‘Overpriced Means Overlooked’ In Washington
The Northwest realtors have the August numbers out. “Northwest MLS figures show the volume of active listings stood at 33,316 at the end of August, up from the year-ago inventory of 23,260 properties. The selection includes 29,404 single family homes and 3,912 condominiums. MLS members added 14,077 new listings to inventory during August.”
“In Pierce County, the ‘biggest story is the multitude of choices buyers are enjoying,’ according to NWMLS director Dick Beeson. ‘Many buyers feel empowered and are waiting to see if prices will start to fall,’ observed Beeson. ‘While we aren’t coasting yet, the market has shifted from fourth gear into third gear,’ Beeson commented, adding, ‘It’s an excellent time for well priced properties, but overpriced means overlooked in today’s market.’”
“Buyers bonuses, price reduced, chance to win $25,000, are these signs that Western Washington is becoming a buyer’s market? ‘I would say it is a buyer’s market with a very strong seller’s influence,’ said realtor T.C. Hyatt.”
“In general sellers aren’t bombarded with buyers like they may have been last year. ‘You’re not going to have eight people that day trying to buy it to bid up the price,’ said Hyatt.”
“Some real-estate brokers are pointing to the sun as the reason it was a slower August. It was an exceptionally warm and dry month. Real estate experts expect that rain in the forecast will start to bring an increase in sales.”
“The Puget Sound area’s housing market is still stronger than most in the country, but signs of slowing are clear. The inventory of homes and condos for sale continued to rise throughout King, Snohomish, Pierce and Kitsap counties, as it has since the beginning of the year.”
“With more choices, buyers aren’t rushing to plunk down earnest money as they were last year, said Mike Skahen, broker in North Seattle. ‘At some point they have to take a little bit of a rest. Even though we have a lot of buyers out there, they’re running out of money,’ he said.”
“Seattle home prices fell last month from their July level and posted the lowest year-to-year increase in 18 months, according to new statistics. Prices have dipped month to month several times in the past year, but the year-to-year increase was the first in the single digits since April 2005 and the lowest since February 2005.”
“Talk of a housing bubble has prompted some prospective buyers to wait. ‘I’m a firm believer that there’s a bubble nationally and there’s a bubble in Seattle as well,’ recent New York City-transplant John Bitzer said Sunday after looking at a $1.05 million Seward Park home. ‘I think that prices are going to fall quite substantially,’ he said, adding that he planned to wait.”
“‘Price reduced’ signs have become a more prominent feature of the Seattle landscape in recent weeks. A half-mile from the home Bitzer toured, the owners of a house that has been on the market for more than three months cut their asking price from $989,000 to $895,000, and agent Carole Alexander was telling all comers to make an offer.”
“Back in the Seward Park house where Bitzer espoused his bubble theory, agent Carolyn Mollot expressed her own caution about the market. ‘I told my own daughter to wait a little bit,’ she said.”
“Some real-estate brokers are pointing to the sun as the reason it was a slower August. It was an exceptionally warm and dry month. Real estate experts expect that rain in the forecast will start to bring an increase in sales.”
Oh, GIVE ME A BREAK already.
Right, and Saturn was out of alignment with Mercury too, so that means there are less buyers.
WTF!?
I am sure the rainy season in the Northwest is great for housing demand compared to beautiful, warm sunny weather. If you really want to stimulate sales, try listing your Florida beachfront condo on the market right after a hurricane warning is issued.
DING DING DING!! I think we have another classic stupid RE excuse for the archives.
We all know that homebuyers just hate to shop on beautiful, sunny days.
Hey! Washington is different! In most other places rain is blamed for a lack of sales.
This is a rediculous excuse. We did have a hot spell (for us) in July, but August was great weather. Next month they will blame poor sales on rain. Rain is what we have most of the time.
Coffee-spitting quotes like the one above make my day. You’ve got to admit, reading quotes like this is a lot more fun than watching comedy.
It’s the “ultimate” reality show!
