10-15% Price Increases In Seattle "Modest"
Here's yet another story for you with the premise that Seattle is not in a bubble at all. This one comes courtesy of the Seattle P-I.
Home prices in some parts of the country might be primed for a decline, putting a drag on the nation's economy, but Seattle apparently could avoid the problem of a price bubble.What kind of insane world is it when 10 to 15 percent per year is considered "modest"? Granted, they said "relatively," but to me just because 10 to 15 percent is less than the increases in Boston or Florida doesn't mean we're not in a bubble, just that we're in somewhat less of a bubble.
...
But economists and real estate analysts who study the Seattle-area market believe it isn't part of that phenomenon.
Rather, they said, the Seattle area is seeing relatively modest home appreciation rates -- in the neighborhood of 10 to 15 percent per year. Those rates are a product of an inventory shortage coupled with demand, they said.
Douglas Pedersen, a Seattle economist, agreed that the area housing market is not seeing the extreme home appreciation rates of other cities. But affordability, he said, is an issue for some potential buyers in the region.Hmm, where have I heard that concern before? Oh yeah, here. And here.
"We have high home prices relative to household incomes," he said.
(Seattle P-I, 09.30.2005)
1 comment:
What kind of insane world is it when 10 to 15 percent per year is considered "modest"?
10-15 is never considered "modest" or normal. 5% is actually on the high side. This is just the same boosterism seen in nearly every metro paper. One wonders how many publishers are hedging their businesses with real estate.
Those rates are a product of an inventory shortage coupled with demand, they said.
What shortage? They're constantly erecting new condos and home developments. I won't blame to paper for stupidity, because they're probably just getting their "data" from local realtors.
Say, have you ever found stats for the % of Seattle and outlying RE sales that are bought for speculative reasons? That might reflect how much "demand" will be short-lived.
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