If anyone has had broken window seals fixed and knows someone in the Redmond/Bellevue/Kirkland area who can fix them, can you please post the info in the comments section of this post, or email me direct?
Thanks!
Broken Window Seals
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Category Archives: General
Seattle Real Estate Market – King County
To know if the market is getting better or worse, we have to expect something of the market. That is the only way to know if the market is doing better or worse “than expected”. Active markets anticipate. If a company’s earnings are down to the same degree as anticipated and expected, there will be no change in prices. So we have to expect something to happen, and this post is all about what I expect to happen in the King County – Seattle Area Real Estate Market.
To keep saying the market is down from peak for 3-5 years is both boring and of no value, and only fun ad nauseum for whiners. I call that NSS (No Sh_t Sherlock) meaning no kidding the market is down from peak; that news is a year old now. What’s next?
To those who hate it when an agent sticks their neck out and makes predictions, I say…go away then or get used to it or get over it. Agents are paid good money to answer the question “Where is the real estate market going?” If we only got paid to open doors and say “do you like this house”, we’d be paid $15 an hour. That’s the going rate for a good real estate assistant.
Sellers need to know if selling next year is better than selling this year. Sellers need to know when they get an offer today, if that offer is or isn’t likely the best offer they are going to see in their timeframe. Buyers need to know if they can sell in 1-3 years without taking a loss. People need agents to have an opinion about the future, both the near term future and the foreseeable future, They can’t simply rely on personal experience and say “well I’ve never seen that happen” because the future is not about the recent past.
The graphs below show what I expect the market to do as to volume, which will assist us in determining true Absorption Rate and knowing whether the market is getting better or worse (than expected).
I’m calling Absorption Rate as of now, 10 months. Current inventory is 12,403 and I expect it to take 10 months from today for 12,403 Residential properties to sell in King County. That also means it will be a Buyer’s Market until and unless we see inventory drop from 12,403 to 7,500. That can happen by property selling, or sellers deciding to rent or withdraw from the marketplace, at a higher rate than properties are coming on market. I expect that to start happening on September 1 and continue through year end. Whether or not prices will continue to decrease into next year and beyond will depend on how close we can get to 7,500 properties on market by December 31st.
The two graphs below are a double check system. On a month to month basis we would expect to see variance. Sometimes August sales are higher than September, and sometimes September sales are higher than August. So the double check is for the Quarterly sales stats to fall into the prescribed ranges within a reasonable variance.
I took the year notations off the monthly stats, as I don’t expect these numbers to change unless there are changes in the mortgage market that create additional buyers. That could be lower interest rates and.or looser lending standards. Until then, we have to learn to live with what we can most likely expect to happen.
Sunday Night Stats – More signs of stability
King County Home Sales for the last 8 years, the only time July volume was higher than June homes sold was in 2003. That 2008 is lower than 2007 is old news. The good news is that the relationship of sales month to month is following a predictable pattern and a normal relationship.King County Home Prices
King County Home Prices June and July
Same as to prices. Even in the boom years, the relationship of prices from June to July was pretty much the same as it is now. Prices are running slightly above where they were this time of year in 2006.
Both of the above graphs are for King County Residential (not condo). The question isn’t whether or not August will be down, but whether it will be down in a normal relationship to June and July.
The text is centering and I can’t stop it 🙂 Since it’s almost 1 a.m., I will do the regular weekly stats in the morning and post a link here. I was more interested in end of July stats. A few more will trickle in for months, so I’d say July was not a bad month overall.
Stats not compiled or published by NWMLS (required disclosure)
And the FED…does nothing.
The markets anticipated the FOMC to leave the Fed Funds rate alone at 2% and that’s just what they did. The markets are reacting accordingly by not swinging drastically either way. The DOW is enjoying triple digit gains while oil has been under $120. What does this mean to mortgage interest rates?
