This is an update to my posting from last January. In the last 30 days, 35 listings came online in the 98122 (for prices less than $800k) That is the most since October of 2010. 19 monthly listings is the median during the past 12 months. Of the 35 listings that came oneline last month only 10 are currently for sale.
Prices in the Central Area are outpacing Greater Seattle. Median prices are up 13.9% in the past 60 days as compared to a year ago. This compares to a 10.6% increase for Seattle that was recently reported by Case/Schiller. Median price per foot is up 19.1% in 98122. The price per foot is up higher because the smaller nicely-kept entry level house in the Central District is pretty much at least $400k. I remember turning down a listing a year ago that I knew I couldn’t sell for $350k but comps-out now over $400k.
I have been telling people to expect more inventory to come online as more people realize that they can sell their home for a profit. Historically people only stay in their homes for around 5 years. The current average is 9 years. Only recently have people been able to sell at a profit if they bought 7 or 8 years ago. I believe that more of these homeowners will sell their homes as they come to realize this. I think that inventory will go up, price appreciation will continue upwards but not as steeply, and market times will increase in the areas close to Downtown.
The above information is for homes priced under $800k in the 98122 and is from sources I deemed reliable as well as from my own opinion. Don’t rely on the accuracy of any of this information without independently verifying it yourself. You can see my blog at www.DanSanchezRealtor.com
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There are dozens of houses within walking distance of where I live that have been empty for one to five years. It seems to me people defaulted on their mortgages for whatever reason. That means the mortgage holders now own the houses. I have often wondered why these houses do not have for sale signs. Then I read the article below. One of the things it says is:
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the banks are holding most of their distressed properties off the market to keep prices high
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How does this fit in with the high selling prices and high rent in this neighborhood? Seems to me this is not in the interest of low and moderate income people. It does seem to bode well for people who want to build apartment buildings here and charge exorbitant rents so that they can make exorbitant profits.
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The article is by Mike Whitney who lives in Washington state.
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Speculators Chasing Yield
US Housing:
Is the Recovery Real?
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http://www.counterpunch.org/2013/03/08/us-housing-is-the-recovery-real/
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Here is my take on it. Total number of home owners in America = 75million. Shadow Inventory = 2.2million. (50% of it in 6 states..WA isn’t one of them). 15-20% of the housing market turns over each year (historically people stay in their home 5 or 6 years). 15% of 75million = 11million. So it would seem that the Shadow Inventory only represents about 20% of the normal annual market inventory in America (2.2mil / 11mil) And that is is it all hits in one year…alot of it wont because of the govt backed refinance plans out there. Of course in those 6 states, the impact is waay more…and way less even uneventful in other states. Real Estate, like politics is local.
Hi Dan,
I responded to you after reading your upbeat review on the Real Estate market. I want folks to know that the information was spot on and very helpfull.
I interviewed three other Realtors, you last. The others were hesitant to negative and suggested rock bottom price for our town home. I chose to go with the optimist who showed more accurate representations of comparisons to our home.
As you know, we sold our place for the right price. Far higher than what we expected 6 months ago, An excellent price. After a week of shooting for the stars, we pulled the price back to what we actually wanted and expected, and the place sold for list.
Thanks Dan. Thanks for sharing the good news here where I found you. Thanks for selling the house. Thanks for getting us and our new baby into the new house. As a CD resident, I suggest you keep writing.
The readership here should know that I trust you after two transactions completed.
Now, how about a big hug?
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Soon the Foreclosure Floodgates Will Open and Prices Will Plunge
Time to Buy a House? Not on Your Life!
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by Mike Whitney
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http://www.counterpunch.org/2013/06/14/time-to-buy-a-house-not-on-your-life/
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Following the doom and gloom philosophy of 98122 leads to standing still while others move forward. If you don’t try climbing the ladder – in 20 years you will see everyone above you and wonder why you are in the basement closet.
Yes, banks and the gubberments do rig the system to bleed you until death. But, they do this no matter what you do or do not do, even if you decide to live in the closet like a bat.
It is equally likely or more likely that the gubberment will solve it’s debt crisis by devaluing debt. This is done with a period of hyperinflation. If the value of the dollar is cut in half, then, your debt is also cut in have. This is a good thing if you manage to keep pace with or at least do better than standing still. Let’s say that Inflation moves to 8% and I manage to get a 5% pay increase. While I have not kept up on income, still my home increases in value and my debt is easier to pay and essentially less. Debt is good in inflationary times that absolutely are coming.
Now, you could have the perfect storm and everything piles to the ground, the world floods, the earthquake hits, and Mount Rainier blows its top wiping out all of south Puget sound and, God forbid, Yakima. Then we would see the importance of 98122’s warnings. Everything will be worthless.
I suggest buying something that is affordable now while rates are low. If housing prices drop you can still make your payments. When inflation kicks in you will be ahead. Don’t let chicken headed advice force you into the basement closet to live with granny.
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CurtisM you really jump to conclusions.
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In my opinion, people are better off if they read a lot of opinions and come to their own conclusions.
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During at least a decade before the 2008 crash a lot, maybe most, people were lead to believe that real estate would be worth more every year forever. Now we all know what folly that was. And there were economists explaining this all the time. Still it was impossible to have a rational discussion with just about anyone.
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I do not believe the responsibility for the crash can be put on the government or politicians or constructions companies or banks or mortgage brokers or real estate salespeople or ordinary people or on and on. Seems to me just about everybody believed what turned out to be hype. The economists who were sounding the alarm were ignored,
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That said, as long as there are dozens of empty houses within walking distance of where I live, the cheerful rhetoric of real estate agents is not credible.
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I do not claim that I know what is on the horizon. I do think it is prudent to avoid magical thinking. One way to try to do that is to read as many perspectives as possible and proceed with humility.
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The good news is, that, even the folks that bought at the top of the bubble should soon be above water, they may already be if they bought affordably and made their payments like most of my neighbors. Even the guys that bought at the top of the market are coming out OK.
The problem folks bought more than they could afford. I suggest buying something simple. The end is not near. I think we can expect normality and stability for quite some time. And by normal I mean a roller coaster. It’s fun, but, keep your arms inside.