Why I Read Seattle Bubble

I use to stop by and read seattlebubble once a week. Now I visit several times a day. The place to go is the forums, where other seattlebubble readers stop by to put all kinds of interesting questions up for debate, offer interesting articles about the current state of the industry that I may have missed during the day, provide critical analysis of real estate statistics, debate what’s being said in the main stream media, and I like this blog for the entertainment, which is really what blogs can be at times: entertaining.

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When I first visited seattlebubble in early 2007, I found the voices of people who were questioning mainstream real estate industry tactics and strategies that I too had questioned during the bubble run-up years. I believe we have a lot to learn from people who do not necessarily agree with us. If raincityguide is mainstream rock and roll, seattlebubble is alternative punk rock. If raincityguide is macaroni and cheese, seattlebubble is mac and cheese with ketchup. If raincityguide is “No Country For Old Men,” seattlebubble is “I Drink Your Milkshake.”

Real estate agents in Seattle should read seattlebubble because there’s a good chance that your customers are reading it.

So why do I bring this up today? Seattlebubble has made it to the semifinals of the metroblogging contest. Simple concepts of game theory are played out here: what is good for your competition is also good for you. Cast your vote for seattlebubble here.

100 thoughts on “Why I Read Seattle Bubble

  1. It’s a tight race too!

    I posted about this over on the SREP blog too–hope Tim can win against the cheatin’ sports fans!

    I may disagree with The Tim a lot of the time but I respect the opinions presented there, even if I don’t always share them. And I do share them sometimes.

  2. I need to see both movies. 🙂 I hope when agents and other RE professionals visit SB, they try to refrain from their self promotion. It seems to me that often professionals go there to troll for business…I could be mistaken!

  3. I used to read Seattlebubble.com from time to time, but I found that no matter how many intelligent posts you place about the market, or what facts you bring to the table, they are always willing to discredit them there… it’s a bunch of naysayers who seem to have a zeal for doom and gloom. Tim tends to be pretty factual… though data can be interpreted in a number of fashions… lies, damn lies and statistics… but I just can’t stand the ‘seattle is special’ crowd.

    I would never vote for seattlebubble over sports… even bowling. Frankly, seattlebubble for 90% of the time is a bunch of hot air… and I wish that hot air bubble would float away.

  4. I said in a comment somewhere about this that somewhere between the extremes is where the truth lies. Seattle Bubble represents one extreme, and many of the blogs written by real estate professionals represent the other. If we can’t have a blog-world where moderation is the watchword (which we can’t because moderation is boring, so nobody reads it), then it’s good to have someone out there who presents the opposing viewpoint.

    Debate is healthy and maybe if we could refrain from making things personally, we could all learn something from each other. (I say that as someone who has taken things personally in the past, and learned from it.)

    PS Rhonda–agents cannot refrain from self-promotion. Even our restraint from self-promotion is a form of self-promotion.

  5. “Seattle Bubble represents one extreme…”

    I don’t consider their views as extreme at all. Every post seems pretty reasonable to me.

    “facts you bring to the table, they are always willing to discredit them there”

    Umm, if your “facts” were discredited then doesn’t that mean that they weren’t facts?

  6. No, it doesn’t… it means there are a dozen ways to interpret data… The way a Republican interprets a document and the way a Democrat interpret a document are two different things. But you have so many naysayers on the website it distracts from the overall thought of the website.

    Just last month there was a post about the John L Scott White Paper, which seemed to have quite a bit of valuable and good information… and yes, you can argue this or that, but for the most part, it was a much more solid argument that this was a great time to buy than not to buy.

    However the renters in their ‘little man syndrome’ came out swinging, trying to discredit everything they could… and regardless of whether they did it or not, it distracted from the message…

    I find that most of the people there have the ‘little man sydrome’.

    Tim makes a great argument… if you own a home, which he admits he does, it’s great to keep it (and he surely has profited greatly from that home) but if you are looking to buy… it’s the worst investment of it’s kind.

    I argue the buy now versus the rent forever logic… he claims that you would make more money if you put it in the stock market… but I doubt that is true as well. Not to mention the psychological factors of owning your home and the tax benefits!

  7. Hi Jason. You have at least one thing verifiably wrong. I don’t own a home, and have never said that I do. Also, “buy now versus rent forever” is a straw man. Nobody on Seattle Bubble is arguing that. But hey, whatever.

