NWMLS: Listings surge as sales and prices soften a bit

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June market stats were published by the NWMLS last week. Here’s a quick look at the home salesperson spin via their press release:

Brokers seeing “simple economic recipe for a softening housing market”

Home buyers around many parts of Washington state had more choices and less competition during June, prompting some industry leaders to comment on “a feeling of change in the market.”

“Inventory is up and demand has dropped,” reported Robert Wasser, an officer with the board of directors at Northwest Multiple Listing Service. That combination is “a pretty simple economic recipe for a softening market,” he added in commenting on the latest MLS statistics.

“Although still a quick response market, with more new listings coming on the market during the summer months, we experienced dispersed buyer energy due to the greater availability and selection,” stated J. Lennox Scott, chairman and CEO of John L. Scott Real Estate.

No need for alarm! It’s just a “simple economic recipe”!

Anyway, let’s look at the actual numbers.

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):

June 2018 Number MOM YOY Buyers Sellers
Active Listings 3,718 +27.7% +42.9%
Closed Sales 2,758 +11.5% -4.6%
SAAS (?) 1.46 -8.5% +6.8%
Pending Sales 2,977 -10.1% -12.2%
Months of Supply 1.35 +14.5% +49.8%
Median Price* $715,000 -1.6% +9.5%

The big news in this month’s numbers is yet again the big bump in total on-market inventory. That said, prices look like they’re beginning to soften as well, which is unusual for what is normally the hottest time of year for price gains.

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

King County SFH Inventory

Inventory rose twenty-eight percent from May to June, and was up forty-three percent from last year. We’re definitely forming an interesting trend now. This year has seen listings building up a lot faster than any recent year. Meanwhile, sales are softening, too…

Here’s the chart of new listings:

King County SFH New Listings

New listings were up two percent from a year ago, but dipped slightly from the record high level posted in May.

Here’s your closed sales yearly comparison chart:

King County SFH Closed Sales

Closed sales rose eleven percent between May and June. Last year over the same period closed sales were up about the same. Year-over-year closed sales were down five percent.

King County SFH Pending Sales

Pending sales were down ten percent from May to June, and were down twelve percent year-over-year.

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

The recent surge in listings is extremely evident in the above chart. June saw the largest year-over-year listings increase since April 2008.

Here’s the median home price YOY change graph:

King County SFH YOY Price Change

Year-over-year home price movement dipped back below ten percent again.

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

It’s interesting to me that we’ve been flat to slightly down since April. That’s a pretty big deviation from normal years. Between 2000 and 2017, April to June has seen an average gain of 3.5 percent. Over the last six years the lowest gain we’ve seen over those months was 4.2 percent. This year prices fell 1.4 percent. Very curious.

May 2018: $715,000
July 2007: $481,000 (previous cycle high)

Here’s the article from the Seattle Times: Market shift? Big spike in Seattle-area homes for sale slows price growth


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.

204 comments:

  1. 1

    Has There Been a Paradigm Shift in Seattle Real Estate?

    More emphasis on holding the ARK together in the coming storm and less haughty pigheadedness that its always gonna go up in price no matter what? We only get one environment, when its destroyed its gone.

    http://www.dailymail.co.uk/sciencetech/article-5933419/Humans-causing-animals-plants-extinct-1-000-times-FASTER-normal.html

    Enjoy your morning Yuban ;-)

  2. 2

    No Wonder Bubbleheads Bander About Owning the Latest Cell Phones…LOL

    http://www.dailymail.co.uk/sciencetech/article-5933261/iPhone-Samsung-TV-Soy-Sauce-Scientists-reveal-10-items-make-people-wealthy.html

    We at least want to look rich in our over priced city?

  3. 3

    Interesting to see the inventory in graph form. We’re really just back to the levels of three years ago, which at the time were considered horrible, until they got worse.

    Again I think the price moderation is due to there being fewer listings bid up significantly over list in bidding wars (or by not as much), which is almost undoubtedly related to the increased inventory.

  4. 4

    RE: softwarengineer @ 2 – I saw that earlier today. The brand of soy sauce you use is indicative of wealth? I didn’t even know there was a second brand of soy sauce (as opposed to house brands). That one seemed really odd.

  5. 5
    SDE2 says:

    Interesting dataset, but it’s hard to see any price trends at this point.

  6. 6
    Deerhawke says:

    I pre-sold a house I was working on in Wallingford in February. I thought the price was very healthy at the time and represented a really good deal for the buyer too. But a few comparable listings in March through May had people asking me if I regretted pre-selling. I heard a lot of talk from agents saying, “I am pretty sure I could have gotten you a substantially higher price….”

    But interestingly, after one really high (and therefore meaningless) sales data pointin the area, all those folks who produced low quality houses listed at very high prices found their listings, umm… sitting.

    One of those listings was by a real estate agent who thought it looked really easy to develop and build. He could do it all– buy, develop, build and sell. Why not? How hard could it be? Well, evidently he never did his research or asked his potential customers what they wanted. Wrong house concept, wrong house design, wrong price for the area, wrong finishes and trims, and so the house is hanging around on the market. This is certainly not the multiple bidding situation he envisioned a year or so ago. Still no sign of a price reduction despite 40 days on the market.

    This market needed to take a breather to get people like that out of the market and to put most people back in touch with common sense.

  7. 7

    By Deerhawke @ 6:

    One of those listings was by a real estate agent who thought it looked really easy to develop and build. He could do it all– buy, develop, build and sell.

    OMG, a clear indicator of a top! ;-)

    Apparently they never heard the saying: “Don’t get high on your own supply.”

    https://www.youtube.com/watch?v=_5yBMOF3_WM (@ 4:15)

  8. 8
    N says:

    Some of the % change numbers are eye popping, it’s interesting to see inventory WAY up and sales coming down at the same time, when most thought the demand was so deep and could handle a significant uptick in inventory without skipping a beat.

  9. 9

    By N @ 8:

    Some of the % change numbers are eye popping, it’s interesting to see inventory WAY up and sales coming down when most thought the demand was so deep and could handle a significant uptick in inventory without skipping a beat.

    Excellent thought, but we’re still at the point in sales where they were being inventory constrained. Most sales are 30-60 days after mutual acceptance. That’s why I’ve said a couple of times that I don’t think last month is a good indicator of sales level. Note the pendings–they were up MOM, but down YOY.

    On that timing issue, I’ve been wondering if that sort of thing is why I’m not able to determine where the active listings came from. Maybe it’s May’s new listings having more of an impact on the number of active listings than June’s?

  10. 10
    N says:

    @ Kary 9 – I see your point about Sales vs. Pendings, but actually pending sales were down both MOM and YOY.

    Being down MOM isn’t a shocker given in June people start thinking about vacations, but YOY when we thought the demand was so high and now there is 42% more inventory than last year and pendings are down, that is quite surprising.

    We thought sales were being inventory constrained, but were they really? I guess time will tell.

  11. 11

    RE: N @ 10 – I’m not sure you are getting the point–the sales are still negatively impacted by the inventory from April. It’s the pendings being down YOY that is significant, and would make your original point better. If there was the pent-up demand, then the pendings should be up YOY and MOM.

  12. 12
    Notme says:

    RE: Deerhawke @ 6

    >>Wrong house concept, wrong house design, wrong price for the area, wrong finishes and trims, and so the house is hanging around on the market.

    Oh vey, not teh wrong trims again! Bubbles crash when hapless real-estate insiders select the wrong trim and finish on their flipper properties. Everybody knows that.

  13. 13
    N says:

    @ Kary – No need to argue semantics but just for clarity in my post above (10) I repeatedly reference pendings. Still, to your point, there will be more clarity of how big a shift we are seeing once we have actual sales data coming out of May and June.

  14. 14

    RE: N @ 13 – I could have been clearer on my post 9–that YOY pending being down supported your position. That’s very hard to rectify with the perception of pent-up demand.

  15. 15
    David says:

    I’ve been watching a guy pour money into a renovation by mostly using a pressure washer to clean a crappy house. No dumpster filling up with rotten wood, broken windows or old dilapidated siding. NOPE. Cleanliness is next to Godliness I suppose.

    Same thing about a block away. A crappy house with terrible structure. Like someone started off building a tool shed and thought: “What the heck, let’s make it a house.” Laminate flooring installed with NO finish trim where it terminates onto concrete. Wavy floors. But that pressure washer makes it shine like a new penny.

    “For who would begin construction of a building without first calculating the cost to see if there is enough money to finish it?” – Jesus

  16. 16
    pfft says:

    Obviously Chumps tariffs and anti-Amazon talk is hurting Seattle real estate.

  17. 17
    pfft says:

    You know what is awesome? When the new homeowner burns a huge pile of brush…

  18. 18
    Michael Goldman says:

    The market fundamentals have changed. Population growth has slowed significantly.

    https://www.theurbanist.org/2018/07/02/what-the-2018-population-estimate-tells-us-about-flattening-rents-in-seattle/

  19. 19
    Justme says:

    RE: Michael Goldman @ 18

    Michael, I noticed you are also the author of the original article at theurbanist.org. There is one very important point about the OIF data that you need to be aware of: The OIF change in population is estimated by taking the change in Housing Units (essentially new construction minus condemnations) and assuming that the average occupancy (persons) per unit is the same as at the last 10-year census. I call this the “Built-Is-Filled-by-Fiat (BIFF) methodology. The methodology is rife with error, because there is no guarantee that newly built units will have the same occupancy rate as existing ones, or even be occupied at all!

    Here is a reference to a recent post of mine, that in turn has links to older references that debunks the OIF BIFF methodology for population estimation.

    REFERENCE:
    https://seattlebubble.com/blog/2018/06/07/new-listing-absorption-falls-to-a-seven-year-low/#comment-271606

    It should be said that OIF itself *is* aware of the weakness of the BIFF methodology, but many if not most people who use or quote the data seem blissfully and/or intentionally unaware of the very significant source of error. The recent reports of 75% vacancies in new buildings in central Seattle should serve as as an indicator that OIF population estimates are significantly above the true population number.

  20. 20

    RE: Michael Goldman @ 18 – Nice piece, but you forgot to mention how the significant real property tax increases in King County this year caused landlords to pass those costs on to tenants and the average rent to skyrocket! /sarc

    Seriously, I liked your focus on supply and demand, but on the demand side perhaps more attention should be placed on the number of jobs created over time. People coming to the Seattle area without jobs undoubtedly impact the rental market more than the NWMLS stats, but their impact is not likely to cause significant average rent price increases. For that you need a lot of people with high paying jobs.

  21. 21
    Rupert D says:

    RE: Michael Goldman @ 18
    there is a glaring error in the article narrative and the last paragraph indicates that it is a politically motivated article. I will stick with S&P Case Shiller articles and data which goes through a vetting process before being published.

  22. 22

    RE: Rupert D @ 21 – I guess it depends on what you’re after. If you want to reduce rents and house prices in Seattle a Seattle income tax would do that. Fewer successful people would want to live within the Seattle city limits, reducing overall demand. It would be sort of a trickle-up theory by getting rid of those who are sucessful. Ignoring the fact that such a tax would mean an income tax was constitutional, the impact on the county or the state would be relatively marginal.

    The other solution, however, inclusionary zoning, is probably misguided. While creating additional low income housing it probably reduces the overall new supply of housing and would thus be counter-productive overall. Imagine if you applied that to new car sales, and required every buyer of a new car to contribute $500 to the cost of a used car for less fortunate people. Over the long run that would result in fewer new cars being sold and increase the cost of used cars, sort of like what happened after Cash for Clunkers.

    But I suppose you’re right overall. The article would have been better without that last paragraph.

  23. 23

    RE: David @ 15
    Jesus Also Warned About Not Building On Sinking Sand

    Or approved King County lots in swamp areas to flood later…

  24. 24

    RE: Kary L. Krismer @ 22
    My Kansas Property Tax Went Down About 5% for 2018

    Yet unemployment and prices [homes, services and parts] are far cheaper than Seattle. Seattle’s electricity is a bit cheaper [PSE, not City Light]…but the completely clogged 50 year old freeway system in Seattle is a joke compared to empty freeways in Kansas. It can get hotter in Kansas, but it cools off too…even in Summer. We have earthquakes that can destroy it all…Kansas had tornadoes that can destroy maybe a block or two…Seattle has active volcanoes near by too…

    Its always Yin/Yang…

  25. 25

    RE: Kary L. Krismer @ 22
    Never Give Your Used Car to a Charity Kary

    They can abandon it and then they stick you with the impound bill [thousands BTW] because the title never got legally transferred.

  26. 26

    RE: softwarengineer @ 25 – You can report sales of vehicles on-line now.

  27. 27
    Notme says:

    RE: Michael Goldman @ 18
    RE: Justme @ 19

    If you build a new housing unit, occupants will come. Not only that, but they will pay whatever price or rent that is demanded. Everyone knows that.

  28. 28

    By Notme @ 27:

    Not only that, but they will pay whatever price or rent that is demanded. Everyone knows that.

    Ah, no. Not everyone knows that because it is false. If it was true why would the landlords be offering the increased incentives to move in?

  29. 29

    I Wrote Open Border P{arty Governor Inslee A Letter About A Month Ago

    During his environmental planning summit for the State…”if the alleged water shortage in Seattle is not fake news, does that mean we’re using 100% of the Cascade Mountain run-off to rinse immigration overpopulation sewage into the Puget Sound to kill off the Orcas Whale?”

    He never replied back….I wonder why? LOL

    https://www.wral.com/starvation-and-habitat-threats-stalk-killer-whales/17685419/

    I was too late…the baby Orcas are already extinct today….isn’t on-going immigration overpopulation a great way to help the Seattle area environment? LOL

  30. 30

    RE: pfft @ 16
    Pffft…I Beg to Differ

    Pork is going down in price with tariffs….99 cent/lb bacon again, etc, etc…supply and demand Pffft.

    The transition back to American engineered cars using tariffs means one thing….lower paid American engineers replacing higher paid European/Asian Manufacturing Engineers….cars should go way down in price too as we go to more domestic engineered ones…tariffs make our nation’s car prices cheaper too.

  31. 31
  32. 32

    It might be a bit nonsensical to some to believe that the market would end it’s upswing after 7 years of full upswing from 2012 forward. I have always believed that an upswing lasts 5 to 8 years, and while I can’t google it, I’m 99% sure I heard that from Greenspan back before my children were born. 7 years is the most predictable time, but it could end as early as 5 or later than 7, but not usually much later. I think the longest standing upswing went for part of the 8th year, and here we may be the same for early next year, just as our most recent crash began in August after “the season” was over.

    I’m seeing enough fuel in the hottest of areas to make it through early next year, but more like a vehicle that was going so fast that its coasting period lasts longer than a vehicle that was going slower.

