NWMLS: Home price gains vanish as sales continue to slip

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December market stats have been published by the NWMLS this afternoon. Year-over-year home price gains dropped to their lowest level since March 2012 as inventory skyrocketed, despite the fewest new listings ever in a month. The end of 2018 definitely set up 2019 to be an interesting year in the housing market.

The NWMLS press release hasn’t come out yet, so let’s get right to the data.

CAUTION

NWMLS monthly reports include an undisclosed and varying number of
sales from previous months in their pending and closed sales statistics.

Here’s your King County SFH summary, with the arrows to show whether the year-over-year direction of each indicator is favorable or unfavorable news for buyers and sellers (green = favorable, red = unfavorable):

December 2018 Number MOM YOY Buyers Sellers
Active Listings 2,838 -29.4% +143.0%
Closed Sales 1,704 -5.9% -18.6%
SAAS (?) 0.94 -15.1% +9.1%
Pending Sales 1,372 -28.8% -6.0%
Months of Supply 1.67 -25.0% +198.6%
Median Price* $639,000 -0.8% +0.6%

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

King County SFH Inventory

Inventory fell 29 percent from November to December, and was up 143 percent from last year. This is the highest level of December inventory since 2013.

On the flip side, here’s the chart of new listings:

King County SFH New Listings

New listings were down 11 percent from a year ago, falling to their lowest level ever for any month of the year. It’s definitely interesting that standing inventory is increasing so quickly despite to few new listings hitting the market.

Here’s your closed sales yearly comparison chart:

King County SFH Closed Sales

Closed sales fell six percent between November and December. Last year over the same period closed sales also dropped six percent. Year-over-year closed sales were down 19 percent and were at their lowest December level of the past seven years.

King County SFH Pending Sales

Pending sales were down 29 percent from November to December, and were down six percent year-over-year. The last time there were fewer pending sales in a December than there were last month was in December 2008.

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 continuing massive surge in active inventory has forced me to adjust the y-axis on this chart. Again. We’ve hit new all-time records each of the last five months.

Here’s the median home price YOY change graph:

King County SFH YOY Price Change

Year-over-year home price changes edged down again from November to December, to the lowest level since March 2012, which was the last month that prices were falling year-over-year.

Finally, 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

November 2018: $639,000
November 2017: $635,000
July 2007: $481,000 (previous cycle high)

So far there’s no story on the December data in the Seattle Times yet. I’ll update this post later after they publish their story.

Update: Here’s the Seattle Times story: Seattle area’s topsy-turvy home market ends 2018 with Eastside prices falling over the year

5.00 avg. rating (97% score) - 3 votes

About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.

671 comments:

  1. 251
    NW says:

    No price inflation here:

    https://www.redfin.com/WA/Seattle/2014-NE-107th-St-98125/home/107455

    Sold 11/29/2017 for $564,500

    Back on the market:
    10-26-2018: $1,099,900
    12-3-2018: $999,999
    1-17-2019: $949,950

  2. 252
    Markey Psychologist says:

    RE: NW @ 251 – Flippy-floppers losing money is a sign of the times. Further proof of a bursting bubble.

  3. 253
    Matt P says:

    I’ll start posting them as I see them. Here’s one that sold for $359k in May 2015 and listed for $570k in July 2018. Thats almost 60% in 3 years. Price has dropped since then, but it points to a huge amount of inflated house prices I’ve been seeing and not just in the upper echelon that Ardell works.

    https://www.redfin.com/WA/Seattle/905-Cherry-St-98104/unit-105/home/12092959

  4. 254
    Market Psychologist says:

    https://www.redfin.com/WA/Seattle/2008-Yale-Ave-E-98102/unit-C/home/12449306#property-history

    2014 – $499.950
    2018 – $799,000
    Days on Market – 156!!!

    Keep hanging on, dear Seller. I am sure a suitcase full of cash will appear soon.

  5. 255
    Buyer says:

    Same thing in Bellevue, 124th a town home bought for 365K and listed for 920K
    now price changed to 890K.. more than double and 500K+ Profit… crazy..

  6. 256
    Matt P says:

    Sold Sep 16 in new building for $489k. Listed Jul 18 for $719k, a 47% markup in less than 2 years. Still sitting on the market half a year later at $649k, still a 32% markup.

    https://www.redfin.com/WA/Seattle/1321-Seneca-St-98101/unit-206/home/88415348

  7. 257
  8. 258
    Eastsider says:

    By Market Psychologist @ 253:

    https://www.redfin.com/WA/Seattle/2008-Yale-Ave-E-98102/unit-C/home/12449306#property-history

    2014 – $499.950
    2018 – $799,000
    Days on Market – 156!!!

    Keep hanging on, dear Seller. I am sure a suitcase full of cash will appear soon.

    I have seen similar listings a decade ago. Some ended up delisted after a year or two. No saying history will repeat here.

  9. 259
    Longtime Reader says:

    The above posts remind me of content from a site called ‘Flippers in Trouble’ that was alive and well during the last fat Bubble (06) in a market I invest heavily in. At about this point in the market 12 years ago people began posting the same content because it was so easily to showcase the properties that were the last standing in the game of Musical Chairs and could not sell and eventually became REO’s. Which of course will happen this time too.

    As a longtime reader, and even more of a longtime investor, the bears on this site are correct, this market will get slayed.

    Ignore the fools that think NINJA loans are the only thing that can create massive asset bubbles. They just don’t understand how $12 trillion of fiat printed by global central banks and a decade of near-zero interest rates blew a massive Everything Bubble that is now bursting. Hang tight and wait to buy. Attractive valuations are coming to a city near you!

  10. 260
    randomseattledummie says:

    RE: NW @ 251

    This is a really bad example. This home underwent a huge renovation. 50/50 to the point that they will lose money on the resale.

  11. 261

    RE: randomseattledummie @ 257

    LOL…Renovation Costs of Seattle 1920 Museum Pieces, the Fun Goes On and On

    The plastic filler and paint temporarily covers up insect rot and earthquake cracking….but its like Stephen King’s “The Shining’ with Jack’s Head through the axed out bathroom door, exclaiming, “I’m back!”; as the cracks and basement leaking re-appear in no time….LOL

  12. 262

    Seattle Home Owners [Even With Electric Cars] Faces the Biggest CARBON TAX Increase Ever

    The OBP wants us to mimic the EU and let local government get into our Seattle household pocketbooks the way Norway does it. Seattle loves the EU NWO taxations [phony global warming efforts] and think they’re grand….LOL….at a theater near you soon. The fun goes on and on…

    https://www.zerohedge.com/news/2019-01-17/norway-readies-big-brother-gps-based-taxation-mile-driven

    Hey Deerhawke, ya like your OBP now? LOL…enjoy the bill ;-)

  13. 263
    Market Psychologist says:

    RE: Eastsider @ 256 – Eastlake is actullay kind of a naturally occuring test case for this market. It’s just off of SLU, but is mostly residential, so it’s a favored neighborhood for tech workers. I lived there for two years in the recent past, and my bus was full of SLU tech people in the morning. I would also see multiple private commuter buses going to the Eastside. It looks like, rather than buy, they are choosing to remain renters. The REIC tells us this is not possible; that any day now they will jump into the market. I say, you are going to wait forever. It ain’t going to happen at these prices.

  14. 264
    Justme says:

    Fortress Silicon Valley is dropping even harder than Seattle/KC is. Look at the December numbers for Santa Clara County in the tables at the bottom of the reference. But Seattle/KC is soon due to record a YTY loss also. Only the insane runup in spring 2018 is holding the YTY above water, while we all know the prices since the ~May peak have been, well, dropping. It appears that Seattle is, just as in 2017, a bit slow to accept reality.

    Both Seattle/KC and Silicon Valley/SCC ran out of their much ballyhooed specialness in 2018.

    Median price -11.5% YTY
    Sales count -20.6% YTY

    REFERENCE: https://www.car.org/aboutus/mediacenter/newsreleases/2018releases/december2018sales

  15. 265
    Justme says:

    RE: Justme @ 261

    TYPO: just as in 2017 ————-> just as in 2007

  16. 266
    Matt P says:

    Here’s a true flip. Sold in May 18 for $468k, now asking $689k after dropping from $715k in October. Over $100k in updates according to the listing.

    https://www.redfin.com/WA/Seattle/4212-34th-Ave-S-98118/home/172203

  17. 267
    Longtime Listener First Time Caller says:

    Ok, I’ll play this game. Twenty five percent in three years!

    https://www.redfin.com/WA/Lake-Forest-Park/19018-33rd-Ave-NE-98155/home/90790

    March 2016 – 540K
    Jan 2019 – 680K

  18. 268
    Longtime Listener First Time Caller says:

    Or this, at only 630 it’s “Character makes for the Perfect Flip…”

    https://www.redfin.com/WA/Lake-Forest-Park/3030-NE-181st-St-98155/home/91949

  19. 269
    NW says:

    RE: Matt P @ 263

    Ouch. Bought @ the peak in a so-so area, remodeled, might need to reduce the price even further… happy I am not them :-)

  20. 270
    QA Observer says:

    Let’s not forget the one I toured and told the REIC used house salesman that they are over priced:

    >120 days

    https://www.redfin.com/WA/Seattle/2217-3rd-Ave-W-98119/home/132608

  21. 271
    QA Observer says:

    What happened to Kary? We would be on comment 1050 by now…

  22. 272
  23. 273
    Mmyy101 says:

    I want to get some advice here as sounds like there are many real estate experts here.

    I own a small(under 1500 feet) split entry house which is built around 80s, in a good location in kirkland. I am debating on selling it and buying a bigger, newer house. As housing price is high these days, if I am buying a newer one , I will have to choose a more far away location, like woodinville, bothell, etc.

    Would you recommend me buying and selling? Will now or next 1-2 years a good time for that?
    My current house if fine, but is quite old and I am worried the split entry style will become even more unpopular in the future, but I am also worried that I could be able to find a house in a decent location within my budget or not(if sell).

    Thanks for your advice!!

  24. 274
    PricesCrashing says:

    Justme, we don’t need to go far to see 2007 trends. Fed does it for us:

    https://fred.stlouisfed.org/series/MSPNHSUS

  25. 275
    Justsomedude12 says:

    RE: QA Observer @ 266 – Wow. It’s a nice little house on Queen Anne and all, but am I the only one who thinks it’s ABSOLUTELY INSANE to place a value of $1.8M on this house?

    I could never understand the thought process of someone who would pay anywhere near that for that house.

  26. 276
    BumpyRIDE! says:

    If Tesla fails we have a game changer! Apple is turning the wrong direction? Where do we go from the top of the mountain? Hold on tight and fasten your seatbelts it’s going to be a bumpy ride.

    https://www.msn.com/en-us/money/companies/read-the-email-elon-musk-sent-to-tesla-employees-explaining-the-need-for-job-cuts/ar-BBSpOxs?li=BBnb7Kz

  27. 277
    Matt P says:

    How about this gem: https://www.redfin.com/WA/Seattle/530-4th-Ave-W-98119/unit-503/home/50010

    Bought in May 2016 for $440k. Listed at $598k Oct 2018 because they moved down the hall to a bigger unit but love the building. But they want their new neighbors to overpay since they did as well. Currently at $567k.

    My biggest question is has the inherent value of dwellings increased in the area in the last few years? Are there that many more people with high salaries than there were 2 years ago?

  28. 278
    richard says:

    good and bad news for wait-and-see buyers. I studied the eastside listing, the new listings are increasing at absorption rate remain low. On the flip side, 99% of listing is meaningless since listing price is too high, but the increase in new listing is good to build seller pressure. I hope baby boomers can soon realize this is the last window for exiting and getting their retirement money. Baby boomers better to pray or dream some sucker holding a bag of cash standing in front of their houses and begging to buy their house.

  29. 279
    richard says:

    another observation in eastside listing is high end(luxury) homes are dominant in listing. that is a good sign for market direction since rich people (market savvy ) are first to exit before full blown crisis happen. If they are willing to drop price of offload the shit, definitely a sure sign the market is improving (meaning price is drecreasing).

  30. 280

    RE: QA Observer @ 267
    LOL…

    I miss Kary too….I hated that attorney 10 years ago, I thought he was just another “pig headed” silver tongued devil OBP pundit….he’s changed. He offers both sides and admits professional confusion; but better yet, he criticizes the NWO globalism lately. I’d hire him if I needed a real estate attorney, he’s demonstrated detailed orientation now. Do I agree with all he says? Hades no. But a good attorney is hard to find.

  31. 281

    RE: Matt P @ 270
    IMO, Most of the Sales are $CASH$ or Old Equity and Inheritance

    Baby Boomer and Gen-X crowd IOWs…very few Milenials. It takes decades to save that much $CASH$.

    With pensions phased out at Boeing and MSFT severance pay after layoff not a monthly pension, but a one time check out the door [my next door neighbor with 20 years experience at MSFT] retirees have to depend on their dinky interest rates. In 1998 I $CASHED$ out on a $26K savings account down payment that was bringing in about $100/mo income interest. LOL…does $26K bring in $10/mo interest now? Retirees are doomed in Seattle, unless they plan their retirement for 0% interest under OBP rules..

  32. 282
    Erik says:

    RE: richard @ 272
    Hey Richard, it seems like you are looking at little hints and make observations that may or may not make sense. That’s what justme, momentum, sfrz, and other people on here are doing that are ignoring basic economics.

    Like deerhawke says, we are deep into the expansion phase. Next phase is hyper supply followed by recession. Research and understand how asset bubbles work if you want to understand what’s going on. It’s not that complicated. The other indicator is look at supply and demand. Supply is historically low and demand is historically average or slightly above average.

    Looking at these 2 principles of basic economics, I’d say we have some time before another collapse. I think this bear market has about run its course as basic economic principles are not saying we are about to have an economic meltdown.

    If you have a healthy portfolio of real estate, perhaps you should hold tight. If you don’t own anything, I’d say buy and sell in 2 years as that’s what basic economics would say to do. Good luck and I hope you make some money!!

  33. 283
    Matt P says:

    By Erik @ 275:

    RE: richard @ 272
    Hey Richard, it seems like you are looking at little hints and make observations that may or may not make sense. That’s what justme, momentum, sfrz, and other people on here are doing that are ignoring basic economics.

    Like deerhawke says, we are deep into the expansion phase. Next phase is hyper supply followed by recession. Research and understand how asset bubbles work if you want to understand what’s going on. It’s not that complicated. The other indicator is look at supply and demand. Supply is historically low and demand is historically average or slightly above average.

    Looking at these 2 principles of basic economics, I’d say we have some time before another collapse. I think this bear market has about run its course as basic economic principles are not saying we are about to have an economic meltdown.

