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Tuesday, June 27, 2006

How To: Ditch The Buyer's Agent

I found this article about ditching the real estate agent to be unintentionally amusing.

Eric Boerner was shopping for a house in the Seattle area when he decided he couldn't stomach the idea of a real estate agent pocketing thousands of dollars in fees for work he'd rather do himself.

Did he really need someone to drive him around? And who could choose the best school for his 5-year- old daughter better than he?

So when Boerner checked out Redfin.com, a Seattle-based home-buying Web site, and saw a modern four-bedroom house in Lake Forest Park he liked, he took the plunge.

He hit the red "buy it" button, and made an offer.

Sight unseen.

"It seemed kind of surreal to throw a half-million dollars into a house, but I have a lot of trust in my own judgment," said Boerner, 39, who made the offer online from California as he and his family were preparing to relocate to Seattle last month.
So as their primary example of someone that has kicked the real estate agent habit, they chose an arrogant Californian, so flush with money that he's willing to throw it into a house he hasn't even seen, let alone had inspected? Wowzers.
"We represent a buyer or seller throughout the entire process. Redfin does not," said Bill Riss, chief executive of Coldwell Banker Bain. He said Redfin's model relies heavily on other full-service real estate agents, who often end up showing Redfin clients' properties.
...
Riss said full-service companies like Coldwell offer an edge, particularly in hot real estate markets like Seattle, where homes sell quickly, often with multiple offers.

"It's a choice of how you value your time over your money, and do you truly understand the entire real estate process?" he said. "The question is, are you trading off something?"
...
Boerner eventually lost the Lake Forest Park home when the seller backed out of the deal during escrow, leaving him and his wife, Lynn, scrambling. Instead, they found a four-bedroom house for $390,000 with a deck overlooking a wooded backyard in Mountlake Terrace. They toured that one before closing the deal through Redfin.
I love the "particularly in hot real estate markets like Seattle" bit. So basically what they're saying is that the popularity of the real estate agent has nowhere to go but down? Oh, and $390,000 in Mountlake Terrace? At a whopping 8% less than last month's King County median, now I know what the Seattle Times means when they called Mountlake Terrace the "sweet spot for affordability".

(Phuong Cat Le, Seattle P-I, 06.24.2006)

84 comments:

Anonymous said...

"We represent a buyer or seller throughout the entire process. Redfin does not," said Bill Riss, chief executive of Coldwell Banker Bain.

Dear Bill Riss, this buyer didn't WASTE thousands of dollars at Redfin. With Redfin, they saved.

At Coldwell Banker Bain, you don't.

Sorry Bill, the mantra of service will never superceed the power of the all-mighty dollar. Check Mate.

DC Housing News said...

New blogon DC's inflated housing market:

http://dcbubblemeter.blogspot.com/

Enjoy, and thanks for visiting.

meshugy said...

Here's the latest from PMI:

PMI U.S. Market Risk Index Shows Hot Markets Continue to Cool, but Strong Economies Offset Price Deceleration

Seattle was given a very low risk rating: 108

That means Seattle only about a 10% chance of a price decrease.

The full report is here:

ECONOMIC
REAL ESTATE
TRENDS


Appreciation
Appreciation remains very strong by historical standards across
much of the U.S. OFHEO reports that the average home price
increased 12.54% over the last 12 months and 8.12 percent
(annualized) from the fourth to the first quarter, significantly outstripping
the Consumer Price Index (CPI), which rose by just
4.2% during the same period. Appreciation remained positive in
all of the nation’s 50 largest housing markets and in the double
digits in almost half of those. Six markets saw year over year
appreciation above 20%, led by Phoenix, where appreciation was at 31.1%, followed by Orlando, Fort Lauderdale, Miami, Tampa,
and Los Angeles. The Pacific census division, consisting of
California, Oregon, and Washington, has regained its position as
the fastest appreciating division, overtaking the Mountain Division.

Anonymous said...

