HouseMath 2.0 - Lending Woes - News

I've received a few e-mails over the past holiday season, some asking if I disappeared. Yes, I read this and many other Blogs every week. I'm not hibernating. So here's what's up:

When people decide it's time to buy in the market this is a cool tool to use.

May I introduce the HouseMath 2.0 website. Last week, I e-mailed Kerill Sheynkman, the wizard behind this tool, if I could get his permission to blog about it. Some may have already seen the introduction to this over at Zillow Blog, but for those who haven't seen it I would encourage you to spend a few minutes to familiarize yourself with this great resource.

When you hit the "Analzye " button, your presumptions come to life. Please don't make fun of the $315,000 sales price for a home in Seattle that I used, it's for illustration only.

Below is a screenshot of financial analysis tools such as creating your reports in .PDF format.

Interestingly, Kerill Shenkyman resides in New York and has previous working relationship ties to Glenn Kelman over at RedFin. Small world. 2007 is going to be a great year in the innovation of real estate tools and Web 2.0 blog arena.

Lenders are scrutinizing loans

One of the perks of being in real estate is that I enjoy discussing issues with the people who are actually conducting business. It encompasses a large sphere: from builders, to Ardell and loan officers.

A lot of discussion is taking place about lending right now and the struggles of the sub-prime market. Seems like the tune out there is changing quite a bit. Inman News has a lot on the plate this morning (check it out quickly before the articles go subscription).

From Inman News:

Bernice Ross on "The demise of the housing ATM"
Bradley Inman on "The subprime tsunami"
Mortgage Lenders Network being shut down (evidently failing to fund on 1,409 loans across the country)

I spoke with a couple loan officers early this week and the responses were that lenders were scrutinizing transactions more. For example, one broker mentioned that an underwriter actually dropped the value of an appraisal from x amount to x amount and required that interior photos be taken along with obtaining two new comp's (comparable homes). In another example, funding conditions came back with more hoops to jump through in terms of actually verifying borrower deposits and funds to close.

Stuff

Before I forget, check out ShackPrices new mapping tools. Packed with innovative features. I had the pleasure of briefly meeting Galen Ward, the wizard behind this great tool at a function a few weeks ago. I look forward to them rolling out some new features that are coming soon.

- S-Crow

Does Job Growth = Home Buying Demand?

An article in the Times yesterday about the Puget Sound's job recovery following the dot-com bust got me thinking again about the oft-claimed jobs to home prices correlation. The usual assertion goes something like this: "Prices are justified because our economy is strong (i.e. - lots of jobs), and as long as we keep adding more jobs, home prices will not stop increasing, because more jobs equals more demand." It's certainly a comforting belief for inflated housing enthusiasts to hold when the local job situation is on an upswing:

Even though it ended on a somewhat muted note, 2006 was still the best year for job creation in Washington in nearly a decade, according to figures released Tuesday by the state Employment Security Department.

The state averaged nearly 2.87 million nonfarm payroll jobs last year, a gain of 3.2 percent, or 91,500 jobs, over 2005's average. That was the most nonfarm jobs added in a year since 1997, when 98,600 were created.

The year-end figures also show that 2006 conclusively marked the Puget Sound region's full recovery, in terms of total jobs, from the dot-com collapse and subsequent recession of the early 2000s.

The article included a nice graph showing the number of jobs in the four-county region since 2000. It has been well demonstrated in other markets that job growth or loss does not directly relate to home prices, but I thought it would be interesting to compare the Seattle Times graph with some data from the Seattle Bubble spreadsheet to see how well the more jobs = more demand = rising prices claim has held up in King County over the last five or six years. To obtain data about the number of jobs in King County I went to Workforce Explorer, the source cited in the Times article.

First I present you with the graph that comes closest to supporting the view that jobs are the primary source of demand.

Click to enlarge

When you compare the percent change year-over-year in both the number of jobs and the median (residential only) home price, the curves actually almost line up, with both job and home price changes being increasingly positive from about early 2003 to the end of 2005. However, the total change in home price increases during that time went from +7.3% to +20.0%, while the total change in jobs went from -1.9% to +2.3%. Despite the similar curves, I think it would be difficult to argue that such a slight change in the job situation drove the major price increases seen over the same period.

Here is same data presented in a slightly different way:

Click to enlarge

At the end of 2006 there were roughly 4% more jobs in King County than January 2000, yet home prices had increased a whopping 85%. I'd like to hear the logic that tries to argue that such a paltry increase in jobs will cause that large of a price increase in homes.

