Category Archives: Sunday Night Stats

Sunday Night Stats – Prices Improving?

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We all know that prices can’t go up in large leaps the same way that they can drop significantly in a short time.  It takes a lot longer to go up than down, due to appraisal issues.

It will take many weeks to build up enough data post Obama $8,000 Stimulus Credit to form any conclusions. But you have to start somewhere 🙂  Stats prior to the credit are somewhat irrelevant at the moment except to later see if in hindsight pre-credit was “bottom”.  We won’t know that until next 4th Quarter and January of 2010.  Until then, we’ll track week to week until we build up enough data to do larger market segments.

I am using MPPSF Pending Inspection King County SFH, as these are the most recent “went under contract” homes. The green columns are properties that went under contract pending inspection Monday March 2nd through Sunday the 8th.  The  purple columns went under contract pending inspection Monday the 9th through Sunday the 15th.

I broke the stats down into under $500,000 (2 columns on the left) and $500,000 to $1M (2 columns on the right). The lower priced segment is doing better, but both show slight improvements.  These are asking prices, so all this is telling us at the moment is that buyers seem to be making offers on houses that are not priced quite as low on a median price per square foot basis, as they were pre-homebuyer credit. We won’t know if actual prices close higher until we get at least 45 to 60 days in front of the credit passing.

Data is not compiled or posted by NWMLS (required disclosure)

King County Home Prices inching Upward?

King County Home Prices inching Upward?

 

Sunday Night Stats – Housing Market is “Stimulated”

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As you can see from the graphs below, there has been a 50% increase in the number of properties going pending in the last 7 days, compared to the week of 2/7 to 2/14 before the $8,000 “first time” homebuyer credit passed.

427 sales went pending in the first week in March. That’s a 50% increase over the 286 that went pending in the 2nd week in February.

The second graph shows the increase in the number of homes that are selling in 30 days or less.  Not sure if that increase is “normal”  for January through the first week in March though.  Still, worth reporting the positive trend upward.
I combined condos with single family homes in King County. I think it’s fair to say that the credit stimulated home sales.  It’s also fair to say that people waiting for the credit, depressed home sales in the previous period.  So the real stimulus may lie somewhere in between.
 
On a side note, I am hearing of a few pending sales falling out, because the owner/seller is now eligible for the new assistance that came out on 3/4, and may not “have to” sell after all.
King County Condo and Home Sales Improved by 50%

King County Condo and Home Sales Improved by 50%

% of homes and condos sold in 30 days or less improving

% of homes and condos sold in 30 days or less improving

 Statistics are not compiled or posted by NWMLS

Sunday Night Stats – At Bottom

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Many buyers are waiting for the $15,000 tax credit for homebuyers in 2009 to be signed into law, as well they should.  This will continue to keep the volume stats down through the month of February as to closings. If the bill is signed by the 16th of February or so, as expected, you will begin to see volume pick up in March. 

The other thing that buyers have been waiting for, are signs that prices are “at bottom”.  While median prices for King County continue to slide as short sales and foreclosures continue to impact sold prices Countywide, we are seeing two emerging trends as to “bottom”.  20% for non-distressed property and almost but not quite 40% for distressed property, more like 37%.

Who determines “bottom” as to prices?  Sellers and real estate agents would love to control prices, but the buyers of homes ultimately control home prices.  While we wouldn’t expect to see prices bottom with continued bad news as to layoffs, buyers are consistently calling the bottom at 20% under peak pricing for non-distressed property.

The odd thing about the stats on this is that it doesn’t seem to matter how long the property is on market.  If it takes the seller 800 days on market to get to 20% under peak prices, the property sells.  If it takes the seller 65 days to get to 20% under peak prices, the property sells.  In several cases when the property gets to 20% under peak prices, there is more than one offer.  BUT rarely do those offers push the price much under the 20% under peak range.

Exception seems to be when the homes sold at peak values did not have remodeled kitchens and baths, but the property sold today does have a remodeled kitchen and baths, and possibly an addition as well.  In those cases, the sales can be as high as 11% to 14% under peak pricing.

Because every neighborhood has a different peak value, and peak MPPSF, you can’t do whole zip codes or a whole County using median statistics.  You have to find the peak price in each neighborhood for each house sold, and calculate the % off peak of the sale.  A tedious chore.