As you know, the FOMC does not directly control mortgage interest rates as mortgage interest rates are based on bonds–mortgage backed securities (MBS). Traders will react to what the FOMC does and does not do and THIS will impact mortgage interest rates.
The FOMC press release states:
“Economic activity expanded in the second quarter, partly reflecting growth in consumer spending and exports”. I’m wondering how much of the growth in consumer spending is from the economic stimulus checks?
This statement is quickly followed with: “…labor markets have softened further and financial markets remain under considerable stress. Tight credit conditions, the ongoing housing contraction, and elevated energy prices are likely to weigh on economic growth over the next few quarters”.
Bonds react negatively to inflation, I’m anticipating that we will see mortgage rates continue to trend higher. Here’s a bit from the FOMC regarding the “i-word”:
“Inflation has been high, spurred by the earlier increases in the prices of energy and some other commodities, and some indicators of inflation expectations have been elevated. The Committee expects inflation to moderate later this year and next year, but the inflation outlook remains highly uncertain.”
You can read today’s FOMC statement here.
PS: As the Prime Rate is tied to the Fed Funds Rate, your HELOC is unchanged for now.
Remember Dustin's Project Blogger Apprentice?
Million Dollar Listing
Back in April of 2007, Dustin chose Madison as his Project Blogger Apprentice. My Apprentice, Kevin Tomlinson of South Beach Luxury Condo Fame (also very hot), clued me in today on Madison’s Cover debut on PlayGirl Magazine.
Madison is also one of the stars of Million Dollar Listing
Madison Hildebrand Million Dollar Listing
Your Mama of The Real Estalker reported a few posts ago about one of the other stars of the show being released on $100,000 bail. If you are into “hard core real estate porn”, I highly recommend The Real Estalker. It’s a fast paced great read, and one of Kevin’s Favorite Blogs.
Someone wanted to do a “Where are the Apprentices?” a year later, but I don’t think anyone would have guessed “On the Cover of Playgirl Magazine” 🙂
The new (2nd) season of Million Dollar Agent airs Tuesday Night, August 5th on Bravo.
Sunday Night Stats
It’s too early in the month to post the end of July stats. We’ll do that next week as many agents will post their month end closings during this week. Seems to me that August closings may keep pace with July and July will be down from June as to price, and maybe volume too. Two of my listings are pending inspection for August closings, and one has been on market for quite sometime. Another is at least a bridesmaid…waiting to hear if it made it to bide. If there’s no offer, it was at least a close second So it seems to me that some people who have been looking and looking, are starting to move in and make offers.
King County Condos
2004 – 1Q – 1,694 – $188, 2Q 2,636 – $199, 3Q 2,540 – $196, 4Q 2,176 – $195
2005 – 1Q – 2,066 – $198, 2Q 2,925 – $209, 3Q 2,769 – $226, 4Q 2,266 – $224
2006 – 1Q – 1,956 – $242, 2Q 2.748 – $252, 3Q 2,737 – $269, 4Q 2,217 – $278
2007 – 1Q – 2,042 – $295, 2Q 2,862 – $302, 3Q 2,676 – $311, 4Q 1,618 – $294
2008 – 1Q – 1,258 – $299, 2Q 1,508 – $287
Changes in condo stats for this week
Active Listings: 4,030 – DOWN 70 – median price $319,950 – MPPSF asking $310 – DOM 65
In Escrow: 793 – DOWN 39 – median asking price $289,950 – MPPSF asking $291 – DOM – 50
Sold YTD : 3,060 – UP 134 – median list price $289,950 – median sold price $285,000 – MPPSF – $289 DOM 49
Residential King county
2004 – 1Q 5,650 – $152, 2Q 9,237 – $160, 3Q 8.737 – $163, 4Q 7,467 – $165
2005 – 1Q 6,402 – $173, 2Q 9,093 – $185, 3Q 9,131 – $192, 4Q 7,301 – $195
2006 – 1Q 5,596 – $201, 2Q 8,248 – $214, 3Q 7,771 – $216, 4Q 6,204 – $217
2007 – 1Q 5,304 – $222, 2Q 7,393 – $230, 3Q 7,944 – $229, 4Q 4,301 – $221
2008 – 1Q 3,640 – $219, 2Q 4,641 – $220
Changes in residential stats for this week
In Escrow: 2,559 – DOWN 125- median asking price $419,950 – DOM 48 – MPPSF $204.8
SOLD YTD: 9737 – UP 420 – median asking $449,950 – median sold price $440,000- DOM 49 – MPPSF $217
Actively for sale 12,307 – DOWN 210 – MPPSF <$800,000 is $220 – MPPSF >$800,000 is $332
