It’s been a very long time since we’ve seen anything but volume down. Often we look for the low end to move early in the year, as a sign that there will be some increased activity in the higher price tiers in the 2nd and 3rd quarters. Though I wouldn’t bet on that this year, as many who are selling will not be buying a replacement home.
The best story is in the $400,000 and under price range (single family). If I move that mark up to $500,000 and under, there is no increase.
Something good has to start somewhere, and that somewhere seems to be in the $400,000 or less price range. “North King County” was derived by drawing a line straight across downtown Seattle, and the stats are for anything in King County above that line. The increase is slight, but compared to the dramatic, continued decrease in the other price tiers, a little bit UP is big news. In the condo market there is also a slight increase in volume YOY in the under $200,000 market.
The worst news is for anyone trying to sell in the $1.2 million and above price range, where there seems to be a 5 to 6 YEAR supply of inventory. Even so, surprisingly many of those that did sell in 2009, sold in less than two weeks and at prices close to the 2009 assessed values. But the odds of selling at all are so slim to none for most sellers.
While you might not think there are many homes that sell for under $400,000 in North King County, the chart above shows that this price range accounts for a large % of all homes sold.
Not really a strong buyers market in the $400,000 or less range. To see the chart for the break down of properties for sale, vs. sold, I have all three graphs posted HERE. To get the absorption rate for current inventory, divide the amount sold by 4 and then divide total for sale by that amount.
I believe this is the first time we are seeing volume up YOY for pretty much anything, since the market turned in July of 2007.
An added sign that things are moving toward where more people can buy them. If I look at single family and condo sales combined, under $400,000 accounts for 52% of all solds vs. last year when that same price range accounted for only 40% of all solds.
Next week I’ll break that $400,000 to $800,000 down a bit, and see if the higher end of the tier is affecting overall performance. But at this point I do not see an increase YOY, even in the lowest price segment of that tier.
(required disclosure) Statistics are not compiled, posted or verified by NWMLS.
P.S. I ran a few stats on South King County. and it looks like the short sales and bank owned property sales are 3X that of North King County and rising. North King County was holding steady at distressed sales being 5% of total sales, while the south end was increasing from 12% of total sales to 18% of total sales.
Calculating the % of sales that are distressed property is not an exact science. As you saw from Jillayne’s post, many distressed property sales end up selling at the court house steps, and outside of our calculations.
When they do come on market as resales by the investors who bought them at the foreclosure sale, they do not apear as distressed property sales. If the lienholder is the one who buys it at the Trustee Sale and later lists it in the mls, then it does show in the %s I have noted, as those numbers include both pre-foreclosures and post- foreclosures (bank-owned property).
One of the sales I closed in April was one purchased by my seller client at the Trustee Sale, and sold at a higher price in the mls as a regular sale at a higher price. Another that I closed in April was one where the lienholder bought it back at the Trustee Sale, forced the lender who sold it to them to take it back, and then that first lender sold it as a bank owned property. Both of those sales, one North Seattle and one Eastside, were in the $400,000 or less category noted as being up YOY in the post.
P.S. I ran a few stats on South King County. and it looks like the short sales and bank owned property sales are 3X that of North King County and rising. North King County was holding steady at distressed sales being 5% of total sales, while the south end was increasing from 12% of total sales to 18% of total sales.
Calculating the % of sales that are distressed property is not an exact science. As you saw from Jillayne’s post, many distressed property sales end up selling at the court house steps, and outside of our calculations.
When they do come on market as resales by the investors who bought them at the foreclosure sale, they do not apear as distressed property sales. If the lienholder is the one who buys it at the Trustee Sale and later lists it in the mls, then it does show in the %s I have noted, as those numbers include both pre-foreclosures and post- foreclosures (bank-owned property).
One of the sales I closed in April was one purchased by my seller client at the Trustee Sale, and sold at a higher price in the mls as a regular sale at a higher price. Another that I closed in April was one where the lienholder bought it back at the Trustee Sale, forced the lender who sold it to them to take it back, and then that first lender sold it as a bank owned property. Both of those sales, one North Seattle and one Eastside, were in the $400,000 or less category noted as being up YOY in the post.