House #1 – Redmond – peak pricing $249 MPPSF – Home sold at $210 PSF, 16% under peak with a remodeled kitchen of 8 years ago.  The odd thing about this house is that in September through January, this home sat on market at 16% under peak, after first trying only 5% under peak for over 200 days.  Once the market determined the price was not going to reduce further and reach 20% under peak…it sold anyway.  This is not the norm and if the kitchen remodel had been more recent, it may have sold a bit higher and faster.

House #2 – Bellevue – Peak pricing $1.5M – this property sat on market for well over 700 days.  The minute it reached 20% under peak it sold.  This would not seem like a basis in and of itself, for calling bottom at 20% under peak.  But when you see house after house going from not sold to sold when it hits the same price point of 20% under peak, the buyers speak in unison.

House #3 – Peak pricing $1,059,000 – This is a sad one.  More than 4 buyers called this one at 20% under peak at roughly $850,000.  Unfortunately it is a short sale and the lienholder would not approve the sale price at 20% under peak, even with several multiple offers all in the same price range.  How much more proof of value to do need then several buyers in a market like this all calling current value at the same place?  This one will likely go to foreclosure and end up selling for even less than 20% under market.  Still…the buyers called the price of 20% under market the acceptable level.

House #4 – Seattle 98103 – peak pricing $425,000 – Asking price at 20% under market sold – this one was unusual as the opening asking price was 20% under market…it sold immediately…in less than a week.  Doesn’t seem to matter if the seller takes over 700 days or 1 day to get to 20% under market…it still sells either way.  This consistent price point of 20% under peak turning a property from ‘for sale ‘”to “sold”, gives us a price at which buyers determine, bottom has been achieved.

House #5 – Seattle 98115 – peak pricing $800,000 – sold when asking price reduced to 20% under peak.  This is a sad one because the owner started out at well OVER peak pricing.  Hard to believe that someone was thinking prices would actually be going up from mid 2007.  But the end result was consistent with the other properties, and a buyer made an offer when the price was within 20% under peak prices.

There are some houses selling for less than 20% under peak. There are many, many houses for sale with asking prices that are much higher than 20% under peak.  But unless it is a distressed property or an especially miserable location or condition, there are NO houses sitting on market without an offer ,where the seller is asking  20% under peak pricing.

I don’t “call bottom” nor do sellers or any real estate agent.  The buyers call bottom.  And when they consistently respond to an asking price of 20% under peak by bringing an offer…the buyers are calling bottom.  

It’s very hard for a seller to price his house at 20% under peak pricing, even if he bought it 15 years ago for much less that that.  Now it seems equally hard for buyers to see a house at 20% under peak…and pass it by.

“At bottom” has nothing to do with more activity.  “At bottom” does not help real estate agents sell MORE houses, as most sellers are not ready to price at this point that buyers have determined is the price at which they will buy.  When a given price point not only guarantees a sale, but brings multiple offers consistently at the same price point…buyers as a whole determine that “comfort zone” of pricing.  Now sellers collectively have to agree with them…or not.

Sunday Night Stats

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As of tonight, prices are showing at down 5% in January vs. the 4th quarter median price per square foot in the graph below.  That would take prices back to the 2nd quarter of 2005 at $185 MPPSF (vs $195 4th quarter median).  That would also be 20% under peak price of $230. ($230 minus 20% – $184)

I expect the median for the 1st quarter to be higher than that, and the median for the second quarter to be higher than the first.  Not by a lot.  But clearly there are more people out to buy property in the last week to ten days, than we have seen for the 6 to 8 weeks prior.

Given Friday was the end of the month, I don’t want to post the January stats yet, as some sales will be recorded by the agents during the coming week.  That could affect the median pricing somewhat, but as of now, January prices are down, and fairly significantly.

Good for buyers…not so good for sellers.

For now, stick a big red dot on the chart below at $185 MPPSF.  That’s where we are as of tonight for MPPSF, King County, Residential vs. Condo.

No stats in any of my posts are compiled or published by NWMLS. All are hand calculated by ARDELL (required disclosure)

mppsf

Click here for previous Sunday Night Stat posts

Sunday Night Stats – 2008

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The charts and graphs will pretty much speak for themselves tonight.

The Median Price Per Square Foot chart above shows medians for each Quarter from 2004 though 2008. You can see the nose dive in prices during the last quarter of 2008.  Popped right through 2006 prices into 2005 year end prices. I expect to see prices come up a bit during the higher volume months of 2009, and then trend back down toward year end.