Yeah, let me get this straight…
Nice weather + school’s out = slow sales
Rainy weather + kids in school = stronger sales
I can’t believe anyone could say this with a straight face or that any reporter could listen to that and not say “Huh?”
It started raining this week after 30+ days of no rain in the scenic Pacific Northwest. We should see an uptick in real estate sales now.
“Some real-estate brokers are pointing to the sun as the reason it was a slower August. It was an exceptionally warm and dry month. Real estate experts expect that rain in the forecast will start to bring an increase in sales.”
First they blame the rain on no buyers showing up. Now they blame the dry, warm weather. When are they going to realize there’s no buyers because the price is too high?
Instead of a rain dance the NAR should come up with a sales dance. Lereah could lead the conga line.
These are lies about the Washington housing market. They have continually maintained that they were ‘Different’ - lots of demand, etc.
I know that you can’t get a So Cal tan up there, you rust.
No bubble here….
http://tinyurl.com/hkund
That is one shocking POS. For $700K they show you a driveway, a garage door, a stinky-looking bathroom and kitchen, and some grotesque heating appliance in a stained room? With windows that look like they were taken off a Motel 6 room? Is this some kind of joke?
He probably thinks the stainless steel appliances he paid $2000 for at Best Buy adds $100,000 to the price of the house, nevermind the otherwise dated look of the kitchen. Gotta love those super cheap cabinets.
Hey! Less of the super cheap, please. I had that kitchen in 1988, and it was very nice….then!
Show me the basement where the hired hand can stay (or a teenager).
At least that POS is in Redmond, near Microsoft, but it’s way overpriced nonetheless
Good example: the Seattle area isn’t much different than California for outrageous pricing. Yet, Seattlelites often assume they’re immune to what comes next: the long, grinding slide back to affordability.
Oh, BTW:
According to Zillow, that home last sold on 10/10/05 for $260K. That’s one hefty markup–as bad as anything in CA. Seattle, you’re going to crash as hard as the market down here.
Doubling and tripling of prices in Seattle has been very common since ‘04.
And that was on top of the doubling that set the whole insanity off in the late 90’s.
Yeah, I love the linoleum counter tops and the fine, faux-wood cabinetry. It’s so retro, takes me back to the 80’s.
The sun gods must be mad at them . You gotta pray to the greater fool god to rain in some qualified buyers with some cash to make that big inventory go away. I got a idea ….Tell everyone to take their house off the market …than no problems.
Tom Stevens, NAR President, was asked why his personal house has not sold in the last year. He said it was because he was out of town. Good one, Tom.
“Some real-estate brokers are pointing to the sun as the reason it was a slower August.”
And Jupiter Aligns with Mars.
They should have replied to this woman that it might be “because your head is up Uranus”.
“Even though we have a lot of buyers out there, they’re running out of money,’ he said.”
Not! Would-be buyers are saving money by renting at 2/3 the monthly cost of owning comparable property and waiting for price discounts. Sellers who bought near the peak or who became accustomed to treating home equity appreciation as another income source are probably running out of money, though.
Getstucco,
Excellent point as always! How many times have we discussed “keeping your powder dry”, setting up vulture funds and being perfectly content on the sidelines bubble-sitting paying 1/2 to 2/3rds what FB is paying?
2/3’s , that’s way high bro
Until you factor in that prices of owner-occupied housing is falling where I live — then 2/3 sounds pretty good (and I am talking about 2/3 the monthly mortgage, excluding insurance, maintenance and property tax).
CS ““Even though we have a lot of buyers out there, they’re running out of money,’”
I understand the contex of the post, But still the statement is refreshing in its own. Simple and to the point and a fact. So simple and so true.
Actually, in the worst bubble markets (I live in one, so please take that as my right to comment) 2/3 is WAY too high.
My condo (that I rent) is on the market for 280K, I pay 1250 for rent (and rent has dropped to about 1100 for this unit now). I am looking to rent a home; sale price of 650K, monthly rent of 2,000. As you go into higher and higher end properties, the numbers just get more skewed.
4 million dollar home; rent for 11,000/mo.