I am curious what the inventory breakdown is for these price ranges, and YoY comparisons of them. Unless there is a similar lack of inventory at the >400k price ranges to match the sales gap, this points to some incredible price declines coming soon.
North King County? That is a new twist. I usually see Seattle vs. East Side if the county level data is cut at all.
I guess it’s apples to apples on the geography, but I am not sure how useful a view of the data this other than to prove a point about volume trends. It doesn’t reflect any definition of an aggregated view of market data that is generally discussed. I don’t even know that you have used this definition before. Have you?
What is the trend for the entire county?
b,
That is in the link marked HERE in the 2nd paragraph under the 2nd graph. You can view the breakdown of both the sold and the actives. I don’t like to post too many graphs on RCG, as it buries other people’s posts too deep, so I did a link over.
deejayoh,
Usually people talk about Pierce County vs. King County, but the reality is that much of South King is reacting to the mortgage crisis more like Pierce than North King.
What happens in Redmond affects Duvall, for instance. What happens in Federal Way does not affect Redmond.
Agents and appraisers have always valued property based on “comps”. Agents have always valued property based on competing markeplaces, as in if this house sells for $550,000 in Redmond, than you can’t get the same price for it in Duvall. Or if this house sells for $850,000 in Kirkland, then you can’t get the same price for it in Kenmore.
Media reporters do not study markets and the impact of one on another. Buyers and sellers of homes, and agents who assist them in that regard, always look at “markets” vs. “county” stats.
In reading the comments on Seattle Bubble over the past several months, many are looking for the affect of future defaults. Given the fact that South King defaults appear to be more than 3X that of North King, and the % of total sales that are distressed property is doubling and tripling, in South King while staying fairly consistent in North King, I thought it was time to show a clearer picture of what is happening. (see my P.S. comment #1).
Last but not least, my talking about Federal Way is like my talking about Texas. The advantage of having agents blog, is that we can test the stats against reality. When I talk to people and agents in South King, it is not uncommon for me to hear that there are 4 homes for sale on one street, all of them being distressed property sales. In North King I have seen an appraiser jump over a close non-distressed sale comp to pick up a distressed sale further away, just to try to have at least one short sale in his mix.
Jillayne touched on this a few times, and again in her most recent post with the video of the Trustee Sale at the Courthouse. Does a distressed property sale impact the values of other property? The answer is yes and no, and the number of distressed sales is the defining factor. Clearly if all 3 comps are distressed sales, they define the value for an area. If they are fewer and further between, the impact is not as great. Consequently lumping an area with 18% distressed sales with one that has 5% distressed sales, is not of value other than for water cooler chit chat.
deejayoh,
Usually people talk about Pierce County vs. King County, but the reality is that much of South King is reacting to the mortgage crisis more like Pierce than North King.
What happens in Redmond affects Duvall, for instance. What happens in Federal Way does not affect Redmond.
Agents and appraisers have always valued property based on “comps”. Agents have always valued property based on competing markeplaces, as in if this house sells for $550,000 in Redmond, than you can’t get the same price for it in Duvall. Or if this house sells for $850,000 in Kirkland, then you can’t get the same price for it in Kenmore.
Media reporters do not study markets and the impact of one on another. Buyers and sellers of homes, and agents who assist them in that regard, always look at “markets” vs. “county” stats.
In reading the comments on Seattle Bubble over the past several months, many are looking for the affect of future defaults. Given the fact that South King defaults appear to be more than 3X that of North King, and the % of total sales that are distressed property is doubling and tripling, in South King while staying fairly consistent in North King, I thought it was time to show a clearer picture of what is happening. (see my P.S. comment #1).