Stats not compiled or published by NWMLS. (Required disclosure)
The Housing Rescue Bill
Today President Bush signed a housing “rescue” bill HR 3221. I’m really still absorbing all of this (I think it’s taking me a bit longer after my trip to Inman Connect). Here are a few quick pointers:
The FHA risked base mortgage insurance pricing (which I’m in favor of) that was to be effective last week is now postponed until September 30, 2009. FHA can now save some borrowers in trouble with their mortgage if their existing lender will forgive the underlying debt to 85% 90% of the current value of the home. Gee…risked based MIP might be handy in these cases.
Also with FHA, Seller paid down payment assistance programs are will be gone and the minimum down payment for an FHA insured loan will be 3.5% (which is a very small increase) beginning October 1, 2008.
Jumbo FHA and Jumbo Conforming loan limits will be reduced from the current 125% of median home value to 115% of the median home value beginning January 1, 2009. As I mentioned, your days of a loan amount of $567,500 are numbered. The new conforming/FHA jumbo limit may be closer to $520,000.
First time homebuyers (someone who has not had interested in a property for the past 3 years) are eligible to receive a tax credit…however, it’s really an interest free loan to be paid back over 15 years or from the proceeds when the home is sold (which ever comes first). This is available only for homes purchased on or after April 9, 2008 and before July 1, 2009. Income restrictions do apply. For more information, check out this website.
Last but not least (and I’m sure I’m missing stuff) Fannie and Freddie have a new regulator: The Federal Finance Housing Agency aka FHFA. This from James B. Lockhart:
“Today President Bush signed the ‘Housing and Economic Recovery Act of 2008.’ I thank President Bush and Secretary Paulson for their leadership in making government sponsored enterprise (GSE) regulatory reform a reality.
The Act creates a world-class, empowered regulator, the Federal Housing Finance Agency (FHFA), with all the authorities necessary to oversee vital components of our country’s secondary mortgage markets — Fannie Mae, Freddie Mac and the Federal Home Loan Banks — at a very challenging time. As Director of the new agency I look forward to working with the combined Federal Housing Finance Board (FHFB), Office of Federal Housing Enterprise (OFHEO) and Housing and Urban Development (HUD) GSE Mission teams and with other regulators to ensure the safety and soundness of the 14 housing related GSEs and the stability of the nation’s housing finance system.
For more than two years as Director of OFHEO I have worked to help create FHFA so that this new GSE regulator has far greater authorities than its predecessors. As Director of FHFA, I commit that we will use these authorities to ensure that the housing GSEs provide stability and liquidity to the mortgage market, support affordable housing and operate safely and soundly.”
Too much to write about in detail for one post…just wanted to throw you some bits.
Reporting from ConnectSF08
I’m here at the beautiful Palace Hotel in San Francisco for the Real Estate Connect conference put on by Inman News. I’ve been to Connect conferences in the past and came away with some fond memories of presentations by Larry Page and John Seely Brown. I’m sure my raincityguide blogger colleagues are here someplace; by this time of night I’ll guess they’re out drinking and I’ll hook up with them tomorrow. There are two tracks to choose from tomorrow morning, blogging and foreclosures. Guess which one I signed up for? Tomorrow afternoon, Brad Inman delivers the opening keynote “How the Nomadic Culture Will Rock Your World” and right after that, we’ll here from Craig Newmark and RCG’s Dustin Luther and THEN finally, “The Housing Debate: Bull v. Bear” panel with two of my favorite bloggers, CR from CalculatedRisk and Yves Smith from Naked Capitalism. It doesn’t look like all the meals are covered so if anyone who knows San Francisco has suggestions for where to step out for a quick bite, please let me know. I’m across the street from the Mongtomery Street BART station and I am armed with a four day BART pass.