And so on.
I’m in DC, and my rent is about 1/3 the cost of mortgage, insurance, and taxes on the house that I’m renting.
Not only do would-be buyers get to rent houses from FBs at a reduced rate they can also make sure to trash the place. Good luck ever getting any money out of a tenant once they leave, regardless of what they did to the place. Factor that in to their wonderful “investment”. This gets funnier all the time.
I think the PS’ missed the true and obviuous heavenly reason for the downfall of the market.
The solar system lost one of it’s planet!
Who can argue against it.
Pluto is pissed off that he has to sit at the “little planets” table this Thanksgiving.
Real estate, after all that is what was the reason for Pluto’s downfall.
OMG ! Come to think of it, Pluto is the victim of same real estate bubblemania!!!
“Pluto is pissed off that he has to sit at the “little planets” table this Thanksgiving. ”
LOL!!! That was FUNNY!
Read the comments section on the last articles link, entitled “Home buying ‘frenzy’ may be leveling off”.
It’s like going back 6 months in a time machine to the rest of the country, where signs were just emerging that things might be slowing. Amazing that all these washington state folks really think that houses will go up 5-10% in perpetuity starting next year and this is a temporary “blip”.
Hey! I was born and raised in Vancouver Washington and one thing is very clear. Moss grows on the north side of your head in the winter!! With that said , now wonder they believe RE will go up for ever.
being in South Fl, my co-workers and I have a bet on the next hurricane, will it be from Mother Nature or from the cat 3 winds from the bubble that will eventually burst..
Speaking of which, did you see the news bit today about El Nino having re-formed. Apparently that will cause a decrease in hurricane activity for 2006 and 2007. Wonder if it’s time for the well-intentioned folks who call these things to admit that hurricanes seasons are just about unpredictable with any reasonable accuracy. I think I could do better at the dog track than these folks have done this year.
Chip,
Hey, that was me… I called on God to give the people of the south a break this year a while back
Well, since i’m taking my wife & daughter with me to live in Fla. in a month, that is welcome news. Do you think there’s a chance for an insurance rate roll-back if there are no claims for next 2 years? Don’t think so.
Well about time! I live in the Portland, OR area and over the years I’ve really grown to dread the Seattle crowd. You’re talking to a guy that owns an expresso stand and you’d think you’re talking to Bill Gates for crissakes! Seeing these guys and their fake wealth evaporate has been a long time coming!
As to the weather: August IS the only nice month is Seattle! (If you consider upper 60’s/mid 70’s and partly cloudy “perfect weather”). These people drudge and trudge their way through drizzle 9 to 11 months out of the year. There was one year where they didn’t have a summer. It get’s better. We are supposedly entering a PDO (Pacific Decadal Oscillation) meaning it’s going to get even cooler AND wetter for oh gee, the next 10 to 20 years! If you’ve ever been to Seattle you’d know that “house hunting” is about as exciting as it gets there. No where else will you get fed as steady diet of “it’s different here” than drizzle town. Live it up boys!
errr yeah, and the weather in Portland is nearly identical, so what’s your point?
I think his point was obvious and, furthermore, we refer to Portland as our “sunnier” neighbor to the south.
“It’s different here” knows no bounds ……
Tsk, tsk, you’re not supposed to be shilling for anti-depressant drug maker’s stocks on this board
I hear they have Prozac dispensers in the bathrooms at Microsoft. Maybe that explains it.
“If you consider upper 60’s/mid 70’s and partly cloudy perfect weather”
Actually I do and it’s been much hotter this year.
BTW: Average Precipitation for Portland is 37.5 inches compared to only 34 for Seattle (http://www.weatherbase.com)
Average Number of Cloudy Days for Portland is 223 and only 201 for Seattle.
WATER FIGHT !!!!!!
BTW: Average Precipitation for Portland is 37.5 inches compared to only 34 for Seattle
You guys and your dueling rainfall figures, hehe! Would you believe my town in CA gets 60″/yr–and last year was more like 80? And all that rain is concentrated in just 5 months.