  8. I like the bubble except for the “crazy real estate agents’ segment which throws around numerous personal attacks. I think The Tim (Hi The Tim – I know you are in these comments, too) is wonderful at putting together interesting numbers and charts and at general accounting of real estate and economy numbers overall, but numbers do lend themselves to translation, and I do believe that ther eis a truth in between the two extremes somewhere. All I can relay is what I am personally out there seeing as a homeowner and as a real estate broker who is selling houses.

    I think messages can be delivered in ways which do not personally attack individuals and that particular “crazy agent” thread is probably opening up the site for some liability (in my opinion). They weren’t terribly harsh on me personally in this thread when they did call me out and I guess I appreciated the extra traffic to my site:), but I am not crazy and to say I am by putting me in the thread is not a truthful blog.

    I might still vote for the site, though…especially over a sports site:)

  9. Sandy, I’m sure LO’s do too…I guess just don’t see the need to sign your name on every comment one makes promoting their website and company. 🙂 Come on…anyone can click our names if they want more info about us when we comment on a site.

  10. Courtney–I’ve been featured on that particular thread myself! It was a good growth experience for me…I guess. But at least in my case I deserved it as I was totally out of line. Since then I’ve decided it’s my job as a professional to not allow myself to get dragged into the kind of discussion that will end up with my being featured on that thread!

    Rhonda–I know what you mean. I think I even know who you are talking about–he cracks me up. Totally not my style but maybe it works for him?

    (But I do have a link to my blog where-ever I go, so I am guilty. It’s not like I’m trying to hide who I am.)

  11. Jason –

    Why do you derive so much of your self worth from owning a home? The last few years showed us that anyone with a pulse can own a home, or five, if they want to. Its not exactly something you can champion over those “little man” renters you apparently despise so much.

  12. Jason it’s easy to see why your “facts” were discredited so easily over there. In two posts here you go for personal insults and get some basic data wrong. Not a good showing.

    As for bubble being extreme. Do you all honestly think he has extreme views right now? Maybe 2 years ago I could see how you could make that argument, but now, really? By Seattle Bubble I mean The Tim, not all the commenter’s. In the comments there is a wide range of estimates.

  13. You’re right, Sandy. I’m probably being too grumpy…it was a rough day. I do enjoy SB…and when I comment in the forums or comments, it’s 9 times out of 10 as a mortgage professional (the other 1 time is as a resident). But I don’t see a need to sign my name as:

    Rhonda Porter CMPS
    Licensed Loan Originator 510-LO-32047
    Mortgage Master Service Corporation

    😉 Maybe I should be?

    I voted for ya The Tim and SB

  14. You need a catchphrase too. Something along the lines of: ” Always keep looking for GEMS.”

    For what it’s worth, I found this site through SB and keep coming back for Jillayne & Rhonda’s posts.

  15. b-I did the Seattle home show a few months ago…it was painful. I only did it to accompany my sister-in-law (who is also the President)…and how we wound up there is another long story…but it was awful! I would never do a home show booth again so I’ll have refrain from using a signature on my comments.

  16. It’s all my fault.

    P.S. for those that confuse Me (all the time) with “THE TIM”–(Mr. Tim Ellis, grand master of Seattle Bubble and all that pops.)

    I’m Tim Kane aka: S-Crow, Insider, Tim Kane or in other words, the “guy who just pays those utility bills,” “the balding dude,” “the city slicker who turned country.”

    The only similarity I share with Tim Ellis, is, well, our first name and we both went to a little school scrunched between Ballard, Fremont and 3rd ave West on Queen Anne named Seattle Pacific University. Oh, and we both believe that the market had quite the run-up in prices. Oh, and he has been gracious enough to let me contribute when I have the time.

    PSS Sandy Kaduce, we really should start doing some discussions about Snohomish County, because there’s lots of things going on……including 777 pilots acting like they are in TOP GUN movies by “buzzing” the tower w/o permission. I wonder if the guys in the tower at Paine Field spilled their coffee just like in the TOP Gun Movie. Did you see that story? But seriously, we can’t let King County get all the glory, right!

  17. I dunno, maybe if they diversified….

    Now that it is obvious that Seattle home prices cannot indefinitely increase annually by double digits (and sadly, it was not so obvious to some folks prior to 2007), it would seem that they could add some more useful content and update the mission. They clearly have the talent, and the readers (so maybe I am wrong about changing the focus).

