inventory.

The price of a single family home (excluding condos) that sold in King County during December jumped nearly 15.5 percent, from $440,000 to $508,000, prompting OB Jacobi, president of Windermere Real Estate to comment, “If December told us one thing, it’s that home prices have clearly recovered in King County. Last month the median price for single family homes broke the pre-recession record of $481,000 that was set in July 2007.”

Another industry leader, J. Lennox Scott, chairman and CEO of John L. Scott, noted the 9.2 percent drop in King County’s pending sales during December, saying “The only reason pending sales dropped in King County was due to a lack of inventory.”

He knows that it is the only reason because he personally interviewed each and every potential homebuyer who backed out of the market. One hundred percent of them cited inventory. Certainly nobody was concerned about prices rising too quickly or the potential that we are in another housing bubble, fueled by an overheated tech industry.

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):

December 2015 Number MOM YOY Buyers Sellers
Active Listings 1,764 -23.4% -36.0%
Closed Sales 2,058 +18.2% +3.8%
SAAS (?) 1.00 +4.2% -8.4%
Pending Sales 1,475 -30.5% -11.6%
Months of Supply 0.86 -35.2% -38.4%
Median Price* $508,000 +1.6% +15.5%

After setting a new all-time low inventory level in November, listings dropped off dramatically yet again to set another new all-time low in December. Here’s hoping we see somewhat of a turnaround in inventory for 2016. If not, expect another overheated year.

Here’s your closed sales yearly comparison chart:

King County SFH Closed Sales

Closed sales rose 18 percent from November to December. Last year they rose 6 percent over the same period. Meanwhile year-over-year closed sales bumped back from negative territory in November to a small gain of 4 percent in December.

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

King County SFH Inventory

Inventory fell dramatically yet again from November to December, with the year-over-year decline sticking in the mid-30% range it has been in for the last few months. December inventory came in at 1,764—the first time it has ever dropped below 2,000 or even below 2,300. The only good(ish) news for buyers is that presumably we can’t possibly get much lower than we are right now.

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

After moving back to the buyer’s side of the chart last month, the red demand line went back into positive territory again in December. The blue supply line still shows no signs of moving toward back toward balance.

Here’s the median home price YOY change graph:

King County SFH YOY Price Change

Year-over-year price growth increased again from +13.6 percent in November to +15.5 percent in December.

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

The median home price broke out of the $480,000 to $500,000 range it was in between April and November, posting a new all-time high of $508,000 in December.

October 2015: $499,950
July 2007: $481,000 (pre-2015 high)

Here’s this month’s article from the Seattle Times: King County home prices hit new highs, inventory at new lows

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.

95 comments:

  1. 1
    ess says:

    Good news for home sellers and taxing authorities!

  2. 2
    GoHawks says:

    Well, we all wondered if the months worth of supply would crack below 1.00 in King County this spring and it did it already. Geez.

  3. 3
    Blurtman says:

    Will shrinking 401k’s give buyers pause? Stay tuned.

  4. 4
    GoHawks says:

    RE: Blurtman @ 3 – Or give sellers pause that they may not want to reach for the moon on price or wait another year or two to sell.

  5. 5
    sleepless says:

    By GoHawks @ 4:

    RE: Blurtman @ 3 – Or give sellers pause that they may not want to reach for the moon on price or wait another year or two to sell.

    Do not forget the institutional buyers that bought on the margin (“cash” has to be borrowed somewhere) and will sell their portfolio once the market goes south…
    I predict two possible outcomes: 1. the fed continues the course of tightening and it kills the whole “recovery” including stock, bond and housing markets as well as pricks the bubbles in subprime lending (student loans, cars, etc) or 2. the fed completely goes 180 degrees and revert the rates back to 0 or, possibly, negative and launches QE4. The #1 will inflict the pain sooner and the pain might not be as bad as the #2 scenario which will mitigate the pain for the time being by kicking the can further down the road, but, the it ultimately unwind, the pain with #2 will be much more severe as more damage is being done.

  6. 6
    sleepless says:

    Watch the stock market closely. The stock market is the housing market one year later. I think, DOJ at $15K is psychological level, once it goes below $15K the FED should either unleash the tsunami of freshly “printed” money, or there is no stop to the bear market. I believe, $15K is when the people start panicking…

  7. 7

    RE: sleepless @ 6

    Agree. When the market dropped to 16.5 back in August I made a bet it would hit 15 before it hit 18 again as a close. It got to 17,891 in Nov, when I admitted I had a slim chance in hell of winning the bet. But given it is an election year, I think I could still win this one with it hitting 15,000 before it hits 18,000 again.

    The 1,000 point drop in 10 minutes time from opening bell back on August 25th was also about China. I don’t really understand what is causing the China shifts though or whether China’s woes actually create long term issues for our markets. Is it reflex psychological panic only?

  8. 8
    Deerhawke says:

    Whatever happened to the post-Halloween slump where prices dropped and inventory had a chance to build up before the spring bump in sales and prices?

    If November and December are charting like March and April, what are we going to see happening this spring?

    Tim, I think you are going to have to re-draw your charts…

  9. 9
    Erik says:

    2016 will be another buyer beatdown. Buyers need to bid up prices now or they will pay more in 2017. You’ve been warned.

  10. 10
    LarryB says:

    “He knows that it is the only reason because he personally interviewed each and every potential homebuyer who backed out of the market.”

    I guess I’m a little confused. If buyers are running away, why are prices still rising?

    Also, how can anyone sell a house that isn’t on the market? Isn’t inventory the absolute ceiling on sales volume?

    90% of microeconomics is the law of supply and demand. Prices find an equilibrium point that clears the market. Real estate is a bit different because it’s not a fungible good, so the market sets the marginal price, but it’s still a product of supply and demand.

    If prices are rising, either demand is increasing, or supply is decreasing. It’s possible that both might be, but that’s pretty unlikely. The idea that buyers are fleeing the market seems wrong to me. If someone can explain this, I’d love to hear it.

    Sure, there might be a bubble. There might not be. But no one has suspended supply and demand. When circumstances change for the worse (and they eventually will – they always do), people will back out of the market, reducing demand, and prices will fall.

  11. 11
    Blurtman says:

    It’s a chic, cozy unit with unlimited potential. Imagine the possibilities as you call Phinney Ridge, Magnolia and even Evergreen Point your home.
    —–
    Seattle neighborhood pleads with city to do something about criminal RVs

    Harley Lever arrived at his Magnolia home in Seattle late one December evening to find something missing.

    “My TV set was stolen out of my carport,” Lever said. “We noticed the TV was sitting next to one of the RVs. I went down to retrieve it.”

    The RV in question is one of many that have taken over roadsides in Magnolia, and among the many throughout the City of Seattle. Lever went to retrieve his TV that was taken from his home. But then he encountered the residents of the RV.

    “I was told by the two gentlemen there that they know where I live and I better get out of there before they beat me up,” Lever said. “I called 9-1-1, and they could hear these guys threatening me over the phone. They said, ‘sorry sir, we don’t have any police in the area, you are going to have to leave.'”