What are “the higher volume months”?  See the volume graphs below comparing 2008 with 2002.  2002 was the most stable year, prior to zero down loans coming into fashion in late 2003.  There will likely be more late postings for December closings, but the relationship of each piece of the pie is more important than the individual numbers.  “stable market” equals larger slices near the bottom of the circle than at the top and a fairly equivalent ratio.  We did not have that in 2007, but we did in 2008 and likely will see the same in 2009.  2009 will either be fairly similar to 2008 as to volume, or moving a little closer to 2002 volume.  It depends on what happens at the high end of the market.

Current volume is lower than 2002 for two reasons.  One – financing is tighter, as 5% down and 10% down was much easier to get in 2002. Two – financing jumbo loans is very difficult right now, and in 2002 only 412 homes sold for over a million dollars.  In 2008 there are 2,338 homes asking more than a million dollars, of which 942 sold, 79 are pending and 1,317 are for sale as of tonight.

If we do see 4.5% interest rates, I expect many who can, will buy.  But that won’t help the high end as too many people just don’t have the downpayments the lenders are looking for. The year ended up pretty much where I predicted it at $400,000 as to median price, give or take fifty bucks.  Volume was a little lower at 15,700 vs. my prediction of 16,500.

Enjoy the graphs…they speak volumes.

Here is a running list of posts with charts and graphs tracking the market that I have written back to 2006.

Statistics calculated by ARDELL and not compiled or posted by NWMLS (required disclosure)

4.5% Interest Rate's Affect on Home Values

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When interest rates are up, home values go down.  When interest rates go down, home values go up.  That’s a basic principle, but I do agree with those who expect this market to perform counterintuitively to stablize prices vs. causing them to go up.  Basically that means they go up to where they are, counteracting the continued pressure for them to decrease. (see 5th paragraph below)

In 1990 when I started in real estate, the common walk-in client said “I want to buy a 4 bedroom, 2.5 bath colonial, with a basement and a monthly payment of $1,200”.  Let’s set the bogey at double that and toss out the basement 🙂  The number I hear most often for the neighborhood below is a rental payment of $2,500 a month or a mortgage payment of $3,000 or so with 20% down. (talking SFH Redmond here)

I like using Abbey Road in Redmond as the bogey house.  Kind of like Goldilocks and the Three Bears selection process.  Not too big, not below desirable…just right.  Good schools.  Popular neighborhood;  3 car garage most times. Current median price around $700,000.  Range of pricing from $630,000 to $830,000.  Not too new to be affordable, not too old to be acceptable.

Let’s test the theory with a monthly payment of $2,800 a month not including taxes and insurance which would add about $500 a month to the payment, and using 20% down (see next post for ratio of value to total mortgages of the neighborhood). Let me test that against $3,000 net after tax payment.  The after tax benefit should be about $700 minimum, so $2,800 plus $500 = PITI of $3,300 less $700 gives plenty of breathing room for price to go up to $750,000 or for people to stick at $650,000 if their household income is $100,000 vs, $150,000.  Depends on whether you use 28% or 33% for housing payment.  At 33% of $100,000 you would need about $200,000 down on the $650,000 purchase price.  Fits the basic buyer profile for that area anyway you slice it.

Rates of 6.25% and 20% down and a payment of $2,800 P & I,  would equal a sale price of $570,000.  Current prices would continue to be drawn down toward $570,000 at rates of 6.25% even in a seller’s market (which this neighborhood still is) due to financing qualification changes. Someone asked me from Sunday Night Stats why prices are continuing to go down in Seller’s Market neighborhoods.  That’s your answer.  Qualifying guidelines & interest rates reducing the ability to purchase and pressuring prices downward.

Now let’s change the rate from 6.25% to 4.5% and see what happens to sale price.  Keeping the same monthly at $2,800 and 20% down at 4.5% the sale price would be $690,000. 

So, my gut was right.  As rates go down to 4.5%, it does not increase the price from the $700,000 bogey we started with, but it does stablizes home prices and keeps them from slipping further down.  I always work through these things in my head in real time, testing my perception against reality.  I’m always happy when I prove myself right, and admittedly sometimes scratch the post if I prove myself wrong by the end of the post :).

I test the same theory on Rivertrail Townhomes with a bogey of $1,800 a month P & I.  High end I won’t calculate…and clearly not at 20% down.  I can’t realistically do townhome scenarios until FHA rates get lower.  But the $700,000 give or take single family home market will clearly be supported in value by interest rates of 4.5% preventing prices from slipping further back.