    It does attract some interesting comments, and addresses a deep undercurrent of discontent that must be pretty heartfelt, judging from the comments both here and there. The graphs are interesting, and it is rich in data.

    I guess that means they got my vote over the sports blog :).

    It seems house prices will go up or down according to the market demand, influenced by innumerable external conditions. If they go down a lot, the majority of people will be unhappy (mostly homeowners), and a minority (non-homeowners) will happily gain from the majority’s loss.

    Doesn’t seem productive, really, to advocate for the majority of people to be unhappy.

    I went to OFHEO because of a news release today regarding home valuations. It is a data rich site! Of note, they said they would start releasing monthly data (with a 2 month lag time), in addition to the previous quarterly schedule.

    Check it out.


    You can also pull up their data by MSA (Seattle Bellevue Everett).

    Draw your own inferences from the data. Most likely the data is not cooked by the pols, but I guess you never know.

    Their numbers are generally rosier than the Case Schiller Index, and they have an extensive report as to why. I am not a statistician, so I won’t try to summarize the findings (but there was an unusual word I have never seen before…heteroskedasticity). It’s there under research papers, for those so inclined.

  18. S-Crow, you’re right. SnoCo is not getting enough attention!

    Evidently there is a You-Tube of that fly-by. Some Cathay Pacific pilot had the CEO on the flight deck and thought it would be a good idea to buzz the tower. Nobody would have cared except I guess someone caught it on tape!

  19. I am noticing something interesting on my daily rounds in the Edmonds area: More “For Sale By Owner” signs.

    It would be interesting to see what our inventory is when we add MLS stats and we add the FSBOs to that. Yes, I’m sure some of the FSBOs are also on the MLS but if anyone can figure out how to do this, it will be the stats guys at SB.

  20. How can you take a blog seriously that for over 2 years or is it 3 that has been calling for a “50% haircut in Seattle area home prices” on a DAILY BASIS. It’s just around the corner right? Anyone who actually could afford to own (and I seriously doubt any of the regular readers can) has missed out on a safe double digit equity cushion and much more lax mortgage rates and financing options. That blog is a joke generally frequented by 20 something Mcjob livin’ whiners who can’t accept the simple fact they are not entitled to home ownership. And I say this as someone who does not work in the real estate industry, just as a casual reader. My .02

  21. Jillayne,

    It would be interesting if you could jot down any of the FSBO addresses. While I would not post the addresses, of course, I’m wondering if they are people with no equity who can’t list in the mls, as they can’t afford commission issues between what they can sell for and what they owe.

    I saw one case of this recently where the owner listed it in the mls at one price and also listed it on Craig’s list for a lower price.
    When an agent went to write the offer they had two asking prices on the table. Very confusing, but telling as to how some owners can’t list in the mls without it being a short sale as the commissions throw it into the “can’t clear the table” category as to costs vs. price.

  22. @Yes_you_really_are_priced_out_4_ever,

    Well I’m over there on a daily basis and although I do not have time to read 100 percent of all material posted daily, I can say that the daily 50% haircut assertion is likely not accurate.

    About a year ago, SB posted a thread where readers were invited to list their occupations and the majority did not fall into your stereotype but instead were a wide range of respectable, decent-paying professions.

    Thanks for your 2 cents. I do agree with you on an important point. Homeownership is not a right or an entitlement.

  23. Hi Ardell,

    The FSBOs I’m seeing are a combination of properties that were formerly listed with a licensed agent, new FSBO signs, and FSBO signs that have been up since before last summer. I will jot down those addresses though it might take me a couple of days to get all the way around the neighborhoods again.

  24. Roger also offered to send a bunch for this purpose. I think I’ll hand check 25 or more and see if there is any info worth reporting. Off to a meeting. I’ll respond after I have more data.

  25. “If they go down a lot, the majority of people will be unhappy (mostly homeowners), and a minority (non-homeowners) will happily gain from the majority’s loss.”

    I wouldn’t assume that the majority of people will be unhappy. I spoke with a homeowner the other day who isn’t currently buying or selling, and she felt it was good for prices to go down. She was concerned about her childen and nieces and nephews being able to buy homes.

    Not everyone is totally self-centered.