    “Well, one, they have my TV set. And two, they are actively threatening me and telling me they know where I live,” he said. “Why, (in Seattle) can’t I get a police officer come to assist me when I’m actively being threatened. It was a huge wake up call. About an hour later, police showed up. They basically told me that there is a hands-off order when it comes to homelessness.”

    Seattle and RVs

    It’s not the first time Magnolia residents have called 9-1-1 about an RV, or have alleged there is a city policy instructing police to leave roadside RV campers alone. The city has denied any such order exists.

    “I don’t want homeless people harassed at all,” Lever added. “But I do want a distinction made between criminals and the homeless.”

    A request for that distinction was made at a neighborhood meeting Wednesday night, organized by Lever and others in Magnolia. Lever started the website and Facebook page “Safe Seattle,” to get word out about the issue, and act as a hub to report criminal incidents in the neighborhood. The RV issue is not only in Magnolia, but a variety of Seattle neighborhoods. Lever hoped that the community gathering would send some kind of message to city officials.

    http://mynorthwest.com/11/2887005/Seattle-neighborhood-pleads-with-city-to-do-something-about-criminal-RVs?google_editors_picks=true

  12. 12
    Deerhawke says:

    LarryB, it really is about supply and demand.

    If you look at the inventory chart above, you will see that supply has been falling year after year since the recession and has dropped at an increasingly rapid pace during the past year as standing inventory has been depleted.

    If you look at the sales figures, you will see that demand has been rising fairly consistently– despite a lack of adequate supply. At this point, the severe lack of supply (near or below replacement) is finally really impinging on demand and causing frictional issues ( eg you cannot safely sell without already having bought the move-up replacement house).

    So from here on out, since there is no frictional supply (standing inventory) the demand- supply imbalance will get worked out directly through the pricing mechanism ( ie. higher prices… Or rather much higher prices.

    Example. A builder friend who has just finished a new house is putting it on the market tomorrow, read today’ s Seattle Times real estate column and raised his offering price $25,000.

  13. 13
    HappyRenter says:

    RE: Blurtman @ 11
    I have noticed this type of RV/tents also in the Fremont area down near the water.

    In the Fremont/Phinney Ridge area, you can’t leave anything outside your door. It might be gone the next morning. Homeless sleep in the staircase of apartment buildings and hang out in carports. If you forget to lock your car in the evening, you might find somebody camped in there the next morning. I feel sorry that some people do not have a home, but at least they should leave private property alone. Those that break or take things with them give a bad reputation to other homeless who are more honest.

  14. 14
    Erik says:

    RE: Deerhawke @ 12
    I suggest you and your builder friends raise prices 20% this year. The faster we can pump this bubble up, the sooner it will pop and we can buy more cheap properties.

  15. 15
    Blurtman says:

    By HappyRenter @ 13:

    RE: Blurtman @ 11
    I have noticed this type of RV/tents also in the Fremont area down near the water.

    During Art Agnos’ reign as mayor of San Francisco, there were many homeless people living in the city. In fact, there were significant homeless camps adjacent to and across the street from city hall. The merchants complained, tourists felt threatened, and Agnos was not re-elected. The new mayor was the former chief of police who somehow disappeared the homeless. Not sure where they wound up.

  16. 16

    Remember Who Won the Race Between the Turtle and the Hair?

    The turtle did, by not moving so fast and winning by finding out the future first by not racing in to grab up an overpriced dump.

    I just got a letter from a Realtor that wants my house for about $30K over my tax assessment value. My next door neighbor [also a Realtor] was right….my neighborhood is a perfect last vestige to get a pre-approved mortgage loan on a normal middle income. I guessed right in 1999 when I bought here.

    Nope….my house has a new roof, freshly remodeled and a new “man-cave” BAR ROOM too [instead of three bedrooms I don’t need]. All new leather furniture and my home office is up and running too with new computer and office equipment.

    I’m set to retire in style WITH NO MORTGAGE PAYMENT and a 401K matching investment equivalent that was mostly all PULLED OUT OF STOCKS on April 2015 and mostly ALL put into a 2.5% long-term CDs before the CRASHES started. Did I plan all this? Hades no, it was slop luck. I’m set for 30-40 years now. I bet you Bubbleheads that own homes in the Seattle area don’t have my affordable $1400/yr King County property tax bill either….LOL

  17. 17
    redmondjp says:

    RE: Blurtman @ 15 – The RV problem in Seattle is going to get far worse before it gets any better. It is fitting comeuppance for Seattle voters – you get what you vote for, and you condone what you tolerate.

    You will notice that you don’t see this problem in most Eastside suburbs. Why is that?

  18. 18
    Blurtman says:

    RE: redmondjp @ 17 – Lake Sammamish is pretty deep.

  19. 19
    ChristianW says:

    Yes, 2015 was bad for buyers but if you think about it, wasn’t 2008 a whole heck of alot worse? Imagine the devastation of buying at the peak and seeing the value of your home drop day by day.

    btw; I just sold my Capitol Hill studio…..2nd flip since 2012. Bought it for $470/ft in 2014, sold it for $605/ft in 12/2015. Here’s some pics http://www.houzz.com/projects/1477604/seattle-studio. Renovated it; rented it out for a year since it had such positive cash flow and the market was booming in 2015, then decided to sell while the getting was good last month.

  20. 20
    HappyRenter says:

    RE: softwarengineer @ 16
    How do you know 2.5% will be enough to offset inflation in the next 30-40 years?

  21. 21
    Erik says:

    RE: ChristianW @ 19
    Good job. I think the market will continue to boom for a couple more years, so I’m holding onto my place on alki. Your area has appreciated much more than my area though, so you may have made a good decision by selling.

  22. 22
    redmondjp says:

    With the announcement about Tableau and Wave coming to Park Place Kirkland, the Eastside RE market will stay extremely tight through 2016:

    http://www.geekwire.com/2016/reports-tableau-and-wave-leases-spark-big-new-real-estate-project-in-kirkland-wash/

    Best deal in this neighborhood: The $1.50 hot dog and drink at the Kirkland Costco (and fill up with gas while you are there, now with new freeway-blocking sound abatement wall).

  23. 23
    Jasper says:

    RE: HappyRenter @ 20 – He doesn’t. But he doesn’t have to. (His investments are in CDs, not 30-year bonds.) If inflation starts to pick up, he can change his investment strategy.

  24. 24

    RE: HappyRenter @ 20
    LOL You Mean Establishment Alleged “Shamflation” With $32/bbl Oil

    Coupled with our federal government approx $20T debt that can’t pay its bills on 1% treasuries?

    We’re in a new segment of the American DEVASTATED economy where 40% of the Millenials [and general population minus foreign immigration are sharing a mere 62% of the 150M available jobs, sharing them with 17% foreign born immigrants] are “give-ups”. Trump’s right; real employment is around 40% now. Employment participation is at a 40 year low.

    Nope Depression deflation is the future now, the debt party is over. We can’t raise interest rates for savings W/O bankrupting the feds and yes; I predict 2.5% is all ya can get safely. Will it be enough for me, will lower wages be enough for you? Same question, we’re both screwed.

