{"id":879,"date":"2007-06-20T10:55:54","date_gmt":"2007-06-20T17:55:54","guid":{"rendered":"http:\/\/seattlebubble.com\/blog\/2007\/06\/20\/seattle-risk-nearly-doubles-in-improved-pmi-model\/"},"modified":"2010-11-17T10:26:55","modified_gmt":"2010-11-17T18:26:55","slug":"seattle-risk-doubles-in-improved-pmi-model","status":"publish","type":"post","link":"https:\/\/seattlebubble.com\/blog\/2007\/06\/20\/seattle-risk-doubles-in-improved-pmi-model\/","title":{"rendered":"Seattle Risk Doubles in Improved PMI Model"},"content":{"rendered":"<p>The latest report from the PMI Group has been released, and the news is increasingly bad for Seattle:<\/p>\n<div style=\"margin: 5px auto; font-size: 0.8em; text-align: center\"><a href=\"http:\/\/seattlebubble.com\/blog\/wp-content\/uploads\/2007\/06\/pmi_seattle_07t2.png\" title=\"Seattle PMI Risk Index - Click to enlarge\" rel=\"lightbox[879]\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/seattlebubble.com\/blog\/wp-content\/uploads\/2007\/06\/pmi_seattle_07t2-tn.png\" style=\"border: 1px solid #000000; margin: 5px\" title=\"Seattle PMI Risk Index - Click to enlarge\" alt=\"Seattle PMI Risk Index\" height=\"268\" width=\"400\" \/><\/a><br \/>\n<a href=\"http:\/\/seattlebubble.com\/blog\/wp-content\/uploads\/2007\/06\/pmi_seattle_07t2.png\" title=\"Seattle PMI Risk Index - Click to enlarge\" rel=\"lightbox[879]\">Click to enlarge<\/a><\/div>\n<p>As noted on the graph, PMI did improve their model with this latest report, so while Seattle&#8217;s new Risk Index of 343 is not <em>directly<\/em> comparable to its previous index of 167, the news still doesn&#8217;t bode well for Seattle home prices.<\/p>\n<p>Of course, the local press puts the most positive spin possible on the news.  The headline takes the cake: <a href=\"http:\/\/seattlepi.nwsource.com\/local\/320505_index20.html\" title=\"Home prices likely to hold steady, study suggests\">Home prices likely to hold steady, study suggests<\/a><\/p>\n<blockquote><p>Will the typical home cost less in two years than it does today?  That&#8217;s the question a new study attempts to answer for the nation&#8217;s 50 largest metropolitan areas.<\/p>\n<p>Seattle has a 34.3 percent chance of lower prices in two years \u2014 the 25th-highest risk and just under the population-weighted average of 34.6 percent in the summer U.S. Market Risk Index that PMI Mortgage Insurance Co. released Tuesday.<\/p>\n<p>&#8220;This bodes well for the market there, in addition to the fact that Seattle has relatively really good affordability &#8230; and a solid employment market,&#8221; said LaVaughn Henry, director of economic analysis for PMI.<br \/>\n&#8230;<br \/>\nThe changes to the PMI index, which led the company to skip its spring report, give additional weight to recent price volatility.<\/p>\n<p>Seattle ranked 18th for price volatility, with a higher rank meaning more volatility.<\/p>\n<p>From the perspective of many Seattle residents, home prices shot up quickly to very unaffordable levels. Affordability is down 4.9 percent from six months ago and 10.5 percent from a year ago, but Seattle&#8217;s affordability rank remained relatively steady, going from 23rd a year ago to 25th six months ago to 24th now, with a higher rank meaning homes are less affordable.<\/p>\n<p>The likelihood of price declines in Seattle in the next two years, while low, is higher than it was six months and a year ago, although new changes in PMI&#8217;s model make comparisons less valid. The metro area&#8217;s chance of declines was 16.7 percent six months ago, putting it 32nd among the top 50 areas, and 10.9 percent a year ago, good for 33rd place.<\/p><\/blockquote>\n<p>But never mind all that.  There&#8217;s never been a better time to buy.  Get on the equity ladder now, any way you can.<\/p>\n<p>(<em>Aubrey Cohen, <a href=\"http:\/\/seattlepi.nwsource.com\/local\/320505_index20.html\" title=\"Home prices likely to hold steady, study suggests\">Seattle P-I<\/a>, 06.19.2007<\/em>)<br \/>\n(<em>The PMI Group,<a href=\"http:\/\/www.pmi-us.com\/media\/pdf\/products_services\/eret\/pmi_eret07v2s.pdf\" title=\"Economic Real Estate Trends\">Spring\/Summer 2007 Report<\/a>, 06.2007<\/em>)<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The latest report from the PMI Group has been released, and the news is increasingly bad for Seattle: Click to enlarge As noted on the graph, PMI did improve their model with this latest report, so while Seattle&#8217;s new Risk Index of 343 is not directly comparable to its previous index of 167, the news&#8230;<\/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":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[198],"tags":[28,56,134],"coauthors":[],"class_list":["post-879","post","type-post","status-publish","format-standard","hentry","category-news","tag-affordability","tag-pmi","tag-risk-index"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.2 - 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