This building I drive by on the way to the gym has made me wonder- it shows an address of 9090 Ravenna from the street. The 6 brand new condos were listed in the MLS last year, but the building is empty and has grafiti on the front, and piles of debris all inside the garage.

From the KC records, it seems to be owned by an investment group.

http://www5.metrokc.gov/reports/property_report.asp?PIN=8641500510

Anonymous said...

Regarding the above building, it also appears they haven't paid any property taxes on it. Correct me if I'm interpreting it wrong.

https://payments.metrokc.gov/metrokc.ecommerce.propertytaxweb/RealProperty.aspx?Parcel=8641500510

marin_explorer said...

From the KC records, it seems to be owned by an investment group.

More Seattle-based investment, which suggests demand-driven prices are due to more than homeowner demand. With short-term rates up, flippers can't carry on forever. Of course, Seattle only has a 10% risk of price decrease, despite that big slide in affordability since '04.

Anonymous said...

Ha! thanks for the chart Marin Explorer!

Anonymous said...

It would appear, and this is a total guess, that someone went into arrears on the property and Chesterfield took possession via a Trustee's Deed.

The excise tax affidavit lists three other parcels affiliated with that parcel so likely the condominiums are on another parcel nearby. Here's the link to the Excise Tax affidavit. Happy hunting.

http://146.129.54.93:8193/imgcache/OPR2070787-1-2.pdf

Anonymous said...

Regarding Chesterfield, that was my first thought that they received the property in default, however they purchased it in 2004, and the building was constructed in 2005. I drive by it regularly It wasn't there in 2004.

The odd thing about it is that it's not fully constructed, but it's been sitting like this for over 8 months.

Anonymous said...

Whoah.. Lake Forest Park to Mountlake Terrace- that's quite a nosedive!

This Californian is the poster boy for "Why it's smart to get to know the area BEFORE you buy"!

Anonymous said...

It doesn't look like Chesterfield "bought" it. They got it on a Trustee's Deed, which usually means a default.

Looking further at the Excise Tax Affidavit, the addresses are the same for the Grantor and Grantee suggesting that perhaps the two entities are the same or related.

Looking even further, Chesterfield appears to be a hard money lender which would indicate that they provided the construction loan.

Short answer, too much time required to figure it out. :)

Mike said...

The June PMI report is interesting. Seattle-Bellevue-Everett risk went down from 12.4% to 10.2% between the last two months. I would have predicted an increase to around 15% given recent price increases.

It also states the Phoenix market as only a 17.5% chance of a price drop, and we know what's been happening there with the inventory build-up. The analysis is based on a mathematical model. Models are often flawed. It would be interesting to see why this one does not have Phoenix near the top of the riskiest metro areas. Ample land for new home building, investor activity, and ARM loans are the risk factors I would build a predictive risk model against.

Anonymous said...

As usual, Meshugy's links are BS.

Any study that would indcate that Phoenix's chance of a drop are only 17%, well, I think we all know the reliability of such a study.

Thank you for actually checking the link Mike and reporting back to us who no longer pay attention to what M posts.

Anonymous said...

Inventory in King/snoho has broken 11,000 this week: 11,248 to be exact.

Check the bubbble tracker.

Steady as she goes for months now. And increasing more rapidly as wqe go along.

12,000 by Aug. 1 , anyone?

meshugy said...

King County inventory is still far below historic norms. Zip realty shows 7627 homes for sale right now.

MLS records show:

June 05 - 6,857
June 04 - 9,958
June 03 - 12,275

So we're a little above last year, but a far cry from 03 #s, which was still a competitive market. We'd probably need to see double the #s we have now to before you'd see any desperate sellers and price reductions.

Anonymous said...

You need some serious layoffs to double the current inventory number quickly.

ser said...

Anon 8:37-

I don't see anyone here suggesting that inventory would/could double in a month.
Although that *would* be something!

Going from 11K to 12K is not doubling.

ser said...

Here's price reductions for some zips:

June 27 '06

98103:(Green Lake) 113 on market/ 27 price reductions

98117: (Ballard) 62 on market/ 15 price reduced

98115: (Ravenna) 93 on market/ 28 price reduced.