Now let's take a look at home sales. Supposedly the improving job situation is driving demand, and demand is measured by sales, so let's see how the two compare.

Click to enlarge

Hmm. It would appear that sales were experiencing the strongest growth during a time when the number of jobs was actually declining. In the summer of 2003 sales were up by as much as 45% over 2002, and yet the job market was still declining by roughly 1.5%.

Looking at the raw numbers of jobs versus sales the disparity becomes even more clear:

Click to enlarge

If jobs are supposed to drive demand, why is it that once the number of jobs began to increase in early 2004, sales actually leveled off? And why have sales been dropping off so steeply in the last year despite what the Times reports as "the best year for job creation in Washington in nearly a decade"? Could it be, perhaps, that the number of home sales and prices of sold homes in fact have very little to do with the number of jobs in a region?

I challenge anyone out there that still believes more jobs = more demand = rising prices to show me the data that supports any sort of correlation between those data sets. Lacking that, I hope we can finally put this dead argument to rest.

All of the above graphs—and the data behind them—can be downloaded in Excel format.

(Drew DeSilver, Seattle Times, 01.17.2007)
(Workforce Explorer, Industry Employment: Historical Series, 01.2007)

Slowing Condo Market? Not Here! Not Here!

The New York Times yesterday ran a story about the struggling condo market in many parts of the country, and with as much attention as it received, you just knew the local news couldn't let it go unanswered. Enter Aubrey Cohen of the Seattle P-I with Seattle bucks trend on slumping condos.

Seattle's market was not to blame for a recent decision to change a planned 34-story downtown building from condominiums to apartments.

Rather, the slumping condo markets in cities such as Washington, D.C., Las Vegas, Miami and Boston affected the national firms that fund such buildings, said John Schwartz, northwest regional director of Keller CMS, which is managing the Terry Avenue Apartments project.

"There was quite a bit of skittishness," he said. "I think the Seattle market clearly has a little different story to tell, but a lot of the big equity players, they take a wider view."

The frenzied condo market in many cities has collapsed since the middle of 2006, dragging down prices and scuttling projects -- or at least forcing them to change, according to a New York Times report Tuesday.
...
Seattle's housing market has fared better than those in other parts of the country in recent months, with continued year-over-year price increases, despite increasing inventory and falling sales, according to the Northwest Multiple Listing Service. The area's condo market, meanwhile, has been stronger than the market for other types of homes.

Seattle real estate professionals and economists agree that the city's job creation, relative lack of speculators and the fact that its boom never rose as high as other places kept its housing market healthy.
...
A Boston real estate consultant cited about 600 condo projects in the city's metropolitan area, with about 49,000 units in various stages of development, according to the Times story. Seattle has fewer than 9,000 condos in the works, according to Williams Marketing Vice President Warren Ballard.

"We don't have anywhere near the volume of construction that some other markets have," Ballard said. "You cannot go anywhere in Seattle and find a finished, brand-new condo to buy."

Really? I guess Mr. Ballard hasn't bothered reading Urbnlivn lately, where Matt has been tracking dozens of condos coming (and sometimes sitting around) on the MLS.

Let's see how this article holds up to the standard "our market is magically stronger than all others" type of article. Prominent mention of continued appreciation: check. Citing job growth as keeping housing strong: check. Un-supported claim of fewer speculator purchases than elsewhere: check. Looks like we've got all the makings of the classic Seattle real estate fluff piece.

Plus, as a bonus, Mr. Cohen threw in the odd comparison of the Boston "metropolitan area" (population 4.4 million) with just "Seattle" (population <600,000). So the Boston metro area has seven times the population and five times as many condo projects as the city of Seattle. Go figure. Also, it is made apparent later in the article that the 9,000 condos figure doesn't include apartment conversions, which numbered 7,000 (this time in the entire Seattle metro area) just last year.

In any case, direct numerical comparisons with other markets seems rather pointless to me. What really matters is whether there are more condos coming online in the next few years than there is demand. Maybe demand for condos in Seattle is just a lot lower than other cities, and 9,000 will push us over the edge. Who knows? It's not like we can count on Aubrey Cohen to actually do some serious investigative reporting on condo demand.

(Aubrey Cohen, Seattle P-I, 01.17.2007)

Update: Over at Seattlest, Michael van Baker compares Cohen's reporting to the Titanic's claim of being "unsinkable."
Meanwhile, condo enthusiast Matt Goyer of Urbnlivn says that "this article is just a little too go-go-go, even for me."