    If you have a healthy portfolio of real estate, perhaps you should hold tight. If you don’t own anything, I’d say buy and sell in 2 years as that’s what basic economics would say to do. Good luck and I hope you make some money!!

    Transaction costs would wipe you out if you buy and sell in 2 years especially if 10+% yoy increases are a thing of the past.

  34. 284
    justsomedude12 says:

    RE: Erik @ 275 – I agree that we must look at the big picture, encompassing all factors. I think that you could be a bit narrow in your analysis as well.

    One more factor I’m not sure you’re taking into account is the simple fact of peoples’ willingness and ability to pay ever higher prices. Even highly paid tech workers have their limit. That’s why you can have historically low inventory but also falling prices, as we’ve had the past 6-8 months.

    There are so many factors to take into account, it’s very difficult to say “because of X, Y and Z” prices will start rising again for 2 years and then level off”. Because you may not be taking factors A, B and C into account. Or some other factor in play that none of us have considered.

    Also, economic expansions tend to follow a pattern, but not a specific timeframe. So to try and time the ending isn’t really possible.

    I’d say if you just really want to buy a home for life reasons (getting your kids into a certain school district etc…) and you can comfortably afford it, then go ahead. But don’t plan on it appreciating for the next several years. There’s a higher likelihood of the value going down than going up(not saying I can predict either one).

    The one factor that is clearly knowable and has a direct effect on affordability and prices is mortgage rates. They’ve steadily declined since the 1980’s, pushing up prices. Other than a half percent or so, they can’t go any lower. That huge tailwind of the past 30 years is gone.

    There are many factors at work, so tough to predict, but the perfect storm of tailwinds that propelled Seattle/Eastside prices so much higher over the last several years are gone or at least greatly reduced. The impartial/logical thinker would have to say that the most likely outcome going forward is that the price increases are gone as well. We’ve actually seen this in reality for the last 6-8 months.

  35. 285
    Notme says:

    I have overpaid
    therefore you must overpay
    or else this won’t work

    – a bubble haiku

  36. 286
    Eastsider says:

    By Erik @ 275:

    If you don’t own anything, I’d say buy and sell in 2 years as that’s what basic economics would say to do. Good luck and I hope you make some money!!

    You would have made the same comment 8 months ago. The housing bulls here are mostly parties with vested interests. Home purchase is the biggest expense in one’s lifetime. Do your own analysis based on needs and affordability.

  37. 287
    npeterson5068 says:

    If foreign buyers return once/if trade disputes have been settled, I do think it’s possible we could see continued growth in the Seattle area. The decrease in foreign buyers was noted as one of the big contributors to inventory increasing. There are still folks fleeing Silicon Valley for a better quality of life. The new restrictions on SALT has only amplified that, since it has less of an impact in the state of Washington. Seattle having such uniqueness means it’s becoming an exclusive place to live. Variety of scenery. There’s actually water, mountains, and desert accessible a couple of hours away. Access to Vancouver BC, Portland, and California is relatively close. A large pool of intelligent and high quality people and jobs that can sustain the growth. As for Amazon’s split HQ2, I think folks will prefer working at the Seattle headquarters instead of VA or NY when you consider what the area has to offer, and the lack of state income tax.

  38. 288
    Justme says:

    RE: npeterson5068 @ 280

    That was a long laundry list of wishful thoughts. Among them,

    >>If foreign buyers return once/if trade disputes have been settled, I do think it’s possible we could see continued growth in the Seattle area.

    That’s a big if, given that China buyers disappeared not because of the trade war (which came later), but because of China tightening access to USD, and also because the US instituted tight reporting requirements so that foreign buyers could not hide behind anonymous LLC corporation.

  39. 289
    justsomedude12 says:

    RE: npeterson5068 @ 280 – A lot of wishful thinking here. And as Justme mentioned, the slowdown of foreign buyers had nothing to do with trade disputes.

    The last few years were an exceptional time for Seattle area real estate. It was not normal, it was not the “new normal”, it was exceptional. The factors that caused it are no longer present. Not logical to believe these price increases will resume for some reason. But everyone is entitled to their opinion.

  40. 290
    Justme says:

    Weekend update, King County active inventory, graphical edition.

    As always, click on the link, then click once more for enlarged view. The graphs compare 2019,2018,2017 inventory on an hourly basis. 2017 was the year inventory was at a multi-year low for most of the year.

    King County SFH active for-sale inventory 2017,2018,2019 on 2019-01-19
    https://imgur.com/a/KjWrSw2

    King County Condo active for-sale inventory 2017,2018,2019 on 2019-01-19
    https://imgur.com/a/2gpBvCL

    King County SFH active for-sale inventory ratio YYYY/2017 on 2019-01-19
    https://imgur.com/a/SWMMFsd

    King County Condo active for-sale inventory ratio YYYY/2017 on 2019-01-19
    https://imgur.com/a/WSklQ0F

    The year-end house-cleaning (harr) is apparent in that many for-sale properties got de-listed within a week or so from the end of the year. Many of these properties will be re-listed fairly soon, with DOM (days on market) reset to 0 and a new shot at landing as a “new” listing in online property searches and email-boxes around the sound.

    Another note on the de-listing activity: it looks like in Dec 2017, many sellers did not even bother de-listing, they just let the listing ride into Jan 2018 because of a perception that the market was still hot. That sort-of worked for a little while, but then sales counts and prices started cooling down in the middle of spring selling season. This year, sellers have gotten the memo and are keen on appearing NEW! and FRESH! in the listing game. Always check the listing history :).

    All that being said, the starting points for inventory counts in 2019 are significantly higher than both 2018 and 2017, and my estimate is that inventories will continue higher this spring.

  41. 291
    justsomedude12 says:

    RE: justsomedude12 @ 282 – Also, the rise in prices around here coincided with the hiring boom at Amazon, and some related companies. It was job growth related, not people coming here for quality of life. If it was related to quality of life the price boom would have happened long ago and over an extended period of time, it wouldn’t have just occurred within the 2013-2017 time period.

  42. 292
    Erik says:

    RE: Eastsider @ 279
    Affordability has at best a very loose correlation with housing prices. One could argue there is no correlation between affordability and housing prices.

    I’ve seen you on here for years. The Tim sent me a graph in the comments section like 10 years ago probably that showed th correlation. Perhaps he’d be kind enough to post it again if you ask him nicely? To sum it up, there isn’t much correlation if any between affordability and housing prices. I was surprised too because it’s counterintuitive.

  43. 293
    npeterson5068 says:

    RE: Justme @ 281

    Not wishful. I don’t have a vested interest in what happens. Just an interest in projecting what will happen to better plan ahead so I appreciate any point being challenged.

    Some other observations though:
    – The restrictions China placed on USD happened in 2017, before the sudden inventory bump in May 2018. It could have taken a while, but why the dramatic change in that month and after?
    – Interest rates had been rising too before then. No real slow down in Seattle, so I don’t see a correlation with interests rates and inventory anywhere. At least not a clear one, though it’s definitely contributing partially
    – The HQ2 idea was announced in 2017. I do think it had some impact, but I don’t think it aligns with what happened around May 2018 either
    – LLC reporting for real estate purchases I thought had been established just recently for WA (correct me if I’m wrong) around November when inventory started to decrease (seasonably, but still)

    So what happened around May to cause a clear jump in inventory and after? The trade war had already been going on, but tariffs became more of a reality and was taken to a new level.

  44. 294
    npeterson5068 says:

    By justsomedude12 @ 283:

    RE: justsomedude12 @ 282 – It was job growth related, not people coming here for quality of life. If it was related to quality of life the price boom would have happened long ago and over an extended period of time, it wouldn’t have just occurred within the 2013-2017 time period.

    I agree jobs is definitely a main driver for growth. What I meant was, lots of people from Silicon Valley have been moving here for a better quality of life. Getting more for their money, and appreciating the unique benefits of the area, while taking advantage of a similar job market.

    Another driver was the restrictions placed on foreign buyers in Vancouver BC. Once that went into effect, foreign buyers started purchasing here more as it offered a similar quality of life.

    The no-poaching custom was uncovered in Silicon Valley, and this also caused salaries for tech to increase dramatically around that time.

  45. 295
    justsomedude12 says:

    RE: Erik @ 284 – I’m extremely skeptical about the assertion that affordability has no correlation to housing prices. Most likely there’s some other factor muddying the waters of the data.

    A good example is the claim that during periods of rising interest rates, home prices also rise. In reality what’s happening is that home prices are rising, then interest rates begin to rise, but it takes a while for the interest rate rise to take have its affect. Home prices don’t start leveling off at the first moment that interest rates increase. There is a lag. That’s why as interest rates are rising, home prices can continue to rise as well (but only for so long).

    One could claim that during periods of rising interest rates home prices have risen as well, therefore interest rates have no correlation to home prices. They would clearly be wrong.

  46. 296
    Eastsider says:

    RE: Erik @ 284 – Home prices are influenced by many variables, e.g. interest rates, inventory, regulations, jobs, taxes, income, supply, demand, labor costs, material costs, inflation, stock market, economy, and the list goes on. In markets where home ownership rates are high, affordability still plays a big role. But if Seattle becomes Manhattan, affordability may no longer matter.

  47. 297
    Justme says:

    I posted the weekend update around 1pm, but it is still in moderation because of 4 links. Maybe The Tim might is taking the long weekend off. It is all well deserved, of course.

  48. 298
    Justme says:

    RE: npeterson5068 @ 285

    >>I don’t have a vested interest in what happens. Just an interest in projecting what will happen to better plan ahead so I appreciate any point being challenged.

    You are contradicting yourself. You have no vested interest, you say, but then at the same time you want to plan ahead for property price changes?? Why do you need to plan ahead if you have no vested interest?

    Your technique is known as concern-trolling. That is, you pretend to have no interest in the outcome of house prices, but you have certain “concerns” about the correctness of the observations that run counter to a propaganda narrative of rising prices. In other words, you are most likely a closet bubble monger. Why would you be here on seattlebubble posting all kinds of (faulty) arguments against price drops, with no personal interest in the matter? There must be something better to do on a mossy Saturday evening?

  49. 299
    npeterson5068 says:

    RE: Justme @ 290 – You sound a little paranoid. There is no propaganda or techniques being invoked here. Just discussing and sharing ideas like everyone else.

    Interesting you chose to respond to that part of my post instead of the points that were made.

    Perhaps you’re reflecting a bit on your own intentions. Though I don’t think a comment on a blog would be considered propaganda or have the capacity influence the market. Did you?

  50. 300
    npeterson5068 says:

    RE: Justme @ 290 – Also there is a difference between those two statements. I wasn’t contradicting myself.

    If you can turn off the propaganda-paranoia, I’m sure you’ll find the distinction.

  51. 301
    Matt P says:

    By npeterson5068 @ 285:

    RE: Justme @ 281

    Not wishful. I don’t have a vested interest in what happens. Just an interest in projecting what will happen to better plan ahead so I appreciate any point being challenged.

    Some other observations though:
    – The restrictions China placed on USD happened in 2017, before the sudden inventory bump in May 2018. It could have taken a while, but why the dramatic change in that month and after?
    – Interest rates had been rising too before then. No real slow down in Seattle, so I don’t see a correlation with interests rates and inventory anywhere. At least not a clear one, though it’s definitely contributing partially
    – The HQ2 idea was announced in 2017. I do think it had some impact, but I don’t think it aligns with what happened around May 2018 either
    – LLC reporting for real estate purchases I thought had been established just recently for WA (correct me if I’m wrong) around November when inventory started to decrease (seasonably, but still)

    So what happened around May to cause a clear jump in inventory and after? The trade war had already been going on, but tariffs became more of a reality and was taken to a new level.

    LLC reporting was recent for Seattle, but once they started it in Miami, NYC and a couple other places, they dropped off nationwide by 90%, so it had some spillover affect.

    Also, it takes time to get money out of China, often using several relatives to launder it along the way since China caps per person. They started cracking down, but a lot had already gotten their money out and went on a last gasp spending spree.

  52. 302
    Macro Investor says:

    The biggest thing affecting markets now is emotion. When prices are ramping up and up, people get scared of missing out and engage in reckless things like bidding wars.

    Now we have a situation where there is a market pause or slight downturn and the emotions change. Better to wait and see if prices fall further. Don’t be the fool with egg on his face who bought at the top.

    The market pause is caused by a combination of all the factors people have mentioned here — affordability, higher rates, more scrutiny of foreign money, etc… But now the biggest factor is media attention. The more people see newspaper articles about falling real estate and stock prices, the more buyers go into wait mode, and the more owners decide it’s time to sell. Hence we get higher inventory and lower sales/prices. Snowball effect.

    Unless the economy goes into recession, this will likely just be a minor correction. Fear subsides, people forget and go back to normal. Normal means expecting price gains on real estate, so okay to buy. Personally, I see no reason for a recession this year, but you never know. Sometimes a highly levered economy can be pushed off the edge just by a normal correction. It happens because a few companies make a mistake and can’t handle even slight pressure (IE bear stearns, lehman and AIG in 2008).

  53. 303
  54. 304
    Voight-kampff says:

    RE: Justme @ 290
    I often appreciate you’re posts/insight, and I think you have honest intentions, but you should recognize that you too have a particular narrative, and you refuse to stray from it.
    But who knows? Maybe I was paid by the REIC to say this?

  55. 305
    pedaltothemetal says:

    RE: Eastsider @ 288

    “But if Seattle becomes Manhattan, affordability may no longer matter.” HAHAHAHAHAHAHA!!!!!!!!!!!!!!!!!!!!!!

    But if Bush saw his soul in Putin’s eyes, affordability many no longer matter.

  56. 306
    BackToBasics says:

    Do Seattle home owners really care about house price? Unless they relocate to other place and have to sell their current house. Only for flippers. We had double digit price appreciation during last couple years. It will be foolish to think this will go on forever. Long term, Seattle will still lead the house appreciation. To me, my house is a shelter for my family. Unless you are will to stay under the bridge.

  57. 307
    Mark says:

    RE: Macro Investor @ 294

    I generally agree with what you’re saying.

    Looking at the shape of the yield curve and high yield credit spreads, I don’t see a recession until late 2019 at the earliest, and that depends on a policy error at the Fed (so far, they’ve done mostly pretty well). The downturn in risk assets which really picked up in October was due to Powell’s hawkish statement last about short term rates being a long way from neutral, implying the Fed could continue to raise rates in 2019. Around Christmas, the Fed backed down from being quite so hawkish, and the stock market has since recovered substantially from the lows.