Last but not least, my talking about Federal Way is like my talking about Texas. The advantage of having agents blog, is that we can test the stats against reality. When I talk to people and agents in South King, it is not uncommon for me to hear that there are 4 homes for sale on one street, all of them being distressed property sales. In North King I have seen an appraiser jump over a close non-distressed sale comp to pick up a distressed sale further away, just to try to have at least one short sale in his mix.
Jillayne touched on this a few times, and again in her most recent post with the video of the Trustee Sale at the Courthouse. Does a distressed property sale impact the values of other property? The answer is yes and no, and the number of distressed sales is the defining factor. Clearly if all 3 comps are distressed sales, they define the value for an area. If they are fewer and further between, the impact is not as great. Consequently lumping an area with 18% distressed sales with one that has 5% distressed sales, is not of value other than for water cooler chit chat.
This is one helpful article Ardell,
But I agree with djo here. Even if the comparison is fair, when the title of your post is generic “Volume UP YOY?” the content of it should be generic too. Or change the title to reflect the content
Besides, the volume looks up only in the <400K range. If you add the numbers across all price ranges then the trend looks awfully bad. 1345 sales this year as opposed to 2091 in the same period last year? That looks much worse than what I thought it would be and what I have been hearing from all the real estate bloggers.
Waileakid,
Post titles are short, and in my opinion should highlight the sliver of difference from one week’s data to the next week’s data. The title should highlight any “new” news, otherwise the information is simply redundant. We can agree to disagree on that one.
As to your second paragraph, the post is very clear as to where the volume is up, and as you point out, also shows where it is worse than you and others might expect from seeing data all lumped together. There is a time to combine, and a time to split out data. Always using one method without testing the data by different means, is not educational for you or me. We have to look at it from all angles to get the truest picture. One post alone does not do that, but over a year’s worth of posts on the same topic, sometimes from a different perspective, is of more value than trying to stuff a crisis into a single soundbite.
“1345 sales this year as opposed to 2091 in the same period last year? That looks much worse than what I thought it would be and what I have been hearing from all the real estate bloggers.”
I’ll assume your addition is correct. Isn’t knowing that one price tier is down 75% while another is up slightly of value? I think it is.
Ultimately blogging should reveal info of particular interest to a given buyer or a given seller in a certain price range. Not be a substitute or side by side reporting of info already generally available in other places. Each blog post around the web should expand and add a layer of data, not simply regurgitate what is already a known factor available via public sources.
Waileakid,
Post titles are short, and in my opinion should highlight the sliver of difference from one week’s data to the next week’s data. The title should highlight any “new” news, otherwise the information is simply redundant. We can agree to disagree on that one.
As to your second paragraph, the post is very clear as to where the volume is up, and as you point out, also shows where it is worse than you and others might expect from seeing data all lumped together. There is a time to combine, and a time to split out data. Always using one method without testing the data by different means, is not educational for you or me. We have to look at it from all angles to get the truest picture. One post alone does not do that, but over a year’s worth of posts on the same topic, sometimes from a different perspective, is of more value than trying to stuff a crisis into a single soundbite.
“1345 sales this year as opposed to 2091 in the same period last year? That looks much worse than what I thought it would be and what I have been hearing from all the real estate bloggers.”
I’ll assume your addition is correct. Isn’t knowing that one price tier is down 75% while another is up slightly of value? I think it is.
Ultimately blogging should reveal info of particular interest to a given buyer or a given seller in a certain price range. Not be a substitute or side by side reporting of info already generally available in other places. Each blog post around the web should expand and add a layer of data, not simply regurgitate what is already a known factor available via public sources.
Another reason this info is important, is that as single family home prices reflect a higher percentage of homes sold for $400,000 or less, this impacts the condo and townhome market.
A few years back I wrote a post regarding condo sales picking up some of the volume lost in the single family market. People opting for condos when they couldn’t afford a single family home as prices rose.
A shift back to single family from condo, is very important for owners of condos and townhomes in this price range to know. When the lowest single family was $550,000, the townhomes went up to $450,000. But being able to buy a single family for $400,000, causes that $450,000 townhome to drop into the 3s.