  25. 25

    By Ardell DellaLoggia @ 7:

    RE: sleepless @ 6

    Agree. When the market dropped to 16.5 back in August I made a bet it would hit 15 before it hit 18 again as a close. It got to 17,891 in Nov, when I admitted I had a slim chance in hell of winning the bet. But given it is an election year, I think I could still win this one with it hitting 15,000 before it hits 18,000 again.

    The 1,000 point drop in 10 minutes time from opening bell back on August 25th was also about China. I don’t really understand what is causing the China shifts though or whether China’s woes actually create long term issues for our markets. Is it reflex psychological panic only?

    A number of large American companies operate in China. They are a country of how many billion people with a middle class that was expanding rapidly( until recently?). They are a giant, economically. So even if we buy a whole lot more crap from China than we sell to them( Kentucky Fried Chicken is huge in China), they’re so big that if they have a recession or depression, it’ll have large reverberations in the US… I don’t know the answer to this one:
    There’s been a noticeable presence in the Seattle area of buyers from Mainland China. If China crashes economically, how will that be affected? Or was part of the reason to buy here to diversify, and get money out of China?

  26. 26
    ARDELL says:

    RE: Ira Sacharoff @ 25

    I do hear it is to get money out of China, but for a different and somewhat political reason vs “to diversify”.

  27. 27

    Here’s a good article on how they move the cash out of China to buy real estate.

    http://www.bloomberg.com/news/features/2015-11-02/china-s-money-exodus

    But not a lot on why they do that. For as far back as I can remember, which is back in the 70’s, I have had clients moving money into real estate (when I was in the Trust business in a bank) to get the money out of China. Back then I had a client in Hong Kong and as I recall she would lose the money if she didn’t get it out. Not sure if that is still the fear. Mentioning that as losing money in real estate was not a concern because if they didn’t get it out they would lose it all.

    It’s not mentioned enough that many if not most cash buyers are buying all cash because they don’t qualify for a mortgage in the U.S. It’s not a strategy to buy cash…it’s their only option in many cases.

    I have recently seen some of these stay in escrow for a long time. One as long as 4 months. Yes, they overpaid for the house, but by doing so the seller gave them a longer period of time to move the money through as noted in the Bloomberg article.

  28. 28
    Shoeguy says:

    I love how “clearly recovered” = prices have returned to or surpassed the top of the most destructive housing bubble in history.

  29. 29
    redmondjp says:

    By Shoeguy @ 28:

    I love how “clearly recovered” = prices have returned to or surpassed the top of the most destructive housing bubble in history.

    There is nothing destructive about the bubble until it pops. And any bubble (such as in equities, housing, and dot-unicorn tech startups) is merely an effect of loose monetary policy where too much money is looking for a home and chasing any chance for a decent return.

    We’re going to see in the coming months whether the Fed is really going to remove liquidity from the system or not. My own hunch is ‘no.’ I see NIRP in our future. But who knows? After the lug nuts have been removed, it is amazing at how long the vehicle can continue to roll before the wheels fall off.

    In the mean time, let’s party like it’s 1999! (does it make anybody else feel really old to say that?)

  30. 30
    wreckingbull says:

    RE: Jasper @ 23 – A very useful tool for estimating if you will outlive your money.

    http://www.cfiresim.com/

    In my opinion, someone like SWE is not doing himself a favor by being in CDs with 30-40 years left to live. While he might have timed the market well today, he likely won’t in the future. I would suggest a 3% safe withdrawal rate with a 50/50 mix of a broad base of equities and bonds/cash. This mix can be gradually modified as he gets older. The old 4% rate from the Trinity Study is not safe anymore.

  31. 31
    ess says:

    RE: Ardell DellaLoggia @ 27

    Ardell – thank you for that interesting article. I have not only reviewed it, but I am going to send it to my in laws who reside in the Vancouver metropolitan area.

    As the article indicated, property in Vancouver has doubled in the last ten years.

    For my in laws – it is the proverbial double edge sword. Their legal duplex has rocketed in value, but their kids can’t afford to buy their own dwellings in the area. What do their and other offspring do? Either continue to reside at home, share a cramped one bedroom condo, or purchase “affordable” housing far away from the Vancouver core area. One does not want to be a young real estate purchaser in the Vancouver area unless one is a trust fund baby or has made it big financially.

    And will Seattle make the list of target buying areas for this kind of money in the future? I had read that Seattle and area is on the top ten lists of Chinese population centers in the United States, and we have the same beautiful winters as Vancouver has, thus anything is possible.

  32. 32
    GoHawks says:

    RE: Ardell DellaLoggia @ 27 – interesting/informative article. Thanks for posting it Ardell.

  33. 33

    RE: GoHawks @ 32

    Here’s a slightly earlier one from WSJ that reminds me of some things I saw back in the 70’s.

    http://www.wsj.com/articles/in-chinas-alleyways-underground-banks-move-money-1445911877

    I remember one of the bank officers coming in to the office from the airport with money strapped to him like that. He was sweating profusely. :) That money was not from China though. In the very early 90’s I remember someone walking into the real estate office with a suitcase full of cash. That was China money. The agent was freaking out because it was after hours and he had to protect the funds until the banks opened. I don’t think he got any sleep! The closest I ever personally came to it was a car trunk full of bearer bonds. But that wasn’t “out of Country” money. Still…I was sweating until I could get it to the bank vault.

    WHY they are pulling the money out of China, and the articles noting a crackdown that is impacting the ability to move that money out, will be important to follow. As I said earlier, I am starting to see more of these being longer closings due to the increased difficulty. I am surprised when a seller takes the cash offer from someone whose cash is not already available in this Country, but I see it happening more so since the crackdown back in June to August than in the past. Cash sales are typically shorter escrows and sometimes as short as 10 days. So when you see a 3 to 4 month cash sale, well…you can guess it is one of these types. The cash isn’t here yet at time of acceptance. I have not seen that from the seller side…only from the buyer side when one of these beats our offer and then sits in escrow for a long time. I am watching one now in case they never get the money and it becomes available again.

    When I hear the seller took a cash offer from someone who needs a lot of time to gather the cash, it always reminds me of Wimpy from Popeye “I would gladly pay you Tuesday for a hamburger today!” :)

  34. 34
    Corndogs says:

    Where’s all that shadow inventory boys?!?! hahaha!!! Remember when the ‘failure to launch’ crowd, led by Wreckedbung wasted months…. or was it years… talking about that crap?!? haha!!

  35. 35
    Joe says:

    Stocks are heading down. Amazon down 13% in 2016. Microsoft, Google, and Apple all down 7%. Boeing down 11%.

    If this keeps up, forget about housing price increases. You be better of worrying about a repeat of 2007-2009. Note, very smart commenters such as Bill Gross, John Hussman, Carl Icahn, etc. are saying financial assets are in a bubble.

  36. 36
    Erik says:

    RE: Corndogs @ 34
    Wreckingbull and his code monkey friends are no doubt a bunch of idiots. Good thing they can atleast write computer code. It keeps them off food stamps.

  37. 37
    boater says:

    RE: ess @ 31
    Doubling your money in ten years is not a crazy rate of return. That’s about a 7% rate of return.

  38. 38
    whatsmyname says:

    With the emphasis by so many here on living in Seattle proper, I am surprised that people don’t spend more time looking at the Altos numbers for Seattle. Today’s update is pretty interesting.