Looks like price reductions happen even with tight inventory.

meshugy said...

Price reductions in the current market are almost always a result of drastically over priced houses being reduced to market value. The rapid monthly appreciations seen in recent MLS reports indicates that these "reductions" are having no negative effect on prices. If these reductions were more severe we'd see big reductions in median price. But we're seeing just the opposite right now...houses in Seattle are getting more expensive every month.

ser said...

M-

That still does not explain why you would say "... the #'s have to double before we see desperate sellers and price reductions..."

Why would you say that when you know there ARE price reductions?

This is why people call you a liar. Do you not see that? If you lie, people will call you a liar.

Perhaps if you quit lying, people here would take you more seriously.

Friendly advice.

Anonymous said...

Today the stock market is down but yet, 25% of all stocks went up. Price reductions happen in a red hot market too. Wake me up when 80% of all listings are price reduced. Blood hasn't even been drawn in this fight.

Anonymous said...

50% in 98105 a few weeks ago was pretty darn good!

I'll take that for the time being.

Anonymous said...

meshugy

Can you post some historical inventory numbers? Going back to 2003 puts us back into a period where the local economy was still shedding jobs - not exactly "normal".

1999 or 2000 would be a better comparison. 01-03 was recessionary so no doubt the inventory levels would be higher as people moved to take professional level positions in other cities.

meshugy said...

Sorry...I don't have inventory #s pre-2001. I'm sure you can find them somewhere. I'd like to see those too.

meshugy said...

Why would you say that when you know there ARE price reductions?

This is why people call you a liar. Do you not see that? If you lie, people will call you a liar.


Seattle Price Drop, Dukes, and many other folks on this list have been posting the price reduction stats from Zip Realty since Jan. Claiming that the market was crashing and that severe price drops were already happening.

And what has happened since Jan 06? Just look at the MLS data:

Seattle Median Price

Jan 06: $376,995
May 06: $415,000

We've had a whopping increase of nearly $40K since January! So I think that clearly shows that looking at the price reductions on zip realty tells you very little about the market. Call me a liar if you like, but the #s are all there in MLS data. Prices are still going up at a feverish pace.

meshugy said...

This is interesting:

Homeowners making fewer late payments

The proportion of homeowners making late payments fell in the first three months of this year, compared with the last three months of 2005. The foreclosure rate dropped a teensy bit.

Factors behind the drop in late payments include job growth, the recent vintage of many mortgages and the run-up in home prices over the past five years.

synthetik said...


this is interesting too


Irvine,
Calif. – April 25, 2006
– RealtyTrac™ (www.realtytrac.com), the leading
online marketplace for foreclosure properties, today released its 2006 Q1 U.S.
Foreclosure Market Report, which showed that 323,102 properties nationwide
entered some stage of foreclosure in the first quarter of 2006, a 38 percent
increase from the previous quarter and a
!!72 percent year-over-year increase from the
first quarter of 2005!!

The nation’s quarterly foreclosure rate of one new foreclosure for every 358
U.S. households was higher than in any quarter of last year."

mmm, yeah, teensy.

synthetik said...

http://tinyurl.com/hplc6

Charles Schwab Chief Investment Strategist said yesterday....

"the party is over" (duh)

"Housing affordability in free-fall.

New and existing home inventories surging.

Adjustable rate mortgage holders to get pinched.

Real estate now a big chunk of household net worth."


...but that only applies to those other 49 states. It's different here!

biliruben said...

I would love to see historical (the 1990s) inventory numbers as well.

Anybody? Anyone?

I think MLS keeps these pretty close to the vest or they didn't collect them, because I've been looking.

Anonymous said...

This is a problem with Meshugy, a blatant, shameless housing bull cheer leader. Of all the negative news out there, he only selectively picked only the rosy or semi rosy ones, those who are sponsored by or related to the real estate industry. Can he fool someone or just himself?

Anonymous said...