Yeah, 37.5 inches… why, that’s only a tenth of an inch a day. Every day!
Sounds like a bitter Portland loser to me.
Portland is a nice TOWN, but it doesn’t have 1/2 the things to do, 1/4 of the job opportunities, and all the locals detest newcomers to a far greater level than in Seattle. And, as someone pointed out, the weather is actually worse there.
So, when you come up short in life, it’s far easier to hate those who are doing better than to own up to your own sorry situation.
Ah put the Pinots kick ass south of Portland
Oliver
cow cat,
Invariably any time someone from the Portland area makes the slightest observation regarding Seattle, mental midgets (that are probably new to Seattle anyway) rush to it’s defense. Deary, please come back and talk to me after you’ve lived there for 20+ years as I have in Portland, o.k? I actually don’t live in Portland but worked “downtown” for investment banks for years! (If working in IB makes one a bitter loser). In a fashion you ARE right. Portland’s weather is almost equally awful. In truth, there isn’t much of interest in either town. Both are “sub-markets” of California. The big difference is that YOU DON’T HAVE TO DEAL WITH THE ARROGANCE IN PORTLAND! (Nor some of the worst traffic in the country). I absolutely despise getting drug into some stupid debate about which town sucks less. Since you probably moved there “post Boeing” you may not have noticed that your core private sector employer has left town. MSFT (that’s the ticker symbol for Microsoft) isn’t churning out millionaire receptionist any more either. Their fundamentals have softened considerably and will take their turn in the barrel just as we in the Portland area is starting to.
Annual weather data means next to nothing. Our fall/winter spring ARE nearly identical. What counts is the time between school letting out and Labor Day Weekend! And there we have the “Emerald City” beat hands down!
The big difference is that YOU DON’T HAVE TO DEAL WITH THE ARROGANCE IN PORTLAND!
Well, I talk to friends in Seattle, and they notice a bit of that pretensiousness. I used to live up there, and didn’t experience it so much (or I was oblivious). I think it happens anywhere people move for “success” reasons. Whether they’re actually successful or not, they learn to act that way–just like SF, LA, NYC. Also, anyplace you see people overpaying for homes, they get real snobby about their overpriced box, and the elevated social class above the “bitter renter”.
Newsweek Magazine cover from 1995 or so, describing the “Emerald City:” LA with Rain. Hate to say, I somewhat agree.
bitter Portland loser? Ahem. I bought five acres of forest and pasture SW of Portland in 2000, and put a nice manufactured home on it. I have about $280K into it. My drive to work is 1/2 hour, and it’s mostly country roads, due to the Urban Growth Boundary. Portland is a clean, generally safe CITY that I CHOSE to live near for the past twelve years. I prefer it greatly to the Bay Area, which I left, or Seattle, where I was born.
Two comments:
1) At least in Washington the government trusts you’re not too stupid to pump your own gas.
2) I kid you not, when you ask people what’s great about Portland, all they can come up with is “It has really good public transportation”.
…actually, as someone who worked/s law enforcement first near Seattle, now in southern Oregon, the gas pumping by Oregon attendants nearly eliminates gas runouts (thefts)…which are endemic in Washington…
Oh come on people. Too much rah rah on Seattle.
Dinor is entitled to his opinion.
Am quite surprised at the reaction here, most people in Seattle acknowledge that Portland is a more “liveable” town. (At least in private!)
You will need it to get out of town. Oregon schools are lower on the list than Mississippi.
Source?
Lauderdalian,
1)When you’re 70 and don’t want to pump your own gas, in Oregon you won’t have to pay $.50 a gallon more to have it done for you. Tell me how much you enjoy pumping gas yourself on a nice 34-degree rainy December day.
It’s also a good way to keep people working, which is better than sitting around, don’t you think?
2) We don’t WANT 50,000,000 people coming to Portland (they do anyway).
Seattle, Portland, nyah, nyah.
Vancouver (BC) has the Olympics! It’s really different!
“multitutde of choice buyers are enjoying.”