    There is absolutely NO reason for a seller to not be selling, if they have been thinking of selling or will need to sell within the next 5 years. But I have been saying that since the beginning of 2017.

    https://www.cnbc.com/2018/07/09/the-hottest-housing-market-in-the-country-may-be-headed-for-a-crash.html

    While the above article may not validate my long standing prediction, it certainly lends credence to it.

    I have been saying “It’s a better time to sell than to buy” for awhile now, and none of my clients have been blind to my recommendations. That does not mean everyone sells and nobody buys, but informed consent is the most important part of a transaction.

    Anyone not being increasingly pessimistic about the market since late 2016 or early 2017, or now, likely has a biased reason to not believe the obvious.

  33. 33
    uwp says:

    ALERT ALERT ALERT

    Inventory has now surged to… the 16th highest June Inventory of the last 19 years!!!

    Prices cratering more than 1% in the last two months!!!
    (After rising almost 15% in the first 4 months of the year)

    Is there a way I can add Flashing Sirens to this post?

    Too add some actual serious content:
    The Altos Research page for Seattle breaks out the market into 4 tiers, and it is clear the upper end (Million+ dollar homes) is taking the brunt of any “pain” in the market. Still sucks to be a Seattle home buyer under 750k.

  34. 34
    David says:

    16th highest – devastating

    RE: uwp @ 32

  35. 35
    Notme says:

    RE: uwp @ 32

    >>Still sucks to be a Seattle home buyer under 750k.

    And that (if true) makes you happy, does it not?

  36. 36
    uwp says:

    RE: Notme @ 34
    – No.

    I stand in solidarity with my fellow millennials hoping to buy homes.

  37. 37
    Dustin says:

    RE: uwp @ 35 – Affordable market rate condos in the downtown core/periphery are the future for millennials hoping to buy homes, in my opinion. Barring a significant population decline of some kind, of course. I know they’re mostly apartments now, but there’s growing demand to live in central neighborhoods and developers are meeting that demand, with colossal projects cropping up all over those areas in recent years. I don’t see a glut of residential housing happening in Old Seattle SFR neighborhoods like Wallingford or Green Lake, but I could see a glut of apartments in downtown, Belltown, Capitol/First Hill, etc, being converted to condos. I’d be worried about paying $1-2 million for a 2 bedroom apartment in the core right now, but the stately $1-2 million Craftsman in Queen Anne is probably a safe enough investment for the sufficiently heeled.

  38. 38
    redmondjp says:

    Ruh Roh Shaggy! MSN headline uses the ‘C’ word (with the ‘B’ word in the article) about Seattle’s housing market:

    http://www.msn.com/en-us/money/markets/nations-hottest-housing-market-could-be-headed-for-a-crash/ar-AAzQ8Me?ocid=ientp

    Should we all be partying like it’s 1999? 2007 perhaps?

  39. 39
    Michael Goldman says:

    Appreciate it.

    We definitely don’t have a complete picture of demand in Seattle without 2018 data on income (forthcoming from the latest ACS survey?) and employment figures from PSRC.

    But the reversal of the 7 year trend of increasing population growth rate in 2018 stands out as either a serious survey error or a real significant decline in the growth rate. RE: Kary L. Krismer @ 20

  40. 40
    pedaltothemetal says:

    What’s that you say?

    Comes with lead paint, mold in the attic, buried oil tank, classic aluminum windows, cracked foundation and cracked driveway!

    Do I get to push the baby carriage in the street because there are no sidewalks? F*** yeah!

    Bonus: It come with a horse, which is actually just 2 coconut halves you bang together.

    Enjoy the moss pit!!

  41. 41
    Michael Goldman says:

    RE: Rupert D @ 21
    What is the glaring error?

  42. 42
    pedaltothemetal says:

    Oh look:

    Top achiever in price-to-rent ratio:
    https://smartasset.com/mortgage/price-to-rent-ratio-in-us-cities

    Top achiever in price-to-income ratio:
    https://www.citylab.com/equity/2018/05/where-the-house-price-to-income-ratio-is-most-out-of-whack/561404/

    You’re getting a great deal on that moss pit.
    Just keep it nice and mossy, what can go wrong?

  43. 43
    pedaltothemetal says:

    Not enough time spent with the tech bros? Try these:
    https://seattle.curbed.com/2018/7/9/17549848/company-coliving-seattle-roommates-apartments

    Hopefully the beds that require a ladder to get up to come with a complementary catheder.

  44. 44
    Suburban Mom says:

    RE: uwp @ 32 – It would be interesting to see the inventory graph broken out by home price tiers. Seems there’s quite a bit more properties that are listed $750k+ ? Would be nice to see some actual analysis on the data, especially homes that sat on the market for a “long” time (14+ days). Is there a way to capture price drops in the data? If so, what homes are price dropping more? High end homes or mid range or low end homes?

  45. 45

    RE: Suburban Mom @ 43

    I tried pulling the data, but ran into a few obstacles. For instance several new construction homes showing they have been on market for 150+ days, but they are only using the same one listing to sell out the entire development. So that one listing appears to have never been sold, but represents many sold properties that later appear as sold listings, but never appeared as active.

    Here’s a little something, but anything for all of King County is obviously somewhat meaningless. In one area $750,000 is a bargain price and in another it is the top high end. $750,000+ as you requested gets a bit odd if you include the mega-million dollar houses. So I’ll go with $750,000 to $1,000,000, but feel free to request something else.

    Since so many in this thread of comments are treating condos as “housing units” and we are starting at $750,000, I’ll leave condos and townhouses in the mix. Anyone spending $750,000 to $1,000,000 for a condo is making a valid housing choice, and not buying a condo because they can’t afford a Single Family Home.

    At present there are 758 Residential Properties asking $750,000 to $1,000,000. For some perspective:

    In January 1018 Sold compared to 758 currently Active.
    In February 1,103 Sold
    In March 1,273 Sold
    In April 1,376 Sold
    In May 1,415 Sold
    In June 1,426 Sold
    In July – in only 10 days of Month to date – 890 have sold and 883 are currently Pending vs 758 currently for sale. (Some of those 883 Pendings will not close by month end and some % will not close at all.)

    So 758 Active listings from $750,000 to $1,000,000 in King County is clearly not representative of an oversupply of properties.

    Extremely tedious part :) 161 of the 758 have been on market for 14 days or less.

    Of those on market for 15 days or more, approximately 10% are condos. About 18% are new construction that might not be built yet or may be one unit representing a full building, so not really on market for 15+ days.

    The Days on Market numbers are harder to be accurate on but while I don’t think they are exact, I scanned and pulled the error factor as much as possible so that the numbers are as close as possible.

    Looks like less than a month’s supply and if you don’t count the new on market houses, closer to a 1/2 month supply.

    Hope that is helpful.

    (Required Disclosure: Stats in this comment are hand calculated by Ardell in real time and are NOT Published, Verified or Compiled by The Northwest Multiple Listing Service.)

  46. 46
    Notme says:

    RE: pedaltothemetal @ 42

    >>Hopefully the beds that require a ladder to get up to come with a complementary catheter

    Nah, as you can see from the photo, the bed is a “loft” on top the 3/4-height bathroom ceiling. You just make a hole under the bed right over the toilet AND institute a rule to leave the toilet lid UP! at all times. Or write an app that will lift the lid upon demand. Then it is just a matter of aiming well. Anyone can do it! Live demonstration of proper use of the facilities will be given at the open houses every Saturday, along with communal cooking classes. Bon Appetit!

  47. 47
    Deerhawke says:

    RE: Notme @ 12

    My view is that people end up in trouble when they forget about the idea of a value proposition.

    If everything in the house is done cheaply and looks like it was bought at the odd-lot store but you put a high price on it, you will only be saved if the market is appreciating in a crazy way. If the house actually has a real design and the builder has put real creativity into it and priced it in a fair way, it has a decent chance of selling even in a market like this one.

  48. 48
    Blurtman says:

    RE: Notme @ 45 – Oven can accommodate small child, but remember to flip the Occupied sign on.

  49. 49
    Deerhawke says:

    RE: ARDELL DellaLoggia @ 31
    RE: ARDELL DellaLoggia @ 44

    Thanks for these two posts Ardell. I appreciate the time and thought you put into them. I also appreciate the fact that these two posts point in different directions.

    To paraphrase: On the one hand, all expansions come to an end and this expansion is getting pretty long in the tooth. You should be cautious. On the other hand, while there are lots of signs that this market is quite different from March or April of this year, “looks like less than a month’s supply and if you don’t count the new on market houses, closer to a 1/2 month supply.” So maybe there is still a bit of gas left in the tank yet.

    I couldn’t agree more.

    In the short term, we saw a lot of listings hit the market at the end of spring/early summer. It seems like people who had been putting off the decision for quite some time (“Why sell when the market is going up so fast?”) finally took the plunge (“This feels like the top. It’s time to get this house on the market!”) Of course, they did not really start to think about this until January or February and of course forgot that it takes time to find a fixit guy, a painter, a plumber, etc. etc. So of course, most missed the early spring market and are now regretting it.

    And buyers, who already were tired of being outbid, outspent and generally treated like suckers were naturally suspicious. (“Wait. Why rush into it? Maybe the time for the big price drop is finally here. Let’s go on vacation and see what it looks like in September. “) Inventory stacked up a bit and there were in my area some significant price drops (from really greedy to just a bit greedy).

    I think political factors really played a role in market events this spring. We may have finally gotten a resolution on school funding, but a lot of people were shocked by their post-McCleary property tax bills. And then there was the city council decision to impose a head tax . This was seen as the last straw, in essence taking down the welcome sign for businesses in the city. The thought that Amazon might actually stop hiring really shook people’s confidence. The emphasis on the homeless issue also made people think that the city is not as attractive as they thought.

    I have retired neighbors who were pretty certain they would stay in the area for another year and suddenly decided to sell. I know a small landlord who said he was going to re-rent but then overnight decided to sell his two rental houses instead. When I asked them why, both mentioned property taxes, the head-tax vote and the vague feeling that the market was reaching a top. The landlord also talked about how large companies were over-building apartments in the city making it hard to rent older in-city houses.

    My feeling is that the market will bounce around a bit and establish a new base in the next few months before the real downturn in early /mid 2020.

    The national economy is pumped up on the steriods of the Trump tax cut (a sop to old fart Trump voters at the expense of the debt bomb being dropped on the next generation). This is terribly timed Keynesianism from a policy perspective, but will probably keep the party going longer than it should. We will probably see a national downturn in early/mid 2020. Seattle will not escape the effects and it will be a doozy for having been delayed.

    In the meantime, Seattle firms (including Amazon) continue to hire for jobs in the Puget Sound area. Facebook, Google, Microsoft, Tableau, and a whole range of smaller tech and med-tech firms are hiring. Expedia’s move may be a wash for the Puget Sound area, but is a plus for Seattle real estate over the next two years. People will continue to be attracted to the area by those jobs. We will continue to draw people from the other big creative centers in the Bay Area, Boston, New York City and LA. We complain about our problems a lot, but people from other areas are quick to remind us that they have the same problems, but worse. Hard to believe but we are cheaper and offer a better quality of life here.

    I have stopped buying, but will build out and sell what I have in inventory over the next year. I plan to be all cash by the end of the first quarter of 2020 .

  50. 50
    ess says:

    An article in today’s Marketwatch

    https://www.marketwatch.com/story/missing-millennial-homeownership-endangers-the-american-dream-

    Will this group of potential buyers step up to the housing plate and purchase housing in the next couple of years?

    If not – will they be permanent renters that also has ramifications for the housing market in Seattle and beyond?

    Will millennials be satisfied sharing housing as they do now as they reach middle age?

    Even if housing prices fall as some predict, will rising mortgage rates offset any short term savings?

    We are all going to find out!!

  51. 51
    wreckingbull says:

    RE: pedaltothemetal @ 42 – I used to live with a bunch of dudes in a rental house. We had a room mate who refused to do dishes. He just chucked them in the sink and walked away.

    We confronted him about it and miraculously, no more dishes in the sink. After two or three days, no more dishes in the cabinets either.

    Instead of chucking them in the sink, he was just chucking them in his bedroom closet.

    ‘Co-living’ at its finest.

  52. 52

    RE: Dustin @ 36
    History in Seattle Is The Opposite Dustin

    The condos get decrepit and then turn into apartments with many of the old condo owners taking whatever low ball offer then…they become worthless to buyers.

  53. 53

    By softwarengineer @ 51:

    RE: Dustin @ 36
    History in Seattle Is The Opposite Dustin

    The condos get decrepit and then turn into apartments with many of the old condo owners taking whatever low ball offer then…they become worthless to buyers.

    What are you basing that on? I’ve only heard of one condo going the other direction, and actually wish there were a better process for that to happen. With a combination of poor management and poor market conditions it is very possible for a condo to head into significant disrepair and have no realistic means of reversing the process. Lately I’ve noticed some slightly run down condos making repairs–probably a result of units selling and dues getting caught up.

    But on the other hand, what we’ve noticed is the well-run condos still have well-maintained buildings years after we first notice them. Basically it’s exactly like houses. You can have one owner who does little to maintain their house and it becomes a neighborhood eyesore. That doesn’t mean all houses become eyesores.

  54. 54
    kenmorem says:

    RE: Deerhawke @ 48
    tremendous summary. i have essentially the same opinion on everything written, but i’m a little wishy washy on the date of the implosion.

  55. 55
    uwp says:

    By Michael Goldman @ 38:

    But the reversal of the 7 year trend of increasing population growth rate in 2018 stands out as either a serious survey error or a real significant decline in the growth rate.

    How does Seattle’s growth rate compare to other large cities?

    “Reversal” of growing trends sounds ominous, but then I remember what Seattle’s population growth-rate was in 2010, 2011, 2012, 2013, 2014 (it was lower). The bigger you get the harder it is to grow in % terms.

  56. 56
    Matt P says:

    RE: Kary L. Krismer @ 52 – I’m currently renting one of those run down condos. I looked at a lot of condos for rent not wanting to be in an apartment complex anymore and every single one was in a state that I would never think of buying it. The one I’m in now was the best of the bunch, but it’s got a lot of problems that need to be fixed. The construction is pretty poor and the owner mentioned it was built by a California company in the 70s, but it’s a far better deal than I could get elsewhere, so you get what you pay for.

  57. 57
  58. 58
    Paulie says:

    By uwp @ 54:

    By Michael Goldman @ 38:

    But the reversal of the 7 year trend of increasing population growth rate in 2018 stands out as either a serious survey error or a real significant decline in the growth rate.

    How does Seattle’s growth rate compare to other large cities?

    “Reversal” of growing trends sounds ominous, but then I remember what Seattle’s population growth-rate was in 2010, 2011, 2012, 2013, 2014 (it was lower). The bigger you get the harder it is to grow in % terms.

    Exactly.