Who's Buying Condos in Kirkland?

We're used to hearing unsupported claims that "young professionals" and "empty-nesters" are providing the bulk of the demand for condos. Well, finally we have a first-hand account of who's actually buying condos (in downtown Kirkland, anyway).

Amie Lynn is the community sales manager for Miller Condominium Marketing, which recently opened The Boulevard, a 119-unit condo building at 598 Central Way, and 128onState, a 124-unit building at 128 State St.

She said most of the two-bedroom condominiums — which make up about a third of the stock — sell to empty-nesters who are downsizing into smaller, lower-maintenance places in more urban areas.

"They can afford the higher price points because they had great appreciation in their last house," Lynn said. "More and more people want to spend their weekends not maintaining a home. They want to enjoy what the city has to offer."

Retirees, too, have purchased condos downtown as second homes, Lynn said. They winter in California or Arizona and come back to Kirkland in the summer to visit old friends and family.

The remaining studios and one-bedroom condos go to single people ranging in age from their 20s to their 50s, Lynn said, though the majority are in their 30s.

So it sounds like "young professionals" are in the minority in Kirkland. I can't say I'm surprised that "most" of the condos are selling to people that are actually downgrading their home. When prices spiral upward out of control like they have lately, young people have a hard time buying, and existing homeowners looking to upgrade find that they can't even afford to trade up.

What's not springing up downtown are young families — the condominium units that are big enough for couples with children are typically more expensive than they can afford. But Lynn said that's something that could be changing over the next decade.

Whoops! Looks like the writer let a little bit of truth slip in there. Maybe they figure that they can get away with implying that prices might actually be headed down soon because the King County Journal hasn't got anything to lose.

(Erica Hall, King County Journal, 01.15.2007)

Where did the "Open Threads" go?

In an effort to de-clutter the front page, I have modified the dates on all "Open Thread" posts to 25 years prior to their real post date. Open threads will still be posted regularly, but in order to find them you'll need to click the open threads link at the top of the page, or browse the archives at the bottom of the sidebar for posts with dates in the 80's.

Anecdote: Reloaded

Many of you may remember the million-dollar new construction that I've been following since June of last year. Recall that it was originally listed at $1,625,000, has seen four separate price reductions (down to $1,275,000—28% off), and was most recently re-listed with a new brokerage and a shiny new description.

About a year ago I posted about a warning the NWMLS had posted to local agents. Here's the heart of it:

You may not cancel and relist a property, even with a new listing agreement and new listing input sheets, unless there is a material change to the listing (e.g., a significant change in the price of the property, a remodel, a change in zoning, or a change in ownership).

What does this have to do with the listing in question? Well, after fifty more days of apparently zero interest in this increasingly stale listing (240 cumulative days on the market), the listing agent—one Miss Sarah L. Reed of RE/MAX—has apparently decided that the new year is a good time to generate some fresh interest in the property by brazenly violating NWMLS rules.

Old price: $1,275,000. Old description:

A warm & elegant tribute to the distinctive northwest craftsman lifestyle! New majestic custom home on over 3 peaceful, close-in acres w/equestrian opp. Featuring glistening hardwoods in sun-filled rooms, arched doorways, library, slab granite, state of the art stainless steel gourmet kitchen-6 burner viking. Open & flowing w/soaring ceilings, greatroom, dining, family~bonus designed for entertaining. Showcase master suite retreat w/fplc, spa bath, dual closets. Caretaker-nanny-ext.Family wing.

"New" price: $1,275,000. "New" description:

A warm & elegant tribute to the distinctive northwest craftsman lifestyle! New majestic custom home on over 3 peaceful, close-in acres w/equestrian opp. Featuring glistening hardwoods in sun-filled rooms, arched doorways, library, slab granite, state of the art stainless steel gourmet kitchen-6 burner viking. Open & flowing w/soaring ceilings, greatroom, dining, family~bonus designed for entertaining. Showcase master suite retreat w/fplc, spa bath, dual closets. Caretaker-nanny-ext.Family wing.

You can also see (if you have a ZipRealty account) that the pictures are identical between the old and new listings.

I'm just an unsophisticated blogger, not a real estate professional, but it sure doesn't look to me like there has been a "material change to the listing." Tsk, tsk Ms. Reed.

Seeing something like this almost exactly one year after posting about the NWMLS warning leads me to wonder whether January is perhaps a particularly popular month to violate the NWMLS rules regarding re-listing properties.