    The thirty day avg. median for houses in Seattle is about $100,000 higher than it was this time last year. The seven day avg. median even more so.

    They focus on the thirty day average for days on the market, but given the seasonal swings, it seems like the seven day average would be more telling. The numbers are about 73 and 96 days respectively. Either way, less than a year ago.

    Price per square foot tracks much more closely, 15%+ higher than last year which is pretty close to the county average.

    Homes for sale: Again it seems like the 30 day average is less telling in the short run than the 7 day average. So it’s either 874 or 533. That is really remarkable. I wonder how many of those are south of I-90?

  39. 39
    ESS says:

    By boater @ 37:

    RE: ess @ 31
    Doubling your money in ten years is not a crazy rate of return. That’s about a 7% rate of return.

    Most people are only putting down 20% of their own money (or less) when they buy a house. The rate of return on the money that is actually fronted by the purchaser is much greater if the property itself doubles in ten years, even accounting for taxes, interest on the loan and PMI insurance if need which are all tax deductible. As a home owner or owner of rental property, I would be most pleased if housing doubled in ten years.

  40. 40
    Mike says:

    By Blurtman @ 11:

    It’s a chic, cozy unit with unlimited potential. Imagine the possibilities as you call Phinney Ridge, Magnolia and even Evergreen Point your home.
    —–
    Seattle neighborhood pleads with city to do something about criminal RVs

    Harley Lever arrived at his Magnolia home in Seattle late one December evening to find something missing.

    “My TV set was stolen out of my carport,” Lever said. “We noticed the TV was sitting next to one of the RVs. I went down to retrieve it.”

    The RV in question is one of many that have taken over roadsides in Magnolia, and among the many throughout the City of Seattle. Lever went to retrieve his TV that was taken from his home. But then he encountered the residents of the RV.

    “I was told by the two gentlemen there that they know where I live and I better get out of there before they beat me up,” Lever said. “I called 9-1-1, and they could hear these guys threatening me over the phone. They said, ‘sorry sir, we don’t have any police in the area, you are going to have to leave.'”

    “Well, one, they have my TV set. And two, they are actively threatening me and telling me they know where I live,” he said. “Why, (in Seattle) can’t I get a police officer come to assist me when I’m actively being threatened. It was a huge wake up call. About an hour later, police showed up. They basically told me that there is a hands-off order when it comes to homelessness.”

    Seattle and RVs

    It’s not the first time Magnolia residents have called 9-1-1 about an RV, or have alleged there is a city policy instructing police to leave roadside RV campers alone. The city has denied any such order exists.

    “I don’t want homeless people harassed at all,” Lever added. “But I do want a distinction made between criminals and the homeless.”

    A request for that distinction was made at a neighborhood meeting Wednesday night, organized by Lever and others in Magnolia. Lever started the website and Facebook page “Safe Seattle,” to get word out about the issue, and act as a hub to report criminal incidents in the neighborhood. The RV issue is not only in Magnolia, but a variety of Seattle neighborhoods. Lever hoped that the community gathering would send some kind of message to city officials.

    http://mynorthwest.com/11/2887005/Seattle-neighborhood-pleads-with-city-to-do-something-about-criminal-RVs?google_editors_picks=true

    And this is why District 6 with it’s 30% voter turn out missed an opportunity by re-electing Mike O’Brien. For whatever reason, Mike O’Brien is perfectly happy turning his district into the crazy drug addict dumping ground for all of North Seattle. He’s probably going to be the next mayor of Seattle with this level of voter apathy.

  41. 41
    boater says:

    RE: ESS @ 39
    Sure leverage is nice when things go your way. I was just responding to the person whos parents home had doubled in value over 10 years. That seems like a bit better than normal appreciation for housing but it’s not outrageous.

  42. 42
    ARDELL says:

    RE: boater @ 41

    For 2006 to 2016 it having doubled is fairly outrageous given some markets still struggle to get back to 2006-2007 values. It depends which 10 years. I just looked at a property in Kent for someone who is still 10% shy of selling at their early 2007 purchase price before cost of sale.

    If it were an investment property you could say compared to other investments. But as a home bought with 80% leveraged funds and that served as a residence, it’s noteworthy if not outrageous.

  43. 43
    ess says:

    By boater @ 41:

    RE: ESS @ 39
    Sure leverage is nice when things go your way. I was just responding to the person whos parents home had doubled in value over 10 years. That seems like a bit better than normal appreciation for housing but it’s not outrageous.

    With real estate, things usually go one’s way if not bought at the top of the market, and given some time to appreciate. At least that has been my experience both as a homeowner and a rental property owner. It is like all other investments, one must review the numbers and accept some risk if one wants rewards

  44. 44

    RE: Ardell DellaLoggia @ 27
    Leave It to Bloomberg to Show Ways to Break Laws in Your Own Country

    And chance life in a Chinese Prison.

  45. 45
    Mike says:

    Here’s a clear sign of where we are in Ballard’s price recovery: Sold at the peak for $492K, just now sold for $626K. 27% above August 2007 pricing… wow. We’re officially in the realm of $600K+ starter homes over here.

    https://www.redfin.com/WA/Seattle/6731-20th-Ave-NW-98117/home/164482

  46. 46
    ess says:

    By Mike @ 45:

    Here’s a clear sign of where we are in Ballard’s price recovery: Sold at the peak for $492K, just now sold for $626K. 27% above August 2007 pricing… wow. We’re officially in the realm of $600K+ starter homes over here.

    https://www.redfin.com/WA/Seattle/6731-20th-Ave-NW-98117/home/164482

    That is good news – because as they say – all boats rise when the tide goes up. That applies to both yachts and row boats!!

  47. 47

    RE: ess @ 43
    2.5% Interest in Savings Low?

    LOL, then the 3-4% mortgage loans are way too low.

    We’re all on the Titanic listening to the string quartet play its last songs….invest in retirement with 1/2 stocks? Sounds like the same investment advisers that failed to advice us that100% in stocks up until 2015 was the optimum investment [none suggested that and they should have]…..grade school kids could give you better wild guesses than that.

    I think gambling in Las Vegas is better than retirements invested largely in stocks right now.

  48. 48
    ess says:

    By softwarengineer @ 47:

    RE: ess @ 43
    2.5% Interest in Savings Low?

    LOL, then the 3-4% mortgage loans are way too low.

    We’re all on the Titanic listening to the string quartet play its last songs….invest in retirement with 1/2 stocks? Sounds like the same investment advisers that failed to advice us that100% in stocks up until 2015 was the optimum investment [none suggested that and they should have]…..grade school kids could give you better wild guesses than that.

    I think gambling in Las Vegas is better than retirements invested largely in stocks right now.

    As they say – In Las Vegas, most people tend to lose money over time. In real estate or stocks, most people tend to make money over time. But as this is a free country, to quote Elvis “Viva Las Vegas”.

  49. 49
    David B. says:

    By ess @ 43

    With real estate, things usually go one’s way if not bought at the top of the market, and given some time to appreciate.