Sunday Night Stats
Before I did the Quarterly and Weekly stats tonight, I did a few calculations on newer vs. older property. I was wondering with lower volume, if more newer properties were selling at a higher rate. Given more choices, would people disproportionately select newer homes and condos? Answer was no, not dispropotionately.
35% of residential properties for sale were built since 2000 and 33% of properties sold YTD were built since 2000. 32% of condos for sale were built since 2000 and 38% of condos sold were built since 2000. So a tad overweighted toward newer on condos, but not by much.
The significant news this year, since volume of property sold being down is really last year’s news that continues in a stablilized manner, is that this is the first time in many years that the MPPSF is lower in the 2nd quarter than in the 1st Quarter.
The scarier number is the $206 per square foot on the residential properties currently in escrow. It is quite possible that this lower number is being caused by short sales that are not closing at these low numbers. Short sales take a long time to close, so we may not know that answer until the end of the 3rd Quarter.
King County Condos
2004 – 1Q – 1,694 – $188, 2Q 2,636 – $199, 3Q 2,540 – $196, 4Q 2,176 – $195
2005 – 1Q – 2,066 – $198, 2Q 2,925 – $209, 3Q 2,769 – $226, 4Q 2,266 – $224
2006 – 1Q – 1,956 – $242, 2Q 2.748 – $252, 3Q 2,737 – $269, 4Q 2,217 – $278
2007 – 1Q – 2,042 – $295, 2Q 2,862 – $302, 3Q 2,676 – $311, 4Q 1,618 – $294
2008 – 1Q – 1,258 – $299, 2Q 1,508 – $287
Changes in condo stats for this week
Active Listings: 3,958 – UP 90- median price $319,990 – MPPSF asking $312 – DOM 65
In Escrow: 856 – DOWN 14 – median asking price $289,000 – MPPSF asking $294 – DOM – 49
Sold YTD : 2,955 – UP 178 – median list price $290,000 – median sold price $287,000 – median PPSF – $290 DOM 49
Residential King county
2004 – 1Q 5,650 – $152, 2Q 9,237 – $160, 3Q 8.737 – $163, 4Q 7,467 – $165
2005 – 1Q 6,402 – $173, 2Q 9,093 – $185, 3Q 9,131 – $192, 4Q 7,301 – $195
2006 – 1Q 5,596 – $201, 2Q 8,248 – $214, 3Q 7,771 – $216, 4Q 6,204 – $217
2007 – 1Q 5,304 – $222, 2Q 7,393 – $230, 3Q 7,944 – $229, 4Q 4,301 – $221
2008 – 1Q 3,640 – $219, 2Q 4,641 – $220
Changes in residential stats for this week
In Escrow: 2,760 – UP 2- median asking price $425,000 – DOM 48 – MPPSF $206
SOLD YTD: 8,963 – UP 648- median asking $449,950 – median sold price $440,000- DOM 49 – MPPSF $223
Actively for sale 12,339 – UP 436- MPPSF <$800,000 is $220- MPPSF >$800,000 is $335
Stats not compiled or published by NWMLS. (Required disclosure)
Sunday Night Stats – Volume is Stabilizing
We have a couple of months to go before we have a full 12 months past Mortgage Meltdown to guide us into the future of the real estate market. But volume has really been pretty stable. As you can see from the above chart, September of 2007 is when the market dropped as to volume. Compare this to some graphs I did at the end of last year showing the relationship of volume month to month back in 2005. Then add my predictions as to volume back in mid April of this year.