Update: Be sure to see Sarah Reed's response to this post.

Prices Unleavened in 2007?

So what's in store for the Seattle housing market in 2007? Everyone's got an opinion, and yours truly is no exception. But before I get into my guesses, let's review the predictions of local "experts" that have been trumpeted in the media in the last few weeks.

From a December 22nd P-I article:

"I think very easily by spring this could be an extremely strong real estate market," said Bill Riss, chief executive of Coldwell Banker Bain, in Seattle. He said he was planning on home prices going up an average of about 10 percent in the coming year and about the same number of homes to be sold next year as in 2006.

Analysts say strong job growth will continue to drive demand in the area.

"Really, the driver of the housing costs is demand, which is fueled by jobs," said Randy Bannecker, a consultant housing specialist for the Seattle-King County Association of Realtors. He predicted year-over-year price increases would be 6 percent to 10 percent in 2007.

[WCRER Director Glenn] Crellin predicted slight declines in activity in 2007 and year-over-year price increases that would be down around 3 percent to 5 percent by the end of next year.

Matthew Gardner, a local land-use economist, predicted activity would slow from recent highs and price increases would settle to 7 percent to 9 percent in Seattle and 5 percent to 7 percent in rural areas farther from jobs.

Don't forget Ms. Rhodes' preferred vision, discussed here earlier.

What will 2007 bring? Here's what Seattle real-estate experts are saying.
...
[Seattle real-estate economist Matthew Gardner] expects closer-in areas to appreciate about 10 percent over the coming year; farther out, 7 percent appreciation will be more the norm for single-family homes and for condominiums.

And of course I have to mention the outlier in the bunch, from Saturday's P-I:

Michael Simonsen, chief executive of Altos Research, in Palo Alto, Calif., has noticed cooling in the Seattle home market.
...
Simonsen predicted that Seattle would start seeing slight year-over-year price declines this spring or summer, although he said the city had a strong economy, and its housing market would fare better than outlying areas.

So the general consensus among the media's preferred "experts" seems to be a fairly optimistic +7—10% to the median price in 2007, thanks to "jobs." Granted, median price doesn't give us a very complete market picture, but it's the best metric we've got.

As far as the jobs argument goes, I believe it is a false hope to think that as long as the sheer number of jobs is increasing, housing prices will also increase. It is true that a large drop in employment will usually lead to a housing downturn, but housing can decline despite a strong job market. For evidence of this, see Rich Toscano's investigation of San Diego's housing market in the 1990s. Of course I'm sure that the local housing bulls would retort that San Diego didn't have Boeing and Microsoft.

Before I tell you what I think is in store for 2007, let's take a look at what I guessed back in April about the remainder of 2006:

In most parts of King County appreciation slows to a crawl through the end of the year. The closer to Seattle you get, the more stagnant the appreciation. Near the end of summer and into fall, inventory begins to build slightly. Realtors and newspapers proudly proclaim a "soft landing."

"Appreciation slows to a crawl" was clearly incorrect. Appreciation did indeed slow to 12% YOY county-wide and 10% in Seattle (pdf, page 2), but that's hardly "to a crawl." I think prices were held a bit higher than I expected thanks to the unexpected drop in mortgage interest rates. My call on inventory was spot on, with active listings up 20-30% YOY the last three months of the year, and as evidenced by the newspaper quotes above, the press is definitely still pretty optimistic about the market.

Here's my 2007 prediction from April:

Inventory stacks up at an increasing pace, prices are level in some areas, slightly declining in others. By the end of the year, prices in some areas are approaching 2004 levels. Realtors still in denial.

With inventory already increasing over 20% YOY, it will be hard to increase the pace, but certainly possible. I expect to see active listings at least 15% over 2006 levels for the first half of the year. During the same time, I expect sales will decline at least 5-10% from 2006, dropping back to levels last seen in 2002 or 2003.

As far as the median price goes, I doubt that it will be "approaching 2004 levels." That would be a roughly 25% drop from today's price, which is highly unlikely save for some sort of scenario that includes a major natural disaster. More realistically, I guess that the King County "residential" median price at the end of this year will be between five percent down ($418,000) and three percent up ($453,200).

I expect we'll see more toward the low end if interest rates begin to edge upward again, lending standards are actually tightened a bit, and the local economy moderates. If interest rates hold steady or drop, new even-more "creative" financing is brought to market, and the economy goes gangbusters, we'll probably end up at the high end.