    It’s hard to call it a reversal in the first place. A reversal of expansion would be contraction. I only see it expanding at a slower rate, which is common once cities achieve a certain size. And if the prices are throttled back downwards and tech salaries remain lucrative, then the growth will be enabled to continue and we will look back at this as a much needed speed bump (rather than turning the car into reverse) so we can go faster later.

    Not sure why that article called it a reversal a trend, loses credibility, just as much as the tulip salesmen trying to convince is this will go on forever.

  59. 59
    Bellevue says:

    I follow Bellevue area more closely than others. I don’t see a price drop or a slow down especially in Somerset, Cherry Crest and Woodridge neighborhoods. The Bellevue homes sell the same week they are listed.

    Are there any areas which are more recession proof than others?

  60. 60

    By Paulie @ 57:

    It’s hard to call it a reversal in the first place. A reversal of expansion would be contraction. I only see it expanding at a slower rate, which is common once cities achieve a certain size.

    Which is probably why the article refers to it as a reduction in the growth rate

    https://www.theurbanist.org/2018/07/02/what-the-2018-population-estimate-tells-us-about-flattening-rents-in-seattle/

    As to the size of the city, I don’ think that’s what’s causing the reduction in rate.

  61. 61
    uwp says:

    By Paulie @ 57:

    Exactly.

    It’s hard to call it a reversal in the first place. A reversal of expansion would be contraction.

    Not sure why that article called it a reversal a trend, loses credibility, just as much as the tulip salesmen trying to convince is this will go on forever.

    Yeah, sentences like the following from the article are confusing at best (intentionally misleading at worst).

    "From April 2017 to April 2018, according to the OFM, Seattle’s population boom reversed course and fell to 2.3% annual growth, a 40% drop in growth rate from the prior survey."

    US population growth was around 0.7% last year, and probably hasn’t hit 2.3% in 30+ years. SF grew by about 1% last year. Portland grew by about 1%. San Antonio by 1.6%. Seattle is a relatively fast growing big city even when it drops to “only” 2.3%.

  62. 62

    RE: uwp @ 59 – It’s only confusing if you don’t know what the words “growth” or “rate” mean. ;-)

    I’ll give you that it’s very poorly written. “Seattle only grew 60% as fast as it did in the prior year” would be simpler and shorter. Or “Seattle only grew 60% as fast as it did in the prior year, the first time the growth rate has been lower since _____.”

  63. 63
    Paulie says:

    By Kary L. Krismer @ 58:

    By Paulie @ 57:

    It’s hard to call it a reversal in the first place. A reversal of expansion would be contraction. I only see it expanding at a slower rate, which is common once cities achieve a certain size.

    Which is probably why the article refers to it as a reduction in the growth rate

    https://www.theurbanist.org/2018/07/02/what-the-2018-population-estimate-tells-us-about-flattening-rents-in-seattle/

    As to the size of the city, I don’ think that’s what’s causing the reduction in rate.

    The sentence does directly say that the population boom has reversed. That can be quoted and taken out of context very easily. It’s bad journalism, but we didn’t argue with his point, only that calling it a reversal in population boom is misleading, as even the growth rate is still well above national averages.

    As a transplant (4 years into Seattle), I will say the reduction in growth rate coming after the city council head tax debacle is not surprising. My friends from back home started texting me out of the woodworks asking me about he homeless problem, and asking why our government is run by socialists.

    The reality is, Seattle became a national headline for (1) a homeless epidemic and (2) its antagonistic battle with job creators, in particular Amazon, a company that is beloved back in the Midwest and only hated by locals here. People couldn’t comprehend that and for those who have never visited Seattle, they now identify us as a filthy dirty homeless haven opposed to businesses that produce products people love.

    When I chose to come here, I didn’t pick my employer over other employers with offers in SFO, I picked SEA over SFO. I went for location. But if I were making the same decision today, with the limited insight I had 4 years ago and the recent headlines about Seattle, I may choose not to come here, or wait and see before making a move. It’s an unstable environment. If Kshama Sawant has her way, the only people who will want to live here are the homeless. And they are a huge source of transplant growth, since most are not from here locally. Imagine that, you get what you spend on, and when you spend more on homelessness, it attracts more homelessness from other regions that don’t spend on it!

  64. 64

    RE: Paulie @ 61 – I would agree with a lot of that, but I’m not sure the stats we’re talking about are after the head tax thing. The income tax thing probably was before, and that certainly could have an impact.

    But still, someone who actually visits Seattle before moving might have second thoughts after seeing homeless encampments and camping on sidewalks.

  65. 65
    Paulie says:

    By Kary L. Krismer @ 62:

    RE: Paulie @ 61 – I would agree with a lot of that, but I’m not sure the stats we’re talking about are after the head tax thing. The income tax thing probably was before, and that certainly could have an impact.

    But still, someone who actually visits Seattle before moving might have second thoughts after seeing homeless encampments and camping on sidewalks.

    Yep. Has a friend from Ohio visit recently. Came back to Ohio with a small cut under his eye from getting punched by a homeless person. Embarassing.

    I hate to sound heartless, but like many problems in excessively progressive cities, this could be all-too-obviously solved by having police officers force homeless people to move along, or if they don’t, arresting them for illegal encampments. Enabling their opiate addictions and unemployment only further disenfranchises them from their own families and homes and support circles, and makes them dependent on each other and the government. I consider the homeless the biggest victims in the city gov’ts policies.

  66. 66

    Deerhawke @ 48

    “I have stopped buying, but will build out and sell what I have in inventory over the next year. I plan to be all cash by the end of the first quarter of 2020 .”

    Thanks for that. In my mix of potential sellers I have a tear down seller in an upzoned area of South Seattle. I’m suggesting she list it now as vacant land with no showings. Maybe just run it up the flagpole on Zillow. I’m thinking builders will take notice without it needing to be in the mls? The builder buyer will likely let her stay for quite some time while they get permits, etc and she doesn’t have to clean up or fix up for people to come in and out, since it’s clearly a teardown. Thoughts?

    My other potential sellers are those that have maxed out their free gain tax limit on their current residence. A hard choice for owner occupants to decide to sell at the right time, but they should at least consider the proposition. Even if they say no, they won’t be looking back saying “If I had only known”.

    Kary L. Krismer @ 5

    I never thought I’d say this, but SWE is 100% correct. The problem is being minimized going forward by some HOA’s adding a Rental Cap at the same time that they do a massive overhaul of the building. The Cap will help protect the investment of the new improvements. The “No Rental CAP” buildings that have an overabundance of investors can’t get enough votes for the Special Assessment for the New siding/windows and roof and other needed improvements. Investors don’t get enough extra rent to justify the cost. Buildings with a 10% rental CAP or even 15% Rental Cap leave enough room to win the vote needed when improvements are desired but not necessarily because the building is ready to be torn down if not improved. The investors get dragged in to sharing the cost, but relying on their vote for a major investment in improvements is a no win situation.

    Paulie @ 61

    Our significant growth since 2014 heavily relied on extremely motivated buyers vs “home value”. Sellers repeatedly listed at market value and buyers pushed the price 10% to 20% on a regular basis, for at least four years now.

    If the market stays the same except the buyers get shy enough to not bid at “the sky’s the limit” prices, the same number of people buying and the same number of homes sold will still equate to a market correction. The correction is the % of the overbid.

    A small change in the newly incoming numbers, coupled with a change in the willingness to retain the idea of $100,000+ over asking as being “normal”, will quickly cause a greatly reduced gain %. Since current “market value” is/was depending on the bid up, that = a negative price change, likely by Fall. Yes, 2019 can still have it’s Spring Bump. But when a market has a short season, it’s a sign that things are petering out.

  67. 67

    RE: Paulie @ 63 – I don’t agree with all of that, but I have repeatedly said here that the last thing anyone should ever want is to be helped by the Seattle City Council. That will only bring harm because so much of what they do is counterproductive. Fortunately it will be a cold day in hell before the Seattle City Council tries to help real estate agents.

  68. 68
    Paulie says:

    By ARDELL DellaLoggia @ 64:

    Paulie @ 61

    Our significant growth since 2014 heavily relied on extremely motivated buyers vs “home value”. Sellers repeatedly listed at market value and buyers pushed the price 10% to 20% on a regular basis, for at least four years now.

    If the market stays the same except the buyers get shy enough to not bid at “the sky’s the limit” prices, the same number of people buying and the same number of homes sold will still equate to a market correction. The correction is the % of the overbid.

    A small change in the newly incoming numbers, coupled with a change in the willingness to retain the idea of $100,000+ over asking as being “normal”, will quickly cause a greatly reduced gain %. Since current “market value” is/was depending on the bid up, that = a negative price change, likely by Fall. Yes, 2019 can still have it’s Spring Bump. But when a market has a short season, it’s a sign that things are petering out.

    Market value is set by the market. So if buyers overbid, that means the seller listed it for a below market price. It does not mean that the market value is reasonable. But they listed below market.

    The argument that lack of overbidding shows deflating prices also assumes sellers have not learned more about the appropriate market price. There was a period when sellers would set a low price attracting multiple bids with full knowledge that it would sell for more. I heard sellers say they and their realtors flat-out don’t know the market price, and then the escalators on offers set prices like an eBay auction.

    Now sellers have formed new expectations about prices, more (but far from) perfect information, and are demanding higher list prices than before. The lack of overbidding could mean list prices are higher, rather than overall prices are lower. There is course evidence of lower prices already, so it tells us something, but looking at the list prices they clearly are higher as sellers have gotten greedy, and many people are still buying them.

    It would be great for the city if prices contracted through the fall.

  69. 69

    By Paulie @ 66:

    Market value is set by the market. So if buyers overbid, that means the seller listed it for a below market price. It does not mean that the market value is reasonable. But they listed below market.

    You’re assuming no one offers more than the market price. That is a false assumption, and the reason banks require appraisals (for what they are worth). Also, some properties are worth more to some particular buyers than the general market and buyers who really want a particular property may bid high to make sure they get it. That possibility is the reason many/most agents/sellers don’t disclose the amount of the highest offer they received. We aren’t dealing in a world of perfect information–the assumption economists make for determining market value.

    The argument that lack of overbidding shows deflating prices also assumes sellers have not learned more about the appropriate market price. There was a period when sellers would set a low price attracting multiple bids with full knowledge that it would sell for more. I heard sellers say they and their realtors flat-out don’t know the market price, and then the escalators on offers set prices like an eBay auction.

    Now sellers have formed new expectations about prices, more (but far from) perfect information, and are demanding higher list prices than before. The lack of overbidding could mean list prices are higher, rather than overall prices are lower.

    I have stated that somewhat differently, and it connects into your first point.

    If a comparable sale was listed for $700,000 and sold for $770,000, how does an agent deal with that in pricing their listing? If that comparable listing had been listed for $750,000 it might have only sold for $720,000.

    There is course evidence of lower prices already, so it tells us something, but looking at the list prices they clearly are higher as sellers have gotten greedy, and many people are still buying them.

    My response here connects with the above too. There is evidence of lower prices, but not necessary evidence of lower values. Fewer bidding wars mean that hypothetical property listed for $700,000 might sell for only $720,000 today. It might not ever have been worth $770,000 because it never could have been listed for $770,000 and sold for that price. So the value was never that high, but the price was. Again, people do sometimes pay more than market price.

  70. 70
    Deerhawke says:

    RE: ARDELL DellaLoggia @ 64

    Remember that when the downturn comes, South Seattle will get hurt more than the prime North or Central neighborhoods near employment centers. The further south, the more it will get hurt.

    My advice is to put your teardown on the MLS, not on Zillow (not enough eyeballs). I wouldn’t forbid people taking a look at it (this tends to raise questions) but make it clear you see that the value is in the land. To get maximum value, she should set a reasonable time to get plans and permits, but make sure there is a large enough EM (5%) to make sure that if the economy tanks and the builder walks, she gets paid for her time and trouble. In this case, I would put some language in the contract that says the EM shall automatically turned over to the seller without further notification or authorization by buyer or seller on XX date (the closing date) whether or not closing occurs, unless by some clear default by the seller. Six months is considered generous. More than that can be part of the price negotiation.

    For your other potential sellers, you might advise them that if they are even thinking about selling, they should spend the time and money now to get the place into tip-top condition. I see a lot of people make the sale decision first and then think about what needs to be done to get top dollar. By that time, of course, they are behind the curve and never get it right. Buyers these days (and in this market) want a house in nearly perfect move-in condition, not one where they have to find people to take care of a punch list.

    Best of luck with them.

  71. 71
    Minnie says:

    RE: Deerhawke @ 48

    Deerhawke, thank you for your post. I can tell that it is thoughtfully written and I really enjoyed reading it!

  72. 72

    RE: Deerhawke @ 68

    I hear you and generally agree with you, of course. I always put them in good condition and have people at the ready to do that.

    But you know how it is with teardowns. If they even have to think about getting it to look half decent, they just hold on to it for longer than they should and often until someone comes along and makes it easy for them. In fact I think you are in the business of making it easy for them. :)

    I could do just a picture of the outside with no showings, but I don’t think the MLS allows a Residential vs Vacant land listing with no showings.

    People don’t realize how difficult the internet has made it for sellers with teardown houses. Some houses just aren’t meant to be seen by anyone and everyone in the Country vs just the actual buyers. :)

  73. 73

    RE: ARDELL DellaLoggia @ 70 – I disagree. You need to show the pictures no matter how bad. There is zero reason not to, and the reason to do so is so that you don’t get those people thinking the house priced 40% below everything else is somehow turnkey.

    It’s a far worse mistake to have listing photos indicate the property is in better condition or more appealing than it is, than to have listing photos that give an accurate or even slightly negative reflection of the property. And if you show no pictures you’re effectively doing the latter or worse.

  74. 74

    RE: Kary L. Krismer @ 52
    Maybe You’re Too Young to Remember

    Its an old Seattle joke, “buying a condo is like catching Herpes” during the MASS 70s-90s apartment conversions.

  75. 75
    wreckingbull says:

    RE: softwarengineer @ 72 – How does this work? Every owner agrees to sell at the same time? I don’t ever recall this. Are you sure your memory is serving you correctly?

    If you are simply referring to individual condo owners renting out their unit, then sure, I understand your point.

  76. 76

    RE: softwarengineer @ 72 – I actually owned a condo converted at that time. I still don’t remember any but one converting back to apartments.

    Back then there was one brand new-built as condo building where it took two developers down and the units were sold at auction. Probably ended up being great buys for someone.

    The condo market did fall a lot more back then relative to houses, which is why I expected the same thing after 2008. But I didn’t see any condos falling into disrepair back then (but I also wasn’t an agent back then), and in the period after 2008 the condo market held up reasonably well relative to houses, at least in the well-maintained complexes.

  77. 77

    RE: wreckingbull @ 73 – There is a process set out by statute, as I recall, but I don’t care enough to look it up. It’s basically designed to deal with the fact that eventually most building will be obsolete and need to be torn down.