So to answer Jillayne’s question on my Sunday Night Stats post (sorry for the delay, Jillayne; had to test my answer) the 2nd wave of Alt-A’s will not affect pricing in this scenario IF 4.5% interest rates take hold, counter-acting the negative impact.

Sorry for the long drawn out answer to Jillayne’s question, but I don’t answer off the top of my head, even when I think I know the answer in two seconds.  I test my answer first…and this one tests out in this example.  FHA won’t test out, I’m not even going to try to test it out.  Unless FHA rates get much lower, the middle value market is going to win on all fronts.  High end will continue to suffer from Jumbo Loan issues.  Low end will continue to suffer from cash to close issues unless FHA rates come down substantially and toward at least 5% or less.  FHA and VA rates were conspicuously missing from Rhonda’s Friday rate post…  Maybe she can pop her head up from her busy day and catch us up on where those rates are, or at miniumum include them in this week’s Friday Rate Post.

Bottom line…4.5% interest rates will stop property values from declining…at least in my service area of North Seattle and Eastside.  Someone else will have to test the theory in the South End of Seattle and beyond, and for the rest of the Country.

Sunday Night Stats – Best and Worst

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First, it’s been pretty obvious in the last 3 to 4 days that people are reacting to the interest rates being at 4.75% to 4.875% recently.  I can honestly say agents are not instigating this momentum, as all of the calls I have received have been directly from buyers that I’ve never spoken with before.  In fact I have had more calls to see property from buyers than I have had showings from agents.  It’s like a large part of the agent marketlace is MIA.  I’m hearing similar stories of “agents retreating” from Vancouver.  A sign that first quarter 2009 is clearly going to be on the upswing.  But let’s look at some more of the here and now tonight.

The Best:  Townhomes – the under $500,000 variety – net even a Buyer’s Market really – not a Seller’s market either.  A balanced market in Townhomes in Redmond where almost ALL townhomes sell for under $500,000 and North of Downtown in Seattle.  Location issues are more of a concern in Seattle than Redmond, as most townhomes in Redmond are built in larger, well located communites.  In Seattle they are often smack on a main arterial.  So be discriminating as to location and lifestyle and not just space issues.

Only a 5.7 month supply of townhomes in Redmond 98052 – not even a buyer’s market

Hard to believe with all the gloomy news, I know, but yes there is a market segment that is still performing well.  That will clearly improve in 2009 if rates stay this low, so we could even see a Seller’s Market come back in Redmond Townhomes in the not too distant future.  Still, I’ve seen prices taking a beating in the last 60-90 days.  Let’s see if lower rates and low supply pulls that back to stable.  I think that will happen for Townhomes in Redmond.

Now for the Opposite Extreme – The Dark Side – The Scariest Stat of all Sundays

Over FOUR YEARS of Inventory!  Where you ask?

Kirkland 98033 in the $1.2M plus market.  115 for sale and only 7 closed in the last 90 days.  See detail.

Compare Single Family Homes – Kirkland 98033 above to Redmond SFH 98052 below:

They look like Chirstmas Balls 🙂  The more red you see, the less green and blue, the weaker the housing market.  Redmond is doing pretty good until you get over $750,000.

Two story townhomes under $500,000 are definitely the IT segment both in Seattle and the Eastside.  Kirkland just doesn’t have enough of them like Redmond does.  Not sure what happens when you get out to Cougar Mountain and other not “close-in” newer townhomes.  I don’t get out that way very often, and last I looked there was a reason why I don’t go out there very often.  Every time it snows, I get calls from people who want to sell them and move closer to work.

Well, that’s your Sunday Night Stat “Christmas Balls” edition.  Hope you’re enjoying your “White Christmas”.

 

November Home Sales – Is Seattle Bubble Overly Optimistic?

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When I did my stats for King County for the month of November, my numbers were actually worse than those reported on Seattle Bubble.  I have come to rely on Seattle Bubble as being the place where I can find the worst possible news about the housing market.  But I have double, triple and quadruple checked my numbers, and I still come up with only 768 sales of single family homes in the month of November.

This from The Tim at Seattle Bubble: “What immediately jumped out to me was Closed Sales, which were down a whopping 43% YOY, coming in at just 869 SFH sales county-wide.”