You guys keep qouting price reductions as sign of bad things to come, couldn't those just be a sign of greedy listing agents or sellers? And that sitting on the market for 21 days was a dose of reality and they lowered the house back down to market value?

Pick the most red hot market out there, I couldn't put a house on the market for 50% over market value and expect it to sell.

I'm not saying the party is going to continue, but I wonder if price reductions is more an example of agents hoping somebody gets caught up in the frenzy and throws money at the house regardless of price.

Anonymous said...

Here's a fantasic home sales chart from 1990-present. Too bad it's for Huntsville, Alabama.
http://www.huntsvillealabamausa.com/new_exp/community_data/econ_performance/homesales.html

meshugy said...

I'm not saying the party is going to continue, but I wonder if price reductions is more an example of agents hoping somebody gets caught up in the frenzy and throws money at the house regardless of price.

Exactly!

Anonymous said...

Meshugy, you annoying little Troll! You're whole "What's happening right now!" mantra is what sucks the idiot investor into a whirlpool of financial ruin. Its NOT 'what's happening right now!'... employing that kind of stupid logic, victims on the stern of the Titanic would've claimed the ship was actually 'rising up and not sinking', before it made its final plunge.

Have you no analyitical neurons to fire off? Do you bother reading anything in the business section about interest rates/inflation/ leading economic indicators like the recent dive in builder's stock? Historical paradyms of bubble psycology ala Japan/Florida circa 1929? Or do you just lie to yourself and hit the MLS listings every morning like a junkie hits his needle?

Why don't you start your own blog somewhere... call it Ballard=Pleasantville... Geezus, you're annoying.

matt said...

From the 'Homeowners making fewer late payments article Meshugy's peddling...

Homeowners are making fewer late payments than they were at the end of 2005. They're making more late payments than a year ago, but only because of Hurricane Katrina.

The correct answer is B, according to the Mortgage Bankers Association


Hahahahaha! Mortgage Bankers Association? Ooooh, I trust them! Come on everybody, get in there while the gettin's good! Can you fog a mirror? yes? well we've got a negative amortization loan with your name all over it! Because WE look beyond the numbers!!...

These people are used car dealers in sheeps clothing....

Anonymous said...

I think MLS keeps these pretty close to the vest or they didn't collect them, because I've been looking.

you aren't looking in the right place :)

In May 1998 there were 4,837 New Listings posted. In May 2006, there were 4,130 New Listings. In May 2005, there were 3,914 New Listings. All numbers are for King County only.

meshugy said...

In May 1998 there were 4,837 New Listings posted. In May 2006, there were 4,130 New Listings. In May 2005, there were 3,914 New Listings. All numbers are for King County only.

Where did you get that data?

Thanks!

meshugy said...

When we bought last April, the modus operandi for buyers was:

1) waive inspection (sellers would balk at any offer subject to inspection).

2) overbid with an accelerator clause (usually there were at least 10 other bidders).

I though that maybe some of these practices might have fallen by the way side. Apparently the market is still tight enough to warrant this sort of activity. See:

What’s a buyer to do?

Matt said...

When we bought last April, the modus operandi for buyers was:

1) waive inspection (sellers would balk at any offer subject to inspection).

2) overbid with an accelerator clause (usually there were at least 10 other bidders).


you're a fool Meshugy....

Anonymous said...

that data is from the MLS Statistics section. 1990 through 1999 are in one document whereas years since are separated and presented in a different format.

meshugy said...

you're a fool Meshugy....

Since that time our house has appreciated 75K. Additionally interest rates for a 30yr fixed have jumped from around 5.8% to 6.5%. So far it's been a great investment...and we lucked into a fixed interest rate that is historically close to rock bottom.



For some perspective, check this article from 1986!

SOME MORTAGE RATES BELOW 10%

meshugy said...

that data is from the MLS Statistics section. 1990 through 1999 are in one document whereas years since are separated and presented in a different format.

Can you provide a link?

Anonymous said...

Looks like Meshugy is about to get burned big time on a stupid real estate investment.

He bought April 2005?! Frickin' idiot!