    Or at least not massively go against one’s way. I bought partway into the last bubble. I sold after the bubble burst, and it took a while to close. I had to drop the asking price twice, but I sort of expected I might. I still sold it for more than I bought it, and could afford to drop the price to attract buyers. I neither made a killing nor lost my shirt (certainly would have been the latter had I bought at peak bubble).

    Bought my current place in October 2014 and dreaded the possibility that suddenly prices would stop rising and inventory would start expanding as soon as it closed. Nope, kept getting worse for buyers. Glad I bought when I did; the selection really sucks now. And every month that goes by puts my purchase further and further before the inevitable peak.

    Wasn’t trying to time the market in either case, just responding to personal circumstances.

  50. 50
    ess says:

    Even more exciting news to both increase housing prices and help create another situation in which housing prices don’t make sense. (aka – the infamous “bubble”)

    http://news.investors.com/ibd-editorials/010716-788747-government-wants-to-lend-more-to-high-risk-immigrants.htm?p=full

  51. 51
    David B. says:

    RE: ess @ 50 – Is it being pioneered by the GSE’s like Fannie and Freddie or is it like last time and are the GSE’s coming late to the party and doing their darndest to get in on it?

  52. 52
    ess says:

    By David B. @ 49:

    By ess @ 43

    With real estate, things usually go one’s way if not bought at the top of the market, and given some time to appreciate.

    Or at least not massively go against one’s way. I bought partway into the last bubble. I sold after the bubble burst, and it took a while to close. I had to drop the asking price twice, but I sort of expected I might. I still sold it for more than I bought it, and could afford to drop the price to attract buyers. I neither made a killing nor lost my shirt (certainly would have been the latter had I bought at peak bubble).

    Bought my current place in October 2014 and dreaded the possibility that suddenly prices would stop rising and inventory would start expanding as soon as it closed. Nope, kept getting worse for buyers. Glad I bought when I did; the selection really sucks now. And every month that goes by puts my purchase further and further before the inevitable peak.

    Wasn’t trying to time the market in either case, just responding to personal circumstances.

    Glad that you are doing well – so long as you enjoy the house, and it all makes reasonable economic sense from a variety of measurements – then enjoy.

    One of the problems of hindsight is that we tend to beat ourselves up for what we did and didn’t do.
    For every stock that skyrockets and makes people fortunes, there are stocks that zero out and lose other people fortunes. But those losing investments are never mentioned at cocktail parties, so we don’t really hear about the duds.

  53. 53
    zed says:

    RE: Blurtman @ 11 – In 20 years the city will be filled with climate refugees living in their vehicles.

  54. 54

    RE: ess @ 48
    Actually, that’s Not True at All

    If I can play roulette odd/even or red/black with no betting limit and like $10K table limits; I just start the betting at say $5, lose, then $10, lose, then $20, lose, etc, etc…..the odds of playing a 48% odds of winning and losing like 7-10 times in a row is like a .01% probability. Slam dunk winner, then back to minimum bet again after a win. This system is fool proof, albeit, I’d still wander around different Casinos in different clothes/disguises after a $300 scoop if you do it….I swear they can rig the roulette wheels if they think you’re doing it, it happened to me at the Mirage.

    Yes, you can make about $300/hr….risk free, except the pesky security cameras.

  55. 55
  56. 56

    RE: Ardell DellaLoggia @ 7
    Hi Ardell

    More on Chinese Investments in US real estate from the NWO MSM outlet, Bloomberg. You’ll notice from this article two things:

    The billionaire lost about 3/4s of his $36B wealth in China and is looking for Hollywood investments [approved by Chinese Government for Propaganda purposes?]. The far reaching analogy to this news story is not explained or proven with written numbers. How did he short circuit Chinese Laws against exporting money out of the country? The article doesn’t say.

    http://www.bloomberg.com/news/articles/2016-01-12/china-s-richest-man-eyes-bigger-deals-after-legendary-purchase

  57. 57

    RE: JR @ 55
    The Las Vegas Loser Stock Market [Short Term Only?]

    Just plunged DOW down 200 pts after a 160 pt morning surge up…..erratic as a bad roller coaster ride…

    If you have your retirements even partially in this current mess….one thing, God help you.

  58. 58

    Big Short

    Playing for $4.92 a ticket Tuesdays at Auburn 17….I’ll go see next Tuesday, it starts at1 030A. One showing this week, next week too?

    I’m seeing the 3 hr long one H8ful Eight at 1150A after I get a meal…recliner chairs, big, too.

    I follow the grey hairs for all the bargains…

  59. 59
    Azucar says:

    By softwarengineer @ 54:

    RE: ess @ 48
    Actually, that’s Not True at All

    If I can play roulette odd/even or red/black with no betting limit and like $10K table limits; I just start the betting at say $5, lose, then $10, lose, then $20, lose, etc, etc…..the odds of playing a 48% odds of winning and losing like 7-10 times in a row is like a .01% probability. Slam dunk winner, then back to minimum bet again after a win. This system is fool proof, albeit, I’d still wander around different Casinos in different clothes/disguises after a $300 scoop if you do it….I swear they can rig the roulette wheels if they think you’re doing it, it happened to me at the Mirage.

    Yes, you can make about $300/hr….risk free, except the pesky security cameras.

    Don’t bet your retirement using that system.

    How many casinos have roullette tables with a $5 min bet and let you bet $10,000 on red/black or odd/even?

    Even if a casino does allow that, the Martingale system doesn’t work because the roulette wheel doesn’t have a memory… it doesn’t care what came up last time, so the odds of getting what you bet on don’t change after you’ve just lost one or two or three or five or ten times in a row. Couple this with the fact that with that bet required increases exponentially, while the winning remains just what the original bet was, and eventually you lose.

    First bet $5 – you lose
    Second bet $10 – if you win, you are up $5… if you lose you’re down $15
    Third bet $20 – if you win, you are up $5, if you lose you’re down $35
    Fourth bet $40 – if you win, you are up $5, if you lose you’re down $75
    Fifth bet $80 – if you win you are up $5, if you lose you’re down $155
    Sixth bet $160 – if you win you are up $5, if you lose you’re down $315
    Seventh bet $320 – if you win you are up $5, if you lose you’re down $735
    Eight bet $740 – if you win you are up $5, if you lose you’re down $1475
    Ninth bet $1480 – usually you’d be over the max for a 50/50 bet (actually a 47.5/52.5) such as red/black or odd even… so the system has broken down… so let’s look at the odds after bet number 8:

    Remember that American roulette wheels have 18 red spaces, 18 black spaces, and 2 green ones (0 and double 0), so the odds of getting red are 18/38 or 47.368421%, which I think we can agree is less than 50%, right?

    So, the odds of losing one spin are .5
    The odds of losing two in a row are .25
    three in a row – .125
    four in a row – .0675
    five in a row – .03125
    six in a row – .015625
    seven in a row – .0078125
    eight in a row – .00390625…

    So you have a .00390625, or .39% chance, of losing $1475
    That means that you have a .99609375, or 99.609375% chance of coming out $5 ahead

    So, for every 100 million times the wheel gets spun:
    You lose 390625 x $1475 or $576,171,875
    You win 99609375 x $5 or $498,046,875
    For a net loss of $78,125,000
    That is over the course of 100,000,000 spins, which would take a while, so let’s just look at the average… which is a loss of 78cents per spin.

