King County Foreclosures Up 27% YOY
Couched in the mind-numbing bubbly language of a press release from Default Research comes this tidbit of information:
"Foreclosures increased by 27 percent in the Seattle area. That is an increase from this time last year," said Serdar Bankaci, president/CEO of Default Research Inc.Cue the "but we're coming off of historic lows!" nonsense in 3... 2... 1...
P.S. (Does anyone know where to find historic foreclosure / default data for King County? I've had no luck locating a source for such data beyond the occasional press release like this one.)
(Default Research, PRNewswire, 04.11.2007)
43 comments:
Tim, you always leave out the best part!
"Foreclosures are
on the rise, but Seattle is still a very strong real estate market and has
avoided the nationwide real estate downfall."
In fact, while much of the country focuses its attention on the recent
sub-prime mortgage controversy, King, Pierce and Snohomish counties have
experienced real estate growth and are still strong markets for investing.
According to Bankaci, ever since the tech boom in the 1990's, many
people have been attracted to those counties in Washington State because of
the strong job growth, which continues today while much of the country is
seeing job growth and home prices drop.
Hook, line, and sinker!
One point for Tim
You can get a rough estimate by looking at "NOTICE OF TRUSTEE SALE" in King County records. Prior to 2002, the monthly average was around 150. After 2002, it moved closer to 250 a month.
P.S. (Does anyone know where to find historic foreclosure / default data for King County? I've had no luck locating a source for such data beyond the occasional press release like this one.)
Tim -
Here's some 2006 Seattle MSA data. PR only, but RealtyTrac may have more if you dig
ever since the tech boom in the 1990's, many
people have been attracted to those counties in Washington State because of
the strong job growth, which continues today
Too bad that's not in line with what actually happened. Total employment didn't reach 2000 levels until 5 years later. Maybe he meant "job growth continues today despite taking a 5 year nap"?
This isn't historic, but still interesting:
A 72% YOY increase in Notice of Trustee Sales in our county from 04/1/2006 to 4/10/2006 and 04/1/2007 to 04/10/2007. Of course, such a short time span can't be statistically significant. Let's look at some slightly longer terms for now and same time last year:
Over the past 6 months: 11.7% increase in Notice of Trustee Sales from same term in 2005-2006.
Over the past 3 months: 12.7% increase in Notice of Trustee Sales from same term in 2006.
Over the past 30 days: 35% increase in Notice of Trustee Sales from same term in 2006.
Well...
Before anyone gets too wound up about this, note the completely non-sensical statement at the bottom of this POS press release
"Home prices have continued to rise in Seattle making it more difficult
for real estate investors to buy the properties and to make a profit," said
Bankaci. "With our leads, real estate owners are able to acquire homes at
below market value and homeowners in economic distress also are spared the
embarrassment of going through a foreclosure."
Ok, so let me get this straight.. Home prices are going up, which makes it hard for investors to make money. Run that by me again? Do they do better if they fall?
Based on that one, I think I'd double check their math!
One point for Tim
He's gonna need it...he's 69,950 points behind. That's the amount King County prices have gone up since he started this blog in Aug 2005. Ouch....
King County Median Aug 2005: $385,000
King County Median March 2007: $454,950
"Foreclosures are on the rise, but..."
But nothing. There is no way to put a positive spin on this FACT. It's only the cocksure chowderheads like meshugy who buy into the "but it's special here" mantra.
"...King, Pierce and Snohomish counties have
experienced real estate growth and are still strong markets for investing."
LMFAO. Yeah, bring your cash and sink it into Tacoma real estate. Grand idea. People are f***ing stupid. And SFR's are NEVER investments if they don't cash flow.
It's pointless to argue with the myopic rhetoric of meshugy. Like the rest of the flock, he's not capable of seeing the cliff ahead. Even as his cohorts sail off into the abyss, he ignores their loud bleating and happily joins them.
Foreclosure... such an embarrasing problem. Nothing more.
He's gonna need it...he's 69,950 points behind.
I'm quite certain you will give him that many chances
It seems Default Research's income is derived from people researching foreclosed properties to buy as investments. The success of their product depends on potential investors believing that real estate will not depreciate. Their opinion / analysis would hardly be objective with respect to predicting future market trends.
"Home prices have continued to rise in Seattle making it more difficult
for real estate investors to buy the properties and to make a profit," said
Bankaci. "With our leads, real estate owners are able to acquire homes at
below market value and homeowners in economic distress also are spared the
embarrassment of going through a foreclosure."
Default Research is the national leader in real estate research. More
information about Default Research can be found at their website:
He's gonna need it...he's 69,950 points behind. That's the amount King County prices have gone up since he started this blog in Aug 2005. Ouch....