When I predicted that total single family home sales in King County would be 16,500 by the end of 2008, I was basing that on the second chart in the first link above. Let me bring that chart forward so you can follow what I’m saying better.
June 2008 sales were 1,557. June in 2005 represented 10.3% of the total year sales. 1,557 is 10.3% of 15,116. If you use April sales from the top wheel of 1,505 that would be 9% of 16,722 (which is where my prediction of 16,500 came from). While volume is clearly drastically reduced, it is not dropping out from under us. It basically dropped once and then stabilized. That’s good news, though we do see some minor slippage in the relationship between April of 2008 and June of 2008, so we will continue to track that as the year progresses.
Where prices will go in response to the change in volume is another story and where Absorption Rates become a weak indicator. Absorption Rates only work when you can expect all inventory to be “absorbed” . that is not the case. In a market like this you have to throw absorption rates out the window and try to find the point at which a property will not sell at all. The worst I have seen is a market where only 3 of 10 houses will sell PERIOD!. To say current inventory will be absorbed in eight months is not true. At the end of eight months, some of those homes will still be on market and other properties that came on market after them will be the cream of the crop that sells.
When you see prices fluctuating upward, while volume is stablilizing and absorption rate is high, that is because the small percentage of homes that sell quickly and at higher prices, are influencing and increasing the price stats. We saw that more in February, March and April than we did in May and June. That is why the April prediction of 16,500 may turn out to be 15,500, since June did not expand much beyond April levels as it usually does.
Single Family Homes in May and June look like they sold at higher prices, as does the condo market, but that is because people are opting to get more for their money. As price per square foot drops, people are opting for bigger houses and lower prices. Instead of buying an 850 square foot condo for $250,000, they are buying an 1,100 square foot condo for $300,000. So they are paying a higher price, but a lower price per square foot. Same is true for single family homes. In March the median price was $435,000 and the median price per square foot was $221. In June the median price is up to $451,000 but people are opting for the higher price AND the larger house, as they trade in the lower price per square foot of $216 for more house. (Note, homes in escrow are at $207 MPPSF – see weekly stats)
It’s really a smart move. People who are unsure of the market over the next several years are making sure they buy a condo or house that is large enough so that they can stay put, and not have to trade up as to size. Those who are buying, and there are clearly fewer of them, are not buying with the idea that they will REFI or sell in a couple of years. They are buying for the long term. They are paying a higher price, but a lower price per square foot. That is why it may appear that prices are going up, when they are really going down.
Before I do this week’s stats, note that earlier this week I did the 1st half and 1st quarter to 2nd quarter comparison. May and June did not do as well as expected, so the 2nd quarter did drop more as to volume YOY than the 1st quarter. But if the market can sustain at this level for another 45 days, I think by year end it will still be in the 16,500 total sales for the year range.
Sorry this post is so long tonight. There are no easy answers this year.
Changes in condo stats for this week
Active Listings: 4,014 – UP 56- median price $320,000 – MPPSF asking $313 – DOM 66
In Escrow: 847 – DOWN 23 – median asking price $297,000 – MPPSF asking $302 – DOM – 48
Sold YTD : 2,875 – UP 98 – median list price $290,500 – median sold price $285,500 – median PPSF – $289 DOM 48 Note: 35% selling in 30 days or less.
Residential:
In Escrow: 2,771 – UP 11 – median asking price $434,000 – DOM 49 – MPPSF $207
SOLD YTD: 8,612- UP 297- median asking $449,950 – median sold price $440,000- DOM 49 – MPPSF $218 Note: 36% selling in 30 days or less.
Actively for sale 12,184 – UP 281- MPPSF <$800,000 is $220- MPPSF >$800,000 is $337
Note that the MPPSF Asking prices of homes not sold is virtually unchanged week to week while those going into escrow are the ones asking less and less each week.
(above info and graphs not compiled, published or verified by NWMLS – required disclosure)