    I guess the free drinks cover that, but it’s certainly not a “sure thing”.

    Yes, you win most times ($5), but it after betting as much as $80 to come out a total of $5 ahead about 1 in 15 times… that is having black come up 4 times in a row, making your bet have to be $80 to get your lost money plus $5 back, and it has a likelihood of happening 6.7% of the times you do it… so if you run through the cycle 15 times, it will have only happened to you once but you’re betting a lot (80) to win a little (5) in that case, and then on the greater than 50% chance that you lose THAT bet you’ll be betting twice as much (160) the next time to come out $5 ahead).

    Toto, we’re not in Kansas anymore… how do all of those casinos afford to keep all those lights lit?

  60. 60

    RE: Mike @ 45

    They are a limited commodity. Love these “tall and skinnies” on 1/2 lots. Seattle should reconsider allowing these 5,000 sf lots to be split up the middle for two tall and skinnies. You see them here and there but then the City wouldn’t let the lots be split that way and ended up with townhomes instead. So when they become available, they get bid out.

    Better than attached housing and more affordable than a newer house on a full lot. Not surprised to see it bid out like this. Last time I saw one it was on a major arterial so not as desirable. But these, which I call “tall and skinnies” as they call them in L.A., are super great options. Seattle should bring them back.

  61. 61
    redmondjp says:

    RE: Ardell DellaLoggia @ 60 – You like those homes; I hate them. Who wants to park on the bottom and have to truck groceries up a narrow stairway to the 2nd floor kitchen, and then have to go up to the bedroom on the top floor every day? Fine if you are young and healthy, but if you blow your knee out skiing and/or get old like we all do, you will eventually come to loathe the stairs. And I won’t help move anybody who lives in one either. Getting heavy bedroom furniture in and out is a huge pain.

    Now if they had a small elevator, I might think differently. But that in itself is 1) expensive, 2) takes up valuable space, and 3) requires regular state inspection and certification (unless there is an exemption from the law for residential elevators). Hence, my rambler, with only one step between the garage the the house, will be the preferred layout for older people.

  62. 62

    RE: redmondjp @ 61

    It’s not a matter of my “liking” them. My opinions in real estate are never based on personal preference.

    Where you live this style is irrelevant. In Seattle a half lot is hard to come by and usually townhomes are on a lot half that size and attached to one another. Full sized lots are either homes in much worse shape or much more expensive.

    This style of detached, 1/2 lot home fills a need in Seattle. I won’t call them “affordable” but they are a lot more affordable than a home with those amenities on a full lot, and a lot better than attached housing if for no other reasons than the garage is usually a lot easier to get in and out of and you get double the land value. :)

    I wouldn’t “like” them everywhere, but when land is scare and expensive and there are not enough houses to go around, these 1/2 lots are a very good option and there aren’t enough of them.

  63. 63
    David B. says:

    RE: Ardell DellaLoggia @ 62 – It’s a problem with Seattle housing in general: the housing market is bifurcated into multi-family and single-family detached on lots that are abnormally large by major city standards, with very little (compared to many other major cities) in between.

  64. 64
    Mike says:

    RE: Ardell DellaLoggia @ 62 – Small lot homes definitely fill a need, I’m more surprised that this one appears to be in more or less original 1987 condition at this price. No gas, electric resistance wall heat for 1400 sq ft of living space broken out over 2 floors for $626K is not an obvious choice. That area is a bit transitional and the park gets some of the sketchy activity from time to time without much attention from SPD being 2 blocks out of the urban village boundary. I’d consider that somewhat of a liability with all of the street crime going on in the area. It seems like a location that is splitting the difference between being close to the boundary and dealing with the growing crime issues in the up-zoned areas.

  65. 65
    ARDELL says:

    RE: softwarengineer @ 56

    The Feds just announced the first stage of a crackdown on cash transactions. This is important as it will cause pricing shifts.

    I think this stage is only in NYC and Miami and transactions of $3 million or more. But there is speculation that the big chunks of over $3 million will start impacting the lower markets right away as several players will buy three $2 millions vs one $6 million.

    CA will likely be added next and well before us.

  66. 66
  67. 67
    Blurtman says:

    Banana republic USA: Goldman Sachs agrees to pay $5.1 billion for Hank Paulson era fraud.

    Hank goes on to become Treasury Secretary, and bails out his former criminal firm. What a country! But you better obey the law, you hear?
    ——–
    Goldman Sachs has reached a $5.1bn settlement with the US government and other agencies for mis-selling mortgage-backed securities in the run-up to the financial crisis, in a move that will wipe out most of its profits for the fourth quarter.

    On Thursday afternoon Goldman said that it would pay a $2.4bn civil monetary penalty to the Department of Justice, and make $875m in cash payments to various other agencies. The bank said it would also provide a total of $1.8bn in relief for distressed borrowers and underwater homeowners, financing for affordable housing, and support for other programmes to boost the housing sector.

    The agreement in principle will resolve actual and potential civil claims by the DoJ, the New York and Illinois Attorneys General, the National Credit Union Administration and the Federal Home Loan Banks of Chicago and Seattle. The claims relate to Goldman’s securitisation, underwriting and sale of residential MBS from 2005 to 2007.

    http://www.ft.com/intl/cms/s/0/c900511a-bb14-11e5-b151-8e15c9a029fb.html#axzz3xGbJjPxI

  68. 68
    Anonymous says:

    do people still use interest only mortgage loans? I thought those were obsolete. But saw this today: https://www.sofi.com/mortgage-loan/interest-only-mortgage/

    I’m waiting for the next powerball, so i could afford to buy a decent box in Seattle

  69. 69
    Deerhawke says:

    RE: Ardell DellaLoggia @ 60

    The reason why we have fewer skinnies being built these days is that the Seattle City Council changed the land use and zoning rules about 3 years ago when they adopted the Small Lot Ordinance. Under intense pressure from north end NIMBY activists, the council adopted rules that make it very difficult to develop/build on lots of less than 3750 sf, and impossible to build on a lot of less than 2500.

    One project I am building in Greenwood is on two 3000 sf lots. The previous owners bought the property with the intent of building two houses there, one to own and the other to sell. The recession and a divorce intervened and by the time the divorced couple realized what had happened they effectively owned one larger lot rather than two lots of the same size as most of the other lots on the block. So I am now building one 3400 SF house on a double lot rather than two 2700 SF houses on 3000 SF lots.

    This is your city council that keeps saying it wants a denser, more sustainable, more affordable city. I suppose they can’t just come right out and admit that they are responsible for driving up the cost of housing.

  70. 70

    RE: Deerhawke @ 69

    Tall and skinnies were from well before 3 years ago and different than the Small Lot Ordinance to which you are referring. Many of these were built long before townhomes in Seattle on a street with standard 50′ street frontage and 100 deep lots. The two lots ended up as 25 on the street and still 100 foot depth such that both houses still faced the street like a “normal” house and the garages for both were on the street side. Pretty sure they had to stop building those back in the 90’s sometime and most are late 70’s or 80’s.

    What you are referring to are the ones built in people’s yards leaving the old house in the front, usually a one story bungalow, and building a tall structure in the yard. The purpose of that allowance was not to promote density and the way it was being used by builders was not true to the intent of the “loophole” in the code.