  26. Every sufficiently broad generality can be contradicted with an anecdote, or an extension to the absurd. Of course, not every homeowner would be unhappy with a price decline of some amount, especially if it reduced their cost of home ownership (taxes).

    Not every one is totally self-centered, but it is generally considered to indicate competence and morality if one is at least somewhat self centered. Someone completely “other” centered would probably be deemed incompetent by their heirs and relatives, especially if the “others”, were not them.

    Let’s take the home ownership concept to a different realm, that of owning stock in say, Berkshire Hathaway. The stock is VERY high priced, so much so that many people cannot afford to buy even one share of it. It appears to be a very successful stock. If the woman above owned BH, and wished for her relatives to be able to buy some of their own, would it be logical for her to wish the price of her stock to go down so that they could buy it? Not likely. It would be more rational for her to gift some of her wealth to her relatives. The same concept could apply to her amassed wealth in home equity.

    Let’s not mistake home ownership for adequate housing, either. They are two entirely different things.

    Most people (there I go, generality again:)), would prefer to see fellow human beings live in decent housing, safe from the elements and crime. There are lots of government programs that encourage both adequate housing AND home ownership, supported by our taxes (increased by higher home values incidentally), and I do support that.

  27. “Let’s take the home ownership concept to a different realm, that of owning stock in say, Berkshire Hathaway. The stock is VERY high priced, so much so that many people cannot afford to buy even one share of it. It appears to be a very successful stock. If the woman above owned BH, and wished for her relatives to be able to buy some of their own, would it be logical for her to wish the price of her stock to go down so that they could buy it?”

    A minor point – Berkshire Hathaway also has “B” shares, which currently cost $4K (I know, I used to own several). I’d also note in passing that BH is so successful because Warren Buffet doesn’t invest in bubbles (I bought my BH shares at the height of the tech boom, because they were so out of favor with the market at the time, since they weren’t tech).

  28. Roger said: “If they go down a lot, the majority of people will be unhappy (mostly homeowners), and a minority (non-homeowners) will happily gain from the majority’s loss. Doesn’t seem productive, really, to advocate for the majority of people to be unhappy.”

  29. OK, for the sake of reasoned argument, I will bite, so long as we agree to being reasonable.

    So that we know what we are arguing for (or against), lets start with the original statement, and parse it a little, so I know what I am defending.

    1. It seems house prices will go up or down according to the market demand, influenced by innumerable external conditions.

    True or false? Is this statement in question?

    Probably not, because there is adequate measurable proof that the prices go up and down, and clearly there are many (if not innumerable) external conditions.

    2. If they go down a lot, the majority of people will be unhappy (mostly homeowners), and a minority (non-homeowners) will happily gain from the majority’s loss.

    True or false?

    Tough to say because there are 3 assumptions:

    a) the majority of people are home owners, and the minority are not.

    True or False?

    Depends on how you count ownership and people I suppose (are my dependent children home-owners or renters?, or neither?). I lazily counted on the oft repeated stat that home ownership is (or was recently) at an all time high, and the figure I heard today was 70%, but I have also heard numbers around 65%. I could be off by millions from the lower number, and that would still constitute a majority, except for possibly in Electoral College or Democratic Party math.

    b) If (home values) go down a lot, (the majority of) home owners will be unhappy.

    True or False?

    Hard to say, I’ve never seen a poll on this question, so admittedly, that is also sloppy thinking. Can’t imagine anyone paying for a poll on the subject, to back up the assertion. Being a home owner, the answer seemed obvious, but perhaps it is not. Does anyone have any data to suggest that homeowners would be happier if their home values went down a lot?

    Of course, the term “a lot” is incredibly vague. Again speaking ONLY for myself, I do not think I would be overly upset if my home were to decline in value by 0-10% in the next year, because I neither plan to sell or refinance in the next year. In fact, I probably would be pleased if my taxes were to go down. However, if I were to either sell or refinance, I would probably be dissappointed, and most likely financially impacted. In that case, I do not think it would increase my happiness.

    c) and a minority (non-homeowners) will happily gain from the majority’s loss.

    Well, this one IS a stretch. Will in fact the minority (non-homeowners) benefit from the majority’s loss? I think that is the most interesting question.

    Possibly, the ones to benefit most will be well capitalized individuals and corporations, buying up properties at discount prices, and either renting them, or just sitting on them, until prices eventually improve.