My figures show a drop YOY of just over 46% from 1,427 sold in November of 2007 to 768 sold in November of 2008 for Residential Property in King County.  While that is only a modest difference, when I look at condo sales YOY, the numbers are even worse and down 58% from 555 sales in November of 2007 to 230 sales in November of 2008.

A more significant factor is the % down from peak volume for any month of November.  For Single Family Homes, that would be November of 2004.  For condos that would be November of 2005.  Based on my previous research, that variance is due to the fact that by November of 2005, many people were priced out of the single family home market, which pushed the peak sales into 2005 for condos.

For single family homes, November of 2008 sales are almost 70% lower than peak volume for the month of November.

For condos, November sales are slightly more than 70% lower than peak volume for any month of November.

The Tim correctly points out that “For comparison, that is lower than any month on record (post-2000).”  However, I think it is more currently relevant to point out the relationship of November 2008 sales volume to a most recent lowest volume, that being January of 2008,  I have shown this figure as a dot on the graph below, green for condos and purple for SFH. 

Conclusion: Both single family and condo sales in Novmeber of 2008 are approximately 70% under peak volume, and 20% under the previous, recent low point of January of 2008.

Seattle Area Home Sales Volume

Seattle Area Home Sales Volume

I think we can all agree on one thing…for the first time in a long time I think we can all be confident that 2009 WILL be better than November of 2008, as to volume of property sold, since it’s hard to imagine that it could get any worse, even for the most pessimistic among us.  Well, maybe not Sniglet 🙂
If November sales volume is not AT BOTTOM…we may have to start looking at an “exit strategy”.
(required disclosure) All stats in this post (and graphs) compiled by ARDELL and not compiled, verified or posted by the NWMLS.

Is the housing market performing "as expected"?

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To some people, that question will seem ludicrous.  If you are buying or selling a house every 7 years or so, you may not care about this somewhat complex answer to the question raised.  I am writing this post for real estate professionals, rather than the individual who may be buying or selling a home every 7 years or so.  My hope is that if more real estate professionals understood the housing market, more consumers would be better served by those professionals.

For those that want to hear that the market is doing much worse than expected, I give you Detroit.  I heard on the news yesterday that home prices in Detroit have rolled back 8.5 years.  That is much worse than “expected”.  For those that want to hear that the market is doing much better than expected, I have to say “jury’s still out” on that one, as the down market has not yet completed its “expected” cycle. 

Yes, real estate prices always go up.  But when did real estate professionals en masse start thinking that meant it looked like the chart below?  It DOES NOT!

Housing Prices do not go up in a straight line

 
Housing Prices do not go up in a straight line!.  I can honestly say that 20 years ago the only agents I met who thought this way were the salesmen vs. the professionals…and they were few. The first time I overheard an agent at an Open House talking to a first time home buyer explaining the real estate market in terms of “AWAYS GOING UP!” and drawing a chart like the one above for them, I thought “What an Idiot!” 

It is only in the last couple of years that I have seen MOST of the professionals, and consequently the general public, setting the unrealistic expectations noted in the chart above.  Many of those professionals have left the business, and more will follow.  For the benefit of those who will continue in the industry, and for the public at large, lets get back to basics and set our expectations properly. First you set realistic expectations based on an Annual Cycle of Real Estate markets.  The one below is primarily for single family residential housing.  Not condos, not multi-family, not commercial – Single Family Residential Housing Market.

Annual Cycle of Home Prices

Annual Cycle of Home Prices

When home prices increase from year to year, most of that appreciation happens from March through July.  Even when home prices decrease from year to year, prices are still expected to be up from March through July vs. January and November.  THAT is the expectation.
Think of it this way, retail sales are expected to be higher in November and December than in February.  They may not go up as much as expected, and that is not good.  But if sales in November are lower than in February, that’s really bad.  So up vs. down is NOT the barometer…it is up when expected to be up, down when expected to be down…and then it is all a matter of degree.

If you heard a store owner who only sells Christmas Ornaments complaining that his April sales were lower than his Nov/Dec sales, what would you think?  That’s how I scratch my head when I hear someone saying “I’m waiting for the lowest possible prices, so I’m going to buy a house in May or June.  Does not compute!  I’m not saying it could never happen, I’m just saying that is not an appropriate expectation.  As long as you are willing to wait until 4th Quarter of 2009 or even 2010…fine.  But if you are determined to buy within 12 months, wanting the lowest price and wanting to buy in June is not a match.  You will likely get a better house if you wait until May…but not a better price.  Again, not impossible…just not likely.  Go back and study the graph above before we move to broader market descriptions.