Now he's got @ 50K of UNREALIZED profits?!

Better go out and spend that money NOW Meshugy. By next year this time, it's all going to be gone, and then some.

You stupid fool.

Hope your next novel/ song/whatever hits it big. You're gonna need it.

You've been coming on this list now for months. You're obviously worried about the housing market- terrified in fact.

Instead of taking good advice and looking at real facts provided on this and other blogs and getting out with your money while you still could, you decided to try to single-handedly *stop* the housing meltdown wuith your pablum articles and lies.

Your loss. Jerk.

Eleua said...

I listen to a lot of radio. All my stations have real estate/mortgage account for about 2/3 of their ads.

Yesterday, I heard another one.

Some dude took out a 1% ARM for a 300K loan. His buddy asked about his bad credit, and it was no problem, as his mortgage is less than his rent was. Best of all? The mortgage company didn't need to see any of his paystubs.

WTF?

About two months ago, the 50y mortgage made its advertising blitz.

Then you have the standby "a loan should be no harder than ordering a pizza" nonsense, and my least favorite - Jay Shippley, that doesn't need to "stick it to ya."

OK, tell me this does not end in tears. You have garden variety morons that can get $300K, with no docs, at the top of the market.

Back in '00, I had zero debt, perfect credit, and enough liquid assets to buy my house, in an upscale neighborhood, for cash. My bank of 10 years (where I stashed my cash) would not loan me any money for the house.

Why?

My income didn't match their ratios, and they said I just had a "career change." I went from Naval Aviator to airline pilot, and that constituted a career change.

Now, any idiot can walk out of a bank with 10 years of income in hand for a PNW crap-box.

When this phenomenon ends (and it will), practically nobody will be able to put $30K down on a house. Without that, it will be very difficult to get homes over the $150K range.

Pop some corn, and chill the beer. This is going to be fun to watch

biliruben said...

Hey Anon - I don't really care about 1998. I am interested in the early years so I can look at the inventory during the last down-turn.

Help me out with a link, brother. Thanks.

vpyqan said...

Since that time our house has appreciated 75K.

If you're not a fool, then sell! If you're able to make a living somewhere else, pocket the cash, then move there....

Right now you're just a fool who niavely waved an inspection on the largest asset he owns and bought into an overheated overpriced market....

matt said...

Since that time our house has appreciated 75K.

If you're not a fool, then sell! If you're able to make a living somewhere else, pocket the cash, then move there....

Right now you're just a fool who niavely waved an inspection on the largest asset he owns and bought into an overheated overpriced market....

matt said...

sorry for the repeat, word-verification vp... is not my name

Anonymous said...

CNBC is actually saying "Housing Meltdown" now. MELTDOWN.

But oh yeah, I forgot, this is Seattle, no meltdowns gonna happen here.

Same goes for Phoenix- according to the people there, no meltdowns.

Wonder who CNBC is reffering to when they talk about a housing meltdown?

Eleua said...

Watching all the RE bulls eat their hats will be more fun than watching Aaron Downey.

Daryl Reaugh with the color commentary...

Eleua said...

Wonder who CNBC is reffering to when they talk about a housing meltdown?

Dallas.

meshugy said...

I think it's pretty clear that if you bought in 2005, you're house has appreciated at least 50K. But what is even more interesting is the savings from the lower interest rates of last year.

If you bought a median priced Seattle house in April 2005 (when I bought) you paid $351,750 and got a 30 year fixed for 5.8%. Your final amortization of that loan is $743,004.00. Your monthly payment would be $2063.90

If you bought a median priced Seattle house in May 2006 you paid $415,00 and got a 30 year fixed for 6.5%. Your final amortization of that loan is $1,364,909.71 Your monthly payment would be $2623.08

So those of you who could have bought last Spring but didn't, you now have to pay $621,905.71 more ($559.18 per month more) for the same house you could have bought last year. Wow....that really shows the difference that interest rates make.