    What SWE may be recalling is there is sometimes a contingency that allows sales to be undone if the project doesn’t sell out. I think I’ve heard of that happening, but have no experience with it.

  78. 78
    seamille says:

    I have been a long time lurker on these board. As a millennial who grew up in Seattle, but lived for a long time in San Francisco before recently moving back, it’s easy to see where similarities lie and where there are major differences.

    Similarities:
    Lots of high paying tech jobs, quality of outdoor life, heavy influence of foreign buyers
    Differences:
    1 – Building regulations are restrictive here, but nothing like San Francisco. The current oversupply of apartment buildings is evidence of that
    2 – Prop 13 is a massive disincentive for the “velocity of real estate”, selling of homes is discouraged through this law.
    3 – No income tax in Washington, meaning less implications for the recent tax bill changes than California where itemizing is more important

    Overall I have a hard time making the argument that Seattle will ever match SF real estate prices unless the restrictive laws in CA change. Therefore when looking at purchasing a home and agents tell me “look at San Francisco, that’s the upside of appreciation” I don’t buy it.

    When I moved back to the Seattle area last year I became friends with many of the people who are vilified by the “locals” (tech workers, full disclosure I don’t work in tech”). Most of my friends who purchased homes here have plans to live here for 2-3 years then move on to a new city. I have a friend who bought a crappy home for ~$850K right next to the worst part of aurora as a 2-3 year investment. Short term mania gets tempered when people see articles like this:

    https://www.cnbc.com/2018/07/12/the-housing-shortage-may-be-turning-warning-of-a-price-bubble.html

    I am a long term bull on Seattle real estate given long term weather patterns (climate change, access to clean water) and quality of life, but near term I think Seattle got way ahead of itself. Any sort of government crackdown on AMZN/Tech (see the recent FCC hire: https://www.seattletimes.com/business/antitrust-critic-of-amazon-joins-ftc-as-agency-sets-sights-on-tech/) , or movement of jobs to HQ2, or recession (likely between 2019-2021) and we should see a drop in prices.

    I sold a rental property in Ballard last year that was purchased in 2013 to invest in real estate outside of the city and kept much of the sale proceeds as a down payment for a future house in the area.

  79. 79

    RE: Kary L. Krismer @ 71

    I disagree. If the goal of the seller is to sell to someone who is going to tear it down and throw it away, there is no reason to show the interior or much of the exterior.

    In many markets a teardown is treated the same as a multi-family property with little or no interior photos (protecting tenants rights) little or no showings, no disturbance of the occupants, and Visual Inspection via in person or via photos to be AFTER an offer is accepted.

    Just because there is a system that wants to be “fed”, there is no reason to subject a seller to any inconvenience above that which is required to effectively support the seller’s objective.

    When a property can become multiple lots and the price is based on that multiple lot price and the price is only valid IF the house is torn down and thrown away (given the house can’t stay to accommodate the upzone to multiple lot potential), there is no reason for people to talk about the house that sits on that land other than the cost to remove it.

    In fact a picture of the lot SKETCH/Shape/Dimensions along with the parcel number and location, and no pictures of the actual lot, are often sufficient.

    “Highest Possible Price, In the Shortest Amount of Time or the Time Most Accommodating to the Seller and At The Least Inconvenience to the Seller” is our stated objective for all Sellers. This is something that cannot be bypassed by any Agent for the Seller in order to accommodate 3rd parties.

    I’m remembering an 84 year old man who came in wanting to sell his house for $1.4 Million. He had a tenant occupied property where the land was worth $1.7 Million (which we told him). He had a young mother with a new baby as a tenant. He wanted to list it at $1.4 Million with the proviso that offers be submitted without anyone stepping ON the property or being conspicuously near the property.

    He got 12 offers and $1.75 Million…sight unseen…no photos. It was an 850 sf 2 bedroom house in poor condition.

    The seller, and not what the buyers and or agents want, is tantamount.

  80. 80

    RE: ARDELL DellaLoggia @ 76 – It still would give them some idea of what they are up against. Is the house full of crap? Is there an octopus furnace in the basement covered in asbestos. Basically there’s no reason to not show interior pictures unless maybe the floor is so unstable you’d need to use a drone to take the pictures. Uncertainty can be removed by showing pictures.

    The seller, and not what the buyers and or agents want, is tantamount.

    What the seller should want is the most offers and the highest offers. It does not make sense for a seller to not consider what buyers want when the cost of supplying what they want is virtually zero. I’m not suggesting hiring a professional photographer.

  81. 81
    ARDELL DellaLoggia says:

    RE: Kary L. Krismer @ 77

    There is never only one answer that accommodates all people. If that were the case, the entire system could be automated at great savings to both buyers and sellers.

    You make a great case for Amazon selling real estate. Kudos!

  82. 82
    Brian says:

    RE: seamille @ 78

    Very good insight. I agree with what you said, particularly the comparison to San Francisco. California’s prop 13 is a huge disincentive to sell when people pay such low property taxes and can pass those savings on to their children. Take Warren Buffet’s $4mil Laguna Beach property for example, that only costs $2.2k/year in property taxes. That’s as cheap as property taxes on a $169k house here.

  83. 83

    By ARDELL DellaLoggia @ 81:

    RE: Kary L. Krismer @ 77

    There is never only one answer that accommodates all people. If that were the case, the entire system could be automated at great savings to both buyers and sellers.

    You make a great case for Amazon selling real estate. Kudos!

    I would agree with you if we are arguing about tearing down the building before listing, but I wouldn’t be making the seller tearing down argument because demolition costs money and is not something everyone knows how to do. There it makes sense that some sellers would demolish and some not.

    This is simply pointing and shooting a basic camera, has no downside, and could be done when the outside picture is taken. There is no downside. It’s not like the NWMLS charges per picture.

    You make a good argument for government selling real estate.

  84. 84

    By Brian @ 82:

    RE: seamille @ 78

    Very good insight. I agree with what you said, particularly the comparison to San Francisco. California’s prop 13 is a huge disincentive to sell when people pay such low property taxes and can pass those savings on to their children. Take Warren Buffet’s $4mil Laguna Beach property for example, that only costs $2.2k/year in property taxes. That’s as cheap as property taxes on a $169k house here.

    And I would bet that that think tank that wants Washington to have an income tax probably says our tax system is more regressive than theirs.

  85. 85
    pedaltothemetal says:

    Is it true that the space needle renovation included an opiate fountain at the top?

    Money well spent.

    Way better than sidewalks.

  86. 86
    pedaltothemetal says:

    Listing agent word helper:
    “Rare ”
    “Gem”
    “Charmer”

    Should add a few new ones:
    “Free needles”
    “Translucent sidewalks”
    “A real poo poo plater”

  87. 87

    RE: Kary L. Krismer @ 76
    Yes Kary Some Things Have Changed Since the 90s

    The HOA fees at the condos was like $30/mo….now Renton ones are reporting $600/mo [not inflation adjusted]….imagine the HUGE fees now in Seattle? But even good HOAs bumble the jobs and fix the wrong things soaking the buyers with high fees anyway…the banks aren’t loaning HOAs maintenance money anymore using the total condo association dues as collateral either [no more convenient monthly payments]. Sooooo…just how do we prove they aren’t getting decrepit with age, even now?

  88. 88
    Notme says:

    RE: pedaltothemetal @ 86

    You need to “plate” the delicacies properly. Presentation is everything. Every agent knows that.

  89. 89

    RE: Kary L. Krismer @ 77
    Its Kinda Like the Government Buys Your Whole Neighborhood to Build More Freeways

    Ya take what they give you and Trump had a name for it….”eminent domain” I believe?

    An apartment building or complex reduces building costs through learning curve so the units are valued cheap at a per unit cost [they were built new with the same cost reduction learning curve, but the contractor/owner pocketed it all then as profit].

    The learning curve on condo building is 70% [every doubling of units built is for 70% the cost of the previous unit group]. Its not an option its the reality of building the same thing over and over again….labor and materials go way down on condo building, hence apartments too [same thing].

  90. 90
    Wile E. Millenial says:

    A dinky rambler a couple blocks away, a slightly worse version of mine, sold two months ago. They paid the same price for it that I did a year ago. I had been keeping a close eye on it, and I just saw that the buyer (who Google reveals is an Amazon engineer) filed teardown permits to build a 3000+ sf home.

    Despite some bear signs in the market, that seems… fairly encouraging. If only I could afford to tear my own house down.

  91. 91
    Notme says:

    RE: Wile E. Millenial @ 90

    Ramblers gonna ramble!

  92. 92

    There’s Now Great New Accommodations for Today’s San Francisco Tourists Being Built

    Two brand new “Bed and Breakfasts” are being built, complete with plenty of board games in each room featured to keep you busy and off the smelly San Francisco streets of Open Border Party poverty…

    https://www.usatoday.com/story/travel/hotels/2018/07/13/these-best-hotel-renovations-summer/782032002/

  93. 93

    By Notme @ 91:

    RE: Wile E. Millenial @ 90

    Ramblers gonna ramble!

    There have been some crazy prices for ramblers the past couple of years. Personally I think having stairs keeps you in better shape as you age.

  94. 94
    wreckingbull says:

    RE: Wile E. Millenial @ 90 – Remember that RE can be rather sticky on the way down, due to the effort, time, and cost of transactions. In your example, that engineer likely has been working on this, (architect, builder search, property search, offer, purchase) since at least the start of this year.

  95. 95
    wreckingbull says:

    RE: Kary L. Krismer @ 93 – My folks used to say the same exact thing, and then things changed overnight. People need to at least make sure they can continue to live on the first floor of a multi-level home if they wish to stay. They did not plan – no bedrooms on the first floor.

  96. 96
    Wile E. Millenial says:

    @wreckingbull My thoughts exactly, curious to see what shakes out next. My area is holding up so far but who knows.

    Personally, I love having everything on one floor in my tiny rambler. I used to own a four-story townhouse which I bought from some nice elderly folks, they hadn’t seen the top floor in years. I get plenty of hill climbing walking around the neighborhood.

  97. 97

    RE: wreckingbull @ 95 – Having a bedroom on the first floor can even be useful if you are younger and break a leg! So yes, that is a nice feature in a house.

    Our house has a bedroom on the first floor, with a Jack & Jill bathroom attached. We wanted that for my MIL (RIP), but when such a house proved difficult to find we decided to open up our search by looking for places with stairs that would accommodate one of those chair-lift devices. Those don’t cost that much money in the scheme of things. But then we found a house where we didn’t need it.

    My point though is that type of device can allow someone to stay in their house if age is the only issue. Joshua Green and/or his wife, who both lived past 100, had one installed in the Stimson-Green Mansion. But they also just quit going into rooms where leaks developed, so maybe they are not the best example! ;-)

  98. 98
    pedaltothemetal says:

    RE: Wile E. Millenial @ 90

    Let’s hope your Amazon engineer can engineer his/her way out of a lifetime of ball shining duty.

    Remember when you were young, you shone like the sun.
    Shine on you crazy Amazon ball shiner!

  99. 99

    RE: Wile E. Millenial @ 90

    We are in that stage of the market where:

    1) VA, FHA and less than 20% down buyers are able to purchase without competing with the “smart money” heavy hitters.

    2) Buyers who want to build their own house (per your example) can get a teardown without losing the teardown to the builders.

    3) Builders who can’t seem to get a lot because the more local and well known builders have them grabbed up before anyone knows the lot/land is for sale, are able to get something they couldn’t when the “smart money” was in the room.

    We are not at a point where sold data is going to tell you anything. By your own account an owner occupant buyer was able to snatch something that the builders hung back on, giving them that opportunity.

    All of the above is not unusual for this time of year in a market that is decelerating. Sometimes and in fact most times, a year like this will be followed by one more and healthy Spring Bump that is a shortened version that peaks in April.

  100. 100
    pedaltothemetal says:

    If you recently put yourself in massive debt nearing the top of the business cycle you can start preparing here:

    https://www.knowyouroptions.com/avoid-foreclosure/options-to-leave-your-home/foreclosure

  101. 101

    RE: wreckingbull @ 75

    I saw something interesting the other day related to this. I chose to think SWE meant a “no rental cap” building where there were at least as many, if not more, renters than owner occupants. I chose that as those are the buildings that I see being sorely neglected.

    It is extremely difficult and pricey to add a rental cap to a no rental cap building, as usually you have to change the CC&Rs. Changing the CC&R’s is more difficult, and usually requires a much higher vote %, than some other changes an HOA can make.

    The Board, however, usually has pretty much full authority to assess and collect dues and fines. I just saw a “no rental cap” building that added an extra $150 a month to the dues of owners who do not live in their condos. It not only applied to those who rented them out, but also to those who left them unoccupied.

    I have never seen that before, and frankly I’m not 100% sure that it is enforceable to add a significant surcharge in the monthly dues for owners who do not occupy their own units.

    A very interesting work-around.

  102. 102
    Dustin says:

    RE: ARDELL DellaLoggia @ 101 – Why do you think that average investors would be more inclined to try to avoid the costs of maintaining their building? It seems to me that an investor who depends on their property for business income would actually be more vigilant in ensuring their building is getting adequately maintained (as opposed to aesthetically improved) than a resident owner who may only be thinking about their personal experience and the years they intend to live in the building. I don’t disbelieve that some investors run their business by trying to maximize their income while avoiding as many of the costs associated with maintenance as possible, but these investors will invariably run into problems if they stay in the business long term, so why would this be a common behavior? Is it a matter of the real estate investment market being disproportionately saturated with short-term investors trying to make quick money, or do investors actually make more money by letting their property run down before selling it as a rehab project or tear down?

  103. 103
    Matt P says:

    RE: Dustin @ 102 – Just an example, I’m renting a condo built in the 70s that still has the original windows. If it were still owner occupied, they would have been replaced long ago. There are a lot of other easy fixes that could be done but the owner won’t bother because they’re not technically broken and hard to detect when viewing the unit to decide whether to rent it.

  104. 104

    RE: Dustin @ 102

    Dustin,

    I’m not talking about maintenance as maintenance is not put to a vote. The Board always has the authority to spend the dues on maintenance. No one gets a say in that. No one needs to vote for that to be accomplished.

    What I see time and time again is a Board who has the money to maintain the property, but wants a complete overhaul. A few people who want to sell at a higher price in the somewhat near future get themselves on to the Board and try to push a very expensive Special Assessment in order to have all new roof, windows and siding as well as some other improvements that are well beyond maintaining what they have.

    In the meantime, deferred maintenance grows and becomes abhorrent. While the Board is charged with maintaining the property, and they have a schedule of painting etc to prevent wood rot in the Reserve Study, they stop maintaining. It makes sense if you want all new siding to not want to spend money on painting the old siding. It makes sense if you want all new railings to upgrade the look of the building to not spend money on paint and repairs to the existing balcony and stair railings.

