{"id":26816,"date":"2013-06-28T16:35:55","date_gmt":"2013-06-28T23:35:55","guid":{"rendered":"http:\/\/seattlebubble.com\/blog\/?p=26816"},"modified":"2013-06-28T16:35:55","modified_gmt":"2013-06-28T23:35:55","slug":"friday-flashback-homeownership-in-jeopardy","status":"publish","type":"post","link":"https:\/\/seattlebubble.com\/blog\/2013\/06\/28\/friday-flashback-homeownership-in-jeopardy\/","title":{"rendered":"Friday Flashback: “Homeownership in Jeopardy”"},"content":{"rendered":"

It’s been a couple of months since our last Friday Flashback. Here’s one from an April 2006 Seattle Times article written by our old friend Elizabeth Rhodes: $405,000 Median house price in King County<\/a><\/p>\n

Ann Dickhoff’s house purchase typifies a milestone in more ways than one.<\/p>\n

Like many other parents of adult children, Dickhoff was afraid her son would be priced out of homeownership in his hometown.<\/p>\n

So last month she helped him buy a North Seattle rambler, gulping as she paid $409,000 \u2014 or $89,000 more than she shelled out a year earlier for a nicer house half a block away.
\n…
\nDickhoff and her husband, Walton, an administrator for the National Oceanic and Atmospheric Administration, had to pay $320,000 last year to snag a small Greenwood-area bungalow for her mother. “That was our wake-up call,” she said, to climbing prices and the possibility that homeownership for her kids was in jeopardy.<\/p>\n

Indeed that’s a serious possibility for many residents, according to Washington State University’s Center for Real Estate Research. Average-wage workers, in particular, are susceptible to the double whammy of rising house prices and rising interest rates.<\/p>\n

In the past year, the average interest rate on a 30-year, fixed-rate loan has climbed half a percentage point to 6.5 percent.<\/p><\/blockquote>\n

Can you imagine how shrill the media frenzy would be if rates today were anywhere near 6.5 percent?<\/p>\n

In January, Ann Dickhoff, a nurse at Swedish Medical Center, began hunting for a house to buy for son Paul, 21, a cheese maker at Pike Place Market, to live in with roommates. A real-estate agent warned her the first one she bid on would sell for more than its $400,000 list price.<\/p>\n

So the Dickhoffs bid $416,000 \u2014 and added a $30,000 escalator clause in case a bidding war broke out.<\/p>\n

It did, and they lost that house to a $450,000 all-cash offer.<\/p>\n

That made clear to her that “the market was taking off, and if we were ever going to buy something for the kids to live in, we’d better make a move.”<\/p>\n

They quickly did, landing for $409,000 a newly refurbished 1950s three-bedroom with a spacious new garage.<\/p>\n

Still, if the market weren’t so hot, “we wouldn’t even have looked at it,” Dickhoff confided. The house is on busy Greenwood Avenue North, and the street noise is significant. Plus a newer townhouse development has consumed its entire backyard.<\/p><\/blockquote>\n

Good thing those buyers jumped in when they did, or they never<\/em> would have had another chance!<\/p>\n

\"JillIronically, as buyers like the Dickhoffs scramble to find a house, the number of King County home sales has been slipping. That usually indicates a cooling market.<\/p>\n

That is the case in California and Florida, where sales are slowing down, according to the National Association of Realtors.<\/p>\n

But not here, said Jill Jacobi Wood, owner of Windermere Real Estate.
\n…
\nKing County’s median for single-family homes “will stay over $400,000,” she predicted. “There are too many good jobs; it’s too desirable a place to live for high-income people.”<\/p><\/blockquote>\n

Except for four and a half years between 2008 and 2013. Also note that $400,000 in 2006 dollars is roughly equivalent to $462,000 now. The latest median price for King County was $417,500 in May.<\/p>\n

Here’s what I had to say about this particular nonsense when it was originally posted: Perplexing March Reporting<\/a><\/p>\n

The purpose of our Friday Flashback series<\/a> is to remind people why it’s never a good idea to base your home purchase decisions on the word of someone with a vested financial interest in selling as many homes as possible for as much as possible, no matter what. If you’ve got a good example of local home salespeople or other industry shills on record making fools of themselves in the years before the bubble burst, shoot me an email<\/a>.<\/div>\n","protected":false},"excerpt":{"rendered":"

It’s been a couple of months since our last Friday Flashback. Here’s one from an April 2006 Seattle Times article written by our old friend Elizabeth Rhodes: $405,000 Median house price in King County Ann Dickhoff’s house purchase typifies a milestone in more ways than one. Like many other parents of adult children, Dickhoff was…<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"On the blog: Friday Flashback: \"Homeownership in Jeopardy\" http:\/\/wp.me\/pe2Bv-6Yw","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[206],"tags":[639,638],"coauthors":[],"class_list":["post-26816","post","type-post","status-publish","format-standard","hentry","category-features","tag-639","tag-friday-flashback"],"yoast_head":"\nFriday Flashback: "Homeownership in Jeopardy" \u2022 Seattle Bubble<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/seattlebubble.com\/blog\/2013\/06\/28\/friday-flashback-homeownership-in-jeopardy\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"Friday Flashback: "Homeownership in Jeopardy" \u2022 Seattle Bubble\" \/>\n<meta name=\"twitter:description\" content=\"It’s been a couple of months since our last Friday Flashback. 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