So if you divide $621,905.71 by 13 months (that's how long it's been since I bought), every month since April 2005 it cost $47,838.90 per month more to wait to buy. So the combination of rising prices and rising interest rates is costing you $47,838.90 per month to wait.

Anonymous said...

Mesh, you made a good point. If house price was inflated because of low interest, now, it should be deflated because of high interest. This is what all the smart guys and economists are talking about. Take the case of Seattle, where more than 50% took out ARM/IO, etc loans recently. Now, the interest on these loans is up 20-30%, then the amount of “house” these borrowers can afford should go down by 20-30%. Only a fool could not see that the house price should go down 20-30% accordingly, unless your income is increasing by 20-30% to compensate for that.

matt said...

So those of you who could have bought last Spring but didn't, you now have to pay $621,905.71 more ($559.18 per month more) for the same house you could have bought last year.

wow, Meshugy, how's that Realtor KoolAid taste? Too late to buy? Priced out forever?... hmmm...

Those of us that didn't buy last spring actually don't have to pay anything this year... If you were really betting dollars to donuts you would've taken the $1000+ surpllas in cash from renting an equivelant property and bought Gold with it last spring, now you could sell it and pocket %40 profit in little under a year.

Ballard real-estate? specuvestor fever, that and its purely liquid, not tied up in a interest/mainatance/tax sucking entity like an overpriced older home.

So chill the smugness there Meshugy, you're on this blog because you're a sucker for bad news and unfortunately for you, the housing bad news is starting to pile up, its the longterm trends in RE, there is no black tuesday, its not about 'right now'

Anonymous said...

And when rates rise enough, the price of homes will go down and so will your monthly payments.

You will also, with a lower home price, be able to possibly pay your home off and OWN it rather than rent from the bank for a lifetime.

But if you don't feel that way, get out there TODAY and buy a house before interest rates go up again tommorrow.

Anonymous said...

"You're on this blog because you're a sucker for bad news"..

Interesting psychological analysis of M.
You could be right.

Maybe you want to see somebody about that M?

Think about it, instead of driving yourself into a frenzy every day coming here, you could be relaxing and living the good life in Ballard.

Hmmmm.....Make myself nuts or relax and enjoy?

What to do?.... What to do?....

meshugy said...

And when rates rise enough, the price of homes will go down and so will your monthly payments.

I'm wondering how high they'd have to go before prices come down? They've already gone up significantly since last year, when you could get a rate below 6%. By the end of the year you're probably looking at over 7%.

Despite the rising rates, we still have had huge price appreciation. Most of which occurred in the last few months when rates have risin the most. How can you explain that? I think there's simply too much demand in Seattle.

Eleua said...

I remember when there was "too much demand" for Juniper Networks common stock back in '01. That "excess demand" drove JNPR to $244/share in the face of a cratering tech/networking corporate environment.

18 months later, JNPR was selling for $5/share. That's a 98% rollback of an "in demand" stock.

This is going to be loads of Schadenfreude fun. Living in the PNW is going to give me ring-side seats to the Main Event.

Anonymous said...

Think the appreciation has happened here, as in most of the US, because people have remained uninformed about the state of the market.

Now that the true picture is coming to light, watch for the psychology to change.

As Schiller says, when the psychology changes, watch out below!

What went up will come down.

Once people start listening to world economists instead of their local realtor, watch out.

A lot of people still think that their realtor is an "expert" (!).

When they start seeing the realtor and mortgage brokers as crooks, it's all over.

Some consumer group went to WA. DC last week to expose realtors as a cartel of sorts.

The mortgage industry is being blasted daily.

When these people are exposed for what they are, buyers will cease buying.

matt said...

Most of which occurred in the last few months when rates have risin the most. How can you explain that?

Obviously you're a Shiller Ph.d.-phobe, but if you picked 'Irrational Exhuberance 2nd.' he'd clue you into the fact that this is driven by a combination of psycology and refugee-investors from the dot-bomb bust of 2000... and with rising rates this psychology is actually amplified because people, like you, parrot the insane poorly-educated notion that if you don't buy in now, you'll never be able to afford.

