Thank you all for your comments. I am heading out of town now, so I will now be signing off… aka… turning off the comments.

Jon

Why don’t you teach us all how to read the stats. I wasn’t aware that a real estate license = spread sheet reading master.

But what do I know, I only took college level economics and accounting at a major division 1 college. I don’t have a real estate license, I probably can’t read a spreadsheet and/or understand market trends.

Please enlighten us all on how to read the data. What are we all missing?

3 bedroom house in Redmond. Is it a sustainable market when above average salarymen cannot afford starter homes in the suburb that they work? I argue not. This is all the evidence I need that the market has to correct some time soon.

I think that the slowing sales are a result of this. The money is drying up. How many people can afford entry level property with 20% down right now? Or even 5% down with a fixed rate loan? If people with entry level stuff cannot sell (because nobody can afford it) then how can people with the next price tier up get people to buy?

The funny money loans, low interest rates and out of state equity locust money will be gone soon. Downward price pressure will result. I don’t think it will drop to pre-2004 levels overnight though. A lot of people will just not sell houses, so once things start going down they will go down very slowly, until housing is so cheap again (like 10 years ago around here) that everybody buys it like gangbusters and forgets that it ever went down.

You say the right message is “Every house sold continues to sell at a huge increase over prior sales, but YOY sales are down”. The title of this blog post we are talking over is “Housing sales fall in 40 states; but not in Northwest”.

a) The title of this blog post is not nearly as balanced as what you are suggesting people say. People are pointing out the negative because the post was not balanced. People have a tendency to point out what was missing. The pdf pointed to by Tim points out that the title of this post is not only misleading but plain wrong. If they want to make a positive point, they should say that prices are up, not sales.

b) Housing sales are down. I welcome a discussion of why this is (and I agree with you that crappy inventory is a part of things). I disagree that the number of houses on the market is the big factor. I think that the number of *quality* properties on the market is the big factor. There is plenty of overpriced crap out there right now.

I find the characterizations that both sides are making in this debate hilarious and childish. People making fun of what college somebody went to are the worst of the lot. This is asinine. When somebody is attacking the source of the information rather than discussing the information, you know that they have no argument. This is why I don’t watch talk shows on TV.

Am I a part of the bubble boosting crowd? Depends on your definition I suppose. I own a townhouse, so I stand to lose equity if the bubble pops (maybe even all of it). But what is the situation that I observe?

I make quite a bit more than average, and my salary is not enough to pay for a

I agree that

“Most people don’t think too much about what their house will sell for in 5 years.”

But you also said,

“Agents think about resale before they buy, not when it is time to sell.”

Yes you said this in the context of assessing a home’s weaknesses. However it’s not too far a stretch to also apply it to market weaknesses.

And by the way the glass is neither half full or half empty – it’s twice as big as it needs to be.

Thanks for your response.

“So maybe the area I know that has had 35% appreciation each year for two years will fall down to 25%…still good.”

so why are you selling houses ??

You should be BUYING houses…there are tons of them…I’ll find ya a loan.

25% a year…man…you are gonna be a Bazillionaire!!!

no…I’m still a firm believer in the bubble.

BUT…

there has NEVER been a better time to buy RE.

I want this bubble to grow out of control.

I have no financial interest in it….I just want to be witness to the worst depression our country has ever seen.

I might even dumb myself down enough to turn on a television so that I can SEE the sensationalism…and not just hear but WATCH the horror stories.

Popcorn anyone?

Maybe Forbes isn’t unbiased, but they used Moody’s data and they had some cities going down, some going down further than others, and Seattle going up.

That seemed credible to me, if only because they didn’t cast a rosy picture on all areas. In fact seattle was one of the only ones they had going up. So sounded credible to me.

I don’t understand why someone would select out number of sales as any kind of indicator. If I have many buyers, but nothing in inventory yet worth buying, why is that any indication of the real estate market? Inventory sucks and is low. I don’t see that as a market indicator in any way shape or form.

At least say, “Every house sold continues to sell at a huge increase over prior sales, but YOY sales are down”. Some kind of balance, instead of trying to pull out the one factor and call that significant, when it isn’t. Or at least post it with a few other significant stats for balance. Some good..some bad. But not always, always, chicken little the sky is falling bad only.

Makes sense…just a tad glass half empty. Most people don’t think too much about what their house will sell for in 5 years. And no one really knows either. Most huge losses in housing prices have come from company decisions, like what would happen if Microstoft shut down or moved to another State? Those issues would affect prices more, and created areas like Allentown, PA and Bristol after U.S. Steel waned.

“fundamentals”? Who can know when a major area employer is going to belly up or leave town? Those are the biggest risks I’ve seen.