    I think the Fed now has the market’s back, and they are going to be susprisingly dovish in the first half of this year. No rate hikes until summer at the earliest. This will reinflate risk assets and continue the expansion through 2019. I think housing will recover and still go higher once this new information is processed by the market.

    Despite that, the severity of the downturn in the stock market based on a pinch more tightening shows how inflated prices are and how dependent prices are on continuing easy credit to maintain. If the Fed goes hawkish again or the economy enters a contraction without the Fed quickly recognizing it and substantially cutting rates and stopping QT, I would expect a sharp and severe sell off. The contraction would worsen and housing would follow suit. Though this is probably a 2020 event vs 2019 though.

  58. 308
    richard says:

    RE: BackToBasics @ 298
    yes, they do care and they care it very much! if i tell sme home owner that his house will lose value by 50% in the next 5 years and it is a fact. what will he do? he will sell his house and it is a no brainer. at the current price level, the.stake is so high and nobody will honestly think the house is just a shelter. in reality, majority homeowner will not sell becoz they think the house price always go up or at least go back up quickly even there is a blip. a good trunk will lose money as just like mom pop stock investors.

  59. 309

    RE: richard @ 300
    My Toastmasters’ Speech Thursday on a 10 year Estimate of RE Prices in Seattle Area

    Was just an estimate, but concluded if signs of “high wage” systems manufacturing returning to Seattle Area [Boeing Auburn Fabrication Plant Rebuilt for 737 Parts now Made in Japan] start now and we gradually retrain Seattle area Manufacturing Engineering experience back to America [5-10 years?]. A journey level Manufacturing Engineer is not a college graduate, its a BS engineering degree and 5-10 years of on the job training, seniority and experience IOWs, not green/inexperienced engineers from like U of W. Ask any heavy manufacturing CEO, they’ll agree with me. Just plotting this manufacturing wage growth for Seattle in future will give us HOPE and that will raise RE prices ASAP.

    My estimated probability of this ever happening was 0-20% with Obama’s NWO. Trump is for tariffs and fair trade, so I can estimate his probability of manufacturing engineering returning to Seattle from Japan is 50-60%….about the same percentage polled that support his WALL [53% now]….HOPE. Something we’ve totally abandoned lately IMO.

    With HOPE we can surf our way on the big wave!

  60. 310

    Google Just Blocked My Access to MSM News

    With a red page warning the news I’m attempting to access is full of alleged malware [it isn’t IMO, I’ve used the sites for years with no concerns]….is Google trying to control me? LOL

    No wonder they’re under Congressional and FBI probes for doing this in China too…they use phony scare tactics like Norton.

    High Tech is always trustworthy with your data….not.

  61. 311
    Luke says:

    By pedaltothemetal @ 295:

    Giant spike in Bezos. Watch out!

    https://trends.google.com/trends/explore?date=all&geo=US&q=bezos

    Yeah, he announced he is getting a divorce.. what’s your point?

  62. 312
    patrick says:

    RE: PricesCrashing @ 268 – Prices

    To add to this.
    https://fred.stlouisfed.org/graph/?g=mIot

    Blue: Median Sale price new house in US
    Red: Median price adjusted for inflation (current dollar pricing)

    Green: Cost of 30y mortgage @ average rate of median sale price of new house
    Purple: Green adjusted for inflation, today’s dollars.

    Like my previous graphs indicating inflation adjusted housing prices are higher than the previous peak BUT that total mortgage cost adjusted for inflation is still less than the last peak (by about 150k).

    If you bought in ’85 I bet you Refi’d!

    Next question is what percentage of previous peak’s mortgages were 30yr vs. today and how did non-standard mortgages affect “total cost of mortgage” across all mortgage types.

    ALSO: Different than my last post, these lines all have real dollar figures to them (green and red inflation adjusted to 2019 dollars).

  63. 313
    Matt P says:

    By BackToBasics @ 298:

    Do Seattle home owners really care about house price? Unless they relocate to other place and have to sell their current house. Only for flippers. We had double digit price appreciation during last couple years. It will be foolish to think this will go on forever. Long term, Seattle will still lead the house appreciation. To me, my house is a shelter for my family. Unless you are will to stay under the bridge.

    Those who already own may not, but those of us who would like to own long term are skittish especially when the mortgage will cost much more than our current rent.

  64. 314
    Justme says:

    Everyone has a vested interested in the housing market. Either you are homeless, a renter or an owner. All of those groups care about housing prices and housing availability.

    I don’t take kindly to disingenuous (that’s a fancy word for dishonest) people that appear in a debate and pretend that they have no vested interest in housing prices. I certainly don’t pretend that I have no interest, and I never have pretended. Now, this blog is a very fine blog. But the comment section is infested with a large amount of REIC insiders, including various forms of landlords, speculator-builders and flippers. Many if not most of these people are unabashed bubble mongers(*). They have never seen a property or rent increase they did not like, and they will post endless amount of lies and propaganda in attempt to justify higher prices of housing, and try to convince potential buyers to bid up prices even higher, or at least buy in and support the current “permanently high plateau” (remember that one?), when things start looking like there is a bust coming (right now is such a time).

    There is a whole gigantic industry that for the most part benefits from always rising prices. In short, we call them the Real Estate Industrial Complex (REIC). My personal mission is to counter their endless propaganda and lies as best I can. There are quite a few others on this blog that I think feel the same way. The REIC collectively has lots resources and money they spend on generating favorable (to them) narratives in the media. And much of that false narrative gets concentrated in the comment section of blogs such as seattlebubble.com. Does the propaganda make a difference? You’d better believe it, or the bubble mongers would not make the effort.

    But many people are fighting back against the bubble mongers. I am myself an unapologetic bubble buster, so just deal with it. Everyone else: Just say no to bubbles.

    (*)Some of them are doubly dishonest in pretending that they have no vested interest in property and rent prices.

  65. 315
    npeterson5068 says:

    RE: Justme @ 306 – Your responses raise some serious red flags. I fully welcomed my points to be challenged. Instead of contending them and having a fruitful exchange of ideas, you instead made assumptions about my character and intentions.

    When someone disagrees with you, it doesn’t mean they’re being disingenuous. It’s healthy to have your ideas challenged, and instead of attacking the character of the people who challenge you, it’s better to work through those ideas in an effort to come to better conclusion on what will happen with the market.

    You seem more focused on coming off clever and dictating what “will” supposedly happen. My advice would be to focus less on those things and focus more on improving the accuracy of your projections. You may also want to reflect on your confidence a bit.

    Not everyone has a vested interest. It’s completely possible for people to have interest in the real estate market before being vested in it.

  66. 316
    Justme says:

    npeterson5068 == whatsmyname? Or just two brothers of the same mother?

  67. 317
    Matt P says:

    By Justme @ 289:

    I posted the weekend update around 1pm, but it is still in moderation because of 4 links. Maybe The Tim might is taking the long weekend off. It is all well deserved, of course.

    So post just the numbers like you used to.

  68. 318
    npeterson5068 says:

    RE: Justme @ 308 – Lol, no we’re != not the same nor are we related. So you can’t discuss or challenge the points I made earlier? Too focused on entertaining.

    Despite the incorrect assertions you’ve made in the brief period we’ve known each other online, I can still say I appreciate the inventory graphs you’ve been sharing.

  69. 319
    whatsmyname says:

    By Justme @ 306:

    Everyone has a vested interested in the housing market. Either you are homeless, a renter or an owner. All of those groups care about housing prices and housing availability.

    I don’t take kindly to disingenuous (that’s a fancy word for dishonest) people that appear in a debate and pretend that they have no vested interest in housing prices. I certainly don’t pretend that I have no interest, and I never have pretended

    I agree that everyone is invested, but just look at post 169 of this thread where Justme seeks to invalidate a poster on the basis that they have a financial motivation:

    “By Justme @ 169:

    … Oh noes, we must not be IMPOLITE! Oh noes, we must not point out that the opposition is driven by personal financial motives! We must pretend that their position is every bit as valid as anyone else’s! Even if it is not”

    Which way is it Justme?

    Also, going back to our earlier conversation; Have you found an example of a new house in the neighborhood causing all the others to double in price as you claimed Deerhawk’s do? Please advise.

  70. 320
    richard says:

    RE: Justme @ 306
    well said.
    the high prices is supported dirty chinese money and artificial low interest rate. some peoplelike to say real estate is local but they can not explain why there is a almost syncronized slow down all cross the hottest markets in this country. i believe it is because the two factors i mentioned is changing.

  71. 321
    richard says:

    RE: softwarengineer @ 301
    speaking of obama,he is one of the most incompetent presidents. unfirtunately, a lot of people deem his as an economy savor, a good president. he might be decent person but he did a lot of damage. for example,
    1. he didnt punish bankers. maybe he actually can
    2.he push more students debts to millenials instead of making colleage cheaper.
    3.he bailed out gm which is doomed to fail.
    4,he reappointed crazy helicopter ben to fed to continue his qe to create current gigantic bubble.
    he is lucky to leave his post in high note of recovery and a sucker successor baghold his mess.
    it make me sick to see him slip away.from his wrong doing by media whitewash and many young people deem him as a hero of sort. sometimes i wonder americas demise is necessary due to years of corruption and misinformation average joe get.

  72. 322
    steven says:

    RE: Justme @ 306

    can you just stop attacking justme? your one way love seems a lil bit sad and an eyesore. he’s just making comments to express his views most of the time and most of your comments are directed against him. i’m not siding with him because it’s not a matter of if he’s right or not.

  73. 323
    steven says:

    RE: whatsmyname @ 311RE: Justme @ 306

    can you just stop attacking justme? your one way love seems a lil bit sad and an eyesore. he’s just making comments to express his views most of the time and most of your comments are directed against him. i’m not siding with him because it’s not a matter of if he’s right or not.

  74. 324
    steven says:

    RE: npeterson5068 @ 307

    i feel like now that he’s finally “right” too many people are attacking his radical views so he’s becoming rather aggressive and offensive as well as a defense.

  75. 325
    whatsmyname says:

    By steven @ 315:

    RE: whatsmyname @ 311RE: Justme @ 306

    can you just stop attacking justme? your one way love seems a lil bit sad and an eyesore. he’s just making comments to express his views most of the time and most of your comments are directed against him. i’m not siding with him because it’s not a matter of if he’s right or not.

    Only some people get to express their views? He brought up my name in post 308. And he was wrong. Seemed like a response was appropriate. You don’t care if his statements are false; you just don’t want him challenged. Now that is sad. Maybe the “one way love” is you.

    I ask legitimate questions that address his statements . All he needs do is give a straight answer. Vested is legitimate? Or vested is not legitimate? How about you. Do you think it goes both ways? Have you seen where a new house doubles the price of all the neighbors? Why don’t you want to see his answers?

  76. 326
    Brian says:

    The people always yapping at justme are annoying. Must feel so threatened about their investments that they have to fight against some random guy on a discussion thread. But justme would do better to ignore them.

  77. 327
    whatsmyname says:

    RE: Brian @ 318 – Questions that challenge your bias are indeed annoying if you have no answers. Best to make up a story about the intentions of the source, and ignore the questions entirely. What could go wrong?

  78. 328
    steven says:

    RE: whatsmyname @ 317

    honestly if i could block/blind both of you i would.

  79. 329
    whatsmyname says:

    RE: steven @ 320 – The best way to discourage me would be to show how my arguments are wrong. I’m getting bored. It might not take that much. I don’t know how you’ll get rid of Justme. That doesn’t seem to affect him one way or the other.

  80. 330
    npeterson5068 says:

    By Brian @ 318:

    The people always yapping at justme are annoying.

    If you look at the manner in which he responds to those who disagree with him, it’s no surprise there are “people always yapping” at him. His posts don’t seek accuracy, but are intended for entertainment purposes only. Seems I may have overestimated him a little. Apologies for the noise.

  81. 331
    Realistic says:

    By npeterson5068 @ 322:

    His posts don’t seek accuracy, but are intended for entertainment purposes only.

    I couldn’t disagree more. Even though some of Justme’s language is occasionally harsh, I think many of his posts are very worthwhile, logical and informative. His weekend updates are also highly appreciated.

    Haiku’s, on the other hand, well… I really see no point of that on this forum.

  82. 332
    BudgetedHomeBuyer says:

    Went to an open house in Mountlake Terrace for a house and had a feeling it may be buzzing because I had not see that kind of square footage for $425k, and it was packed. The sad thing to me was no one looking at the house was excited to be at the open house. My husband even made a comment “it’s like everyone is beaten down from competing for homes and they are sad this many other people are at the open house.” I know we were.

    Side note, Redfin gave me a chuckle. Before we looked at the house Redfin expected the house to close at $409k, after the open house Refin expects it to close at $483k.

    As a shopper it did not feel like there is a slow down.

  83. 333
    Erik says:

    RE: justsomedude12 @ 287
    If you’ve used your current understanding of the real estate market and have had success with timing, then keep on keeping on. If you are unsure or have had trouble timing the market in the past, you should look into my comment.

  84. 334

    RE: richard @ 313
    He Destroyed Equal Employment Opportunity (EEO)

    IMO it was defunded about 2009 because it hurt diversity in his opinion…I know it was defunded because I was an EEO Monitor at the time and watched the effort vaporize. It protects skills and experience BTW….can’t have that…LOL

  85. 335
    Erik says:

    RE: Eastsider @ 288
    I don’t believe all of those things matter. That’s why we disagree so much on here. I am guessing that you are using your own logic and not reading and learning what factors historically affect real estate prices. If you are going to invest all this time on this site, you should spend some time reading and learning which factors historically affect real estate prices. Otherwise, you are having a negative effect on other commentators.

  86. 336

    RE: softwarengineer @ 302

    Hey McAfee S/W May be Organized Crime

    But they blocked the fake malware attacks on my computer this morning….maybe they’re listening to SWE….good recent job McAfee this time, I didn’t have to pull the battery to unfreeze it and reboot from this innocuous/fake website…McAfee did it automatically. Good PR McAfee ;-)

    McAfee has gone Christian? LOL

  87. 337
    richard says:

    RE: whatsmyname @ 321
    i dont know what is.your argument. does your argument touch upon the chinese money or do you show first hand data about it? if your argument does not touch upon this first order force behind seattle market, it is kind weak to me.

  88. 338

    RE: richard @ 313
    Great List BTW

    I’ll sum up your list….tax and spend…swallow the caster oil with glass particles, its delicious and safe to swallow….LOL

  89. 339

    RE: richard @ 329

    Good Questions

    The infamous Chinese money buying up all the Seattle RE is an Urban Legend on the Bubble….no data to support the allegations but a barrage of fake news to support it anyway. See why I try to use my own raw data on any analysis?…I’ve became a MSM skeptic decades ago BTW.