    This goes on for years while the Board and residents bicker over whether or not to pass a huge special assessment to upgrade (not merely maintain) the building on the outside. They don’t allow owners to get new windows either because they don’t want any new windows until they get all new windows at the same time as the new siding. (They can replace the glass to correct the broken window seals, but that’s all.)

    By letting the place go to pot, their case for all new roof, windows and siding gets stronger and stronger. They can now, after a few years of no maintenance, use the fact that all of the wood rot and the deplorable state of the building makes replacing everything a necessity, ignoring the fact that it was their neglect that caused that issue. These are Associations with plenty of money on hand for maintenance, but once their goal is all new siding and changing the look of the building vs merely maintaining what exists, things can go downhill fast.

    I call it “neighbor envy” as I see this most often when the prices of nearby newer buildings or condo conversion buildings are higher than what they can sell their unit for. They want the higher price that the neighbor building is getting.

    In many cases, after all this effort, they still can’t get enough votes for the massive Special Assessment. The people who tried all leave and everyone is left with a big mess of a building. Sometimes they win and the improvements are made and everyone gets a $50,000 plus special assessment. But sometimes they don’t win and all of the years of deferred maintenance cannot be easily corrected. They can only patch up and paint, but wood rot runs deeper than what you can see and easily access.

    Hopefully that is clearer. Maintenance done in a timely manner does not need a vote. The Board has ample authority to maintain a building vs change it.

  105. 105
    Eastsider says:

    By Matt P @ 103:

    RE: Dustin @ 102 – Just an example, I’m renting a condo built in the 70s that still has the original windows. If it were still owner occupied, they would have been replaced long ago. There are a lot of other easy fixes that could be done but the owner won’t bother because they’re not technically broken and hard to detect when viewing the unit to decide whether to rent it.

    The windows are replaced by the HOA, not individual unit owners. Unless the (super) majority agrees to replace the windows/sidings/roof, likely with a special assessment, it will not be done. However, if the HOA has a healthy reserve, it can opt to replace windows using the fund.

  106. 106

    RE: Eastsider @ 105

    Historically windows have been considered interior to the unit. Owners with broken window seals or a broken window have always been responsible to repair the window by replacing the glass. For many years owners complained that the Board dictated the type of window and sliding glass doors and often dictated which contractor(s) could be used for the replacement, but they did not pay for the window and door replacement. Many complaints as to why if they were paying for it, should the Board be able to have a say in what they buy.

    The most notable one that I remember (it was in Bellevue) decided that all owners needed to replace their silver, metal windows and sliding glass doors with vinyl clad white. They gave the owners the exact model that needed to be used and the contractor who needed to do it. (They may have given a choice of a few, but I think they worked a deal with one.) They gave the owners a deadline of two years from the date of the mandate to comply UNLESS they sold the unit in the interim. If they sold the unit, it had to be sold with the new windows and doors.

    Even when the Board takes it upon themselves to include an item in The Reserve Study for all new windows and sliders, contrary to their obligations in the CC&Rs, they still do not repair and replace glass defects caused by cracks and/or broken window seals.

    In recent years more CC&R’s include windows and sliding glass doors as an HOA responsibility because bad contractors have caused mold issues in buildings when owners replaced their windows. But historically, and to this day, the glass usually belongs to the owner and the portion that interfaces with the siding belongs to the HOA.

    If anyone sees an HOA paying to fix Broken Window Seals, let me know. I have never seen it on an individual basis and have sold many condos over almost 30 years where the owner of the unit had to negotiate that in the home inspection without being able to say “the HOA will fix that”.

  107. 107
    David says:

    I’ve yet to see a single Amazon employee house shopping in several months. You can look at one single entity causing a slowdown in housing in Seattle – Seattle City Council.

  108. 108
    Eastsider says:

    RE: ARDELL DellaLoggia @ 106 – Windows are “limited” common elements. Yes, you have to replace the window if you break it. But if the windows are defective (e.g. bad installation/faulty/out of warranty), they will have to be replaced wholesale and not individually. You can’t ‘upgrade’ your unit with double pane windows because the style/design will be different. The HOA will have to decide if they want to upgrade to energy efficient windows.

  109. 109

    RE: Eastsider @ 108

    A “broken window seal” is not something you cause, nor is it broken. It is extremely common and a cosmetic issue that causes your windows to be cloudy. Replacing the full glass is very common in both condos and homes and paid for by the owner and not the HOA. Most condo buildings are not built with the high end brands that have lifetime warranties on the seals.

    I have seen many unit owners being held responsible for the cost of replacement windows even when the entire building is being done at the same time. Same for garage doors in many condo neighborhoods that have garages.

    I’m going back three decades in five states and have had extensive experience managing condo buildings. Adding window replacement as a Reserve Study Component is a relatively new idea. Adding it to the Reserve Study cuts down on the likelihood that there will need to be a Special Assessment for them. But to date, and for many decades, the cost of window replacement has not been accounted for in most Reserve Studies and owners have replaced their windows even when no one else in the building is replacing theirs. However the Board must approve the window style and sometimes the contractor as well.

    Here in Washington a Reserve Study was not even required until 2008 or 2009.” Washington soon will become one of a half-dozen states requiring condo associations to provide a financial-wellness check that can predict whether the place is a potential money pit. The check, called a reserve study, estimates how much money an association must set aside to pay for expensive long-term maintenance, such as repaving a parking lot, replacing a roof or rebuilding rotting decks.”

    Perhaps your experience is based on a place where you lived that was built in recent times?

    We have thousands of condo buildings that are not collecting for window replacement and those that currently do, did not do it for the entire life of the building unless it is a newer building.

  110. 110

    RE: Kary L. Krismer @ 93
    Your Old Growth Framed House Has Its Positives Kary

    And if its a two story with stairs, required less wood per sq foot…..less roof to build. But I beg to differ, old folks fall more and that’s a normal degradation of balance age has on most anyone…why do you think 71 year old Trump always grabs the hand rail when using stairs? I do too and I worked out extensively and wrestled when I was younger. Retirees prefer one story Ramblers in general [some like RVs too…LOL]..

  111. 111

    RE: pedaltothemetal @ 98
    So Pedaltothemetal is Getting All the Positive Attention Some of the Bubbleheads Allege?

    LOL….your blogs are funny ;-)

    You never answered my question though, do you have quick Grand Prix style Honda or a NASCAR style high HP Dodge Hell Cat? I can imagine Pedaltothemetal driving the Duke Orange Charger air borne over Seattle, laughing at all the buffoons…

  112. 112

    By Eastsider @ 105:

    By Matt P @ 103:

    RE: Dustin @ 102 – Just an example, I’m renting a condo built in the 70s that still has the original windows. If it were still owner occupied, they would have been replaced long ago. There are a lot of other easy fixes that could be done but the owner won’t bother because they’re not technically broken and hard to detect when viewing the unit to decide whether to rent it.

    The windows are replaced by the HOA, not individual unit owners. Unless the (super) majority agrees to replace the windows/sidings/roof, likely with a special assessment, it will not be done. However, if the HOA has a healthy reserve, it can opt to replace windows using the fund.

    You’re correct that window frames are typically the responsibility of the HOA, but not always. The condo declaration will determine that. I ran into a building a year or two ago where it was the owner’s responsibility. This is all very building specific, although there are common results–and this sentence goes to a number of the posts on this topic which state things which are not necessarily correct.

    If it is the HOA, whether the board has the powers to do the repairs will depend on the condo documents. Sometimes it’s dependent on the type of work, some times the amount it will cost. And it wouldn’t necessarily require a super-majority.

  113. 113

    By ARDELL DellaLoggia @ 101:

    It is extremely difficult and pricey to add a rental cap to a no rental cap building, as usually you have to change the CC&Rs. Changing the CC&R’s is more difficult, and usually requires a much higher vote %, than some other changes an HOA can make.

    I don’t know about pricey, but it is difficult. There was a case about 3-5 years ago that held a statute applied rather than the condo declaration, and that 90% approval was required to add a rental cap. Most before then were going with the lower standard of a declaration, typically around 60%. But even if improperly passed there is a time limit (in most situations) to contest a new rule–one year. So most of the improperly passed rules would be valid even if enacted incorrectly.

    One thing I look for in rental caps is hardship exceptions, so that if you need to the board can approve your rental even if above the cap. That was a problem in the last downturn where someone would own a condo and either not qualify for a short sale or suffer significant tax consequenses. They were pretty well stuck absent a hardship provision.

    Finally, rental caps are a double-edge sword. They keep those “dirty filthy renters” out of the building, but they also hold down value when you try to sell because even a buyer who wants to live in the unit may be interested in being able to rent in the future. Being able to rent is typically an attribute of owning property, so not having that right limits value. And the idea that renters cause problems is really overblown, IMHO. In my old condo everyone was convinced it was a renter doing some malicious activity, but it turned out to be an owner, and I’m not sure we ever had an issue with a tenant.

  114. 114

    By ARDELL DellaLoggia @ 109:

    Here in Washington a Reserve Study was not even required until 2008 or 2009.

    It’s not even clear it’s really required now, or at least it often doesn’t happen. It’s sort of like how landlords are supposed to keep deposits in separate accounts, but there’s no real consequence if they don’t (or at least there didn’t used to be.) If the Board doesn’t do one then there is a process set up where a rather small percentage of owners can vote to have one done, and they can go to court if it isn’t done, but I’ve never seen that done.

    Although not required before 2008, some condos did them before. But they are rather questionable as to result, and mainly just useful as devices to get the board to think about the future (or to let buyers know about really bad situations). The entity doing the study basically just picks numbers out of thin air as to how long something will last and how much it will cost to replace. And how long something lasts is often dependent on how it is maintained in the future. Wood siding is probably a good example of that. Properly maintained some types may have a 100+ year life. Poorly maintained the same type may be only 25 years. But the reserve study may say 40. Add to that the fact that many of the components are likely outside the expertise of the person(s) doing the study, and that in any event they are unlikely to know cost to fix, and they really become questionable as to specifics.

  115. 115

    RE: Kary L. Krismer @ 112
    Kary My HOA is a Brainless Joke Wasting Money and the Banks Know it too

    They bought some shyster attorney’s recommendation that they could get maintenance money by putting a lien against 140 HOA homes…they even spent 10,000s of dollars on a Professional Engineer report to fix the water system 5 years ago….the water system was apparently fine, a complete waste of money chasing ghosts. They put in a $20K playground hardly no one uses and put off half the road repaving to pay for it…the list goes on, etc, etc

    I’d go to the HOA meetings, but, you can imagine why I don’t, LOL….they hate my common sense predicting their idiotic failures time and again…..I get treated like scum at the meetings IOWs….for telling the truth….LOL

  116. 116
    David says:

    BUT have they put in a bike lane along each street? If not, why not? The regressive scoundrels?

    By softwarengineer @ 115:

    RE: Kary L. Krismer @ 112
    Kary My HOA is a Brainless Joke Wasting Money and the Banks Know it too

    They bought some shyster attorney’s recommendation that they could get maintenance money by putting a lien against 140 HOA homes…they even spent 10,000s of dollars on a Professional Engineer report to fix the water system 5 years ago….the water system was apparently fine, a complete waste of money chasing ghosts. They put in a $20K playground hardly no one uses and put off half the road repaving to pay for it…the list goes on, etc, etc

    I’d go to the HOA meetings, but, you can imagine why I don’t, LOL….they hate my common sense predicting their idiotic failures time and again…..I get treated like scum at the meetings IOWs….for telling the truth….LOL

  117. 117

    RE: Kary L. Krismer @ 114

    As to the siding saying 40, usually it isn’t counted until it gets below 35. I agree that replacement may not be needed at the time they say, but a Reserve Study also does not require, or in most cases recommend. 100% funded balance.

    The Board has to manage the Reserve Study and earmark the largest replacement items so they can stop collecting for the siding, as example, once that replacement cost is fully funded. But more likely the monies will simply pay for the roof that costs more than the amount collected.

    The simple math of collecting for replacement of Major Components can really be updated by a Board once they have the first one in hand. In fact neither a 3rd Party Reserve Study Company OR a Board should go it alone long term. They should both interact with the process of the working document.

  118. 118
    David says:

    I’ve generally found that HOAs decrease the value of a property. I’ve been looking at various markets and I can almost tell when an HOA property pops up because the values are curiously lower.

  119. 119
    Notme says:

    RE: softwarengineer @ 111

    Pedaltothemetal sounds like a sensible guy. He probably drives a Prius.

  120. 120
    Notme says:

    RE: Kary L. Krismer @ 93

    >>Personally I think having stairs keeps you in better shape as you age.

    Who needs a 2nd story for exercise when you have Bezo-balls to shine. Just the commute from that rambler in Emunclaw to the Amazon Intergalactic Ballquarters in Seattle will keep you in better shape than anyone could wish for.

  121. 121
    Paulie says:

    Hey. Why don’tcha go SHAVE BEZOS’ BALLS?! AHHHH HAHAHAHAHA. Get it!?

    I made a funny joke…. about BALLS! Ah ha! Ha! Ha! The best part is is that it is an original and inventive thought that has not been had before. See, the thing is, a geodesic sphere can be analogized to a testicle, and testicles are funny. In fact, the more times the same joke gets told, the funnier it gets.

    Knock knock. Who’s there. Bezos’ balls. Hahahaha! I better write that comedy goldmine down so I don’t forget it.

  122. 122
    sfrz says:

    She is not the enemy: This is what happens when corporations capture governments and society. Unchecked capitalism is eating its host, like a tumor. https://www.seattletimes.com/seattle-news/politics/seattle-council-approves-electricity-rate-hikes-directs-city-light-to-rethink-rate-structure/
    Kshama Sawant
    @cmkshama

    Just weeks after they repealed Amazon Tax, @SeattleCouncil approved plan that’ll increase electricity rates on working families by 30% over 6 years starting 2019! I was the only NO vote. Rate increases should go on big businesses, not workers or small biz.

  123. 123
    Notme says:

    No cracker for you, Polly. Keep trying.

  124. 124
    Paulie says:

    By Notme @ 123:

    No cracker for you, Polly. Keep trying.

    For some reason, the comments I post about Seattle real estate typically only get posted half the time, but the ones about stupid shiny Bezos balls always slip through. I don’t understand the moderation of these comments.

  125. 125
    Notme says:

    RE: sfrz @ 122

    Well, yeah, remember the $280/year proposed headcount tax that was greatly vilified and rejected by the “business community”. To wit, it was not so much the $280/year pittance they complained about, but rather how being subjected to such as MASSIVE INSULT and DISRESPECT was the cause of HURT FEELINGS and a sense of not being DESIRED by Seattle. Big BOO-HOO!! Why didn’t they tax the homeless $280/year instead? After all, they are much less desirable than us!