    Tall and Skinnies were the precursor to townhomes for the most part and there were no side driveways or shared driveways or one home towering over the other and not one old bungalow plus a new tall structure on the same 5,000 sf space. They were built at the same time side by side, more like a side-by-side-duplex but on separate lots with no party wall.

    They come up from time to time on the market and these days sell at a premium to townhomes. So the 27% appreciation on the tall and skinny that Mike noted in the link up at Comment 45 is not “a sign that…” and the same 27% would not be applicable to all forms of housing. It being a “limited commodity” in a low inventory market gives the price a double boost over the standard bungalow or townhome.

  71. 71
    sleepless says:

    The FED starts talking about the “negative interest rates” again. It seems like we can go back to ZIRP / NIRP as the nose diving of the stock market continues. The wall street wants more heroin as the last dose is wearing off. If the FED mafia falls to the wall street thugs, i expect DJI to go to 20K and housing to rise 20% this year. If the FED continues it tightening, then the housing bubble will pop by the end of this year as the stock market will continue to nose dive. BTW, all those “tech” buyers would disappear as most of the startups would disappear too. With less of the easy money debt, most of the BS startups that burns thru investors money and don’t make profits will vanish.

  72. 72
    redmondjp says:

    RE: sleepless @ 71 – You nailed it. The party is over when The Fed takes the punchbowl away. Even if they go full reverse and NIRP it to the max with a full dose of QE4, will that keep the festivities going for awhile longer? Time will tell.

  73. 73

    RE: David B. @ 63
    And With 40% of Seattle Real Estate Owned By Singles

    The homes are carbon footprint eyesores….WAY TOO BIG for one person. An environmental disaster.

    But God forbid we build what is needed, $150K 1000SF homes to retire in or live single…..no, we want empty houses to heat….LOL…with like $4-6K/yr property taxes alone.

  74. 74

    RE: redmondjp @ 61
    Ask SWE

    I can get around and am a GREAT single dancer….but I’ll be honest, at 62 [I only look 40ish…LOL] my balance isn’t like it was when I was younger….stairs are a no/no for me. Also if I climb stairs I use the hand rails.

  75. 75

    RE: ARDELL @ 65
    We Did the Same Thing to Japan in the Early 90s

    Sold ’em a bunch of over-priced real estate and rolled on the ground laughing afterwards….the Asian real estate dummies never learn….LOL

  76. 76

    RE: Anonymous @ 68
    Its Sad When Vegas Odds

    Are seriously touted as credible information when talking Seattle real estate.

    Did you guys see the Rep debates last night? The “highlight for Seattle audiences” was when Jeb Bush argued against Trump’s Chinese Tariffs, then mentioned loss of Boeing jet sales…LOL…the savvy businessman Trump quickly retorted [don’t ever argue business with Trump], yeah, Boeing is giving away our trade secrets to China and building 737s there now….

    Forbes caught that Jeb error too today. I’d add, compare this Boeing sales “anthill” to the outsourced American auto engineering to Asia and Europe for “higher paid engineering”, albeit factory rat assembled by Americans under foreign overlords. Come on man! Trump would understand me completely. We’re on a Titanic heading for an iceberg without NASA and Detroit engineers, the best in the world too.

  77. 77
    MD says:

    I think the party is over in a major way. I’m in tech, and I’m hearing more and more about layoffs. I’ve also heard from several startups that raising funding has gotten extremely difficult in recent weeks. On top of that, the stock market is imploding.

    It feels like 2008 redux here. Or at least 2001.

  78. 78

    RE: MD @ 77
    Both Gates [MSFT] and Zuckerberg [Facebook] Want More Techs From India

    As they falsely allege STEM [ya know degreed engineers] worker shortage. Those yahoos don’t have engineering degrees, so they have no credentials for the STEM allegation. Besides, both MSFT and Facebook don’t need but a 1-2% tech real engineers to do computer programming. …..what’s their point? They did quite fine with Windows 95 and 98 using basically all community college and high school students from the local area. These local area workers could answer a phone and we could actually understand ’em too….lol

    C’mon Man! This is pure hogwash. There’s a huge engineering GLUT of techs in America after Detroit butcher axed 250K in 2007 and NASA basically went out of business in 2001. Oh yeah, we’ve got factory rats in America working for Asian overlords for peanut pay….let alone your unnecessary foreign H-1B tech replacements working for peanuts too.

    And this is GOOD NEWS for Seattle real estate? Now SWE is rolling on the ground in laughter [crying won’t help].

  79. 79
    JWS says:

    RE: MD @ 77
    “On top of that, the stock market is imploding.”

    To put things in perspective the S&P 500 is currently down 12% from recent highs. This compares to the S&P 500 declining ~50% in 2009 and ~50% in 2002.

    From a broad (domestic) stock market perspective we are nowhere near the declines we’ve experienced in the past. Time will tell how bad it gets but I’m betting this correction does not end up like 2002 or 2009.

  80. 80
    David B. says:

    RE: softwarengineer @ 73 – Indeed, and those cute “Old Seattle” homes that are home to affluent singles and DINKs now were typically occupied by middle-class families with children when they were first built around 100 years ago. Preventing increased housing density hasn’t stopped single-family residential neighborhoods from changing; it’s merely meant they’ve changed by becoming more upscale (a polite term for elitist) and less population dense.

    (This is I believe a first for me; agreeing with something SWE posted!)

  81. 81
    cshecks says:

    Screw the title of this article. It was the BEST DAMN YEAR ever. The place I bought last April is up almost 60K already according to my agent (who’s trying to get me to sell…..not happening). Bought at a nice low price for a single family home. Thought I’d chime in/join the fun with the constant subtle brags on the comments section of this forum……(bought a piece of crap and renovated it and made 6.5 million last week in Everett and got an engineering degree….bought a place in Kansas City and now it’s worth 4 trillion dollars). You know who you are.

  82. 82
    whatsmyname says:

    RE: cshecks @ 81 – Congratulations! We bought a rental – complete with renters. I think the values of both have gone up. The house is midcentury modern. The renters seem clean and trainable; and have every appearance of being good breeding stock, although I am new to the farming business.

  83. 83
    ess says:

    By Deerhawke @ 69:

    RE: Ardell DellaLoggia @ 60

    The reason why we have fewer skinnies being built these days is that the Seattle City Council changed the land use and zoning rules about 3 years ago when they adopted the Small Lot Ordinance. Under intense pressure from north end NIMBY activists, the council adopted rules that make it very difficult to develop/build on lots of less than 3750 sf, and impossible to build on a lot of less than 2500.

    One project I am building in Greenwood is on two 3000 sf lots. The previous owners bought the property with the intent of building two houses there, one to own and the other to sell. The recession and a divorce intervened and by the time the divorced couple realized what had happened they effectively owned one larger lot rather than two lots of the same size as most of the other lots on the block. So I am now building one 3400 SF house on a double lot rather than two 2700 SF houses on 3000 SF lots.

    This is your city council that keeps saying it wants a denser, more sustainable, more affordable city. I suppose they can’t just come right out and admit that they are responsible for driving up the cost of housing.