Yeah, that is 15%. Half way there, shugy.
Can't those with ARMs refinance their mortgages with a new ARM? I am not familiar with the rules
Can't those with ARMs refinance their mortgages with a new ARM? I am not familiar with the rules
I believe the problem here is (1) the closing costs associated with refinancing, (2) the current value of the home and whether or not the owner has positive/negative equity (negative equity = deep doo doo), and (3) whether or not the owner can actually afford a fully-amortizing fixed-rate mortgage payment.
Sorry -- ignore point three for acquiring new teaser-rate loans. Those animals are simply becoming extinct.
Plus teaser-rate loans usually have early-payment penalties which would prevent chaining into a new one.
Guess what NAR is saying-
Home prices are set to drop first time in 40 years!!!
http://money.cnn.com/2007/04/11/news/economy/home_prices/index.htm?postversion=2007041111
hope we can get this message across to our real estate cheerleaders.
Don't bother in Seattle Tom. It won't happen here. As a matter of fact, Seattle home prices will increase so much, it will actually skew the national average so that there will be no drop in prices, statistically across the nation.
confused? - I will do the math for you, as its 18.2% not 15%...just wanted to clarify it for the record.
[(454,950-385,000)/385,000] = 18.2%
What did you mean by half way there?
Shug - Why did you change the password on your account? It wont let me log in as you anymore to post.
Ok, this will be said one more time, Because the median rises by 69,000 in two years, in no way, metaphorically, realistically, statistically or any ...lly way means that an individual home's value increases by that same amount. The fact that Farceguru and Shrug don't even come close to "getting it" is the reason they are laughing stocks.
Don't use medians, use Case-Shiller. It's amazingly close to the median:
Aug 2005 Seattle: 156.61
Most recent 2007: 183.92
Increase: 17.4%
Very funny video;
New strategy to sell your overpriced home – use pheromones!
Colbert Report
I’m having trouble making the link work, so here is how to navigate to video
Comedy Central
Colbert Report
Most Recent Videos
Bears and Balls; Home
T,V & Mr.B - I truly do get it, yet often over dramatize things to play devils advocate and to get people thinking. The mortgage market is slowing dramatically and will most likely cause some pain in this region, yet it will be more moderate than many areas that had twice the appreciation we did…
The good news for the Northwest is that prices didn’t really start appreciating until 2003/2004 when most of the rest of the nation started back in 2001/2002. Thus we are on the tail end of the wagon. Once the problem becomes more pertinent the FED will eventually start to lower rates (which will help to alleviate the problem to a small degree, as every little bit helps). This region has a lower percentage of sub-prime loans and Alt-A loans than other overheated markets that went up at least as much as us or significantly more than Seattle…which means more prime loans, and should prevent as more foreclosures on a percentage basis than we would have ended up with in markets that had looser standards. Im not in anyway stating that there isn’t problems...
The other issue of appt rents in Seattle increasing by 7% YOY also is a good sign for owners…as it is a minor positive contribution but every little + helps.
The Tim was right, rental rates did not increase at 8.5%, it was actually 7% over the past year (for apartments)…as they were talking about a smaller segment of the market, yet does show that different rental properties rent are going up at different rates. Not sure what SFR rent increases are at though.
Sorry about previous post - way off topic of foreclosures. I should have posted on open thread.
I just got my daily missive from RedFin on Capitol Hill listings. Looks like they dropped the price again on the townhome I had under contract. I'm another $20k ahead in my decision not to buy. Price has now dropped to $475k from $530k.
That's $55k equity saved, real money in my pocket. plus what I have saved in rent vs. mortgage.
The median price can indeed be an irrelevant statistic.
That's $55k equity saved, real money in my pocket. plus what I have saved in rent vs. mortgage.
If you look at what the total cost of financing that $55K over the life of the loan would have been, it's a lot more than that!
It might even be $69,950!!!
FinanceGuru said... This region has a lower percentage of sub-prime loans and Alt-A loans than other overheated markets
Most of the subprime loans aren't in overheated markets. They're in depressed areas with large disenfranchised popluations, largely minorities. That's where subprime lending got its start, by giving people a way out of poverty.
The subprime loans that are performing poorly are those issued since Q1 2006 - What % of loans issued in Seattle since then were subprime?
Seattle is a ripe market for Alt-A loans. We may not be near the 80% seen in some other cities, but there's no evidence that Seattle is below the national average, just based on local home buyers preference for option arms.
Still waiting on some decent stats on alt-a, but any area where incomes have fallen as prices have increased is bound to have a higher percentage of alt-a loans to bridge the affordability gap.