Maybe the "experts" are right and prices will go up another ten percent this year. Maybe I am underestimating the willingness of Seattle homebuyers to jump into greater and greater debt for an unchanging product. No doubt they've already demonstrated themselves to be far more willing than I ever would have guessed. However, as the real estate party winds down around the country, I have yet to hear any good, well-thought-out reasons ("Microsoft and Boeing" doesn't count) that we will escape the slow landslide.

Whatever happens, most of the action will probably take place March through May, so we'll most likely have a pretty good idea by June where we'll be in December.

So what are your predictions (and the reasons behind them) for 2007?

(Aubrey Cohen, Seattle P-I, 12.22.2006)
(Elizabeth Rhodes, Seattle Times, 12.30.2006)
(Aubrey Cohen, Seattle P-I, 01.06.2007)

Local Builders Offering More Incentives?

In a Lynnwood Journal puff piece that reads more like a sales ad than a news article I found these interesting anecdotes:

Local lenders, such as Golf Savings Bank, are offering incentives, such as $1,000 off closing costs for certain new home communities, like Edmonds Cascade Cottages.

And local developers, such as Puget Sound Homes of Everett, are extending generous buyer's incentives for purchases of homes into January, to spur sales activity during a typical slower time of the year. However, as the market heats up again after the 15th of January, these buyer's incentives may go away.

Realtor Rick Horst, from the Everett office of Windermere Real Estate, represents Puget Sound Homes and Bellrose, a community of 28 single family homes located at the north end of Mill Creek. According to Horst, buyers at Bellrose can choose between a 2007 Ford Mustang, with a $23,000 MSRP, a $17,000 buyer bonus for use in closing costs and/or down payment, or having their first six months worth of mortgage payments paid by the developer.
...
One example of this [builder incentives] is the Acadia community of homes in Silver Lake, currently being offered for presale through John L. Scott Real Estate. Listing Agent Paula Hovander believes builder D R Horton will extend some portion of the buyer bonus offered in December, when the presale campaign was launched for their community of 36 single family homes. A total of seven homes were sold in December, with a $10,000 buyer bonus offered through DHI mortgage as an incentive to quick start presale activity.

Aren't these the kind of things that builders do when they are having a hard time selling at current prices? If the local housing market is as "healthy" as some would have us believe, why would homebuilders be resorting to bribes to get people to purchase new homes? Not having been shopping for a hew home lately I couldn't say how common this is becoming, but the fact that it's happening at all is still more evidence that things are slowing around here.

I kind of wish that we had a local blog that followed new single-family homes the way that Matt over at Urbnlivn follows condos. It would certainly help give us a better idea of how much the market is softening.

(Jolene Anderson, Lynnwood Journal, 01.08.2007)

Lending News: Washington State Cracks Down?

A pair of articles printed Saturday in the Seattle Times show some slight tightening of lending practices in our state.

Nineteen states, including Washington, and the District of Columbia have moved quickly to warn state-regulated lenders about the hazards to consumers from nontraditional mortgages.

Tens of thousands of state-licensed lenders and mortgage brokers are affected by the advisories, also known as a "guidance."

Such loans include interest-only mortgages and other arrangements where the borrower cuts monthly costs by paying back less than full interest and nothing toward principal.

The states are following closely behind federal banking regulators, who issued a sternly worded advisory in late September to the lenders they supervise, telling them they should not make these loans to borrowers who may be unable to repay them.
...
In 2003, just 10.6 percent of new loans tracked by First American LoanPerformance, a San Francisco-based real-estate information service, were nontraditional mortgages. But during the first nine months of 2006, about 34.1 percent of borrowers used these loans to buy or refinance homes.
...
Many economists now say the surge in these loans contributed to the real-estate boom of the past few years. Regions that had the highest rates of nontraditional lending were those areas where housing prices rose most quickly.
...
In Washington State, where the Department of Financial Institutions sent out its warning about three weeks ago, the guidance covers 1,767 mortgage brokers and 356 consumer-loan companies.

Not being in the mortgage lending business myself, I am not qualified to comment on whether the new "warning" will actually slow the spread of suicide lending. Hopefully potential home debtors will at least be better informed about what they're potentially getting themselves into with the more dangerous loans.

The second article deals with who is allowed to work as a loan officer in our state.

Until this month, virtually anyone could work in Washington as a loan officer for a mortgage broker — even convicted felons whose job gave them access to borrowers' most sensitive financial information.