I love that quote, who’s enjoying it…there still sitting on the market dumb f@#k.
“In Pierce County, the ‘biggest story is the multitude of choices buyers are enjoying,’ according to NWMLS director Dick Beeson. ‘Many buyers feel empowered and are waiting to see if prices will start to fall,’ observed Beeson. ‘While we aren’t coasting yet, the market has shifted from fourth gear into third gear,’ Beeson commented.
Multitude of choices buyers are ENJOYING? Choosing between many overpriced homes is not a joyful process. And, I hate to tell Beeson this, but it looks like lots of people have hit the brakes, rather than shifted into third gear. In fact, some have left the track altogether!
“Multitude of choices buyers are ENJOYING? Choosing between many overpriced homes is not a joyful process. And, I hate to tell Beeson this, but it looks like lots of people have hit the brakes, rather than shifted into third gear. In fact, some have left the track altogether!”
Good post. I know several people who have moved away from this area and a few more with plans to. Not only is the cost of housing absurdly high, but the everyday cost of living is too. Factor into that a horrible public school system, hideous traffic with no solutions on the horizon, dismal weather, high crime, and a questionable future in general, and it is a no brainer that real estate is going to tank. The local media has been cheering it on because we are bucking the national trend lately, but our bubble is as large as any. Inventories are really swelling and the greater fools are the only ones left buying of course. Just a little behind the national trend but watch out below.
“Psychological factors are causing some buyers to remain on the sidelines, waiting for prices to stabilize or for more favorable news about the market and the economy. Contributing to this hesitancy is a lot of negative news stories, but in the end we believe that underlying market fundamentals will prevail,” Lereah remarked.
I love this…if anyone sees David, could you ask him if by “underlying market fundamentals”, he means the credit bubble, insane prices, toxic mortgages, and rampant fraud? Does anyone know if David actually owns a house or is he a happy renter?
Not all parodies have to be pessimistic, right?
Here’s the Tune if you want to open it in another tab and sign along.
When the moon is in the Seventh House
And Jupiter aligns with Mars
Supply will fill the markets
And price
will fall to earth
This is the dawning of the age
of Aquarius
The age of Aquarius
Aquarius!
Aquarius!
Honesty and value pricing
Sympathy and trust returning
No more falsehoods on appraisals
Golden living rooms of visions
Property revaluation
And the market’s liberation
Aquarius!
Aquarius!
When the moon is in the Seventh House
And Jupiter aligns with Mars
Supply will fill the markets
And price
will fall to earth
This is the dawning of the age of Aquarius
The age
of Aquarius
Aquarius!
Aquarius!
No more flipper pleas on Craigslist
Sanity and deals abounding
No more cashback instant HELOC
Grateful families back to living
Listing price revaluation
Full disintermediation
Aquarius!
Aquarius!
Brilliant!
Lol . Now we just have to wait for them to make a play out of the real estate debacle with yours being the lead song sm landlord .
That is great! Disintermediation in lyrics… impressive.
Great lyrics! Nicely done.
Dude,
You need to gather all these tune re-writes you do and assemble the Housing Bubble Song Book. Could be a classic volume.
on realtytimes.com the realhores in Seattle say it’s still booming
why would anyone use a realtor
the mls is to mail as email is to
Excuse after spin- spin and more excuses- the NAR honchos along with those clowns on Capital hill today are going to be turning purple and green in 6 months when there is still no light at the end of the tunnel.
Sounds like a politico from the 60’s who said he was ‘brainwashed’ about Vietnam.
“Sounds like a politico from the 60’s who said he was ‘brainwashed’ about Vietnam.”
They did not have brain to wash, just like the current crowd.
OT-
How long will it be before we get disguntled home owners going postal. Their lifesavings evaporated overnight by greed and lies?? This will be coming soon. As the stress and pressure builds of payments and foreclosures, violence will increase. Coming soon to a city near you.
In that case we really will have a “multitude of choices” when considering our future housing needs.
http://tinyurl.com/fxcyb
bubble rage.
“How long will it be before we get disguntled home owners going postal.”