Finance,"Once the problem becomes more pertinent the FED will eventually start to lower rates (which will help to alleviate the problem to a small degree, as every little bit helps)"
the Fed neither will, nor can lower rates. Their primary fiduciary responsibility is to the value of the dollar. period. they are stuck. Stagflation is just around the conrner if not already underway. they cannot boost the economy by lowering rates, as that will cause more inflation, they can't raise the rates to tide inflation, thereby causing the economy to wallow.
They know that, many economists know that, they just can't say it publicly, as it would create a greater lapse in confidence in consumer spending.
"This region has a lower percentage of sub-prime loans and Alt-A loans than other overheated markets"
Frankly, No it doesn't. Alt-A loans make up a VERY large portion of loans over the last few years. I believe that conversation has already taken place, but you have chosen to ignore it.
I am glad that you realize there is a problem. My problem with you and Shrug is that you keep saying with glee how much house values are increasing , and then you turn around and say there isn't a problem here because house values haven't risen so much. And then you, Mr.FG, come up with some inane rant that really does not compliment any knowledge you pertain to have by your moniker.
Mike - You are correct! Seattle has more Alt-A loans than the national avg, however not as high percentage as other superheated markets do.
From previous posts I remember that Subprime loans make up ~8.5% in the Seattle market and ~8% of those are in default...people just probably forgot to pay their bill for a few months, like losing your keys or checkbook, jk.
Subprime & Alt-A (all non-prime loans) made up ~39% of all loans made in 2006 (based on a prior recent post)...which will probably poise a problem, yet not as dramatic as some markets.
Finance-
No, it would be 15% on the way down. 69,500/454,950 =15%. March 07 would be the denominator when comparing future pricing in that scenario. I was just trying to put into percentages. They work a lot faster in reverse, almost 2 years of appreciation or 69,950. That would all be erased by a 15% decline from a median point of 454,950. I have a degree in Finance too and past the CPA and past my securities license;)
The best source for this data I have seen is this CSFB Report
The only Alt-A category where Seattle shows up as in the top 12 is in IO and Neg-AM loans (ex 31). At 33%, we are 10 points higher than the national average and one point lower than Phoenix.
I've also seen that we are way above the national average in ARMs but I can't remember where that was from.
Subprime is not really an issue in Seattle directly - though I think we will be affected by tightening of credit availablity. That one is going to lower all boats, as "all real estate is local" but financing is not...
Confused -
I'm hoping you passed the CPA, in the past
deejayoh-
Yeah, very good at math not so at spelling. Good catch, at least I was consistent.
More Homes Flooding Bay Area Housing Market
(CBS 5) OAKLAND A new survey by ZipRealty shows Bay Area home listings jumped at one of the nation's highest rates.
Investors are placing properties on the market, trying to sell them before the busy summer selling season. And more homeowners, desperate to avoid foreclosure are placing their homes up for short-sale meaning they are being sold for less than the mortgage.
Don't worry, Seattle, the Bay Area isn't as special as you are.
Yah, Seattle is so special. Home town heros Boeing and Microsoft are rolling up sleeves moving people here from all over the world. Startups are flocking from Bay Area to Puget Sound. Seattle housing price will hit that of the Valley in no time.
The thing every hard working rational person fears the most appears to be starting : BAILOUT. How long do we need to "quick fix" every macroeconomics mistake we make?
Write your congress-person that this will only exacerbate housing problems.
http://www.msnbc.msn.com/id/18059004/
If congress is stupid enough to print more money to bail out loan companies (that's where the money is going to ultimately),I am going to move my money out of HSBC Online Saving and invest in PM ETF. PS, I take 124th from Kirkland to Microsoft everyday, lost count of all the for sales signs. It must be selling season. I drop by this place to take a look as well, it's nice, but $800k! Really? Who buy these houses? http://www.cottagecompany.com/ccConover2.html
He's gonna need it...he's 69,950 points behind. That's the amount King County prices have gone up since he started this blog in Aug 2005. Ouch....
I will respond to that.
Michael, you are so ridiculously petty that it would be funny if it weren't so sad. I derive my self worth from a host of things, and although I am very happy with my living situation, it is not one of those things. If imaginary profits on a home you don't intend to sell are what keep you going, then good for you.
However, you should know that I couldn't possibly care less about your opinion on the matter, or how many "points" behind you believe I am.
I'm done responding to your petty jabs and misleading garbage.
I'm done responding to your petty jabs and misleading garbage.
Amen brutha!! I've already started the Boycott the Troll campaign, need some kind of online petition,
e.g. "The following signees pledge not to feed the Trolls, Troll-feeding is like pidgeon feeding, the more you feed them, the more doodoo you have to wipe off your car in the morning."
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