But a new day has dawned, and it's mortgage brokers who pushed for the change.

A new state law, which went into effect Jan. 1, requires the state's 8,000 loan officers employed by mortgage brokers to be licensed. They write more than half of Washington's home loans.

Exempt from the new law are loan officers working for banks, credit unions and savings and loans. Also exempt are those working for consumer-finance companies.

Loan officers at mortgage brokerages must pass a background check meant to weed out those convicted of recent felonies or financially oriented misdemeanors, such as credit-card fraud. Also out are those who've generated a significant number of business-related complaints to state regulatory agencies.

I would think that shady loan officers are more likely to push people to take on more loan than they can truly afford, so this also comes as welcome news. I don't know if either one of these will do much to stem the tide of suicidal financing, but they couldn't make the situation worse. If these new regulations actually do significantly decrease the number of exotic loans that are issued, it would go a long way toward reigning in the runaway appreciation of the last few years.

(Kirstin Downey, Washington Post, 01.06.2007)
(Elizabeth Rhodes, Seattle Times, 01.06.2007)

December Reporting Roundup

After just nine months of increasing YOY home inventory and fourteen months of declining YOY home sales, the local media has apparently taken notice. Even Elizabeth Rhodes at the Seattle Times can't ignore the slowing trend:

In fact, buyers weren't racing to make offers anywhere in the central Puget Sound area last month, according to home-sales numbers released Friday by the Northwest Multiple Listing Service.
...
But nowhere could the drops be attributed to a lack of homes to choose from.

Indeed, last month the number of houses and condos available increased 48 percent in Kitsap County, 42 percent in Pierce, 34 percent in Snohomish and 24 percent in King, compared with the previous December.

I can hardly believe I read such a thing with Ms. Rhodes' name on it, but there it is in black and white. I guess the inevitable slowdown has become impossible to ignore.

Aubrey Cohen chimes in at the P-I with what I think may be the first in-print prediction of actual YOY price declines for the Seattle market.

"It's more of the same," said Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University. "My expectation is that we're moving into a period where sales are going to remain strong, but certainly not as strong as they had been, and where prices are going to be moderating and stabilizing."
...
Michael Simonsen, chief executive of Altos Research, in Palo Alto, Calif., has noticed cooling in the Seattle home market.

"Any comparison with last year is down in terms of demand and numbers of sales," he said. "Not great but certainly not falling through the floor."
...
Simonsen predicted that Seattle would start seeing slight year-over-year price declines this spring or summer, although he said the city had a strong economy, and its housing market would fare better than outlying areas.

"While we see some positive things to keep the bottom falling out, we don't see any big catalyst that will let prices jump upwards," he said.

Price cuts might not reassure already skittish buyers, Simonsen said. "I kind of think that people are attuned enough to the bubble headlines that if we see year-to-year price declines that might even scare people."

Of course, it just wouldn't be a news roundup without an article proudly proclaiming what a "healthy market" we have. This month's optimism comes to us courtesy of Mike Benbow at the Everett Herald:

December home sales dropped in Snohomish County, but prices continued to rise, according to information released Friday by the Northwest Multiple Listing Service.
...
December followed the trend for about the last six months where listings rose dramatically, sales slumped and prices continued to climb. Unlike many areas of the country, prices in the county continue to rise each month.

"The market is really healthy now," [Windermere broker Vern Holden] said. "I think everyone prefers the more balanced market we have today compared to a year ago."

And just to round out the experience, here's John Gillie at the Tacoma News Tribune with your monthly dose of lame excuses:

In a twist in the law of supply and demand, median December home prices in Pierce and 18 other Washington counties were substantially higher than in the same month in 2005 despite a larger supply of homes on the market and fewer sales.
...
December figures released by the Northwest Multiple Listing Service on Friday followed the pattern seen for several months, stubbornly refusing to join the price deflation that has happened in other markets as the supply of homes increases and sales slow.
...
...sales undoubtedly have been affected by the dose of miserable winter weather – record rains, devastating winds and heavy early season snow – Washington has had the past two months.

Things should get really interesting if we do actually see YOY price declines this year. I can't wait to hear the excuses for that.

(Elizabeth Rhodes, Seattle Times, 01.06.2007)
(Aubrey Cohen, Seattle P-I, 01.06.2007)
(Mike Benbow, Everett Herald, 01.06.2007)
(John Gillie, Tacoma News Tribune, 01.06.2007)