While the average market watcher likes to see broad trends covering broad areas, the individual buyer and seller needs to see beyond their neighborhood at other factors that are affecting the property values both specifically and generally.
I would rather be of value to 200 local people who are trying to make decisions about buying and selling real estate, than 60,000 people who are reading RCG as one might read the home page of MSN.
Well the reason the title and the charts look deceptive is becuase it talks about the minute jump in sub 400K properties but not as much about the rest of the stats (50% drop in 400-800K range and a 60% drop in million dollar plus home from an already abysmal 2008)
I love your posts and the data but it always seems like there is an attempt of spin which is what I want to call out. This information is important no doubt but I’d prefer to hear the message as it is without any spin
And as of people who are trying to make a decison, I am one of them. I have been in the market for past 13 months with perfect credit and enough money for down payment but the market hasn’t stopped falling and would not stop any time this year at least and I would continue to read RCG like MSN home page until that time 🙂
“Sunday Night Stats – YoY Volume Up in Select Areas” would be short, and more to the point. Your title asks a question, and in general, it sounds like the answer is: “no”.
As a reader, I personally like objective points of view that help customers. Pointing out that some areas at certain price points are seeing high volume is, indeed, helpful.
I don’t have a problem with your data, I do question your “spin” and presentation…
“Sunday Night Stats – YoY Volume Up in Select Areas” would be short, and more to the point. Your title asks a question, and in general, it sounds like the answer is: “no”.
As a reader, I personally like objective points of view that help customers. Pointing out that some areas at certain price points are seeing high volume is, indeed, helpful.
I don’t have a problem with your data, I do question your “spin” and presentation…
Waileakid,
I wrote a new post on the need for distinguising between North King County and South King County. Would appreciate your thoughts on that.
The only reason to post every week, or almost every week, on “stats” is to find NEW info. When that new info was really bad…I posted it. Not fair to object only when that new info is a bit positive. That is what I see happening recently.
Agents complained when that sliver of new info was very bad, and it was for a very long time. As soon as that sliver of news turned slightly positive…well, you can answer what happened.
Of the last 3 home purchases:
One buyer had an 80 risk of price falling for the home they purchased…and I told them so and I told them why that is.
One buyer had a zero risk of price falling for the home they purchased…and I told them so and I told them why that is and what they needed to do to guarantee that result.
One buyer has great risk or no risk depending on what happens with planned new development near that home. It was a risk based purchase. We discussed the risks and what was involved, and they made an informed choice wthout a good guideline as to what is actually going to happen. Time will tell and the price was discounted for the risk.
If you are reading RCG or any blog like MSN home page, and planning to invest your hard earned money based on what you read, well all the more reason I need to point out the variances and slice and dice, vs. being too broad. If you tell me what your parameters are (though we can’t discuss specific property on blog due to MLS rules) I will be more than happy to write a post highlighting the specific factors you should be paying attention to, in that area, in that price range.
Misinformation is spread when info is too broad. Someone who is buying a home near Microsoft said “it’s a buyer’s market, YAY!”. Well, in the sense that they can actually buy something at that price, that is true. But when they discount their offer on a $300,000 house with 20 offers “because it’s a buyer’s market”…not so good.
I take the impact I may have on people’s decisions very seriously, and I will “skew” the data in any direction that I think helps people more vs. less. I believe that’s my prerogative.
Waileakid,
The $1.2M+ market is abysmal…but I weight the number of people the data affects, more than the pure drama of the info.
I don’t see anything selling in my part of Capitol Hill at all. Even the houses under a million. This area used to be hot, but now its not all of a sudden? I doubt Seattle real estate is coming back this year but I hope I’m wrong since economic recovery unfortunately hinges on a housing rebound in many ways. I used to invest quite a bit in Florida when it was bubble central and still stuck with some cheap land and that market shows no signs of life yet from what I can see. I would think the places where the bubble all began like FL CA NV AZ etc need to come back for a real recovery to take hold.