    Enjoy Martin Luther King’s Day…now that was a very special guy that anyone could team up with….LOL

  90. 340
    Eastsider says:

    RE: Erik @ 327 – This is too funny… what happens to your RE 18yr super cycle thesis that says prices would not drop before 2022(?)…

  91. 341
    npeterson5068 says:

    By Realistic @ 323:

    I couldn’t disagree more. Even though some of Justme’s language is occasionally harsh, I think many of his posts are very worthwhile, logical and informative. His weekend updates are also highly appreciated

    No one said harsh.

    As for the weekend updates, you’re basically using the exact same words I used to describe it @ 310. The charts, minus the paranoid yet entertaining commentary, are indeed informative.

  92. 342
    Justsomedude12 says:

    RE: Erik @ 325 – I’ve never tried to time any market. I don’t think it’s possible to do it successfully. It’s basically gambling.

    Not sure how you got that idea from my post.

  93. 343
    whatsmyname says:

    RE: richard @ 329
    It doesn’t look like you are following the conversation. If you find a point of dispute in something I said, please feel free to surface that, and explain why it is wrong. If you’ve no interest in that, but would like to engage others in your Chinese theory; I recommend that you expand by adding evidence or rationale to your assumptions.

  94. 344
    richard says:

    RE: whatsmyname @ 335
    then i have no interest in your argument. in my opinion your argument is irrelvant since you dont even think chinese money is reality. it will be a waste of time to argue with you.

  95. 345
    Notme says:

    REIC in a tizzy
    the truth drives them stark crazy
    amusing AND sad

    -a bubble haiku

  96. 346
    Notme says:

    Is the truth too harsh?
    the poor snowflakes of das REIC
    having a meltdown

    -a bubble haiku

  97. 347
    Randomseattledummie says:

    RE: Justme @ 306

    Hypothetically where should I go to get paid by this “REIC”? Sounds lucrative! I would love a piece of that action.

  98. 348
    Erik says:

    RE: Eastsider @ 332
    The 18 year cycle is for major crashes, not blips like whatever we just went through.

  99. 349
    Realistic says:

    By BudgetedHomeBuyer @ 324:

    Went to an open house in Mountlake Terrace for a house and had a feeling it may be buzzing because I had not see that kind of square footage for $425k, and it was packed. The sad thing to me was no one looking at the house was excited to be at the open house. My husband even made a comment “it’s like everyone is beaten down from competing for homes and they are sad this many other people are at the open house.” I know we were.

    Side note, Redfin gave me a chuckle. Before we looked at the house Redfin expected the house to close at $409k, after the open house Refin expects it to close at $483k.

    As a shopper it did not feel like there is a slow down.

    I assume you meant MLS 1402462. This house is listed way under market value, and it is by far at the lowest price per sq ft compared to everything else in the area. Competition is to be expected if someone lists for that cheap.

  100. 350

    RE: Realistic @ 341
    $483K Ain’t Cheap

    The average price American SFH is $259K. We’ve been brainwashed? LOL

  101. 351
    Justsomedude12 says:

    RE: softwarengineer @ 342 – So true. It is interesting how de-sensitized we’ve become to high home prices around here.

  102. 352
    Joe says:

    RE: BudgetedHomeBuyer @ 332

    If you are patient and can wait three years, a whole new world of opportunity will open up to you. If you are impatient and buy an overpriced house now, you will open the door to 5-10 years of financial misery and regret.

  103. 353
    Justme says:

    RE: Justme @ 290

    The weekend update has appeared from moderation.

  104. 354
    Joe says:

    RE: Mark @ 307

    Don’t be silly. We could easily be in a recession next month. There is no basis for saying a recession will be deferred until 2020. The pundits will be surprised.

  105. 355
    npeterson5068 says:

    RE: Justme @ 353 – The SFH chart you posted on the 19th appears to be the same as last week. Image shows it was generated from the 12th data (SFHlog.2019-01-12.txt)

    Appreciate you putting these together.

  106. 356
    Matt P says:

    By npeterson5068 @ 355:

    RE: Justme @ 353 – The SFH chart you posted on the 19th appears to be the same as last week. Image shows it was generated from the 12th data (SFHlog.2019-01-12.txt)

    Appreciate you putting these together.

    Yep, the condo one is the same too. Pretty sure all 4 are.

  107. 357
    Scotsman says:

    By Erik @ 335:

    RE: Eastsider @ 288
    I don’t believe all of those things matter. That’s why we disagree so much on here. I am guessing that you are using your own logic and not reading and learning what factors historically affect real estate prices. If you are going to invest all this time on this site, you should spend some time reading and learning which factors historically affect real estate prices. Otherwise, you are having a negative effect on other commentators.

    This, right here- is the crux of it. Way too many people offering opinions with few facts to back them up. Much of what we think matters as inputs to pricing simple doesn’t. There’s almost no correlation between interest rates and pricing trends, and very little correlation between affordability and pricing trends. Chinese money? How much actually came into this market? What does matter, at the extreme, are financing options and down payment requirements. The one thing that always matters is future expectations. Right now, expectations are taking a bit of a hit due to uncertainty about the future strength of the economy and political considerations. 90% of what’s posted here these days is blather and little more.

  108. 358
    Matt P says:

    I think we’re at an inflection point in this market. I’ve been following a lot of houses that are seemingly overpriced or have been on the market for a while and most have not been dropping their price. A few have gone pending and sold for less than asking. Some have gone pending then come back on the market, but most are just sitting.

    Sellers are hoping for the spring bump: waiting for their price while continuing to pay the mortgage is better in the long term if the buyers decide to bite. On the other hand, if there’s an inventory spike, they will get less than if they try to earnestly sell now.

    Going to be interesting to see which of these 2 play out.

  109. 359
    Justme says:

    CORRECTION, the original post accidentally had links to graphs from a weekend earlier.

    Weekend update, King County active inventory, graphical edition.

    As always, click on the link, then click once more for enlarged view. The graphs compare 2019,2018,2017 inventory on an hourly basis. 2017 was the year inventory was at a multi-year low for most of the year.

    King County SFH active for-sale inventory 2017,2018,2019 on 2019-01-19
    https://imgur.com/a/MXnfolK

    King County Condo active for-sale inventory 2017,2018,2019 on 2019-01-19
    https://imgur.com/a/8EjMz4J

    King County SFH active for-sale inventory ratio YYYY/2017 on 2019-01-19
    https://imgur.com/a/Li4Y9DJ

    King County Condo active for-sale inventory ratio YYYY/2017 on 2019-01-19
    https://imgur.com/a/crINMLt

    The year-end house-cleaning (harr) is apparent in that many for-sale properties got de-listed within a week or so from the end of the year. Many of these properties will be re-listed fairly soon, with DOM (days on market) reset to 0 and a new shot at landing as a “new” listing in online property searches and email-boxes around the sound.

    Another note on the de-listing activity: it looks like in Dec 2017, many sellers did not even bother de-listing, they just let the listing ride into Jan 2018 because of a perception that the market was still hot. That sort-of worked for a little while, but then sales counts and prices started cooling down in the middle of spring selling season. This year, sellers have gotten the memo and are keen on appearing NEW! and FRESH! in the listing game. Always check the listing history :).

    All that being said, the starting points for inventory counts in 2019 are significantly higher than both 2018 and 2017, and my estimate is that inventories will continue higher this spring.

  110. 360
    Justsomedude12 says:

    By Scotsman @ 357:

    There’s almost no correlation between interest rates and pricing trends, and very little correlation between affordability and pricing trends.

    Simply not true. I give an example why in my post #295.

    There is a lag before rising interest rates affect pricing. There is also a lag before affordability affects pricing. That’s why prices can continue to go up during periods of rising interest rates or declining affordability. But only for so long. Then the higher rates or affordability limits do indeed affect pricing.

    You can’t seriously believe that if mortgage rates went to say 10% or so, it would have little affect on pricing.

  111. 361
    Notme says:

    Fear Of Missing Out
    Shame Of Being Suckered
    try to avoid both

    -a FOMO-SOBS bubble haiku

  112. 362
    dariakus says:

    RE: Matt P @ 358

    I’ve seen a lot of houses dropping prices in the last few months. Redfin sends me a list almost daily now that’s filled with PRICE DROPPED tags. Somewhat anecdotal but it is definitely a change from 12 months back.

  113. 363
    Matt P says:

    By Justme @ 359:

    CORRECTION, the original post accidentally had links to graphs from a weekend earlier.

    Weekend update, King County active inventory, graphical edition.

    As always, click on the link, then click once more for enlarged view. The graphs compare 2019,2018,2017 inventory on an hourly basis. 2017 was the year inventory was at a multi-year low for most of the year.

    King County SFH active for-sale inventory 2017,2018,2019 on 2019-01-19
    https://imgur.com/a/MXnfolK

    King County Condo active for-sale inventory 2017,2018,2019 on 2019-01-19
    https://imgur.com/a/8EjMz4J

    King County SFH active for-sale inventory ratio YYYY/2017 on 2019-01-19
    https://imgur.com/a/Li4Y9DJ

    King County Condo active for-sale inventory ratio YYYY/2017 on 2019-01-19
    https://imgur.com/a/crINMLt

    The year-end house-cleaning (harr) is apparent in that many for-sale properties got de-listed within a week or so from the end of the year. Many of these properties will be re-listed fairly soon, with DOM (days on market) reset to 0 and a new shot at landing as a “new” listing in online property searches and email-boxes around the sound.

    Another note on the de-listing activity: it looks like in Dec 2017, many sellers did not even bother de-listing, they just let the listing ride into Jan 2018 because of a perception that the market was still hot. That sort-of worked for a little while, but then sales counts and prices started cooling down in the middle of spring selling season. This year, sellers have gotten the memo and are keen on appearing NEW! and FRESH! in the listing game. Always check the listing history :).

    All that being said, the starting points for inventory counts in 2019 are significantly higher than both 2018 and 2017, and my estimate is that inventories will continue higher this spring.

    That confirms what I’ve seen anecdotally. Inventory has gone sideways this month so far. I don’t think we’ll know anything until March.

  114. 364
    patrick f weber says:

    RE: Justme @ 359

    Thanks Justme! Worth slogging through the second-half-of-the-month/ 200+ comment part of the thread each month.

  115. 365
    Justme says:

    RE: patrick f weber @ 363

    Thanks, Patrick. And thanks to Tim for making it possible!

    PS: The post was extra loud today because I mistyped the end-bold tag. May cause indigestion for the sensitive, sort of like a bubble in your tummy.

  116. 366

    RE: Matt P @ 358

    Another thing I observed and checked the stats on. Possibly not a significant factor, but moving to a slower market imposes some needed changes. More of the homes that haven’t sold or gone pending are offering a lower Commission.

    In the hotter market that was likely more appropriate. More of the houses that sold or went pending in the last 60 days did not have a discounted rate offered. More of the houses not sold did have a reduced rate.

    The bulk of the variance is only 1/2%, but it reminds sellers to check what is offered to the Buyer’s Agent and make sure the Seller’s Agent takes the full 1% discount off their side, if possible. Some just negotiate the 1% reduction without noticing which agent is taking the hit, the buyer’s agent of the seller’s agent. If the seller works a discount with their agent, they should try to be sure that they are not splitting that discount with the agents who are showing and selling the property, if and when possible.

    It seems to be making a slight difference in this slower market as to sold vs not sold. With volume down overall, this may be a factor worth noting. Also for buyers, make sure your agent isn’t being enticed with a higher than the norm commission. I am not seeing many of these since a considerable number of active listings may just be coming up to and not over the norm. But be aware of these changes.

  117. 367
    Realistic says:

    RE: Justme @ 359
    Thanks so much Justme. Your charts are always extremely helpful. One question though – would it possible to somehow estimate the data for Dec 21 – Jan 7 in order to make the graph a bit more accurate in that period of time when estately started having problems? That would help better understand the current trend.

  118. 368
    Scotsman says:

    By Justsomedude12 @ 360:

    By Scotsman @ 357:

    There’s almost no correlation between interest rates and pricing trends, and very little correlation between affordability and pricing trends.

    Simply not true. I give an example why in my post #295.

    There is a lag before rising interest rates affect pricing. There is also a lag before affordability affects pricing. That’s why prices can continue to go up during periods of rising interest rates or declining affordability. But only for so long. Then the higher rates or affordability limits do indeed affect pricing.

    You can’t seriously believe that if mortgage rates went to say 10% or so, it would have little affect on pricing.

    No. I was a mortgage broker for a brief period in the early ’80s when folks were happy to get 11% during a dip from the more standard 12%. And housing prices were rising at a healthy clip because of inflation. Savings accounts paid 6-8% and stock market returns were also high. It’s not the rate that matters, but the delta between costs and returns. Future expectations made the 11% reasonable everything considered. Nothing but a big math problem. Gotta look to history and real data over time, not just hunches and short term analysis.

  119. 369
    Azucar_80127 says:

    What effect on housing prices does the Seattle Bubble community think that Edgar Martinez being elected into the Baseball Hall of Fame will have?

    Go Ed-Gar!!!!!!!!!!!!!!!

  120. 370
    Justme says:

    RE: Realistic @ 367

    I don’t have any data to fill the gap. A person who has NWMLS access could do all kinds of things, in theory, but I cannot. Sorry.

  121. 371
    Justme says:

    RE: Justsomedude12 @ 360
    RE: Scotsman @ 368

    Scotsman: When a statistician calculates the cross-correlation between two time series, ALL POSSIBLE DELAYS are considered. There is a reason for that, namely that there may be a time delay between a cause and an effect. Peak correlation most often is not at delay 0.

  122. 372
    PricesCrashing says:

    Can people give an advice how to buy w/o an agent? I tried to approach some seller agents in the past and they always have an agreement with the seller that they will get the buyer agent commission if the buyer doesn’t have an agent. This defeats the purpose of not having an agent for me – I would rather bring in an agent who will give me some commission rebate.

  123. 373
    Matt P says:

    By PricesCrashing @ 372:

    Can people give an advice how to buy w/o an agent? I tried to approach some seller agents in the past and they always have an agreement with the seller that they will get the buyer agent commission if the buyer doesn’t have an agent. This defeats the purpose of not having an agent for me – I would rather bring in an agent who will give me some commission rebate.

    If you negotiate the price down, does it matter how much commission the agent takes? Say the house is $500k and you want to pay $475k and they accept. At that point, the seller gets all the money and they can do with it as they see fit with no effect on you at all.