They won’t, they will go like sheep. one by one they will get on the cattle cars.
I guess the terrorist attack had nothing to do with the down market….or did disappearing Pluto cause the attack? Or was that the Rave killer? So much crime, so little time in Seattle these days.
You guys are all wrong! Seattle is totally different!!! We have July & August are the only nice months, the rest are filled with rain from the heaven. Our streams, creeks and rivers are bountiful, filled with salmon, trout, etc. We have a lot of volcanoes, and earthquakes are not uncommon on a daily basis. Land is soooo limited!!! Cash is sooooo unlimited! Microsoft, Amazon.com, Costco, Starbuck, etc. etc. Our people are way above literacy average. Recently $375K for a 2-bedroom, 840 sq. ft. are not uncommon. The only way for Seattle RE to go is up, up and up to the top of Mt. Rainier (which is a huge volcano by the way!) If ye have time, look at how rich our wealth is. Recently 294 sq. ft. condo is priced for $145K (ye can search Seattle Post Intelligent website on “condo” for more info). Of course it doesn’t have any bed-room at all, but still goes for $145K.
Don’t look at recent data! It’s because August was soooo hot, and our people had to hide in malls or AC-rooms. Come, come and invest in Seattle. It will make ye rich beyond the eyes can see!!!!
“Recently $375K for a 2-bedroom, 840 sq. ft. are not uncommon. ”
My neighbors have a 2-bedroom, ~800 sq foot SFR that they are about to list, and they’re expecting to get low-400s for it. Time will tell if they beat the slowing Seattle market or not…
Jon
They think they are going to get over $500 per square foot? Boy people really are sick…
They may have missed the boat on that.
New 2bd. condos on First Hill just got prices slashed from 425 to 365 a few weeks ago. And HOA dues paid through 2009!
What I’m noticing in Seattle is that in the expensive, close-in neighborhoods like Cap Hill, Montlake, Madison Park, very few SFH’s are for sale, with the exception of the ‘losers’–those hard by busy intersections, next to loud businesses, with butt-ugly architecture. Seems like every home on busy 23rd Ave E has been up for sale at some point in the last two years. Many of these have been sitting for months. Tells me the market was still optimistic for now but worried for later, these folks saying to themselves, ‘we’d better sell now when people will buy anything’…
“Chance to win $25,000″ …oh yea! Nothin’ makes me wanna buy a house like a chance to win!!!! YAAAAAY
In Portland Or, things are really loosening up. Lots of new Craigslist adds incrementing up. Better quality properties showing up move often too.
Oh and that “Some real-estate brokers are pointing to the sun as the reason it was a slower August. It was an exceptionally warm and dry month. Real estate experts expect that rain in the forecast will start to bring an increase in sales.” does not apply to Portland. Once the rain starts people retreat for the couch or the snow in the mountains.
Just saw an add for the soon to be completed Vaux lofts/condos. Their sign says starting at $513,000. Someone on Craigslist is trying to dump one for $370,000.
The loft/condo situation will only get worse as many more properties are close to completion. Bad bad timing. Was easy to see years ago.
I’ve just moved to Portland and have rented for a year as I can see the obvious coming - I’d be curious on any data you have reguarding loan makeup the last 5 years - ie. % of I/O ARMs etc.
It would help in determining how fast things are going to fall apart here.
I’m in the exact same boat. Have asked realtors for that data but no takers. Oh well, guess I’ll wait a little longer to buy then.
Smart person. I’d wait. Things got WAY out of hand in the last year or two, particularly in the Pearl/central city, and the new places in the burbs. Case in point, my old place - Paid $125K in ‘94, sold for $155K in 2000 - sold in 2002 for $179K - now places there have asking prices of $279-300K (but are going down).
UG-
Check out this article; it might provide some clues. PNW people should notice the high incidence of risky morts used in OR and WA recently.
Awesome - thanks very much for the data - I much appreciate it.
Now the weather is to blame?