    Government at all levels are responsible for driving up the cost of housing. Whether it is needless regulation (rather than important regulations which I support), land use regulations that are implemented to further social policies, or just fees and expenses placed on the building and rental of housing to raise revenue, someone has to pay for it. And that someone is either the homeowner or the renter.

    Years ago I represented a consortium of investors at a number of hearings that had purchased a twenty acre parcel that was zoned for half acre building lots. The county in question wanted to change the planning map and zoning to ten acre parcels per residence. That would have resulted in a huge loss for the investors after buying and paying taxes on the property for years based upon its value before any proposed changes. I argued at the hearings that it would negatively impact both my clients and those who wanted to purchase future housing on the property. While my clients would own property that was significantly less valuable if the plan and subsequent zoning was implemented, the cost to any perspective home buyer would dramatically increase as that person would have to purchase ten rather than a half acre in order to construct a house. The only ones that benefited were the neighbors residing on half acre parcels in the area who enthusiastically supported the proposal, as they would benefit from others paying for their guaranteed country experience. And all of this transpired before the current debate on the lack of affordable housing. That change removed dozens of houses from the housing mix of the county, and in its small way contributed to the housing shortage and increase in housing prices we all either suffer or enjoy today depending on which side of the ownership divide one finds themselves.

    On the other hand, I am not unsympathetic to those who don’t want increased density around them. A homeowner in Seattle may be distressed to learn that his or her small backyard will have an accessory dwelling looming over it on an adjacent property, thus removing any small sense of privacy that homeowner may have had. And parking problems have been well documented here as well as other media outlets.

    As a matter of fact, we moved from a city that was enthusiastically embracing population density to an adjoining city whose population was vehemently opposed to any increases in height and density. One can scope out communities and get a feel of what is going on as per density, height and other related issues that affect the quality of life as one views it. Not only did our new house have a bigger lot, but we planted foliage in strategic locations in the possible event that future minimal lot requirements changed, and we too would have the potential of a new structure overlooking our property as a result of potential increased density or ADU units. One learns to take proactive measures having been driven out by hyper density plans. While that has not happened yet, it is irrelevant at this point as our privacy is protected by the plantings, and we have off street parking for a number of vehicles, thus parking is also not an issue.

    Thus there are no right or wrong answers as to resolving the issue of housing for a growing area. I guess the best one can do is to reside in an community that appears to support the environment one wants. If one wants a suburban lifestyle, Seattle probably isn’t the best place to reside, even if located in a single family area. One should just assume that there will be change as Seattle grows. On the other hand, one can locate in nearby communities to Seattle where there won’t be much growth and increased density over the next few decades.

  84. 84
    Cap''n says:

    RE: ess @ 83

    I totally almost drunk posted too.

  85. 85
    Corndogs says:

    back in January 2012 ‘The Tim’ was posting this same chart with the red and green arrows and it showed all red arrows down for buyers indicating it was a sellers market…. boyyyyy was that wrong! I think it’s time to retire that chart, it is ABSOLUTELY useless,

  86. 86
    Cap''n says:

    RE: Corndogs @ 85

    The arrows are directional. They don’t signify magnitude. So, to be gentle, you are wrong. The metrics tell you which way the market is trending not whether year x is better for buyers than year y. If someone was that omniscient, they sure as hell would not blog about it.

  87. 87

    RE: cshecks @ 81
    Actually, My Kansas City Rental

    Went down in price according to my $1060/yr property tax in 2016, down from 2015’s $1160/yr. Assessed values are still decreasing there and the Kansas City high tech surge can’t compete with too many homes and too many new lower waged workers, Millenials and such causing deflation.

    Locally, I see property tax levies aren’t “slam dunk” passing for my Covington Fire Dept too, their bill went down.

  88. 88

    RE: redmondjp @ 72
    I Hear the Worse Case Scenario for Reversing the Recent Stock Market Degradation

    Is negative bank savings interest like Europe. Did anyone say switch to a mattress bank? LOL. Of course all our foreign investors will pull their money out of American treasuries if that happens.

  89. 89

    RE: ess @ 83
    I Have a New Party Line Democrat Friend [He’s No Old Fashioned Earthday Democrat Like Me]

    Who alleged that big empty homes in the area would soon fill with multiple families living in them, that’s happened already with more 30 somethings living with mom and dad, but its definitely not generally normal, if ever. Most Seattle folks could never share a kitchen, power bill and cable bill, etc…..it turns into a big argument. They’d rather live in a dinky$1100/mo Studio with its own kitchen, than share a $600K home.

  90. 90
    Joe says:

    It usually takes several months for stock market activity to hit real estate valuations. I think the continuing stock plunge already bakes in a 5% drop in real estate, which will be apparent in a few months. I also believe several layoffs are baked in as well – layoffs that haven’t been announced yet. Amazon in particular has been on a hiring spree.

    When that reverses course it wil be painful. Prudent persons are taking a wait and see approach to real estate. Home owners that aren’t going to live in their house for five years should be looking at selling early this Spring before the recession news starts hitting the press – and it will.

  91. 91
    Blurtman says:

    How low will prices go after a Seahawks loss?

    Go Hawks!

  92. 92
    ARDELL says:

    RE: Blurtman @ 90

    Inventory should start opening up a bit….

  93. 93

    RE: Joe @ 90
    Delayed World Depression Deflation from $29/bbl Oil?

    Let’s stop talking Looney Toons like Trump does and just look at the business savvy raw data in writing, like he does. Oil is now threatening bankruptcy of American shale producers. They say this year sometime, but the exact business collapse timing is hopefully a trade secret….do we have any trade secrets with the world anymore?

    Also, what I recently heard on MSM allegations last week, is the deflation won’t affect prices for 5 years. I don’t believe it. Its wishful MSM lies. They make up things to suit them.

    They lie about Trump too….the establishment doesn’t quote recent polls, there are none that make sense. They quote statistics without polls referenced. They shoot from the hip IOWs.

    http://www.washingtonexaminer.com/poll-trump-vs.-clinton-would-be-close-battle-in-2016/article/2579162

    Most of the Dems I talk to “the SWE Poll” +/- 4%; want Trump elected. Even Latino and African American Dems. Don’t believe O’Reilly and FOX news, they lie. They’re all for amnesty overpopulation establishment, and quote from Mother Goose fairy tales on this one.

    Trump scares the Dem/Rep foreigner/corporate lobbyists to death, but not American voters. Trump is right, its not Americans’ fault for this economic mess….its all our Dem/Rep leaders fault, and their lobbyists who pick our establishment candidates and blame us for their choices afterwards.

  94. 94
    Justme says:

    Amazon’s stock is deflating. Today it has been as low as 547.50, and currently trading at 549. It peaked at 696 in late Dec, only about 3 weeks ago.

  95. 95
    Liz says:

    I’ve read all your comments and they certainly are enlightening. I just moved to Seattle and am not sure the real estate market is in a bubble or not. I don’t know if I should buy now while it’s is still a bit affordable, where as waiting might price me out of the market. Or if I buy now and we are in a bubble, if that bubble will burst in the next 1-2 years. Can any of you look in your crystal balance advise me? Thanks!!

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