    So now the small business ends up with a big fat 30% electricity raise over the next 6 years instead. That’s what you get for being such whiners. And the socialist voted against it. Who knew she cared so much about you? ROFLMAO.

  126. 126
    Paulie says:

    By sfrz @ 122:

    She is not the enemy: This is what happens when corporations capture governments and society. Unchecked capitalism is eating its host, like a tumor. https://www.seattletimes.com/seattle-news/politics/seattle-council-approves-electricity-rate-hikes-directs-city-light-to-rethink-rate-structure/
    Kshama Sawant
    @cmkshama

    Just weeks after they repealed Amazon Tax, @SeattleCouncil approved plan that’ll increase electricity rates on working families by 30% over 6 years starting 2019! I was the only NO vote. Rate increases should go on big businesses, not workers or small biz.

    People keep forgetting that Amazon already publicly said they would accept the $20M head tax and had already resumed construction. Businesses didn’t revolt against the head tax as a policy in itself. They revolted against the vitriol and polarizing language that makes future investment and development of their business within the city so uncertain for them.

    Kshama Sawant is correct, that corporations are too powerful, and Jeff Bezos is too wealthy. However, her effort was poorly timed, ill-conceived, and amateurishly executed. She didn’t listen to her constituents and made it very personal, attacking “the billionaire bosses,” using taxpayer’s funds to print “TAX AMAZON” signs and marching on their HQ in front of national media.

    How can anyone say this was in the best interest of the city? City Council is supposed to do things like fix potholes, make sure the police is funded (bonus points for not labeling them murderers without due process), and write legislation that balances the needs of all its constituents (not only the transient homeless population). All we have here is wasted time and energy to write and repeal the legislation, more polarization and us-vs-them politics, and a new national narrative for Seattle as a homeless haven at war with its job creators. Her tactics backfired badly.

    Neither Sawant nor the businesses needed to be enemies, but Kshama Sawant made the entire debate about her “revolution” and painted the businesses as mortal foes in a way that no one was going to accept. So she had a choice: (1) attempt to pass a sound policy quietly that everyone can agree to, or (2) attempt to boost her national profile by attracting unnecessary national media attention on her platform and “revolution” to boost her own career and profile. How does national media attention help the city of Seattle, or help her legislative agenda within the city of Seattle? So she chose Door #2, sacking the needs of the constituents to boost her own career.

    I can say with great confidence that Kshama Sawant is the enemy. She is not fighting for Seattle or its people. She is fighting for her own fame and political career. She torpedoed her own legislation by making it into a national social justice issue where it didn’t need to be, and once she took it that far, business couldn’t afford to give her an inch and watch her take the mile. Again, the fact that her sensational signs said “TAX AMAZON” instead of “SAVE THE HOMELESS” tells me what I need to know about her. She doesn’t stand for anything but incensing the mob to boost her own career.

  127. 127
    David says:

    ANY defense of Sawant and her allies is ‘per se’ illegitimate. You can count on one thing from them: A recession.

    By Paulie @ 126:

    By sfrz @ 122:

    She is not the enemy: This is what happens when corporations capture governments and society. Unchecked capitalism is eating its host, like a tumor. https://www.seattletimes.com/seattle-news/politics/seattle-council-approves-electricity-rate-hikes-directs-city-light-to-rethink-rate-structure/
    Kshama Sawant
    @cmkshama

    Just weeks after they repealed Amazon Tax, @SeattleCouncil approved plan that’ll increase electricity rates on working families by 30% over 6 years starting 2019! I was the only NO vote. Rate increases should go on big businesses, not workers or small biz.

    People keep forgetting that Amazon already publicly said they would accept the $20M head tax and had already resumed construction. Businesses didn’t revolt against the head tax as a policy in itself. They revolted against the vitriol and polarizing language that makes future investment and development of their business within the city so uncertain for them.

    Kshama Sawant is correct, that corporations are too powerful, and Jeff Bezos is too wealthy. However, her effort was poorly timed, ill-conceived, and amateurishly executed. She didn’t listen to her constituents and made it very personal, attacking “the billionaire bosses,” using taxpayer’s funds to print “TAX AMAZON” signs and marching on their HQ in front of national media.

    How can anyone say this was in the best interest of the city? City Council is supposed to do things like fix potholes, make sure the police is funded (bonus points for not labeling them murderers without due process), and write legislation that balances the needs of all its constituents (not only the transient homeless population). All we have here is wasted time and energy to write and repeal the legislation, more polarization and us-vs-them politics, and a new national narrative for Seattle as a homeless haven at war with its job creators. Her tactics backfired badly.

    Neither Sawant nor the businesses needed to be enemies, but Kshama Sawant made the entire debate about her “revolution” and painted the businesses as mortal foes in a way that no one was going to accept. So she had a choice: (1) attempt to pass a sound policy quietly that everyone can agree to, or (2) attempt to boost her national profile by attracting unnecessary national media attention on her platform and “revolution” to boost her own career and profile. How does national media attention help the city of Seattle, or help her legislative agenda within the city of Seattle? So she chose Door #2, sacking the needs of the constituents to boost her own career.

    I can say with great confidence that Kshama Sawant is the enemy. She is not fighting for Seattle or its people. She is fighting for her own fame and political career. She torpedoed her own legislation by making it into a national social justice issue where it didn’t need to be, and once she took it that far, business couldn’t afford to give her an inch and watch her take the mile. Again, the fact that her sensational signs said “TAX AMAZON” instead of “SAVE THE HOMELESS” tells me what I need to know about her. She doesn’t stand for anything but incensing the mob to boost her own career.

  128. 128

    RE: Paulie @ 126

    Not sure if this will play for you because it is a facebook link. “New Seattle Tourism Video”.

    “We’re about Compassion…to a pathological level.”

    https://www.facebook.com/DadusAmericanis/videos/10212721558541492/

  129. 129

    By Notme @ 125:

    RE: sfrz @ 122

    Well, yeah, remember the $280/year proposed headcount tax that was greatly vilified and rejected by the “business community”. To wit, it was not so much the $280/year pittance they complained about, but rather how being subjected to such as MASSIVE INSULT and DISRESPECT was the cause of HURT FEELINGS and a sense of not being DESIRED by Seattle. Big BOO-HOO!! Why didn’t they tax the homeless $280/year instead? After all, they are much less desirable than us!

    So now the small business ends up with a big fat 30% electricity raise over the next 6 years instead. That’s what you get for being such whiners. And the socialist voted against it. Who knew she cared so much about you? ROFLMAO.

    First, the reason you give for the outrage is completely made up. Fiction seldom gives a compelling argument, and you failed miserably.

    Second, the SCL thing would have occurred anyway. But Seattle’s plan there is stupid–as are most their plans. Save Seattlites $5 a month on their electricity bill while costing some their jobs (not to mention tax revenue and revenue from electricity which will then force future rate increases).

    The unfortunate thing is that just being outside the city limits of Seattle doesn’t necessarily save someone from being subjected to SCL–they operate in some areas outside the city.

  130. 130

    RE: ARDELL DellaLoggia @ 128 – That’s great! “We’re about looking forward, by refusing to learn from the past.”

    I would have left out the needle reference, but . . ..

  131. 131

    RE: ARDELL DellaLoggia @ 109
    Yes Ardell

    But how long does any brand new seal last slammed open and shut for even a year [especially framing heavy air conditioners on the flimsy plastic frames]? Do the leaks cause any heat loss?

    Questions, questions…it may all be a waste of money…I know heater duct cleaning is….

    Maintenance priorities are never planned right.

  132. 132

    RE: softwarengineer @ 131 – There are very few situations where heater duct cleaning makes sense. Blocking foreign objects would be one, and mold would be another. But as to the general rule, anything that is in the duct will stay in the duct due to inertia, and if that isn’t the case it won’t be there to remove. It’s sort of common sense, but this entire industry has grown up to take peoples’ money!

    https://www.epa.gov/indoor-air-quality-iaq/should-you-have-air-ducts-your-home-cleaned

  133. 133
    GoHawks! says:

    RE: Bellevue @ 59 – no neighborhood is immune from a recession or real estate downturn. Some will hold up better than others, but none levitate.

  134. 134
    sfrz says:

    RE: GoHawks! @ 133 – Prices keep going up… until they don’t. Mercer Island… the Island!…down down down…. “What a difference a couple of months can make in the housing market. In May, inventory levels were still at record lows and many homes were getting multiple offers. As previously reported, the Seattle area has seen the largest home price increases in the country for the last 20 months in a row, according to Case-Shiller data. With the median house price at $812,500 in Seattle and $978,000 on the Eastside, we are at a tipping point where record-high home prices, overly optimistic sellers and buyer fatigue have converged.” http://www.mi-reporter.com/marketplace/are-seattle-eastside-home-prices-headed-down/

  135. 135
    David B. says:

    As far as homelessness in Seattle goes, let’s please continue the proud tradition of blaming the homeless themselves for the problem. Whatever we do, don’t blame those with the most economic and political power in society. That might lead to awkward questions being asked. And let’s keep ignoring the point that homelessness has grown hand in hand with rent inflation.

    Rational dialogue is based on comforting the comfortable and afflicting the afflicted.

  136. 136

    RE: David B. @ 135 – You can take a middle road and not blame either the homeless or the extremely successful, although some of the former may be at least partially if not mostly responsible for their situation. There is the fact of addiction, often brought on by prescriptions, and also that our economy is not as strong as claimed. It’s been particularly difficult for older persons to get reemployed.

  137. 137
    David B. says:

    RE: Kary L. Krismer @ 136 – There have always been individuals which, for whatever reason, have difficulty being as economically successful as others. That is not a new development. What is new is that fewer and fewer of such individuals can now afford housing. If you keep raising the hurdles, fewer and fewer will be capable of jumping them.

  138. 138

    RE: David B. @ 137 – That’s largely true, but I’m not sure it’s fewer and fewer. The problem is more and more relatively successful people have moved into the area, as well as some politically protected less successful groups (Sanctuary City). The latter is part of my problem with Seattle government–they have no realization of the fact that what they do for one cause hurts another cause, because they don’t understand the world or economics. They live in a make-believe fantasy world where they think they can just make things happen by decree.

  139. 139

    And back in the world of real estate, Redfin is turning to the market again for money. If my sources are right, it’s $100M more than their IPO last July. That seems odd unless they have some really big plans.

    https://www.geekwire.com/2018/redfin-seeks-raise-239m-new-debt-stock-offering/

  140. 140
    David B. says:

    RE: Kary L. Krismer @ 138 – The problem is a population that is increasing faster than its housing stock.

    And speaking of make-believe fantasy worlds where the Law of Unintended Consequences doesn’t apply, Sanctuary City policies* were originally adopted to help minimize how unintended consequences foster crime, particularly organized crime (because if the undocumented were afraid to report crimes, crime would flourish, and worse, some would choose to use the mob instead of the legal system to resolve disputes). One of the first sanctuary cities was Los Angeles, and the policy was instituted by none other than LAPD chief Daryl Gates — for just this reason.

    * Which are completely legal, by the way. The law says that if local police departments collect data about immigration status, they must share it with the Feds. Sanctuary City typically means that the local cops refuse to collect the data in the first place, giving them nothing to share.

    Washington state doesn’t even rank that highly on the illegal immigrant population, by the way: http://www.slate.com/articles/news_and_politics/map_of_the_week/2013/02/map_illegal_immigrant_population_by_state.html . So it seems unlikely that’s a big cause of any housing shortage in Seattle. I think you’re paying way too much attention to SWE and other fascists’ Trumpists’ spittle-flecked rants here.

  141. 141

    RE: David B. @ 140 – I’m aware of that justification, but not the history–thanks for that. I get the feeling though it’s gone far beyond that. They are critical of anything that does anything to prevent anyone from living here, including federal enforcement of immigration laws.

    https://www.king5.com/article/news/local/7-eleven-immigration-raids-criticized-by-seattle-mayor-councilmember/281-507002275

  142. 142
    David B. says:

    By Kary L. Krismer @ 141:

    How dare they question the motives of an obviously racist and white nationalist president! Can’t they be good and reasonable both-sides-ists?

    And regardless, that’s just saying some mean words about an ICE raid. Words are not policy.

  143. 143
    uwp says:

    By Kary L. Krismer @ 139:

    And back in the world of real estate, Redfin is turning to the market again for money. If my sources are right, it’s $100M more than their IPO last July. That seems odd unless they have some really big plans.

    https://www.geekwire.com/2018/redfin-seeks-raise-239m-new-debt-stock-offering/

    Comes a few weeks after Zillow announces plans to raise ~$600 million. May be connected to Redfin Now?

  144. 144
    David says:

    RE: David B. @ 142 – I remember when South Africa got woke. They traded one racist horse for another racist horse. Cept the new horse started murdering the old horses and carrying out a genocidal pogrom. A place where the old horses have to get ‘rape insurance’ literally.

    Now I look at the U.S. and I see our woke Obama hiring his personal artist famous for this kind of painting and think “How diverse he was.”: https://www.snopes.com/fact-check/kehinde-wiley-painted-black-woman-severed-head/

    If the women of this country think this is o.k. then I hope they get what they want. And men/boys like you as their only romantic option.

  145. 145

    RE: David B. @ 142 – So you think ICE wasn’t conducting employer raids under Obama? And you don’t think ICE should be enforcing the law?

    Employers hiring people who are not entitled to work in the US leads to people who can legally work here being either unemployed or working for less money, and eventually possibly homeless.

  146. 146
    Erik says:

    RE: David B. @ 135
    Move them to Everett or Tacoma. Get them out of Seattle!!! Unsuccessful people have to live in poor areas, what makes the homeless any different?

  147. 147
    pfft says:

    Donald Trump has betrayed this country and you guys are complaining about the city council. Putin is basically our president now. Of course I said that a long time ago.

    LOL.

  148. 148
    pfft says:

    By Erik @ 146:

    RE: David B. @ 135
    Move them to Everett or Tacoma. Get them out of Seattle!!! Unsuccessful people have to live in poor areas, what makes the homeless any different?

    unsuccessful people retire and get tens of millions of dollars in a retirement package. AKA a failed CEO.

  149. 149
    David B. says:

    RE: David @ 144 – I suppose that all somehow made sense… to you.

  150. 150
    David B. says:

    By Kary L. Krismer @ 145:

    RE: David B. @ 142 – So you think ICE wasn’t conducting employer raids under Obama?

    Of course they were, and at what were for the time record numbers.

    It just wasn’t against the background of an obviously racist president.

    If you think Trump is doing anything “just to enforce the law”, I have a bridge across the East River to sell you.

  151. 151
    David B. says:

    RE: pfft @ 148 – But those people are by definition quite successful, since they get to retire in comfort and luxury. (Success and virtue are two different concepts.)

  152. 152
    pfft says:

    By David B. @ 150:

    By Kary L. Krismer @ 145:

    RE: David B. @ 142 – So you think ICE wasn’t conducting employer raids under Obama?