Lennox Scott of local mega broker John L Scott Real Estate mentioned earlier this year that sales were slower in Jan/Feb. due to…drum roll please, THE SEATTLE SEAHAWKS BEING IN THE PLAYOFFS!
WTF!!!
This is good:
http://brownstoner.com/brownstoner/archives/2006/09/fsbo_looks_to_j.html
Note, the owner is a flipper in Santa Monica . . . the condo is in park Slope Brooklyn.
Ha ha! The place closed in June for $885K. Now on the market for $1,250,000. It almost makes me miss NYC, that kinda chutzpah…
“‘I would say it is a buyer’s market with a very strong seller’s influence,’ said realtor T.C. Hyatt.”
So what the heck is “a very strong seller’s influence”?
Sounds like more silly talk…
Beat me to it….what a bunch of crap!
“Strong seller’s influence” actually sounds about right to me–sellers are strongly influencing the market (further stalling it) by resisting dropping their prices to a reasonable level!
Jon
Where are TxChick and Robert Cote and Crispy? Is it vacation time?
LOL. Here!
Posting hiatus, signal to noise ratio getting too high. Lightning rod discomfort and degraded civility. Unfair to Ben, unfair to readers.
Robert-Nice to see you back in print.
ummm, now this is very close to the mark……..
http://firstrung.co.uk/articles.asp?pageid=NEWS&articlekey=2850&cat=47-0-0
Close to the mark? I think not.
“1. Don’t sell right now if you don’t have to. If you do have to sell, do it now, even if you have to reduce your price. The national or some regional markets may ultimately correct to 10%-20% less than current market valuations, especially in formerly hot markets like California, Arizona, Nevada, Washington DC Metro, New York, Florida and the Carolina’s. It may take 5 to 7 years for these markets to recover to 2005 price levels.”
And NASDAQ could fall as low as 3500.
She might have been referring to the first two paragraphs:
“U.S. News: The question regarding soft or hard landings with respect to our nations housing “bubble” is about to get answered, with a touch down that will evolve into a very hard landing. This hard landing may put at risk the entire economy. The two largest culprits are homebuilders/mortgage firms that forced real estate appraisers to come up with inflated valuations and the second culprit are teaser rate, adjustable rate mortgage products that are now starting to adjust beyond many homeowners ability to make the payment. The victims are or will be our nation’s homeowners, our nation’s pension funds and ultimately the U.S. Taxpayer in a Katrina type bail out.
The question regarding a national real estate bubble, and or a hard or soft landing according to the President of The National Mortgage Complaint Center/Homeowners Consumer Center ‘is about to get answered.’ Mr. Thomas Martin the President of this group has indicated that the ‘bubble is going to be more like a nuclear detonation with consequences getting progressively worse, with no quick fix.’ He calls it ‘the Hurricane Katrina of real estate, because everyone knew it was coming and no one prepared for what it would, or could do.’”
Damnit! I accidently clicked the link right below the comments section and now I own a new house in Dallas. >:(
Recently, at the water cooler, a co-worker of mine mentioned that the FEDs should bail us out of this housing mess, since they are responsible for it. She mentioned that there should be some sort of tax (about 5% of gross income > $40k) should be in a ‘general fund’ which should be used to bail out banks and lending institutions that lose money from defaults and foreclosures resulting from ARMs resetting over the next few years.
Sounds like a great idea! I suggest that they tax all the bozos who can’t make their payments an amount 12x the monthly payment on which they default.
So I take it your coworker is upside down on her home and she makes less than $40k.
Learning Man,
Do you work at a school? Because your cow-orker’s suggestion sounds just like something that would come out of the mouth of a schoolteacher that makes $39,950 per year.
The FEDs should bring back the Civilian Conservation Corp from the 1930’s and give all the realtors, mortgage brokers, homebuilders, flippers and FB’s a job and a tent to live after they get kicked out of their house and lose their jobs. Tell your pompous co-worker they can pick up trash and rebuild some of our deteriorating infrastructure (roads and bridges especially) instead of getting a handout. The RE gravy train is over.
Not a bad idea Bubblebutt. A job and a tent.