    Personally, if a large drop in prices occur, I hope that the ones to benefit ARE the current folks who wish to be homeowners. The negative effect of empty homes in a neighborhood can be devastating for home owners and renters alike.


    Doesn’t seem productive, really, to advocate for the majority of people to be unhappy.

    That’s merely an opinion. Of course, people are welcome to advocate for whatever change they would like to see happen, benefitting whatever group they would like to benefit, whether that group be in the majority, or the minority.

    There are certainly times, in the interest of justice and public good, where the majority may be justly inconvenienced and made less happy, to help a minority. I am glad to have lived thru such a time to see that happen. Whatever inconveniences that may have befallen me from the improvements to the conditions of racial minorities in this county in the past 50 years, I am glad to have endured.

    Unfortunately, this kind of occurrence (minorities benefitting from the majority’s loss) happens with depressing regularity in the capitalist system. As in the rich (the minority), get richer, and the not rich (being the majority), comparably suffer. I think that is fairly well documented in the past 6 years or so.

    Embarrassingly, though I have tried to get richer, I have not succeeded so well in the past 6 years or so. Just trying to hang on, as I suspect are many home-owners in the middle class.

    The other arguments made by laxtocnoco I generally agree with.

  30. Roger –

    Who exactly is going to continue to buy homes if the market goes on increasing faster than wages? Like a stock, a home is only worth what you can sell it to someone for. If homes continue to rise in price, the number of eligible buyers will continue to dwindle as more people are “priced out forever”. This occurred in most markets around 2004-2005, prices got so high that standard mortgages meant you could not afford a house. This is when banks began peddling ARMS, Option ARMS, etc, to keep the party going. With those products you could now afford to pay more overall for the same house so the party continued. Finally in 2007 we reached the point when not even those products can prop up housing, and the bubble burst.

    Fast rising home prices only help investors or other people who are selling a property and banking the money (e.g. not buying another house with it). This class of people is very small compared to the rest of the market. For everyone else it is bad.

    – New buyers: priced out or need to stretch into a piece of crap
    – Own home and no plans to sell: Higher taxes
    – Own home and want to upgrade: A wash or worse, your house is worth more but so is the place you want to upgrade to
    – Own home and want to downgrade: Same as upgrade
    – Investors/Flippers: Make money
    – Own home and selling to move into rental: Make money

  31. Roger –

    The same assumptions apply to prices rapidly increasing (as they have) and then staying without declining. The only people that helps is the same class, investors or people changing to cheaper rentals. For everyone else its either a wash or bad. It would only be “ok” again once wage inflation has eaten away that plateau, which is just an effective decline in prices anyway.

  32. I forgot that it is also bad for people who have very recently purchased and need to sell, which is also a small class of people compared to the rest.

  33. Roger –

    Think about it this way, when is the price of a consumer good (which is what homes are) going up beyond inflation ever good for the majority of consumers? It never is. Its good for speculators, or people who are disposing of that good, but for everyone else it is bad.

  34. I didn’t mean to start a philosophical discussion on the Common Good. I think I understand your logic: A.) most people are homeowners –> B.) homeowners will suffer from price decreases –> C.) we can do something to stop price decreases –> D.) we should help the most number of people

    I’m with you from A –> B , but you’re making an awful big leap to C. The housing market isn’t a zero-sum game where one group’s gain is another’s loss.

    Let’s assume the government could simply stop RE price decreases. I suppose it could mandate that you aren’t legally allowed to sell your house for less than you bought it. Wouldn’t that create all kinds of unintended side-effects that hurt both homeowners, renters, and lenders alike?

  35. laxtosnoco

    Re C, I didn’t think I was suggesting anywhere that the government should do something to stop home values from going up or down, assuming they actually had that power.

    It is probably true that govermental policy either intentionally or unintentionally precipitated the unnatural increase in home values.

    Generally, my position would be that governments have been involved in markets since the dawn of both, that goverment involvement in markets can be both good or bad (depending on who the regulations favor), that generally the level and type of government involvement in markets is controlled by the people that pay for the goverments or their campaigns.

    Arguments for having the government have no control of markets are equally bad as arguments for goverments having complete control of markets.

    The optimal happiness seems to lie somewhere between the two extremes.

    b’s points are reasonable.

    If I had the power, (and thankfully, I do not), I would try to achieve moderation and gradual change, wherever possible. Sadly, we do not always get to choose our revolutions.

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