  124. 374
    richard says:

    Link below is a good one by david stockman. It seems the nice anchor does not quite get it.

    https://www.youtube.com/watch?v=KZU_dz_emOg

    Retiring babyboomers, SELL YOUR HOUSES NOW when suckers are still abundant, you should listen to what David stockman said in the video.

  125. 375
    NW says:

    PricesCrashing @372:

    Look up Trelora (https://www.trelora.com/seattle). They take a flat fee commission, and they are fantastic and you get as the personalized attention you need. They get back to you within minutes – try getting that with one of the infatuated RE agents. They also provide very useful in depth comparative analysis for as many properties you might be interested in.

    For the rest of the RE ppl wanted to bash Trelora – just don’t.

    Disclaimer: I am a Trelora Seattle customer, extremely pleased with my experience – and savings.

  126. 376
    uwp says:

    By richard @ 374:

    Link below is a good one by david stockman. It seems the nice anchor does not quite get it.

    https://www.youtube.com/watch?v=KZU_dz_emOg

    Retiring babyboomers, SELL YOUR HOUSES NOW when suckers are still abundant, you should listen to what David stockman said in the video.

    More Stockman from 2012: https://www.cbsnews.com/news/why-david-stockman-isnt-buying-it/

    “Stockman suggests you’d be a fool to hold anything but cash now, and maybe a few bars of gold.”

    The US stock market is up over 100% since this interview, Gold down almost 30%, but I’m sure he will claim vindication and make the TV rounds each time the market drops 10% as it does every couple years.

  127. 377
    Eastsider says:

    By Matt P @ 373:

    If you negotiate the price down, does it matter how much commission the agent takes? Say the house is $500k and you want to pay $475k and they accept. At that point, the seller gets all the money and they can do with it as they see fit with no effect on you at all.

    At 6% commission,
    Buyer offers $475k
    Seller receives $446.5k
    Agent collects $28.5k
    $475k = $446.5k + $28.5k

    But if 6% commission is evenly split between buyer and agent,
    Buyer offers $489,691
    Seller receives $460,310
    Agent collects $14,691
    Buyer receives $14,691
    $489,691 = $460,310 + $14,691 + $14,691
    Buyer effectively pays $475k (= $489,691 – $14,691)
    But Seller receives $460,310 compared to $446,500.

    Seller is more likely to accept the $489,691 offer. To the seller, the house sells for $489,691, a 2% discount from list price. He is less likely to accept the $475k offer at a 5% discount. This is a difference of 3%!

    Based on my experience, the agent will not forgo 3%. Not a chance. Your best bet is to find a realtor friend, or a cheap discount brokerage to submit the offer.

  128. 378
    Realistic says:

    RE: NW @ 375
    RE: PricesCrashing @ 372

    It is unfortunate that the commission rates are percentage based and remain so ridiculously high in this day and age. They really should be flat rates, perhaps with just a few tiers to distinguish between cheap housing, standard and luxury.

    I bought and sold a few homes without any agents and it was quite straightforward. We signed a contract and hired a title company which handled the closing.

    When you are trying to buy a home you can find FSBO’s on Redfin and Zillow (use filters to find them). But if there is a home that you like and it’s listed on MLS then use Trelora or Faira to make an offer. They will charge a small commission and give you back the rest in a form of a cashback or a rebate for closing costs.

  129. 379
    Eastsider says:

    By Scotsman @ 368:

    No. I was a mortgage broker for a brief period in the early ’80s

    This, right here- is the crux of it. It explains the nonsense here –

    “Much of what we think matters as inputs to pricing simple doesn’t. There’s almost no correlation between interest rates and pricing trends, and very little correlation between affordability and pricing trends. Chinese money? How much actually came into this market? What does matter, at the extreme, are financing options and down payment requirements.”

  130. 380
    richard says:

    RE: uwp @ 376
    actuallt tvs didnt invite him in recent stock downturn. his reasoning is sound but he may underestimate the power of feds interference so his timing is way off. but i think there is nothing wrong with his reasoning and fed may really runs out of tricj this time. i think evetybody should listen to him.

  131. 381
    richard says:

    RE: Scotsman @ 368
    its not the delta that matters. it is the return rate.
    2% of 1mil is significant for average joe but the return is not satisfactory.

  132. 382
    Erik says:

    RE: Scotsman @ 357
    Yes, this site has very few knowledgeable investors that understand the market right now. The new group is not here to learn and grow.

  133. 383
    Erik says:

    RE: Eastsider @ 379
    Why are you on this site? What’s your objective?

    My objective when I started on here was to grow my knowledge and learn about the market. Scotsman is someone that can help you understand the real estate market. I would show him respect and ask him questions if I were you. You are wasting your time and getting nowhere fighting people. Some of these people you are fighting have a lifetime of real estate knowledge they want to share. If you are ready to learn, the people on here will gladly help you.

  134. 384
    Joe says:

    RE: Matt P @ 358

    The people that have to move to new locations are the ones that will continue to take Seattle prices down. It is no fun sitting on an empty unsold house. There is the mortgage, real estate taxes, landscaping, mold control (inside and out), insects, rats, etc. When a house sits idle all kinds of bad things happen. These are motivated sellers, and they will reduce price to sell.

  135. 385

    RE: Scotsman @ 357
    I Enjoy Scotsman and Erik’s Blogs

    But both of those bloggers are experienced folks with opinions they formed over time that work for them…great. I just don’t see that similarly happening when your RE investment is a “golden inheritance spoon”, these greenhorns likely lack a plan and likely buy on impulse. Something both Scotsman and Erik would never do.

    How is Scotsman’s custom home doing? I hope it went up to your liking and Erik, my advice….when ya get a great Condo lead….talk about if you don’t want it. Don’t talk about it on the Bubble, if you’re planning on grabbing it up. I wouldn’t trust us….LOL…talk about it after you grabbed it up. I’ve had deals stolen from me from a RE office “overheard” conversation.

  136. 386
    Eastsider says:

    RE: Erik @ 383 – “Why are you on this site?…” – This. Maybe you should add a disclaimer when you offer your ‘knowledgeable’ and ‘expert’ opinion that you lost your apartment to short sale/foreclosure in the last housing crash.

  137. 387
  138. 388
    Justme says:

    RE: Erik @ 383

    >>Some of these people you are fighting have a lifetime of real estate knowledge they want to share.

    Bahahahaaa! Erik is trying to make us believe that the bubble-mongers (including himself) are here to share their supposed wisdom with us? Is it kind of like the way Wall St charlatans are all over the media trying talk up the stock market, but on a smaller, more local scale.

    Come on Erik, and all bubble-mongers. Buy now! Buy at the peak! Even if it will take another 10 years to get above water again, and only at massive cost to the country! Why are you not buying right now?

  139. 389
    Macro Investor says:

    By Erik @ 383:

    RE: Eastsider @ 379
    Why are you on this site? What’s your objective?

    My objective when I started on here was to grow my knowledge and learn about the market. Scotsman is someone that can help you understand the real estate market. I would show him respect and ask him questions if I were you. You are wasting your time and getting nowhere fighting people. Some of these people you are fighting have a lifetime of real estate knowledge they want to share. If you are ready to learn, the people on here will gladly help you.

    By Eastsider @ 386:

    RE: Erik @ 383 – “Why are you on this site?…” – This. Maybe you should add a disclaimer when you offer your ‘knowledgeable’ and ‘expert’ opinion that you lost your apartment to short sale/foreclosure in the last housing crash.

    Erik is a newbie who has had ONE success, following a dismal failure. He has many times proven he doesn’t even understand basic financial math concepts. When a person just demands respect or says “read a book”, what he’s really saying is he has no logical argument… but it’s your fault for not doing his homework for him. He couldn’t even hold onto a bottom-level job at slowww boeing.

    It’s really ridiculous for anyone to use this blog for talking their book. It has such a low readership, you really can’t influence the market. But that’s what Erik and many others are doing here. After years of browsing here for entertainment, the only users displaying any kind of knowledge are Ardell and Ray Pepper. The other agents are so bone headed I wonder how they even fill out the standard forms.

  140. 390
    Macro Investor says:

    By Eastsider @ 386:

    RE: Erik @ 383 – “Why are you on this site?…” – This. Maybe you should add a disclaimer when you offer your ‘knowledgeable’ and ‘expert’ opinion that you lost your apartment to short sale/foreclosure in the last housing crash.

    Erik is a newbie who has had ONE success, following a dismal failure. He has many times proven he doesn’t even understand basic financial math concepts. When a person just demands respect or says “read a book”, what he’s really saying is he has no logical argument… but it’s your fault for not doing his homework for him. He couldn’t even hold onto a bottom-level job at slowww boeing.

    It’s really ridiculous for anyone to use this blog for talking their book. It has such a low readership, you really can’t influence the market. But that’s what Erik and many others are doing here. After years of browsing here for entertainment, the only users displaying any kind of knowledge are Ardell and Ray Pepper. The other agents are so bone headed I wonder how they even fill out the standard forms.

  141. 391
    Eastsider says:

    By Erik @ 348:

    The 18 year cycle is for major crashes, not blips like whatever we just went through.

    So you believe we are now experiencing ‘blips’ and the 18yr super cycle crash is coming up fast – like in 2 years. And you think people should buy now and sell in 2 years (Erik @ 282)! Is this some kind of sick joke?

  142. 392
    Longtime Listener First Time Caller says:

    The whatever we just went through comment struck me as real hubris; its too soon to know what we are experiencing, or whats driving the apparent change, so we can’t say if its over or not.

    P.S. Did anyone catch the report from the National Association of Realtors yesterday? Or perhaps the the story in the Columbus Dispatch echoing much of Seattle’s market in central Ohio?

  143. 393
    Justme says:

    RE: Longtime Listener First Time Caller @ 391

    Did not see it, please post it!

  144. 394
  145. 395
    randomseattledummie says:

    RE: Justme @ 392

    Calm down there bud. You’re frothing at the mouth for anything resembling negative housing news.

  146. 396
    Justme says:

    RE: randomseattledummie @ 394

    Haven’t you heard? “Negative” news is good news.

  147. 397
    sfrz says:

    RE: randomseattledummie @ 394 – Excitement for some TRUE RE news maybe a better analysis.
    We “came out from under the ether ” (used car salesmen speak, after you get home and realize you got a lemon), pulled that IV drip of the Wall St./REIC propaganda, and said we are awake and alert to the BS.

    There was no recovery. No jail time for ANY of the banksters. The banks know this is an artificial bubble (NOT a recovery). The brokers (gangster) and used house salespeople know this is a central bank- driven everything bubble that is now coming unglued. Hong Kong, London, Toronto, Sydney, NYC, LA, Silly Valley, and….Seattle.
    The REIC rode that wave and stuffed their pockets, with the cheerleading Wall St. news whipping the lemmings into a frothy mass of madness. The central bank’s printing of worthless money went into overdrive to prop up the banks and stock market, with a policy of Wall St. over Main St. There is no bailout this time.
    As the Tim states:
    “Don’t take anyone’s word when it comes to what will likely be the largest financial decision of your life. Do the research for yourself and determine if the market is right for you. That’s what Seattle Bubble is for: providing a resource where regular people can assess the local housing market on their own.

    Seattle Bubble promotes responsible home ownership by fighting ignorance, myths, and stereotypes. If you are a real estate agent that depends a steady flow of naïve home buyers or sellers, you probably won’t enjoy this site. However, if you are interested in buying or selling a home around Seattle and want to try to understand what’s going on in the market, this is the place for you.”

  148. 398
    whatsmyname says:

    RE: sfrz @ 396
    It may take several weeks before you feel the full benefits of Thorazine. You shouldn’t stop taking this drug without first talking to your doctor.

  149. 399
    sfrz says:

    RE: whatsmyname @ 397 – Thank you. Your rude comment re: mental illness shows your character.

  150. 400
    whatsmyname says:

    RE: sfrz @ 398 – Just some friendly advice. Someone who “knows” what the bankers “know”, and what the brokers “know”, and what the salespeople “know” is someone who “knows” a great many incongruous and conflicting things all at the same time. It’s the kind of thinking that might even reduce perception of whole populations to frothy mad lemmings for simply participating in a very ordinary activity. But I am happy to take my scolding.

  151. 401
    Matt P says:

    By whatsmyname @ 399:

    RE: sfrz @ 398 – Just some friendly advice. Someone who “knows” what the bankers “know”, and what the brokers “know”, and what the salespeople “know” is someone who “knows” a great many incongruous and conflicting things all at the same time. It’s the kind of thinking that might even reduce perception of whole populations to frothy mad lemmings for simply participating in a very ordinary activity. But I am happy to take my scolding.

    Still no reason to personally insult someone’s mental health.

  152. 402
    Erik says:

    RE: Eastsider @ 386
    Don’t listen to me then.

    I was very poor when I started this real estate journey. Now things are much better for me. My line of thinking was I could help, but I see you already are an expert. Good luck!

  153. 403
    Erik says:

    RE: Justme @ 388
    I am looking to buy right now. I will only buy now if I can get about a 40% discount. I’m waiting for the right deal and some luck at the auction. I’m waiting for investors to get scared and pull back so i can score a nice deal.

  154. 404
    Erik says:

    RE: Macro Investor @ 389
    Ouch! You are hurtful.

  155. 405
    Justme says:

    RE: Erik @ 402

    LOL, so you only want to buy if you pay 40% less than everyone else does right now. I hadn’t heard you say that before, did you say that before?

    Everyone else should just pay bubble prices. Housing is not overvalued, no siree Bob. Buy now! Pay whatever they ask!

  156. 406

    RE: Justme @ 395
    Negative News Example?

    NYC sports the highest priced condo in America?

    https://www.yahoo.com/finance/news/citadels-griffin-buys-york-condo-record-238-million-035839244–sector.html

    Is positive news to the developer $CASH$ inflow….LOL

  157. 407
    ess says:

    RE: softwarengineer @ 406

    We saw a few very tall apartments under construction last week as we walked through Central Park from the south. I assume one of them was the building referenced in the article that you posted.

    While prices in NYC are soft, we observed apartment buildings going up everywhere in Manhattan and in parts of the outer boroughs such as in Flushing, Queens.

  158. 408

    All Our Jobs Replaced With Automation by 2030 Anyway?

    Even attorneys and real estate agents? LOL

    The truck drivers and fast food workers [backbone of Seattle’s labor market now] are the first victims in Seattle? At a theater near you soon and its downward impact on RE prices horrifying?

    I see key making robots and make change robots….robots to cash checks, TVs with robot hearing, etc, etc. already….robot carpenters soon? LOL

    https://www.apnews.com/6034c9ce1af347ec8da996e39b29c51b

  159. 409
    Erik says:

    RE: Justme @ 405
    All this negative energy is exhausting. Find your own way.