    Of course they were, and at what were for the time record numbers.

    It just wasn’t against the background of an obviously racist president.

    If you think Trump is doing anything “just to enforce the law”, I have a bridge across the East River to sell you.

    Trump doesn’t like brown people. I think that is pretty obvious. He told us that the day he went down the escalator and announced his candidacy. It’s not just illegal immigrants, he wants to cut legal immigration in half. don’t believe him when he says he is just against illegal immigration. he also said that he wishes we could have more people from Norway. If he only knew the context of that remark and the other historical figure who liked Scandinavians. I guess he doesn’t know also who Anders Brevik was.

  153. 153
    pfft says:

    By David B. @ 151:

    RE: pfft @ 148 – But those people are by definition quite successful, since they get to retire in comfort and luxury. (Success and virtue are two different concepts.)

    I just really really mind all the money CEOs get AFTER the company or it’s stock tanks.

  154. 154
    David says:

    RE: pfft @ 152 – Still waiting for pfft to pull the plug out of hus butt and explain this: https://www.snopes.com/fact-check/kehinde-wiley-painted-black-woman-severed-head/

  155. 155
    Blurtman says:

    RE: pfft @ 152 – Trump’s remarks are not policy, but even so, it is nothing new regarding immigration policy. Just examine the history of US immigration law.

  156. 156

    RE: David B. @ 135
    I Was at Church a Couple Weeks Ago

    I asked God to get the MASS homeless Veterans jobs at Microsoft instead of foreign nationals stealing them all at lower wages. Microsoft does give to charities….in Africa, not America.

  157. 157

    RE: pfft @ 152
    Hey Your Righteous Democrat President Johnson Used the “N” Word to Identify African Americans

    He thought he had the “N________s” fooled as he locked them in inner city slave quarters during civil rights bills. Who are the real NWO Confederates in America anyway? Those who want to replace working and livable legal citizen wages with foreign slaves? Confederate= NWO, the Confederate buried gold for Civil War II is still being hunted for now by today’s treasure hunters….its new name is NWO BTW in documented writing too.

  158. 158

    RE: David @ 116
    LOL….Bike Lanes Nobody Hardly Uses are First Priority Over Fixing Roads

    Yes….David….the Open Border Party is off its rocker.

  159. 159

    RE: Blurtman @ 155
    IMO Blurtman Obamacare and Immigration Enforcement are Similar

    We all want our greedy individual perks and stomp on the pesky/general thought We the People [Trump] wishes in order to protect the real Confederate slave masters, the Open Border Party or NWO.

  160. 160

    RE: Notme @ 119
    LOL Prius?

    The car that uses that “Horrifying Toxic Manufacturing Process Lithium Battery from China”? You are a true Open Border Party…..I sure hope those high priced engineers from Japan will discover the science of real news Safety Engineering in America…..LOL….before the whole world is soaking up heavy elements from your “safe” hybrids….LOL

  161. 161
    Justme says:

    Wow, look at the KC/SFH inventory rise again. Formerly recalcitrant sellers are smelling danger and are crowding the exits of the housing market in King County.

    07.13.2018 21:00 3799 (Fri night)
    11.22.2014 23:00 3802 (last time inventory exceeded last weeks peak)

    We are at a 3yr8mo inventory peak. Perhaps time to get the discussion back on the bubble-bursting track?

  162. 162

    Returning again to the real estate area, I finally saw a good use of electronic signatures for closing documents. The buyer/borrower still needs to sign the deed of trust (and note and REET affidavit?) in person in the presence of a notary, but everything else can be signed electronically. Not only will that save a lot of sore hands/wrists, but also it allows the buyer to actually have time to review the documents they are signing. And the package I saw had the note and deed of trust too, so that could at least be reviewed.

  163. 163

    RE: Justme @ 161RE: David B. @ 142
    The 140 SE King County Glenbrook Open Houses are Still Zero as We Enter August

    Banks have to unload units constantly to make money [Summer is the home buying maxima BTW]….so why the stop on SE King County open house “apparently Pre-approved Mortgages”…..does anyone really know why?

  164. 164
    David B. says:

    RE: softwarengineer @ 156 – The system doesn’t much care about veterans; it sees them as expendable, much as it sees the entire working class. Expect the next imperialist war to simply create more of them — and many will end up homeless, as veterans have long tended to do.

    Imperialist wars* successfully create profits for the military-industrial complex and are most useful tools for managing and herding public opinion. This is their purpose, and the serve it well. The well-being of those who fought in them is at best a second or third-priority matter in comparison.

    You may personally derive comfort and satisfaction from religious rituals (if so, feel free to participate in them), but in and of themselves such practices are unlikely to accomplish much. If the fact that there are so many homeless veterans upsets you, I would suggest pursuing more concrete modes of action (of which there are many).

    * Basically all there’s been since World War II, which was the last truly defensive one the US fought in.

  165. 165

    RE: Kary L. Krismer @ 162
    Be Careful Using Computer Signatures Kary

    I just got a bogus email from the federal government on 2014 health care auditing….it was fake I found out today… they hope you send ’em money anyway?

    Do hackers work directly for Microsoft to justify poor quality weekly S/W patches and low quality indicator parts replacements….i.e., anti-virus S/W fees….???? How about the Intel Chip too, it has an open backdoor in its circuitry to allow Microsoft NWO hackers in? None of this is in the MSM BTW….truth.

    Beware of the website USPS Stamps.com $15.99/mo endless credit card charging [almost impossible to shut down, I had to use Credit Dispute] they fail to clarify in their “free stamps” advertisements…

  166. 166

    RE: Justme @ 161 – I know you keep saying it’s sellers rushing to the exits, but the stats don’t bear that out. The new listings for 6/18 (King County SFR) were only less than 100 over 6/17. In contrast, the pendings were off less than 400 and the solds less than 150. Those in total doesn’t quite account for all the roughly 800 increase in listings MOM, but it’s most of it, and the vast majority of the increase is sale related, not supply related.

    The YTD solds are only off by less than 600, which is somewhat surprising given some of the prior months’ sales seemed to be supply constrained. But the YTD new listings are up by over 1,200. Those two stats alone would get you to an increase of almost 1,800, but over longer periods of time, some of the new listings are likely to be re-listed properties. Even ignoring that though, an increase in rate of 200 a month for new listings is hardly sellers rushing to the exits.

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

  167. 167

    By softwarengineer @ 165:

    RE: Kary L. Krismer @ 162
    Be Careful Using Computer Signatures Kary

    You’re preaching to the choir on that one. When they first became common for real estate I was slow to adopt them because of the legal uncertainties. When the NWMLS started providing a free service I decided to go with them more, in part because it was not me picking the service! (Although admittedly I wasn’t not selecting another service–but I was not the one who picked. The same issue comes up with inspectors and forms.)

    And of course you should be careful with any non-solicited electronic signature, but here the buyer would know the docs are coming and be expecting them. But as long as the note and deed of trust are not signed electronically I don’t see any major issues beyond that. If the lender is the one creating the electronic signatures, then they will fund with electronic signatures.

    One last thing. I’m very leery of electronic signatures on notes, because every copy is an original. I’ve adopted a non-negotiable note for earnest money transactions where the deal is signed with electronic signatures.

  168. 168

    RE: David @ 144
    Women are On Mens’ Side On that Issue

    Good gosh they want great sex [let’s be honest] and the current NWO American man is WAY down in testosterone and sperm count recently….working women are dying of heart disease and diabetes worse than men too now. The Milenial Women were polled recently….70% just want to be housewives with a working hubby…they see the general failures of the Gen-X and Baby Boomers clearly and I’m on their side too…

    Seattle recently had a mens’ protest march , I wonder why? LOL

  169. 169
    N says:

    @ Kary 166 – Tim’s reporting for May indicated new listings were up 17% YOY (4,200 new listings). Wouldn’t that be a lot of more than the 100 listing increase you mention.

    The June numbers showed a 42% increase yoy, seems pretty substantial to me, even if that isn’t new listings. Either sellers are increasing or demand is decreasing or some combination. Curious to hear your thoughts.

  170. 170
    Justme says:

    RE: Kary L. Krismer @ 166
    RE: N @ 169

    @N, :-) :-)

    @Kary, I said CROWDING the exits, not rushing. Likewise, one might say that buyers are not crowding the entrance at this time.

  171. 171

    By N @ 169:

    @ Kary 166 – Tim’s reporting for May indicated new listings were up 17% YOY (4,200 new listings). Wouldn’t that be a lot of more than the 100 listing increase you mention.

    The June numbers showed a 42% increase yoy, seems pretty substantial to me, even if that isn’t new listings. Either sellers are increasing or demand is decreasing or some combination. Curious to hear your thoughts.

    New listings for May 2018 were up about 600 YOY. The 100 figure was for June YOY.

    The total active listings being up 42% is a significant change YOY. The issue is why. More sellers or fewer buyers, and it seems to be a bit of both, but mainly fewer buyers. And that’s surprising given all the multiple offers of the recent past.

  172. 172

    By Justme @ 170:

    @Kary, I said CROWDING the exits, not rushing.

    But there’s little evidence to support either term, other than one month, and that only supports a short rush at best.

    If you look at the new listings graph (2nd one above), May was unusually high relative to the month before and after, but not particularly high for May in general. March and April were on the low side for those months , and June was hardly unusual at all. So there was basically a one month surge.

  173. 173
    uwp says:

    By Kary L. Krismer @ 171:

    The total active listings being up 42% is a significant change YOY. The issue is why. More sellers or fewer buyers, and it seems to be a bit of both, but mainly fewer buyers. And that’s surprising given all the multiple offers of the recent past.

    Couldn’t it simply be reversion to the mean? Dec/Jan we were hitting all-time lows for inventory (for recent recorded history). This was after 3+ years of declining inventory. How many threads did we have where people commented “how can inventory get lower?” And then it would get lower!

    From just eyeballing the “New Listings” chart it looks like May/June 2018 were not even in the top 5 most new listings for their comparable month in the last 19 years. And this is after Seattle population has grown by ~30% in that time frame.

    EDIT: I see you said something similar above while I was writing this.

  174. 174
    David says:

    RE: Kary L. Krismer @ 172 – I think Amazon is heading for the exits and the employees know it. Until someone confirms the existence of Amazon employees shopping the market recently, I think this market is already in recession.

    I also doubt it is just Amazon. Seattle’s anti-business assault is undoubtedly causing havoc.

  175. 175

    Median Days on Market in King County for currently Active listings is 26 days. Thought this might be a good number to track as to whether or not that starts going higher. In my service areas I calculate more by neighborhood so I can see specifically if something is selling that should not have sold.

    My two most recent clients were able to find a house in about 10 days and my other most recent closing took over a year. That could be meaningful in terms of more selection and not as much competition. Three completely different areas, but it does seem a bit better for buyers recently, even ones who have had difficulty for quite some time. None of the three had to compete heavily as to price or terms. My fourth recent closing had to compete with 6 offers and pay over 10% over asking, but that is because the bidding was back in Jan/Feb and the closing got held up by a Quiet Title Action.

    So the shift seems to be very recent and something we need to watch very closely.

    Still a much better time to sell than to buy, but not a good time for sellers to be too cocky. I’m seeing fewer “offer review dates”.

  176. 176

    By ARDELL DellaLoggia @ 175:

    Still a much better time to sell than to buy, but not a good time for sellers to be too cocky. I’m seeing fewer “offer review dates”.

    Well those were stupid anyway, so that’s a good thing! ;-)

    What I’m seeing is fewer going straight to pending without an inspection period. That’s generally a good thing for both buyers and sellers!

    So two “stupid agent things” that are going away with a more balanced market!

  177. 177
    Alyx says:

    RE: Justme @ 170

    I agree!

    I keep visiting this site to read insightful discussion about THE BUBBLE, but instead Trump has invaded here as well.

  178. 178
    Sid says:

    By Alyx @ 177:

    RE: Justme @ 170

    I agree!

    I keep visiting this site to read insightful discussion about THE BUBBLE, ……..

    There is no BUBBLE. Have you seen tech stocks lately (especially AMZN and MSFT)? Insane amount of wealth being generated in tech heavy cities like Seattle and there is no way real estate prices go down YoY here in 2018 or 2019.

  179. 179
    David B. says:

    By Sid @ 178:

    There is no BUBBLE. Have you seen tech stocks lately (especially AMZN and MSFT)? Insane amount of wealth being generated in tech heavy cities like Seattle and there is no way real estate prices go down YoY here in 2018 or 2019.

    And there has never been a bubble in the stock market, ever!

  180. 180
    David says:

    RE: Sid @ 178 – Just because AMZN moves out and takes housing demand with them does not mean AMZN stock will go down in price. But what it does mean is housing demand will go down. Prices will deteriorate – as they are now.

    It isn’t a bubble if demand is sustained. But Seattle has gone out of their way to kill business sentiment.

    Take a look at this Google search and see what Bezos has had to endure from the enlightened ones of Seattle: https://www.google.com/search?q=jeff+bezos+isn%27t+in+seattle+anymore&oq=jeff+bezos+isn%27t+in+seattle+anymore&aqs=chrome..69i57.8519j1j7&sourceid=chrome&ie=UTF-8

  181. 181
    Brian says:

    By Kary L. Krismer @ 172:

    If you look at the new listings graph (2nd one above), May was unusually high relative to the month before and after, but not particularly high for May in general. March and April were on the low side for those months , and June was hardly unusual at all. So there was basically a one month surge.

    I’ll be interested in seeing July numbers – it seems like inventory accelerated again last week.

  182. 182
    Paulie says:

    By David @ 174:

    RE: Kary L. Krismer @ 172 – I think Amazon is heading for the exits and the employees know it. Until someone confirms the existence of Amazon employees shopping the market recently, I think this market is already in recession.

    I also doubt it is just Amazon. Seattle’s anti-business assault is undoubtedly causing havoc.

    Good eye. You’ve noticed something very significant. In my view this is largely about Amazon.

    Specifically, Amazon’s annual reviews are given in April. By mandate, 10% of the company’s workforce was given a negative review that is a precursor to termination. This is called the “unregretted attrition” target. Amazon has had this every year but is enforcing it more rigorously this year, because people aren’t quitting Amazon due to the high stock prices and waiting for their restricted stock units to vest… but Amazon kind of needs people to quit. They expect the lowest performers will usually leave on their own, but because of the insane stock run, people who were hired by mistake or shouldn’t be there are staying anyway, so Amazon is getting more aggressive about shuffling them out.

    Similarly, because total compensation factors in stock appreciation, the highest performers were told they are not getting any performance-based raise at all. These are the folks who are now fleeing to Google and Microsoft over on the east side. These folks may have been buyers in this summer, but likely are waiting it out a little longer as their careers are in transition.