Mike,
Without looking again, one of the over $1.2m quick sales I saw last night when running the data, was in Capitol Hill, and seemed to be a good price for the seller, and not a huge discount of value. Not sure what you mean by your “part” of Capitol Hill.
“bottom” doesn’t equal “real recovery” to me. To me, the Dow has “recovered”. For some it needs to get to 14,000 to be “recovered”. I don’t think that is realistic.
Anyone waiting for prices to be what they were…is waiting for the wrong thing. The stimulus was to stop the bleeding. The stimulus was to shore up prices where they are…not bring them back to where they were.
The part of Capitol Hill east of Volunteer Park. Listings are piling up.
Again, I hope I’m wrong but I think this is all a headfake, including the move in the stock market. If we are in an L shaped “recovery” that plays out over many years is that truly a recovery? I was reading today there’s a rumor Microsoft is going to lay off more folks this week. That would really suck although the stock price would probably move up on the news 🙁
Cheers
The part of Capitol Hill east of Volunteer Park. Listings are piling up.
Again, I hope I’m wrong but I think this is all a headfake, including the move in the stock market. If we are in an L shaped “recovery” that plays out over many years is that truly a recovery? I was reading today there’s a rumor Microsoft is going to lay off more folks this week. That would really suck although the stock price would probably move up on the news 🙁
Cheers
Mike,
Let me try a polygon search for you.
Not going to get into what a “recovery” is. Too many opinions on that. Just know that when I say “bottom” it does not mean the market is going to go up from there, or that prices from there will get back to where they once were. That can’t happen given mortgage guideline changes.
Best I can hope for is for my clients to get better than average value at purchase time, and for prices to stop dropping. Future equity is going to be about what you pay into it, not appreciation, for a very long time. Not overpaying at time of purchase, helps a lot.
Mike,
Let me try a polygon search for you.
Not going to get into what a “recovery” is. Too many opinions on that. Just know that when I say “bottom” it does not mean the market is going to go up from there, or that prices from there will get back to where they once were. That can’t happen given mortgage guideline changes.
Best I can hope for is for my clients to get better than average value at purchase time, and for prices to stop dropping. Future equity is going to be about what you pay into it, not appreciation, for a very long time. Not overpaying at time of purchase, helps a lot.
Mike
Back to Capitol Hill East of Volunteer Park. You have 28 homes for sale, 12 condos and 3 multi-family. Of the 28 homes, two are towhomes. One is priced at $345,000 and the other $499,950. Let’s assume you are talking about the other 26 homes and not the townhomes, condos or multi-family homes.
The median price of the homes for sale is $1,067,000. As you saw from my post of last night, volume of sales in that price range is way down due to financing issues.
4 of the 6 pending home sales sold very quickly, in less than 30 days. 3 of those pendings are WELL under the median for sale price, in the $400,000 to $450,000 range. So no surprise that those sold.
In the first 4 months of 2007, 26 homes sold, but 8 of those 26 were townhomes, so 18 solds.
In the first 4 months of 2008, 18 sold. 2 were townhomes and one was a teardown lot. So 15 homes sold vs. 18 the previous year. Not a big change.
Now let’s look at 2009. 8 sold and 4 or 5 of those sold very quickly. I think the clue is in median price of sold property is $725,000 (includes some very pricey homes and some low priced ones). Median price of those for sale is $1,067,000. Big difference.
9 of those 26 homes are very new on market. 3 of those 9 homes (maybe 4) are priced well. Expect the other 5 or 6 to pile up on top of the older inventory.
Unfortunately a couple that have been on the market for over a year started to high and are now priced under what they like would have sold for if they were priced more accurately last year. Most are still overpriced even after a few price reductions.
Back to your comment. Few sales, but a large % of those are quick sales. So it is more an issue of overpricing than it is of area.
You said, “Even the houses under a million.” From what I can see, so far the determining factor for your neighborhood is not over or under a million, it is how well the asking price represents the true value. That is not true of many areas, so in that regard you are lucky.
Hope that helps.