  160. 410
    Macro Investor says:

    By whatsmyname @ 398:

    RE: sfrz @ 396
    It may take several weeks before you feel the full benefits of Thorazine. You shouldn’t stop taking this drug without first talking to your doctor.

    WhatsHisFace is a real estate agent. No surprise that his comment is just a low brow attack with no facts to back up an argument.

    I go to open houses and talk to them. I ask them simple questions, like how is the market, fast or slow. What’s good or not so good about this neighborhood. I get blank stares, indicating to me that most of these people are too bone headed to even fill out boilerplate forms correctly.

    Other than Ardell and Ray, none of the real estate *professionals* commenting on this site do anything other than promote themselves and their business interests.

  161. 411
    Macro Investor says:

    By Erik @ 402:

    RE: Eastsider @ 386
    Don’t listen to me then.

    I was very poor when I started this real estate journey. Now things are much better for me. My line of thinking was I could help, but I see you already are an expert. Good luck!

    How have you ever helped anyone here? Recap the details so that we can agree with you.

    All I’ve ever seen is future predictions based on really flimsy math. 18 year cycles that probably have a 20 year standard deviation. Or low inventory = price gains, with no recognition of inventory possibly exploding right now.

    And bragging. Lots of bragging about selling 1 condo for a profit, conveniently leaving out how many hours you put into it. You should be congratulated for essentially working 2 jobs and pulling yourself up.

  162. 412
    QA Observer says:

    Is this some sort of trick by the REIC to eliminate a stale listing? NWMLS reflects only sitting on the market for 3 days.

    The laughable new-build I keep harping about has been sitting on the market for 130 days+ and just had it’s price reduced again.

    https://www.redfin.com/WA/Seattle/2215-3rd-Ave-W-98119/home/147142379

    Day 0 = $1.99 million
    Day 60 = $1.89
    Day 132 = $1.739

    Sneaky…

  163. 413
    Justme says:

    RE: QA Observer @ 270
    RE: QA Observer @ 412

    I think I got this one figured out. Some teardown-terrorist bought 2217 3d Ave for 1300k in Mar 2017, then demolished the house, split the lot in two, and started building TWO new “teardown-taj-mahals” (2215 being he 2nd one). The new houses are now being listed-delisted in a time-staggered fashion so that one is on MLS and the other is not. The speculator-builder was trying to get $2M for each house. That price was not happening, but the original $4M total was above the Ardell “3X the land” rule.

  164. 414
    Realistic says:

    By QA Observer @ 412:

    Is this some sort of trick by the REIC to eliminate a stale listing? NWMLS reflects only sitting on the market for 3 days.

    Maybe it’s because they relisted it under a new MLS #. I thought doing that was generally not allowed, unless with a new agent.

  165. 415
    whatsmyname says:

    By Macro Investor @ 410:

    By whatsmyname @ 398:

    RE: sfrz @ 396
    It may take several weeks before you feel the full benefits of Thorazine. You shouldn’t stop taking this drug without first talking to your doctor.

    WhatsHisFace is a real estate agent. No surprise that his comment is just a low brow attack with no facts to back up an argument.

    I go to open houses and talk to them. I ask them simple questions, like how is the market, fast or slow. What’s good or not so good about this neighborhood. I get blank stares, indicating to me that most of these people are too bone headed to even fill out boilerplate forms correctly.

    Other than Ardell and Ray, none of the real estate *professionals* commenting on this site do anything other than promote themselves and their business interests.

    Sorry, you are wrong, and I am not a real estate agent. As a result, your realtor hate is wasted on me, but it does look like someone is making lowbrow attacks he can’t back up.

    If you wanted back up, or rationale for my statement; it came 2 posts later in post 400. Keep working on your attention span.

    One question about your final statement: You thought I was a realtor commenting on this site to do nothing but promote myself and my business interests? Anonymously? Really?

    I certainly hope you have better fact finding and deduction skills when it comes to your macro investing. I’m not especially hopeful, though.

  166. 416

    RE: whatsmyname @ 415

    Another clue. A real estate agent is not allowed to use a fictitious name when speaking about real estate to the general public. Once in awhile if I’m just chatting here about something not real estate, like someone’s baby or birthday, and I’m using my phone I put just my first name. For some reason I still have to fill out all of the blanks every time I comment, which is a pain in the butt. :) On the computer I can click the auto fil but on my phone it’s tedious.

  167. 417
    Eastsider says:

    By Ardell DellaLoggia @ 416:

    Another clue. A real estate agent is not allowed to use a fictitious name when speaking about real estate to the general public.

    I am sure no real estate agent ever lost his/her license in the state. We also know that stock brokers never talk up penny stocks anonymously. LOL.

    I am curious to know who his name is or what his RE credential is. Maybe you know based on the above statement? If he uses his real name, perhaps he will be more civil here.

  168. 418
    whatsmyname says:

    RE: Ardell DellaLoggia @ 416
    I’m glad that you do what you have to do to be here. I can agree with most people that you are regularly one of the most informative reads on the Seattle Bubble.

  169. 419
    whatsmyname says:

    RE: Eastsider @ 417

    Ardell has never met me.

    I’d like to know your name and credentials too, but I presume you have an alias on purpose. I don’t feel any need to go beyond that. I am happy to look at your arguments on their own merits. I often invite people to criticize my arguments.

  170. 420
    Eastsider says:

    RE: whatsmyname @ 419 – Great. I’m glad Tim provides this platform for exchange of ideas although we can all be a little more civil here.

  171. 421

    RE: Macro Investor @ 411
    Time Equals Money

    Its amazing how high tech “gobbles up time” instead of saving it too. Its why the trash collectors mix the blue and gray together anyway and SWE uses a stamp to order instead of speaking to some one through a typical “distorted” head set with spittle destroying the microphone…the cell phone speaker phones are an echo chamber distorted joke too. Some of the Jack in the Box speakers are rain destroyed crackling static boxes too….and its not just a need for hearing aids either…

    The fun goes on and on…

  172. 422
    Notme says:

    falling prices is…
    not negative housing news
    it is just good news

    -a bubble haiku

  173. 423
    N says:

    Realistic 414 – It’s pretty standard practice for agents to delist and relist at the beginning of the new year – something about having a new MLS number starting with 2019… At least this used to be the case.

  174. 424

    RE: N @ 423

    It used to be that way many years ago (and back since the time of “mls books”) because the listing numbers started with the year as in 28xxx in 2008 changed to 29xxx in 2009. In 2010 they changed the numbering system, basically going back to 1, and they didn’t change the numbers each year anymore. (I think it was 2010). So if they gave out number 3526 on December 31 then Jan 1 would just be 3527. No need to update the number.

    It then became against the rules to trade in your old number for a new one or to cancel and relist just to appear “fresh” on market. Since only agents had access to the information and we always had access to the full history, it wasn’t to fool anyone. The new rules started coming in once the general public had more open access to this info via “the internet” display.

    Lots of minor nuances and a few exceptions such as if you reduce the price by 5% all at once (not 3 combined price reductions) you can get a new listing number. Change of agent as someone mentioned. Off market a long time. Sometimes a listing contract expires and a new one isn’t signed for awhile afterward and that will cause a new listing a few days after the expiration. Agents can always see the full history, so we don’t pay as much attention to these small aberrations on various external websites.

    In any case the house you are talking about was off market for more than 60 and close to or more than 90 days before it came back on as a new listing. Usually the days on market, even the CDOM days on market, cancel out after being off market for more than 60 days.

    In essence JustMe’s answer is the most accurate. There are two new houses and they are not always both on market at the same time, though likely both available to be purchased at the same time.

    There are a few reasons for this that I can’t go into as the info is a bit confidential. There will never be 100% compliance with all of the rules and there is still a ton of info that agents have access to that the general public can’t access. At least in residential real estate where privacy is still a big factor and everything is not publicly available. That makes more sense from a seller’s perspective than a buyer’s perspective and we are always balancing the rights of both while trying to be as fair and transparent as possible. Some areas are more progressive in that regard than others and ours is one of the best in the Country. But still…not always what buyers would want. Sometimes the owner wants and can get something else. Each has rights within reason.

  175. 425
    Erik says:

    RE: Macro Investor @ 411
    You got to see my transformation from poor white trash to white trash with rental property and more means. At the time you are referring to, I was doing a remodel in Kirkland that I was fixing up paycheck to paycheck. At the same time I was in the most difficult part of getting my master of science in mechanical engineering at uw. I took on so much at one time. I didn’t have much to give by the time I got to work and eventually got laid off. I had a previous remodel I sunk tons of money and time into and ended up short selling. Needless to say, it was a tough time for me I needed to push through.

    Yes, I had to sell short. Yes, I got laid off. But I came out of it with a master of science in mechanical engineering degree and a very successful remodel in Kirkland. I got back on at the same company I was previously laid off from with a job I liked more and a big raise. I was paid by the lender to short sell my remodel in Everett and was glad to offload that headache.

    Fast forward to today, I have a small but respectable portfolio of condos in Seattle, a higher paying job at the same company that laid me off, an awesome marriage, and a son. I will keep learning and progressing in the real estate world whether you and others try to pull me down or not.

  176. 426
    northender says:

    RE: Erik @ 425
    Good for you Erik!
    Everyone goes through hard times, the people who are willing to work hard and also have the capability to make wise choices come out better afterward. Taking financial risk isn’t for the faint of heart but it can really multiply wealth. It’s not much of a challenge to sit at the computer and type discouraging comments, it’s much harder to work a day job and renovate units nights and weekends.

  177. 427
    Macro Investor says:

    RE: Erik @ 425

    Nothing personal. Glad you turned things around.

  178. 428
    Erik says:

    RE: northender @ 426
    Thanks. I wanted to share in case anyone actually reads it and has a similar situation. Everyone has trials and tribulations. It’s how we react to those trials and tribulations that determine our success. I wouldn’t say I’m a successful guy, but I think I have produced a better outcome for myself by keeping my goals in sight. I think if anyone makes strides to improve their lives, they are going to face adversity.

  179. 429
    Erik says:

    RE: Macro Investor @ 427
    I was letting you know why I may have come off as bragging. I was probably at a tough spot in the event and finally achieved my goal.

  180. 430
    Harrison Lee says:

    RE: justsomedude12 @ 289 – RE: justsomedude12 @ 289 –

    Actually npeterson is right. I work in one of the big banks and all my clients are Chinese..giving I speak Mandarin and etc. It was strict.. but after the war its pretty much sealed and no influx of $. They institute anew rule this yeae that if the gov discover u purchased a property they’d ban u from sending $ out for 2 years.

    Anyways I agree with npeterson. Good time to buy. Chinese buyers will come back.

  181. 431
    Harrison Lee says:

    RE: npeterson5068 @ 293

    Actually there has always been restrictions.. since 2015 and 2016. Not just 2017. People just found loopholes to get money out.. via HK, TW and etc. 2017 is the cracking down. 2018 is pretty much criminal offense for wiring $ out.

  182. 432

    RE: Erik @ 429
    You’re Honest too Erik

    That takes Toastmaster leadership courage, skills we work on all our lives. The fun goes on and on ;-)

    I went through bad times too….horrifying times in the mid 90s. Let’s put it this way….it should have set me back 15 years financially, but I, like Erik, had help from unexpected [lucky?] sources….I put all my chips on one table (stocks) and made enough to retire early. Not real estate folks, stocks. Is this a workable plan anyone can master? Hades no, every case and timing is different, but if I had not thought out of the box, I had nothing to lose then and a possibility of winning if I tried. It worked.

    I challenge anyone to keep fighting and don’t ever give up….that’s where the payoffs come from…

  183. 433
    Justme says:

    Weekend update, King County active inventory, graphical edition.

    As always, click on the link, then click once more for enlarged view. The graphs compare 2019,2018,2017 inventory on an hourly basis. 2017 was the year inventory was at a multi-year low for most of the year.

    King County SFH active for-sale inventory 2017,2018,2019 on 2019-01-26
    https://imgur.com/a/JiQ80ik

    King County Condo active for-sale inventory 2017,2018,2019 on 2019-01-26
    https://imgur.com/a/K3S9oZm

    King County SFH active for-sale inventory ratio YYYY/2017 on 2019-01-26
    https://imgur.com/a/PoGJgAe

    King County Condo active for-sale inventory ratio YYYY/2017 on 2019-01-26
    https://imgur.com/a/V3xe3Iz

    It is still early 2019, and it is still several weeks until the traditional high-season for selling kicks into gear. But SFH active for-sale inventory count is nevertheless starting around 1.9X what it was last year at the same date, and the Condo count is about 2.5X. The ratios are both actually a bit more than that — keep in mind that the ratio graphs are relative to 2017, and 2017 started a bit higher than 2018, although 2018 soon overtook 2017 by a large factor.

  184. 434
    Justsomedude12 says:

    By Harrison Lee @ 430:

    RE: justsomedude12 @ 289 – RE: justsomedude12 @ 289 –

    Actually npeterson is right. I work in one of the big banks and all my clients are Chinese..giving I speak Mandarin and etc. It was strict.. but after the war its pretty much sealed and no influx of $. They institute anew rule this yeae that if the gov discover u purchased a property they’d ban u from sending $ out for 2 years.

    Anyways I agree with npeterson. Good time to buy. Chinese buyers will come back.

    Actually npeterson is wrong. I work with a lot of Chinese clients and they all say Seattle real estate is no longer a good investment. None of them will buy anymore.

    Anyways I disagree with npeterson. Bad time to buy. Chinese buyers will not come back.

  185. 435
    npeterson5068 says:

    By Harrison Lee @ :

    Actually there has always been restrictions.. since 2015 and 2016. Not just 2017. People just found loopholes to get money out.. via HK, TW and etc. 2017 is the cracking down. 2018 is pretty much criminal offense for wiring $ out.

    In your 430 post, I noticed you mentioned there was a possibility Chinese buyers could still come back. Is that because a trade resolution could remove the criminality of purchasing property, or do you think they’d find other ways?

    Something worth pointing out is that the national real estate data showed that foreign and all-cash buyers were starting to re-enter the market the past couple of months. This data did not reveal if they were Chinese-foreign-buyers but still thought this change was interesting.

    By Justsomedude12 @ 434:

    […] I work with a lot of Chinese clients and they all say Seattle real estate is no longer a good investment. None of them will buy anymore. […]

    – Proximity to China
    – Proximity to Vancouver (a lot of Chinese relatives have already purchased there, so they’ll want to remain close)
    – Similar to Vancouver lifestyle
    – Educated population. Look what this did for Silicon Valley, before Chinese buyers started showing up
    – Strong jobs market, one which is able to support housing prices comparable to Silicon Valley (minus the State Income Tax and disadvantages of SALT changes)
    – Strong Asian presence

    And you think that none of them will buy anymore? Uh huh, OK

  186. 436
    Justsomedude12 says:

    RE: npeterson5068 @ 435 – I was pointing out that anyone can come on here and claim anything they want.