Hint: Houeses have always tracked inflation over the long term, why? because people have to be able to buy them.

matt said...

anon 12:59...

As Schiller says, when the psychology changes, watch out below!

exactly!

meshugy said...

June is almost over...we should have the MLS #s in about a week. Wondering what people are expecting? Many folks have been posting reports of price reductions and other gloomy news. Will we see a real slow down this month?

matt said...

Many folks have been posting reports of price reductions and other gloomy news. Will we see a real slow down this month?

Wholly Crap Meshugy? Denial just ain't a river in Egypt. Interesting how you get cornered on a thread, and then like Golem, steal off to your cave and start ruminating on your precious MLS numbers

Anonymous said...

M-

When you were little and went on a family car trip, how soon did you start screaming "Are we there yet?!!!"

I'm guessing about 10 minutes into a 6 hour ride.

Anonymous said...

M-

When you were little and went on a family car trip, how soon did you start screaming "Are we there yet?!!!"

I'm guessing about 10 minutes into a 6 hour ride.

Eleua said...

Hint: Houeses have always tracked inflation over the long term, why? because people have to be able to buy them.

How true. It is so sad that it only takes a very basic education to understand this, but most Amurikunz can't possibly fathom this.

For anyone that thinks this is a "normal" market, ponder this:

Q) Why doesn't every homeowner in the entire PNW just crank up the price of their home to $5M minimum?

A) Easy. No one would be able to buy them. Prices would have to come down to meet the buyers.

The past few years, the toxic loans have given buyers more money than they usually have. This has moved the bar up, and allowed sellers to raise prices. When these loans vanish, and equity disappears like a virgin on prom night, sellers' prices will have to plumb depths to find buyers.

Imagine there's no equity...
It isn't hard to do...
Nothing to bid up homes with..
and no toxic loans too...

Imagine all the people...
Showing income pay stubs...
Saving every penny...
and bypassing airport backrubs...

Anonymous said...

This guy is the best proof of a housing bubble that any town's ever had!

Keep it up Meshugy!

Anonymous said...

Poor Mesh – Would you guys show some mercy for him? His lizard brain (I borrow it from the recent book of an economics professor at Havard - “Mean Markets and Lizard Brains: How to Profit from the New Science of Irrationality”) cannot understand basic economics principles. He can only see a few blocks from his house….

synthetik said...

http://tinyurl.com/oehdd

This is fantastic; from Arizona! bwahahah!

Anonymous said...

Well you don't have to wait for the report. The end-of-month (through today) numbers are up at the Housing Tracker site.

www.benengebreth.org/housingtracker/location/Washington/Seattle/

This month inventory up 9%, median price up .1%

The 3-month trend is inventory up 35%, median price up 3.5%

Ruh-roh.

I do wish this data included # of sales, though. If inventory is up, and sales are down, that's not a good trend for sellers.

biliruben said...

Anon!!!

re: 1990s inventory

I really, really want to see this data.

Could you please provide a link to the data you claim you found the MLS statistics site. I can't find it.

Thanks.

meshugy said...

Well you don't have to wait for the report. The end-of-month (through today) numbers are up at the Housing Tracker site.

That is an interesting site...but is at best only a vague indication of what is going on. The prices are the asking prices, not the sold prices. Since most houses have been going for more then asking, these #s don't tell you much.

We'll have a better idea of the situation when the MLS report comes out next month. That will show what houses really sold for....

marin_explorer said...

This is fantastic; from Arizona! bwahahah!

"Why then are you printing so many negative articles about our real estate market?"

LOL. Is someone worried?

Anonymous said...

'Shugy loved the Benegebreth site til this month when it started showing bad news for Seattle.

What a surprise.

And quit lying about everything going over asking 'Shug. You really have to stop lying to yourself man.

You're gonna give yourself a breakdown. Just don't even pay attention to the housing news from here on in because it's only getting nastier and nastier.

The U. S. Dept. of Treasury is calling Fannie Mae to the carpet for corruption and possibilty of systemic risk.