That’s way better than they do for most “down on your luck” people in the States.
You may be on to something here.
Are the CEO’s of all these companies that caused the crash going to give back the bonus money? If not, they can drop dead.
No bailout for anyone.
How about taxing gross incomes above $35K a year so that the government can pay people to whipe FBs’ butts for them. A new cabinet level position could be created called “The Department of the Nanny State”.
First of all, I must say that I don’t agree with the premise that, we the citizens, should bail out any private or public institution. These lending institutions must be responsible for the fall-out from their loose lending practices. However, I must say that since the Federal government has been largely responsible for this housing debacle (when they started reducing interest rates after 9-11-2001), they are obligated to fix it. The FEDs, under Greenspan, did nothing to stop the run up in prices. All Greenspan did was talk. He talked about the ‘froth’ in the housing market, and other coded speeches. He and the FEDs were happy that the economy was humming along with moderate growth and little to no inflation. Now that the chickens are coming home to roost, the FEDs must do something to make sure this doesn’t get out of hand. The bailout fund was just a non-sensible talk with a co-worker. She is the same person who said that the government should give citizenship to all the illegals, and that the US should welcome everyone who wants to move here.
“since the Federal government has been largely responsible for this housing debacle (when they started reducing interest rates after 9-11-2001), they are obligated to fix it.”
They can fix it by raising interest rates, bringing everything crashing down. Simple!
“make sure this doesn’t get out of hand.”
See above.
“She is the same person who said that the government should give citizenship to all the illegals, and that the US should welcome everyone who wants to move here.”
Ask her if everyone shout get free ice cream and chocolate cake as well. *I* think that would be a swell idea.
The market started going kafluey in Seattle early last winter.
Stuff began sitting for unheard of amounts of time (6 months, a year, etc.). Price reductions were everywhere. Nearly everything was selling under asking.
The local media and realtors simply lied and ratcheted up the “We’re Different! Seattle’s still hot!!” talk to a fevered pitch and drug us through the spring and early summer.
They convinced enough people to keep a sputtering market alive a bit longer.
It will be way harder to keep lying like that this year . There’s too much talk of the bubble in general, and YOY appreciation is going down. It was easier to fool people when the YOY % was still high.
With Seattle being so high on the toxic loan maps (#5 or 6 nationally), it will get harder and harder for people here to convince themselves that Seattleites are extraordinarily rich Americans who can therefore afford these ridiculous prices.
Foreclosures also ramped up this month. They are like a third again of the number of houses on the MLS list.
We may be good liars here, but we can’t perform miracles! The “it’s too sunny to shop for homes” line is pretty symptomatic. They have plum run out of lies.
“They have plum run out of lies.”
Peak Lies.
And perhaps most telling:
Our local flipper with a blog, Eric, has recently come to grips with the fact that flipping in the area is a losing proposition.
They will not be buying RE in Seattle now, not for flipping and not for rentals- he discovered they don’t cash flow.
His wife went to Buffalo NY this week to look at homes. Yep. Buffalo.
That’s a statement on the state of the market right there.
Link please? I couldn’t google up Eric :).
http://seattlerei.blogspot.com/
Thanks!
C’mon, the guy cites the TLC channel as research.
His blog gives a whole new meaning to the phrase ‘morbid fascination’.
Yeah, it is a fascinating blog.
He jumped into the Seattle market last August when it was peaking (DOM’s and price reductions had already begun).
Then he quit his (good) job in the summer and went full time RE speculating just as the market began crashing (anyone with a Zip Realty account could see it for Pete’s sake).
Now, end of summer he finally sees that the market’s softening (one year after the fact), he can’t turn a profit , so where does he go? Buffalo!!
Buffalo NY, where RE investors have been going to die for decades.
He’s our indicator here in Seattle for last years news.
That’s more of a statement on Eric than it is on the market. 10 minutes on Realtor.com will tell you all you need to know about Buffalo without having to FLY there. Cash flow from renters? What renters? - they can afford a 30-fixed on Wal-mart pay.