    By the way, I have a friend on the Seattle City Council, and they’re about to implement a 20% foreign buyer tax.

  187. 437
    Demotivated Buyer says:

    Making money is easy. Let me just ask double of what I paid 8 years ago…

    https://www.redfin.com/WA/Kirkland/9027-125th-Ave-NE-98033/home/512164

  188. 438
    npeterson5068 says:

    By Justsomedude12 @ 436:

    I was pointing out that anyone can come on here and claim anything they want.

    Part of his post was anecdotal, but it was in the context of a policy change that is completely verifiable and discussed here previously. I found it more useful than the response you made where you mimicked his wording to make the (obvious) point that people can post anything here.

    Feel free to discuss or dispute. That’s why we’re here.

  189. 439
    justsomedude12 says:

    RE: npeterson5068 @ 437 – You’re clearly fishing for a certain response (that Chinese money will return). No doubt Harrison Lee will oblige you with the response you’re looking for.

  190. 440
    npeterson5068 says:

    RE: justsomedude12 @ 438 – If you go back read through my posts, you’ll see that I’ve welcomed people to challenge my points, so I’m not looking for specific responses. Just genuinely trying to figure out where the market will go next.

    In the meantime, it would be great if we have more actual discussion and minimize smart-aleck responses.

  191. 441
    justsomedude12 says:

    RE: npeterson5068 @ 439 – I have read through your posts, and you’re salivating at the possibility that large price increases will resume. Looking for any confirmation of this. You shoot down anything contrary, and lap up any confirmation.

    You hope that Chinese buyers will return, thus pushing prices(and the value of your property) up. Yet you don’t care that this will hurt future generations of people that actually live here. I think it’s a distasteful display of greed.

  192. 442
    Realistic says:

    By Justsomedude12 @ 436:

    By the way, I have a friend on the Seattle City Council, and they’re about to implement a 20% foreign buyer tax.

    I couldn’t find any current news of such such tax being considered. There was some talk in 2017 but it went nowhere for political reasons:
    https://www.seattletimes.com/seattle-news/politics/proposed-seattle-taxes-targeting-foreign-buyers-investment-properties-take-fire/

  193. 443
    Matt P says:

    How about this wonder: https://www.redfin.com/WA/Seattle/2621-2nd-Ave-98121/unit-803/home/55192

    It has been taken off and put back up as new 2 times now. It’s the cheapest 2 br in the area, so curious why it’s not selling. It may not matter on the MLS, but on redfin, the price gets hidden, days on market reset and they send it to everyone as a new house who has a saved search in the area. They even changed a few of the pictures on it.

  194. 444
    Realistic says:

    By npeterson5068 @ 287:

    If foreign buyers return once/if trade disputes have been settled, I do think it’s possible we could see continued growth in the Seattle area.

    China implemented new restrictions on foreign investments before the trade war even started. It’s unlikely those restrictions will be lifted when the trade dispute is over.

    As for Amazon’s split HQ2, I think folks will prefer working at the Seattle headquarters instead of VA or NY when you consider what the area has to offer, and the lack of state income tax.

    It’s not a matter of preference. After HQ2 Amazon will not expand in Seattle as rapidly anymore. It will slow down hiring here or may even reduce the head-count. It doesn’t matter whether an employee prefers to work in Seattle HQ if there are no jobs available. And let’s not forget the looming recession that will inevitably impact companies and jobs as well.

  195. 445
    Matt P says:

    RE: Justme @ – Looks like condos are already on an upward swing again.

  196. 446
    Voight-Kampff says:

    How about selling for 5x what you paid 7 years ago. No remodel necessary. It’s a great high rise. Anything bought in this building in 2012 is a rental goldmine. But no rental can cash flow like this.

    https://www.redfin.com/WA/Bellevue/650-Bellevue-Way-NE-98004/unit-4102/home/2118291

  197. 447
    justsomedude12 says:

    RE: Realistic @ 442 – Sorry, I was just using that as an example of how people can make any claim they want on here.

    But you’re right, it was discussed a couple years ago. The Seattle politicians instantly caved when someone claimed it was racist. Even though it has nothing to do with race and everything to do with keeping Seattle RE from becoming a casino for the rest of the world.

  198. 448
    Demotivated Buyer says:

    RE: Voight-Kampff @ 446
    That’s our very own baseball hall of famer Edgar Martinez selling his Bellevue penthouse.

    https://seattle.curbed.com/2019/1/24/18195276/edgar-martinez-home-bellevue-penthouse

  199. 449
    richard says:

    RE: Justsomedude12 @ 436
    I hope it is true. but I am highly skeptical about it since I believe the government colluded with real estate complex to let all the foreign money coming in and blew the bubble in the first place.

  200. 450
    Harrison Lee says:

    RE: Justsomedude12 @ 434

    One of my clients own a real estate agent co.. all they do is host Chinese buyers. Keep your negative attitude about Chinese buyers not coming back…

    If anything half my 24 hour day is spent meeting with Chinese clients.. ie developers, potential buyers , RE agency owners and etc. I’m buying more dirt and land. You can stay on the side.

  201. 451
    Harrison Lee says:

    RE: justsomedude12 @ 447

    While you’re at it claiming Im just making some false claims with no knowledge of Chinese buyers market
    .I’d research a bit on RMB vs USD relation for the past several years. Put aside the monetary control ans look how expensive it’s gotten for Chinese buyers to buy in the last year. Was 6rmb in 2016 and 7rmb in 2017 (but economy was a lot better for the Chinese then.). The rise to 7rmb once again in 2018 definitely made it a lot more expensive this time around since the emerging markets and Chinese economy is struggling now. If anything 6rmb to 7rmb to USD is 16% increase in cost for them, while their portfolio in their Chinese stocks drop like 30-_40%

    Anyhow looks like it’s coming back down and cheap USD (house) is coming back for Chinese buyers, if they can get their money out of course.

  202. 452
    richard says:

    RE: justsomedude12 @ 441
    that’s why we need to take action to add pressure on the government to ban Chinese buyer or implement foreign buyer tax. Otherwise working class American’s dream to buy house here is doomed. For example, in the next round of city council and mayor election, just ask she or he will take serious action on foreign buyer, that should be no.1 criteria to choose your government official.
    Let it to be clear, those who benefit from Chinese buyers don’t give a ***** to us renters. We should let our voice heard and use your vote to fight for your future.

  203. 453
    richard says:

    RE: Demotivated Buyer @ 448
    it is interesting that so many high end properties on market today. Rich people are the first bunch to react to market change.

  204. 454
    richard says:

    RE: Matt P @ 445
    really? I just checked redfin, in seattle, condo total listing 409, 315>14 days, 250 >30 days, 205>60 days. does not look like a rebound to me.

  205. 455
    Justme says:

    RE: richard @ 454

    I think MattP meant condo active listing count being on the upswing , Richard, not the prices.

  206. 456

    2018 Chinese Money Drying Up in Seattle RE

    https://www.cnbc.com/2018/08/02/seattle-housing-market-is-under-pressure-as-chinese-buying-dries-up.html

    No help there anymore [even if it was really there before BTW]. A lower yuan and money transfer restrictions in 2018 caused this per alleged article…

  207. 457
    npeterson5068 says:

    By justsomedude12 @ 441:

    I have read through your posts, and you’re salivating at the possibility that large price increases will resume. Looking for any confirmation of this. You shoot down anything contrary, and lap up any confirmation.

    You hope that Chinese buyers will return, thus pushing prices(and the value of your property) up. Yet you don’t care that this will hurt future generations of people that actually live here. I think it’s a distasteful display of greed.

    You are literally making stuff up and drawing conclusions based on what you made up about me.

    What I said was that I think there is a chance foreign buyers could return. I never said I hope they do. Do you not understand the difference?

    I’ve asked people to challenge my points. And I didn’t shoot down any contrary views or salivate over confirmation, though I’m sure that’s how it seems with someone you disagree.

    I’m genuinely trying to discuss what could happen next in the market. It doesn’t seem possible on this blog without the noise of some folks accusing you of propaganda or greed. I don’t have a “vested interest” in what happens. I have an “interest” in projecting what will happen in order to make the next move. It’s astounding how some people are not able (or refuse) to grasp the difference.

    I don’t care what that next move is, just I prefer to make the right one. There are a lot of people like me. Has nothing to do with greed, as the decision can go either way. It’s about being responsible, planning for the future, and discussing reality.

  208. 458
    Joe says:

    Are you guys ready for round three of the stock market route? The next drop will be a doozy, after this large dead cat bounce. I believe it will come just in time to tank Spring real estate listings.

    Everybody knows EPS growth will be dropping to the floor in 2019. People are looking at other ready to pull the trigger, like Good Bad & Ugly.

  209. 459
    LessonIsNeverTry says:

    RE: Joe @ 458 – Seems a little early to me. The markets are back on the CB hope train.

  210. 460
    Eastsider says:

    RE: Harrison Lee @ 451 – As you acknowledged, RMB is down, Chinese stocks are in depression. Chinese economic news has been terrible lately and I think it will get a lot worse in the 1st quarter. So I’m not sure where your optimism comes from. Trade deal?

  211. 461
    Justme says:

    RE: justsomedude12 @ 441
    RE: npeterson5068 @ 457

    npeterson5068 is the classic concern-troll. He tries hard to SOUND balanced, but then posts a bunch of convoluted whatabouts that supports his underlying motivation of talking up housing prices.

    For example, the whole china-buyers-will-come-back-when-and-if-trade-tensions-ease thing that he has been pushing is a fake. It is completely wrong because it is China itself, and not the US, that is trying to keep chinadollars (USD held by Chinese people and corporations) from escaping into the overpriced US property market. It is not about trade and tariffs.

    Then there is the whole “I have no vested interest” nonsense. I’ll say it again: EVERYONE has a vested interest in the cost of roof over their heads. The definition of “vested” that npeterson5068 uses HAS NOT BEEN DEFINED BY HIM, but I can assure you that his is not an honest definition. Anyone that has or wants to have a roof over their head has a vested interest.

    Personally, I’m a renter. I want housing prices to be fair and un-manipulated. It has been nothing but REIC propaganda/lobbying and Fed and GSE (mortgage securitizer) intervention to inflate asset prices, including 30 years of Fed manipulation of interest rates and mortgage rates.

    Just say no. The buyer strike is working.

  212. 462
    Eastsider says:

    By npeterson5068 @ 287:

    If foreign buyers return once/if trade disputes have been settled, I do think it’s possible we could see continued growth in the Seattle area. The decrease in foreign buyers was noted as one of the big contributors to inventory increasing. There are still folks fleeing Silicon Valley for a better quality of life. The new restrictions on SALT has only amplified that, since it has less of an impact in the state of Washington. Seattle having such uniqueness means it’s becoming an exclusive place to live. Variety of scenery. There’s actually water, mountains, and desert accessible a couple of hours away. Access to Vancouver BC, Portland, and California is relatively close. A large pool of intelligent and high quality people and jobs that can sustain the growth. As for Amazon’s split HQ2, I think folks will prefer working at the Seattle headquarters instead of VA or NY when you consider what the area has to offer, and the lack of state income tax.

    I know some people already pointed out the wishful thinking. There is no fleeing to Seattle from Silicon Valley as you claimed. The Census survey shows insignificant net migration between King County and Silicon Valley county. This was discussed a few posts ago. Seattle geography (water, mountains, desert) has not changed. WA has never had state income tax. If you have to resort to pre-existing conditions to justify recent price gains, perhaps the gloomy wet weather will pour some cold water on your thesis?

  213. 463
    David says:

    RE: Justme @ 461 – Per the ST last week, the average renter has a net worth of $5k.

    I wonder if a lot of the negative voices here are in that category of simply never being able to buy a house. This is what is sad.

  214. 464
    dariakus says:

    RE: David @ 463 – Some of us renters have significant net worth and still cannot afford a house, as the price increases faster than our ability to save up a down payment. So I will continue to rent until such time as I can move out of the area entirely.

    Between my inability to afford a house with a solid income and the relatively rapid deterioration of Seattle, it’s time to look elsewhere…

  215. 465
    Eastsider says:

    RE: David @ 463 – Average net worth of renter is irrelevant. That hasn’t changed much or mattered for years. The relevant chart is the King County Homeownership Rate. It was 65.73467% in 2009. It is now at 61.42371%. It is the 4%+ decline in 5 years from 2009-2014 that tells the real economic story.

    https://fred.stlouisfed.org/series/HOWNRATEACS053033

  216. 466
    Realistic says:

    By David @ 463:
    There are also people who have enough net-worth to buy a house but decide to rent because of the declining market. I know for a fact there are indeed (at least some) buyer’s on strike.

  217. 467
    justsomedude12 says:

    RE: David @ 463 – Renters skew toward the younger demographic, so their average net worth is bound to be low. Not to mention student loans dragging the average down further. That $5K average net worth probably doesn’t really tell you what you’re thinking it does.

  218. 468
    Realistic says:

    RE: Eastsider @ 462
    Brilliant post, and I completely agree with you. There is nothing special in WA in terms of geography or climate that would help support exorbitant RE prices. Besides, having no state income tax is of little consolation since sales tax in WA is one of the highest in the country.

    RE prices here were boosted primarily by 3 elements: Amazon, foreign buyers and booming economy. None of them are in effect anymore, and sellers are slowly starting to realize that.

  219. 469
    whatsmyname says:

    By justsomedude12 @ 467:

    RE: David @ 463 – Renters skew toward the younger demographic, so their average net worth is bound to be low. Not to mention student loans dragging the average down further. That $5K average net worth probably doesn’t really tell you what you’re thinking it does.

    A $5K average would relationally mean that there are 19 people with only a $1K net worth for each 1 person with an $81K net worth in the rental group. That’s pretty stark.

  220. 470
    Joe says:

    RE: dariakus @ 464

    As you say, Seattle is undergoing rapid price deterioration. Panic buyers of last summer are already down 12%. That’s $120,000 on a million dollar house. Ouch. The situation is currently a falling knife, with rapid price declines continuing. The smart buyers are waiting it out, at least until prices stabilize for a year or so. There is no sense throwing money away. The market is not going to suddenly reverse, as the negative trend is firmly established. The bottoming process will take many years.

    Heck, the recession hasn’t even begun yet. The onset of that recession will only accelerate the price declines from here.