CA. Assoc. of Realtors is predicting that, if the summer trend there keeps up, by Fall '06 they will have sold fewer houses than at any point in the past 24 years. yes that's 24 years.

When the Assoc. of Realtors says that, it's time to listen, no matter how bullish you are on RE.

The articles are on today's "housing bubble blog", Wed. June 28.

ser said...

According to the Benengebreth site, Seattle prices are right up there with all the other bubble-icious markets:

CA., Boston, Miami, Seattle all ripped from the fundamentals. Check it out. Ripe for a fall.

One of the "interest sensitive" markets that David Lereah was screaching about last week.

Anonymous said...

Hey, 'Sugy - so you're saying that prices are going up and interst rates are going up and the net effect is HUGE even over only a single year?

Well, genius, I guess you havn't thought much about the fact that it's actually the housing bubble that the Fed is targeting. They may want a soft landing instead of a crash but history shows they almost never get it. What's the result? a) first they bust the bubble, prices fall faster than they would like, b) THEN THEY LOWER INTEREST RATES to try to prevent a depression.

SO those who are smart enough to wait a few years will end up with BOTH LOWER PRICES AND LOWER INTEREST RATES. You must be a moron to think that rates will only go up forever! But I should have expected that since that's what you think is going to happen with house prices.

In a couple of years, those with half a brain will end up with lower prices and lower rates (maybe below your beloved 5.x%) and you'll just end up with a house worth less than you bought it for. At least you'll be able to refinance when rates drop lower than your current rate...

Eleua said...

anon 544...

You are so close. The FED can not control mortgage rates. Those rates are set by the open market, and not by gov't fiat.

If the FED were to go on a printing spree (cutting rates, and monatizing bonds), they would flood the market with dollars and cause inflation. Bond purchasers would have to jack up interest rates to cover their inflation risk. This would make the monthly payment more expensive, less affordable, and with a substantially cheaper house.

Borrowers and sellers would both lose, big time. People could pay cash, and make out big time, but they would be burying their money in a static, or deflating asset, in lieu of putting their money into a higher yielding vehicle.

The FED is trapped. They have no way out. Inflate or default. Either route will kill the economy.

They need the Ballard Miracle to happen all across the US.

Anonymous said...

"Many folks have been posting of price reductions and other gloomy news..."

Hey Shuggy, I thought price reductions meant only that "the property was overpriced to begin with"...

When did you start thinking price reductions are "gloomy news"?

Anonymous said...

meshugy
Since most houses have been going for more then asking, these #s don't tell you much.


When the MLS report lists the asking to sales price ratio, does it use the initial asking price or the final asking price, in the case where the price was increased or reduced during the listing period?

Anonymous said...

Tomorrow we get news of the new short term interest rates.

I feel like it's Christmas!

'Night all and sleep tight. Good news tomorrow.

Anonymous said...

I know that this is way off track considering the last 80 comments... But I used to live near Lake Forrest Park. This guy in the article is a moron. You can't compare Mountlake Terrace to Lake Forrest park. He probably mapped them out and saw the close proximity. There are beautiful home throughout LFP but I consider MLT pretty nasty. Rows and rows of post WW2 cinder block houses... Hes going to wish it wasn't as easy as pushing the buy button on a website.

Anonymous said...

Hint: Houses have always tracked inflation over the long term, why? because people have to be able to buy them.

This is not strictly true. Demographic or cultural shifts can change local markets (for example, urban vs. suburban), which can make some sub-markets appreciate at the expense of others. So your long-term returns could be greater or less than the rest of the market.

My other gripe - housing appreciates with wages, not with inflation. Historically, wages appreciate about 1 percent faster than inflation, but real wages have suffered over the last five years. So, strictly speaking, if wages continue to appreciate more slowly than inflation, housing has even further to fall!

Anonymous said...

Anon 10:30-

Yes, I think that's been mentioned in other posts here. Lake Forest City to Mountlake Terrace?!! WTF??!!

Only an outsider would make such a stupid move.

Anonymous said...

Precisely my thoughts.