Friday Open Thread
This is your open thread for today. Please post random links and off-topic discussions here.
Here's a fun thing I discovered yesterday. Check out the results of a Google search for It's a Priority. Nice!
Off-topic comment? Interesting link?
Head over to the forums, or click here for open threads.
Head over to the forums, or click here for open threads.
16 comments:
http://seattlepi.nwsource.com/business/296834_seattlemarket22.html
Friday, December 22, 2006
Seattle a patch of sun in gloomier housing forecast
By AUBREY COHEN
P-I REPORTER
There are many ways to highlight Seattle's divergence from the national housing numbers.
Nationwide, home prices rose 7.7 percent in the third quarter of this year over the same quarter in 2005, the U.S. Office of Federal Housing Enterprise Oversight reported Nov. 30. They increased just 0.9 percent from the second quarter of 2006 -- the lowest quarterly boost since 1998.
But homes in the Seattle-Bellevue-Everett area increased 17.2 percent from a year ago -- ranking 22nd among metro areas nationwide -- and 3.7 percent from the second quarter of 2006.
On Tuesday, analysis and forecasting firm Global Insight reported that the number of overvalued home markets fell from 66 in the second quarter of 2006 to 63 in the third quarter, and the percent of homes deemed overvalued fell from 21 percent to 17 percent during the same period.
Seattle's market was 28.8 percent overvalued in the third quarter of 2006 -- the same as the second quarter and up from 22.3 percent in the third quarter of 2005.
Global Insight bases its analysis on prices, interest rates, household incomes, population density and other factors specific to particular areas.
Meanwhile, the National Association of Realtors and the Mortgage Bankers Association agree that home sales will continue to slow in 2007 nationally, although the National Association of Realtors puts the decline at 2.3 percent, while the Mortgage Bankers Association predicts a drop of 8.1 percent.
Both expect the median price of an existing home to rise by less than 1 percent. The Realtors say the median price of a new home will fall by 0.8 percent, while the bankers say it will rise by 0.7 percent.
Moody's Economy.com, an independent research firm, takes a dark view.
"Odds are high that national house prices will decline in 2007; the first decline in nominal national house prices since the Great Depression," its economists wrote in an October report. According to one of the firm's models, more than 100 of the nation's 379 metropolitan areashave a significant probability of price declines.
But Seattle was not among the markets Moody's expected to decline. In fact, another Moody's analyst wrote in August that the Seattle area wasn't hit as hard by slowing sales for several reasons, chiefly that its excess supply was half the national average. The report predicted the area's strong growth of good jobs would help it "outperform the nation over the forecast horizon."
Just wait for the recession of 2007... Then we will see what the "experts" have to say about strong job growth keeping this area afloat.
Looks like we're seeing a lot of people moving to Washington State:
Growth states: Arizona overtakes Nevada
Washington ranks 12th highest % change: 1.65%
and 7th highest in actual growth (state's population rose by 103,899 in 1 year).
The Next Real Estate Boom
As America makes room for 70 million more people during the next two decades, these supercities represent the biggest long-term business opportunities since the end of World War II. In Oregon and Washington, growth trends see Portland and Seattle merging by 2030 into a single megaregion Lang has dubbed Cascadia.
Wow...maybe it's time to think about buying up some farms around Centralia?
"Wow...maybe it's time to think about buying up some farms around Centralia?"
Good idea. Do it and let us know how they are doing 2 years from now.
Single mega region????? Yeah right, what a bunch of b.s.!
I love people making projections for 2030... I'm still waiting for the flying cars they said we'd have in 2000....
Thought you guys might like this one. I suspect many have already read it.
http://tinyurl.com/yexarg
Maybe I shouldn't post this. It's a depressing indicator that "flipping" is still a profitable venture: Two places that recently sold in my area (near Silverdale):
1700 sq ft "pre-manufactured" home on 1.2 acres. "Built" in 1999. Bedrooms / Bathrooms not listed. Bought in October 2003 for $97,500. Sold in October 2006 for $237,000 after trees were cleared for profit.
2600 sq st ft "rambler" including a 1100 sq ft unfinished / unliveable basement. Built in 1996. 2 Bedrooms / 2 Bathrooms. Bought in March 2004 for $366,000. Sold in October 2006 for $490,000.
Seattle/WA is on the front of Ben's blog today...
http://thehousingbubbleblog.com/?p=2049
Regarding "It's a Priority", there are other ways that government can put stabalizing pressures on housing prices.
For example, we could Raise property taxes to 2-3% and add a large homestead exemption (say $75k-$100k) on which people who actually live in the house pay a lower rate. This gives people who buy houses to live in a market advantage over investors. It means fewer investors enter the market which reduces the chance of a bubble forming. It also means that people have more incentive to sell houses they are not using since their money is being eaten up by taxes.
The unfortunate side of this is that renters get screwed since the properties they are renting do not get the homestead exemption and they have to pay the entire tax amount indirectly through their rent payents.
"The unfortunate side of this is that renters get screwed since the properties they are renting do not get the homestead exemption and they have to pay the entire tax amount indirectly through their rent payents."
...which is why the property tax approach is regressive and unworkable.
There's a much better solution to the problem that would directly punish flippers and other short-term "investors" without hurting the low-income: heavily tax short-term capital gains on real estate.
I'd love to see the tooth-gnashing that would come from that, wouldn't you?
Is it me, or do the rest of you notice that any particular market is in one of the two following conditions:
1. Outperforming (Seattle)
2. Recovering (New Hampshire)
IOW, when it comes to real estate, the market is ALWAYS in a position to go up.
Funny how nobody ever says that a market is ripe for a decline, or is in decline. The bottom is always in - ALWAYS.
One constant remains so far, most economists have not predicted this slowdown in housing. The few that have, are saying it could get much worse. I tend to put my money on them, as they are the only ones that have been right so far.
I read a thread on another forum where the author claimed that CNBC had some "expert" on their show at every 100 points on the way down for the NAZ. At each instance, the "expert" claimed the bottom was in. This happened at 4500, 4400, 4300, etc. The last "expert" claimed the bottom was in at 1000, and the NAZ finally bottomed at 800.
The bottom is always in - even if it isn't. Every child is above average - even when they are not. Every school district is "the best in the state."
'Twas the nightmare before Christmas, when I talked with my spouse
Why weren't we selling the old one before buying the new house??
Suzanne, who had researched all this made me feel like quite louse
St. Joseph was buried in the front yard with care
In hopes that a buyer would soon be there
My child and her dog both snug in her bed
With ideas of the horror that lay ahead
Our tree was bare, no presents to be found
To the subprime loan we were inextricably bound
The realtors and lenders all said I'd feel no pain
That I'd be drinkin' pink champagne but now I'm livin' in black rain
I finally came to realize I'd been hit by the equity train
Happy Holidays!! ;)
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