Mike
Back to Capitol Hill East of Volunteer Park. You have 28 homes for sale, 12 condos and 3 multi-family. Of the 28 homes, two are towhomes. One is priced at $345,000 and the other $499,950. Let’s assume you are talking about the other 26 homes and not the townhomes, condos or multi-family homes.
The median price of the homes for sale is $1,067,000. As you saw from my post of last night, volume of sales in that price range is way down due to financing issues.
4 of the 6 pending home sales sold very quickly, in less than 30 days. 3 of those pendings are WELL under the median for sale price, in the $400,000 to $450,000 range. So no surprise that those sold.
In the first 4 months of 2007, 26 homes sold, but 8 of those 26 were townhomes, so 18 solds.
In the first 4 months of 2008, 18 sold. 2 were townhomes and one was a teardown lot. So 15 homes sold vs. 18 the previous year. Not a big change.
Now let’s look at 2009. 8 sold and 4 or 5 of those sold very quickly. I think the clue is in median price of sold property is $725,000 (includes some very pricey homes and some low priced ones). Median price of those for sale is $1,067,000. Big difference.
9 of those 26 homes are very new on market. 3 of those 9 homes (maybe 4) are priced well. Expect the other 5 or 6 to pile up on top of the older inventory.
Unfortunately a couple that have been on the market for over a year started to high and are now priced under what they like would have sold for if they were priced more accurately last year. Most are still overpriced even after a few price reductions.
Back to your comment. Few sales, but a large % of those are quick sales. So it is more an issue of overpricing than it is of area.
You said, “Even the houses under a million.” From what I can see, so far the determining factor for your neighborhood is not over or under a million, it is how well the asking price represents the true value. That is not true of many areas, so in that regard you are lucky.
Hope that helps.
Ardell,
I have a townhouse in capitol hill, two blocks from Broadway that I want to sell. I am not sure if I should put on the market now or wait till next year or two. I can almost break even with the rent.
Are you seeing townhouse (6 years old) selling on the hill?
Rojo,
Waiting a year or two isn’t going to help you, as far as I can see, for many reasons. Being two years “older” is not good as 8 years vs. 6 years has always been a huge difference in real estate. 8 years = the beginning of being old in real estate. 5 years or less = “newer”. 6 isn’t 5, but it’s better than 8.
Another consideration is the change in the tax law as to capital gains tax if you rent it out. If you owned it for those 6 years, and lived in it, and have a gain, the tax law is no longer “2 out of the last five years” as to forgiveness of capital gains tax on primary residence. You could lose twice by renting it, one on value and the other on taxes, so check that out.
There is a common thread in Capitol Hill Townhomes that separates the solds from the not solds, regardless of price range. There is a wide variance of price range, but that doesn’t seem to matter. What matters is pricing at or slightly less than 2009 assessed value for the not new townhomes.
Every single one that sold was priced no more than 2009 assessed value, and I mean not a dime more. $10,000 under even better. All of the ones not sold are priced higher than 2009 assessed value, some as much as $100,000 higher than 2009 assessed value.
I couldn’t find your townhome in the tax records under “rojo” as a last name. If you email me your name and address, I’ll give you as much info as I can. But sooner looks better than later from what I can see. There are a ton of new ones, as I’m sure you know. I’m only looking at the ones that are not new construction, and I looked at both solds, actives, and “I give up” expireds and cancelleds.
The common thread is relationship of asking price to 2009 assessed value. How does that number compare to what you were thinking about selling it for?
P.S. the advice in the comment above is specifically directed to rojo and his product in his area. Other areas may be different, so that is not generic advice.
rojo –
Keep in mind rents are falling. If the employment picture does not improve, they will probably keep falling, and you will need to compete with the thousands of condos which are now turning into brand new luxury apartments all over Seattle. You might break even now, but its doubtful you will in the foreseeable future.
b,
Are you agreeing with me? ZOMG! I think I’m going to faint!
Its not my fault you make sense sometimes Ardell 😉
ROTFLMAO