For this next part, different people will have different market theories.  Mine are primarily based on a “7 steps forward, 3-5 steps back” theory, that I attribute to having entered my head via Alan Greenspan many years ago.  Nationally the market started moving up past it’s previous peak in 1998.  Consequently the expectation would be for it to go down in 2005.  When it did, people freaked out while I said “DUH”. 

The market performed as expected.  But when professionals don’t know what to expect, they react inappropriately, which creates an unexpected market condition.  It’s like playing a sport where half of your team is not performing their role “as expected”…it throws the whole game off.  When your quarterback starts throwing to the guy in the wrong colored Jersey…all hell breaks loose.  As a real estate agent, you are the quarterback, time to learn the plays.  The people in the stands have a harder time betting on the game, when the quarterback is messing up the plays to the degree that we as professionals have been screwing up.  STOP sending GOOD NEWS! C-R-A-P.  This is NOT an industry based on consistent and continual “Good News”!  STOP wishing ONLY for Good News, and blaming market conditions on the purveyors of “bad news”.  Get Real – Real Fast…or suffer the consequence.

Another analogy.  The market went down when the Dow hit 14,000.  If most people said “DUH”, there wouldn’t have been panic selling.  Yes the market still would have gone down, but the market loses all semblance of sanity when expectations are set at unrealistic levels.  Momentum created by panic forces markets out of their natural cycle.  That is true both on the up side and on the down side.  The Dow was supposed to go down when it hit 14,000…in fact it should have gone down when it hit 12,000.

This is my expectation of the housing market.  Yours may differ.  Lacking an informed and valuable opinion from the professionals, the public will start imposing their own opinions like “markets should only increase at the same level as median income.”  That is not correct BUT professionals have no one to blame but themselves for all of the Bubble Blogs.  When professionals started lying both to themselves and to the public, the public had to move in a different direction.  You hate Bubble Blogs, you say?  Well then stop acting like you don’t have a freakin’ crystal ball!  If you don’t like the public not relying on your opinion…well then go get yourself an opinion!  OK, here’s mine.  Beyond the Annual Cycle above for single family homes, there is the YOY expectation in a long term cycle.

Home prices up for 7 years; down for 3-5

Home prices up for 7 years; down for 3-5

Now let’s define what a Housing BUBBLE is.  A housing bubble is when the market outperforms expectations…not when it goes UP.  A housing slump is when the market underperforms expectations…not when it goes DOWN.  Bubbles ALWAYS burst.  That is why you need to know the degree to which the market should go up (like Christmas Ornament sales in November and December) so that you know when you are entering a bubble zone.

I learned this many years ago…so long ago I don’t know where.  A market will ALWAYS reach and surpass a  level it has previously achieved.  It’s not a matter of IF…it’s a matter of WHEN.  If it happens too quickly, the downside of the cycle will hit harder.  If it happens as expected, the people betting on that expectation will do well.  We want to be a Country that always does WELL…not that always goes UP beyond normal market expectations and never, ever goes down.

Once you set a realistic expectation, you can predict markets.  When the market moves outside of predictable levels, you know you are in a bubble or a slump.  If you think every batter is supposed to hit a home run…you will spend your life in misery and disappointment.  If you expect the batter to always hit a home run…one day he will hit you instead of the ball.

Real Estate Prices are supposed to stop going down, nationally that is, somewhere between 2009 and 2011.  They were supposed to go up from 1998 to 2005 and down from 2006 through 2009 – 2011.  The degree they went up was “bubbled” by the loose lending practices in the latter part of the up cycle.  First that bubble must pop, as it did, and now we’re looking for the end of the down cycle.  If the government wants to make sure the down cycle is only 3 years and not five, then they have to do something to cause interest rates to stay at or below 5.75%, even if that is an artificial stimulus level.

No one can, nor should anyone try to, force the market to be always up.  That kind of talk is for salesmen, not professionals.  If you don’t want to hear ANY bad news, ever.  If you don’t understand that there should be at least 3 years of “bad news” following a consistent 7 year trend of “good news”, please go do something else for a living.  That’s like a lawyer who tells everyone they can win a case, cause they get paid whether the client wins or loses.  That’s like a doctor ordering MRI’s every week for a hypochondriac, because he makes money whether the patient is sick or not. 
Don’t want to be compared to a Used Car Salesman?  Then stop acting like one.