    10% of Amazon’s 50K Seattle workforce is 5K. Those people see a great opportunity to realize gains, especially if they are transplants who only moved here for Amazon, and especially if they are now being asked to leave Amazon (the only reason they moved here). Your incremental 600 new listings in May YOY is obviously about an increase in sellers, and the recency of it suggests a heavy linkage to Amazon’s annual performance review. Notice that June went back to normal with only 100 incremental YOY new listings. Dust settling. All it takes is a fraction of those 5K bottom performers to decide to sell and a fraction of those remaining top performers waiting to buy to fully explain this whole swing. That’s how much of a company town Seattle is.

    This tells me that we should expect a systemic shift in cyclical patterns in Seattle. Amazon’s annual performance reviews of 50K highly paid Seattle-based workers in April is now significant enough to change the Seattle market as a whole. But these are not to be confused with layoffs — Amazon isn’t cutting headcount, it just wants bottom performers out. It will hire new transplants from all over as this location and tech salaries are super attractive. They will spike demand. Amazon’s fundamental business is still strong and prices will continue to climb throughout the next 12 months. People who don’t know what is happening internally will be tempted to misread the market signs and infer a major slowdown in the market. People who understand what is happening internally know that this is just a speed bump based off of a specific event which will continue to recur and induce this new pattern into Seattle’s real estate cycles. When the dust settles, buying will resume.

    The big check on prices is going to be increasing interest rates. This is much needed. As an owner of multiple Seattle properties, I hope prices fall even though it will impact my portfolio. Because if they don’t the correction will hurt even more when it comes. The demand is reduced temporarily but it still exists and you will see it when the dust settles, which concerns me as the market will just continue heating up if true. In September, data over the summer will likely bear this hypothesis out.

  183. 183
    David says:

    RE: Paulie @ 182 – Good analysis, BUT you did not explain the effect of Amazon’s main leaders skipping town to a new location well away from Seattle. Amazon has already stated that existing employees can transfer to the new location. Which makes sense. How else will they continue the corporate culture if they don’t ‘seed’ the new location with their own people?

    Long-term consequences are: retraction in demand. Localized housing recession?

    BUT if anyone can document Amazon employees still house shopping that would be welcome news.

  184. 184
    Paulie says:

    By David @ 183:

    RE: Paulie @ 182 – Good analysis, BUT you did not explain the effect of Amazon’s main leaders skipping town to a new location well away from Seattle. Amazon has already stated that existing employees can transfer to the new location. Which makes sense. How else will they continue the corporate culture if they don’t ‘seed’ the new location with their own people?

    Long-term consequences are: retraction in demand. Localized housing recession?

    Possible. And yet I still see the construction booming downtown for Amazon’s new campus.

    Bezos does not think like other businessmen. For example, he intentionally lost money on AWS, by pricing it so low, because he wanted the profitability to look so unattractive that competitors wouldn’t touch it. He was avoiding “Steve Jobs’ mistake” of pricing the iPhone so high that it became a magnet for competitors. And hence, Bezos invented an entire new utilities industry and slurped up 90% of the market share before anyone noticed. Today, only 5% of global IT infrastructure spend is on cloud compute resources, but this will become an increasingly dominant industry with tremendous growh potential. It is a three horse race between Amazon, Microsoft, and Google, and their cloud divisions are all headquartered where? Seattle.

    When he makes a decision like HQ2, the motivation is not to leave Seattle. That isn’t how he thinks. It is more about (1) creating redundancy to enable business continuity and disaster recovery (like having a data backup stored in another city) and (2) keeping Seattle and HQ2 city in constant competition with each other. This only works if Amazon stays in Seattle.

    What you will see is less growth within Amazon in Seattle, not Amazon’s wholesale abandonment of Seattle. HQ2 location will be announced in October. It will take at least 3 years to really build out a significant presence in the new city that affects Seattle headcount numbers any more than any of its other offices it has all over the world.

    Meanwhile, in those 3 years, cloud computing will explode, there is a major dearth of talent in cloud computing, and it happens to be concentrated in Seattle. Seattle is still cheaper than the Bay Area. While Amazon may slow down hiring in Seattle, I assure you that Google, Microsoft, Facebook and others will not and likely will more than pick up the slack.

    If I look at Amazon in isolation, HQ2 is a concern. If I look at the big picture, I don’t see the growth slowing down for reasons other than macroeconomic reasons (which are looking increasingly odious).

  185. 185

    RE: Kary L. Krismer @ 176

    The one I did down in your neighorhood that is closing Thursday did have an Inspection Contingency. But since I don’t get down your way very often, I don’t know if that is as uncommon near you as it is in Kirkland, Bellevue, Redmond and North Seattle where I usually work. Bothell and Shoreline where I am frequently can go either way, depending on exactly where the property is.

    Have you seen no Inspection Contingency as the norm in Renton and specifically Fairwood? I wasn’t sure how unusual it was there for us to have done one.

  186. 186
    uwp says:

    By Paulie @ 184:

    He was avoiding “Steve Jobs’ mistake” of pricing the iPhone so high that it became a magnet for competitors.

    LOL
    Apple introduced the iPhone in 2007, in the last 10 years (2008-2017), they made over 300 billion in profits. They made more in 2017 alone than Amazon has made over it’s entire existence.

    May we all be so blessed as to make those mistakes.

  187. 187

    By ARDELL DellaLoggia @ 185:

    Have you seen no Inspection Contingency as the norm in Renton and specifically Fairwood? I wasn’t sure how unusual it was there for us to have done one.

    It was getting to be more common than not, but not 100% by any means. It’s been much better lately–maybe 20%–just a guess.

  188. 188

    By uwp @ 186:

    By Paulie @ 184:

    He was avoiding “Steve Jobs’ mistake” of pricing the iPhone so high that it became a magnet for competitors.

    LOL
    Apple introduced the iPhone in 2007, in the last 10 years (2008-2017), they made over 300 billion in profits. They made more in 2017 alone than Amazon has made over it’s entire existence.

    May we all be so blessed as to make those mistakes.

    Also, Apple was hardly first with a smartphone, so they could price how they wanted. Palm was 2002 and Blackberry 2003.

    My first smartphone was a Palm device because it had an IR port that would work the Supra keyboxes on listings. A horrible OS though. For a long time Apple was a horrible RE agent device because you’d have to plug something into it to access the keyboxes. They crippled Bluetooth so that the devices Android used wouldn’t work.

  189. 189
    Paulie says:

    By uwp @ 186:

    By Paulie @ 184:

    He was avoiding “Steve Jobs’ mistake” of pricing the iPhone so high that it became a magnet for competitors.

    LOL
    Apple introduced the iPhone in 2007, in the last 10 years (2008-2017), they made over 300 billion in profits. They made more in 2017 alone than Amazon has made over it’s entire existence.

    May we all be so blessed as to make those mistakes.

    Ha, you caught that. I put it in quotes because it is exactly what he called it, whether we agree with it or not. Nothing Amazon has done to date has yielded the sheer levels of profit that the Apple iPhone has. It reflects that he thinks very differently about how to grow a business. A lot of people speculate about what his motives are, from our City Councel members to the media to Trump to ordinary commenters on this forum. Most of them are wrong. Time may prove him correct on the “Steve Job’s mistake,” for as impressive as Apple’s growth has been, Amazon’s rate of growth has been even higher.

    And to bring it to the point, HQ2 is about leverage and business continuity, not about decoupling entirely from Seattle. I actually don’t think that abandoning all the buildings he has here would bother him. He’s not sentimental and doesn’t subscribe to the sunk cost fallacy. But now that his competitors have built offices in Seattle to poach his talent, he can’t afford to leave Seattle unfortified. And his engineers are his alchemists, who have created entire industries from scratch (AWS is the gold standard of cloud computing) and this makes them valuable to competitors. And they have lives here, and they aren’t all just going to pack up and move to the east coast like lemmings to keep their jobs. Not when Google will pay them 30% more to keep their families here. Any reorgs out of Seattle have to be surgical and steady in pace, or Bezos will create a vacuum in job supply which his competitors will be all too happy to fill in pursuit of his market share. Some risks are just too great to take, and that is one of them.

  190. 190
    David says:

    Meanwhile over at ZeroHedge:

    Emphasis on buyers not wanting to catch a falling knife.

    “the supply of homes for sale during the “all important” spring market rose at 3x last year’s rate

    30 of America’s 100 largest cities now have more inventory than they did a year ago, and

    mortage applications for new homes dropped 9% YoY”

    https://www.zerohedge.com/news/2018-07-17/trouble-ahead-housing-market

  191. 191

    And now for some politics–a takedown of Krugman (and anti-Trump hysteria?) by Nathan Robinson, who is hardly a conservative by any means, and clearly not a fan of Trump. An interesting read, not at all related to real estate. It’s basically Trump is bad, but let’s not get carried away.

    https://www.currentaffairs.org/2018/07/liberalism-and-empire

    BTW, I first became aware of Robinson from his piece that basically set forth the case of how nominating Hillary Clinton would lead to President Trump. It was written in 2/16 and just about everything he said came true.

  192. 192

    And in real estate, apparently Zillow’s first home has still not sold, per the bottom of this Geekwire article.

    https://www.geekwire.com/2018/zillow-expanding-home-buying-selling-program-atlanta-3rd-market-far/

    It would be interesting to have more data points for Zillow and the others operating in this area of business. Seems like they should move into an area that is more similar to their real business, maybe something like payday loans.

  193. 193

    RE: Justme @ 170
    Now You’re In the Doghouse For a Double Negative Speech Mistake

    You must be impeached now for this horrifying unforgivable sin….LOL

  194. 194

    RE: Alyx @ 177
    That’s Right

    A President affects real estate futures and the stock market….why wouldn’t Trump be a great Bubble topic on a plethora of topics?

  195. 195
    seamille says:

    RE: Paulie @ 189
    I agree with your assessment that Amazon has a huge impact on the local housing market, but the shrinking inventory trend seems to be slowing if not reversing in other metro areas:

    https://www.trulia.com/research/inventory-report-july2018/

    I have a friend who purchased a house at list in a very “hot” location within the last week (SFH, under $800k). A sample size of one isn’t indicative of anything, although this would have been crazy just a few months back. List was well under the Redfin estimate, not that those estimates are reliable…

  196. 196

    Microsoft Next on the EU $5B Money Grabbing Push?

    The high tech American piggy bank for EU to rob?

    https://www.cnbc.com/2018/07/10/eu-hits-alphabet-google-with-android-antitrust-fine.html

    Europe is our ally, they don’t want our theoretical real estate budget salaries’ main Seattle source? LOL

  197. 197
    Justme says:

    RE: softwarengineer @ 193

    Really? I don’t understand what you mean by that. But I’d love to be impeached, perhaps you as well?. LOL.

    PS: You can’t prove a double negative. Everyone: wag your tail if you get the pun and the joke.

  198. 198

    RE: softwarengineer @ 196 – That action against Google reminds me of the antitrust action of the US against Microsoft and their IE software. I’m actually sort of surprised Google doesn’t comply given that prior Microsoft action, but the government really seemed to have it out for Microsoft back then. But for Apple there are no third-party manufacturers.

    The EU action is somewhat absurd given the fact that Android users generally customize their devices. You would think such an action would be more likely against Apple given their user base and the companies restrictions (e.g. the prior Bluetooth restrictions I recently mentioned and what I believe are current restrictions on NFC).

  199. 199
    uwp says:

    By Kary L. Krismer @ 191:

    And now for some politics–a takedown of Krugman (and anti-Trump hysteria?) by Nathan Robinson, who is hardly a conservative by any means, and clearly not a fan of Trump. An interesting read, not at all related to real estate. It’s basically Trump is bad, but let’s not get carried away.

    https://www.currentaffairs.org/2018/07/liberalism-and-empire

    From the article:

    It is, of course, important to oppose Donald Trump for doing atrocious things, of which he does many. But it’s also important to be principled, and not to let one’s dislike for Trump become a defense of American empire. Being consistent means acknowledging that Trump is not as much of an aberration as we might like to think, and is in many ways a particularly grotesque continuation of longstanding presidential practices. The task of a decent human being is to oppose both Donald Trump and American empire more generally, not to wish for an “empire with a more benevolent face.”

    It’s a takedown of the idea that an American Empire is a good thing. It’s not “Trump is bad, but let’s not get carried away” it’s “Trump is bad, in a long line of bad.”

    He is attacking Krugman not for being harsh on Trump, but for romanticizing America’s actions of the past 60 years. It’s an attack Krugman from the left.

    Here is another article by the same writer:
    “In saying this, I’m not downplaying how bad Trump is, but emphasizing how bad the rest of the American right is.”

    https://www.currentaffairs.org/2018/01/trump-exceptionalism-will-kill-every-last-one-of-your-brain-cells

    Kary… welcome to the Resistance.

  200. 200
    David says:

    RE: uwp @ 199 – Paul Krugman is a joke. It’s as if Robert Reich and a tranny munchkin had a baby. You listen to it only out of morbid curiosity, until you realize how the sad the whole situation is.

  201. 201
    uwp says:

    By David @ 200:

    RE: uwp @ 199 – Paul Krugman is a joke. It’s as if Robert Reich and a tranny munchkin had a baby. You listen to it only out of morbid curiosity, until you realize how the sad the whole situation is.

    Go ahead and ignore Krugman on politics, but he has been generally correct on economic policy of the last decade while you are linking to articles from ZeroHedge.

  202. 202
    David says:

    RE: uwp @ 201 – ZeroHedge is contrarian. Krugman is just an idiot.

  203. 203
    Justme says:

    RE: uwp @ 199

    It must be a cold day in hell: I am agreeing with uwp about something. And what I am agreeing with him about is that Krugman SHOULD be attacked from the left. Krugman is in effect at Wall St apologist.

    Krugman’s monetary (and other) policy position is, in practice, “We will flood Wall St with money until they run out of things to speculate on and start to hire the unemployed. Never mind that meanwhile, housing prices and stock prices will double, and your savings will generate 0% in interest, AND your wages will be stagnant, AND no bankers are going to jail”.

    What I don’t understand is how otherwise sensible and progressive people think that doubling housing prices and rents is going to help the working man. Explain me that, UW Professor.

  204. 204
    David says:

    RE: Justme @ 203 – As long as the Dems keep flooding the country with foreign labor, there will be no meaningful gains in wages. You cannot claim this basic fact is not true when the argument is that building more housing will lower prices.

    When the Dems bring in more people than there are jobs – low wages or no jobs. Also, these immigration systems create a self-sustaining network of people outside the country who have a little society focusing on getting those American jobs. These companies hire staff or lawyers to funnel those people into their companies creating a vicious cycle of people who have a monied interest in keeping you tamed and out of the picture. Sinisterly, you are out of the circle and don’t know why. Not understanding that there are 8B people on the planet who are getting priority over you.

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