    As buyers, don’t be foolish. Wait it out. Sellers of course should be panicking. Only the first ones to drop prices will get close the deals. The others will watch as prices gradually fall, until they plummet in the recession.

  221. 471
    Justme says:

    RE: David @ 463

    >>I wonder if a lot of the negative voices here are in that category of simply never being able to buy a house. This is what is sad.

    Ooooh baby, a dagger aimed at my heart, but cloaked as faux sympathy for renters. That was really clever. NOT. But it does show your true nature with great clarity.

  222. 472
    Justme says:

    RE: whatsmyname @ 469

    >>A $5K average would relationally mean that there are 19 people with only a $1K net worth for each 1 person…

    Relationally?? That sounded really sophisticated. Except it wasn’t. I have noticed that you have a penchant for flowery phrases that have no defined meaning in standard English. I wonder if it is working? Does it make people want to buy, despite everything? Who knows, but clearly, desperate times do call for desperate measures.

  223. 473
    David says:

    RE: dariakus @ 464 – I still think the MOST important thing, if you are young, is to buy a house and stay put long enough to build equity.

    Renting is not going to do that for anyone. As a landlord, I’ve made significant money renting out complete crapholes that initially kept me up late at night thinking I had made a horrible investment. I kept the properties about 10 years before I realized it would turn out alright.

  224. 474
    Sam says:

    RE: Justme @ 472 – Dear Justme, whatsmyname, I appreciate both your, among many others’, viewpoints to build my perspective on local RE matters. To a limit it is fine by me if you call each other’s agenda as you perceive it to be. Nevertheless, would request you and others to post comments that add to the conversation for most readers, not just to your on going fight with each other. There’s always the good old honorable option to duel and settle personal fights :-P. But seriously I would be personally thankful to you both if you help build more civility on this blog. This blog is pretty relevant to many folks… So are your voices….please keep them relevant

  225. 475
    Voight-kampff says:

    RE: Sam @ 474
    This blog has always been rife with posters taking differing economic/RE concepts personaly. I sometimes find it frustrating, yet also mildly entertaining.

  226. 476
    whatsmyname says:

    RE: Sam @ 474 – My comment here was about a mathematical relationship, and was specifically in answer to another poster’s comments. It did not involve Justme, and was in no way personal. Still, since you brought it up:

    Justme, you seem to have again demonstrated your penchant for avoiding the substance of a post. Did you ever find any evidence for your claim that new houses cause the neighboring houses to double in price???

  227. 477

    RE: Justsomedude12 @ 436
    The Internet Companies Pay Wash St Sales Tax Now

    But one alleged to me in writing that the Wash St Income Tax could collect the money that hasn’t been collected yet. LOL? What state income tax paperwork? The tooth fairy’s?

    They make policy they don’t/can’t enforce and BTW…if they charge you for state sales tax will Wash St get the money you already paid and will you billed again later anyway? The fun goes on and on…

    Never pay a bill to the Twilight Zone collection….you can be billed again and again by these shysters.

  228. 478

    RE: Joe @ 458
    Day to day Changes Mean Nothing

    Since the shutdown stocks went up about 10% [dead cat bounce?] MOM approximately….Trump needs another good shutdown to buoy the stock market or is SWE assuming too much? Actuals have a way of mucking everyones’ predictions…the trade tariffs are mucking up predictions similarly.

    Read it before ya believe it? Or do what I do, smile and enjoy the ride…it is what it is…

  229. 479

    RE: David @ 463
    Yes David

    A furloughed worker under Trump in 2019 will receive all their back pay. Its an EO now.

    A paid extended “vacation” in my book….why is that bad to the saver? The Open Border Party (OBP) is made up of a lion’s share of folks who love to live “Paycheck to Paycheck”….and these buffoons are lion’s share or most of the federal workers [OBP members]….no wonder we’re in deep doo-doo…

    I should feel sorry for them? I do, they’re pathetic….LOL

    Erik and I would love a “guaranteed paid” furlough vacation, we’re prepared and savvy investors….LOL

  230. 480
    Justpassinthru says:

    @Dariakus, that is our position as well. Making 6 figures and have 6 figures saved for a down payment. It’s still not enough to afford a starter home which are $700k+ on the east side. No I’m not spending $600 on a total fixer bc If I’m spending that kind of cash, I want move-in ready. We are also continuing to save $$ with the intention to relunctantly leave the area eventually. Quality of life matters. Unless home prices come down a few hundred thou, that is the sad reality for many potential buyers here. The middle class has been priced out. We are smart buyers, I should add, since lending standards have lowered, this does enable a few more folks in the door, however saddling yourself to be house-poor is no way to live. Despite this, I have a realtor continuing to call me since the holidays and tell me it’s a great time to buy! She was ignoring us completely last year, which I see as a sign of what has occurred in the market. RE: dariakus @ 464

  231. 481
    uwp says:

    One funny thing about the recent posters and their massive cash piles that they hold as they wait for a fall in house prices: This potential example of the Buyers Strike™ is also an example of price support for Seattle area housing.

    Clearly, despite the worries about houses being too expensive for the Average Joe, there are people on the sidelines with the ability (and desire) to buy houses. If Justme is to be believed, there are masses of them, just waiting to pounce! Hopefully they don’t run into a situation where they are fighting against each other for a good deal on a house, and need to bid the property price up.

  232. 482
    Justme says:

    RE: uwp @ 481
    RE: David @ 463

    You two need to have a meeting of the bubble-monger minds and decide which narrative you are going to push in order to make some more suckers buy into the bubble peak. It does not look good when one of you pushes the renters-are-broke narrative while the other pushes the rich-people-on-the-sidelines narrative.

  233. 483
    NW says:

    @Justpassinthru, @@Dariakus: Same boat here. Not renting though, but in a tiny house. 6 figures income, plenty saved for down payment (probably all). Just refuse to pay ridiculous prices for junkyard-worthy “museum pieces”.

  234. 484
    N says:

    https://www.businessinsider.com/super-bowl-real-estate-housing-market-outlook-glenn-kelman-2019-1

    “Significant housing declines have foreshadowed nine of the 11 post-World War II recessions in the US, according to another note by UBS from December examining the housing slowdown.”

    And there’s one weekend that Kelman says will indicate the direction of the market: the weekend of the Super Bowl, which is this Sunday.

    “That weekend is the weekend where the housing market either goes crazy or it takes a nap,” Kelman said on NPR, later referring to the weekend as a sort of “Groundhog Day for the housing market.”

    “What I’ll be watching that weekend is just how many people are touring houses and, on Sunday night, how many of them decide to make an offer,” Kelman continued.

  235. 485
    Blake says:

    Meanwhile, China’s Minsky Moment looms… Third leg in the world debt supercycle soon?
    https://www.smh.com.au/business/the-economy/it-could-be-on-the-scale-of-2008-expert-sends-warning-on-china-downturn-20190124-p50t9q.html
    Professor Ken Rogoff said the key policy instruments of the Communist Party are losing traction and the country has exhausted its credit-driven growth model. This is rapidly becoming the greatest single threat to the global financial system. “People have this stupefying belief that China is different from everywhere else and can grow to the moon,” said Professor Rogoff, a former chief economist at the International Monetary Fund.

    “China can’t just keep creating credit. They are in a serious growth recession and the trade war is kicking them on the way down,” he told UK’s The Daily Telegraph, speaking before the World Economic Forum in Davos. “There will have to be a de facto nationalisation of large parts of the economy. I fear this really could be ‘it’ at last and they are going to have their own kind of Minsky moment,” he said.

    This refers to the financial instability hypothesis of Hyman Minsky. It is when a seemingly unstoppable debt bubble collapses under its own weight in a cascade of falling asset and property prices. The authorities can cushion the crash, but they cannot escape the brutal mechanics of reversion.

    Prof Rogoff is co-author of a magisterial history of debt delusions, This Time is Different: Eight Centuries of Financial Folly, written with former IMF firefighter Carmen Reinhart.

    He said it is an error to think that China’s current slowdown is entirely deliberate and calibrated. While the People’s Bank undoubtedly wishes to curb the credit boom, it is also riding a tiger that it cannot fully control. “I fear this will be the third leg of the global debt supercycle, after subprime in the US and the eurozone debt crisis. Nobody knows how this is going play out but it could be on the scale of 2008 and will be very bad for Asia, and there will be spillovers in Europe,” he said.
    (fin)

  236. 486
    richard says:

    RE: uwp @ 481
    what is a sucker’s(herd) psychology? when the price rise, they FOMO and they jump without hesitation.
    when the price fall, they are afraid of catching a falling knife even when the price is close to bottom. In either case, they fail. I guess you have seen a lot of sucker in the price appreciation phase t but not the price depreciation phase

    A wise buyer will buy when he feel it is worth it even it is a little pricy and not everybody can catch the very bottom. Current price is at historical super bubble level.

  237. 487
    David says:

    RE: richard @ 486 – How are they Super Bubble level? It has been 12 years since the Obama Depression started to form.

    Based upon the following, where is this super bubble:

    1) Underlying land price?
    2) Building materials price?

    It costs what, 175/SF to build, plus land. Where is the bubble in the equation?

    You don’t have to buy in Seattle proper. You can buy just outside of Seattle in White Center, etc. Seattle itself is quite small.

  238. 488
    richard says:

    RE: David @ 487
    glad you call it Obama depression since he deserve it in his incompetency on managing economy.
    I think you can ask similar questions (land/ labor cost) in 2007 right before the housing bubble collapse.
    You emphasize the high cost as a justification that this is not a bubble. in my opinion, that is a more of a effect not a cause. The cause is that the FED keep near zero interest rate for so long and re-inflate the house price and also the Chinese money inflow. When the house price is high, the price of EVERYTHING is high. The construction worker, police, elementary teacher and nurse all demand higher pay. That’s why microsoft’s 500mil does not help at all since it does not address the root of the problem.
    you see, if you keep inflate the price, you will lose sucker to hold the bag in the future. In the meantime, you pay higher property taxes to government and all the service around you cost you more. It will be very sad to see your paper wealth go up everyday but you actually suffer real loss year after year.

    so smart people should sell real estate to the sucker now.

  239. 489
    whatsmyname says:

    By Justme @ 472:

    RE: whatsmyname @ 469

    Relationally?? That sounded really sophisticated. Except it wasn’t. I have noticed that you have a penchant for flowery phrases that have no defined meaning in standard English. I wonder if it is working? Does it make people want to buy, despite everything? Who knows, but clearly, desperate times do call for desperate measures.

    Your argument is with the people at the Oxford dictionary, but I am confident you can outshine their puny knowledge of the English language.

    Btw, I rent to people, not sell to people. Why would I be desperate to make people buy? That seems as counterfactual as when you claimed a new house in the neighborhood would cause prices for the other houses to double, don’t you think?

  240. 490
    randomseattledummie says:

    RE: Justme @ 461

    That’s just preposterous. With no external/gse intervention the 30 year fixed rate home loan at any rate wouldn’t exist. Would you like your rate terms when you buy a home to be 8% for 5 years and then adjusting at +5% of the 5 year bond every 5 years until you pay it off? I don’t think so. Everybody hate government involvement until it helps them.

  241. 491
    randomseattledummie says:

    RE: dariakus @ 464

    I can’t speak to your opinion of the rapid deterioration of Seattle but there are so many “creative” loan programs around I don’t buy the “we can’t afford to buy” while similtaneously claiming to have a significant net worth. Either your definition of what a significant net worth is low or you’ve decided you don’t see value in purchasing at current prices.

  242. 492
    Matt P says:

    How about this doozy? Sold end of Jan 2018 for $800k. Relisted in Nov at a loss for $760k. Recently reduced to $730k. It’s probably not going to sell until it hits $650k or less comparing it to other 2/2 townhomes around. That’s a foreclosure waiting to happen.

    https://www.redfin.com/WA/Seattle/219-24th-Ave-E-98112/unit-C/home/146591

  243. 493
    Unknown says:

    Looks like Amazon is getting cold feet at Rainier Square. Is this the first real economic indicator in the Seattle market? Time will tell…

    https://www.bizjournals.com/seattle/news/2019/01/28/source-amazon-will-market-rainier-square-tower-for.html

  244. 494
    Matt P says:

    By Unknown @ 493:

    Looks like Amazon is getting cold feet at Rainier Square. Is this the first real economic indicator in the Seattle market? Time will tell…

    https://www.bizjournals.com/seattle/news/2019/01/28/source-amazon-will-market-rainier-square-tower-for.html

    Ha! I was just talking with my coworkers about this as we looked out the window at the construction from Rainier tower and my boss’ soon to be not so great view. I said Amazon might not want to fill it because they aren’t hiring anymore and everyone else thought they would. Guess I was right.

  245. 495
    Eastsider says:

    By randomseattledummie @ 490:

    That’s just preposterous. With no external/gse intervention the 30 year fixed rate home loan at any rate wouldn’t exist. Would you like your rate terms when you buy a home to be 8% for 5 years and then adjusting at +5% of the 5 year bond every 5 years until you pay it off? I don’t think so. Everybody hate government involvement until it helps them.

    The UK mortgage market operates with minimal state intervention. The US market was also private prior to the S&L crisis. When government gets involved, it usually distorts markets and prices. Just look at the rising costs of college tuition and healthcare. Prices would be a lot lower if there are no government ‘subsidies’.

  246. 496
    Eastsider says:

    By randomseattledummie @ 491:

    I can’t speak to your opinion of the rapid deterioration of Seattle but there are so many “creative” loan programs around I don’t buy the “we can’t afford to buy” while similtaneously claiming to have a significant net worth. Either your definition of what a significant net worth is low or you’ve decided you don’t see value in purchasing at current prices.

    Hello Dummie!

  247. 497
    Notme says:

    Keep the renters down
    houses SHOULD be expensive
    not sorry, Fleeces!

    -an unusually greedy landlord bubble haiku

  248. 498
    LetsGetAcross500 says:

    RE: Notme @ 497

    Keep the renters down
    houses SHOULD be expensive
    not sorry, Fleeces!

  249. 499
    QA Observer says:

    This is good news. There will be less P-textrians walking around with their hands in their pockets avoiding eye contact. Safety first!

    One of Amazon’s goals in weathering down-trending business cycles is to invest in real estate regardless if they utilize the space for themselves.

  250. 500

    RE: Joe @ 470
    The View Property Will Take Another Sock in the Stomach for 2019

    Assuming the 2017-2018 Summer SMOKE POLLUTION “likely” returns to the Seattle area to destroy the breathing air and real estate views all FOG UP. OVERPOPULATION is causing the wild fires, its not lightening strikes. OVERPOPULATION is getting worse with open borders.

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