‘An Increasingly Strong Buyers Market’ In Washington
A couple of rare reports on the Washington housing market. “As mortgage loan interest rates hit their highest level in nearly four years this month, not one but two housing markets are emerging in Clark County. One market is dominated by sellers, the other by buyers.”
“According to Realtor Mike Lamb, houses priced below the median number remain in short supply and high demand. By contrast, there is a growing inventory of houses priced over $250,000, particularly $400,000 and higher. ‘In the lower price ranges, this is a seller’s market, while in the upper price ranges it is becoming an increasingly strong buyer’s market,’ said Lamb.”
“Thirty-year mortgage loan rates at 6.5 percent have cooled last year’s home-buying frenzy here and pushed the county’s inventory of homes for sale to about 3,300. That’s well up from a year ago. March was the first month in which there was more inventory available than in recessionary 2003, the year inventory peaked, Lamb said.”
The News Tribune. “A tally of downtown projects for the City of Tacoma shows 774 residential units are currently being built in 13 different projects around downtown. In planning and design phases are 1,014 additional units. Hundreds more housing units are in less formal planning stages. Those under-construction and planned units will join 997 condominiums and apartments built downtown since 2000.”
“That’s 2,785 units, something akin to adding a city the size of Steilacoom in downtown Tacoma. Those who sell the downtown projects say several factors are driving the housing boom and attracting buyers to an area that just a few years ago was the new housing equivalent of the Sahara Desert.”
“Some real estate sales people wonder whether the market can absorb the hundreds of units that will go on the market beginning next fall through the summer of 2007. Privately they say they’re concerned that the biggest projects, such as the 183-unit Esplanade just under construction on the Foss Waterway, are too big to enter the market all at once when so many other projects will hit the market at the same time.”
“Had the Esplanade been built on its original schedule, some real estate experts say, it might have entered a less competitive market. The Esplanade was part of a hotel-condominium package project that has been delayed for years as developers sought financing for the nearby hotel.”
“‘Luckily, we have only a couple of projects coming on the market during the rest of 2006,’ said one veteran real estate agent. ‘We’ll have to wait until 2007 to see the blood bath.’”
OT: update on zip inventory for San Diego, Phoenix, Vegas:
4/3/06:
SD 18,252
Phoenix 40,012
Vegas 18,348
today:
SD 19,236
Phoenix 43,900
Vegas 19,548
Phoenix, inventory up almost 4,000 houses in 18 days, 10% increase!
Wow, the rats are trying to jump ship.
No liferafts available — enjoy the ride down…
This is my first post on Tacoma. I hope a local can let us know what’s up with this condo market.
Everybody who wanted to get in the housing market in Seattle but were priced out-started buying in Tacoma. Buying land there is one thing-purchasing a condo is madness. Have you been there? The town literally stinks to high heaven from paper mills and tidal flats.
Excellent quote from Robert Prechter’s latest, it perfectly points out the epic disconnect that is present in the mind of the public today regarding real estate, enjoy:
“And still there is virtually no fear about home values. A recent national survey of homeowners by the L.A. Times shows “widespread faith in the real estate market.” A question about expectations for house prices asked only about the predicted amount of future rises and did not even include a category that allowed for expressing an opinion about any decline. The worst possible scenario, that prices would “stay the same” over the next 3 years, was selected by just 5% of homeowners. That total was less than the 6% who said they expect to see a rise of “31% or more.” No matter how much talk of a bubble there may be, homeowners continue to demonstrate that they have no clue about the ramifications of one. Included in the survey were respondents with adjustable-rate mortgages, a quarter of whom said they “aren’t sure they’ll be able to make their monthly payments if interest rates go up.” Even among the financially strapped, the very concept of falling real estate prices is not a consideration. And, as the latest housing figures attest, this is in an environment in which prices actually are falling! The denial runs so deep, it’s not even denial anymore. It’s some kind of epic disconnect between the reality of a newly-falling housing market and an unwritten social contract that says home prices do not fall. Whatever this delusion is called, it cannot last much longer.”
It’s one of two things:
Mass Hysteria
or
Stockholm Syndrome
I’ll say this again. This is like 90%+ of America went to work one day and ate a retard sandwich. A complete disconnect between basic economic reasoning and the conduct of their own personal affairs. Extremely unsettling to watch.
But how is this different than any other time 90% of them ate a retard sandwich?
People fall for every boom. It’s all momentum. Most people don’t know anything about wealth or money or finance. Given that, what they do is reasonable, to a point.
Something works for a friend or two of yours and a relative or two. You see their success. You do it a little later. It works for you. Now you’re ready to tell everyone about your success. That’s how it spreads.
My dad bought an Internet fund at the very top. He’s very careful. Very conservative. But he just couldn’t handle everyone else making so much money. I remember saying to a friend, “Dude, my dad bough an Internet fund.” “Oh my god,” my friend said, “the top.”
Did we sell when we called that top? I mean, who was left to buy after someone like my Dad got in?
Of course not. But I learned my lesson this time. That’s why I sold my house in December.
You can’t have a boom without high participation. If everyone was well informed about and believed that the boom existed, it wouldn’t happen.
“I’ll say this again. This is like 90%+ of America went to work one day and ate a retard sandwich.”
Two words: Beanie Babies.
I went for a long walk around Chicago today.
For the first time I’m seeing a LOT of lockboxes around.
Now I didn’t count them, and it’s not as bad here as that one bench in DC the WaPo had a photo of. But I never really noticed lockboxes before, but after today I saw so many I had to check to make sure Al Gore didn’t suddenly become President.
Anyone else seeing more lockboxes?
maybe someone is secretly hiding the SS trust fund money.
This article seems to say it all.
Going down…………………
http://moneycentral.msn.com/content/P149596.asp?Rating=10&PageID=149596#Rating
The media seems to be catching on, the front page Washington Post story was excellent. I keep lobbying the LA Times to do an authentic realistic story on speculators and the “off the chart” metrics of home values for Southern California. I haven’t seen one yet. It looks like the editor has them on a pretty tight leash.
Bubble………what bubble……..hehehe
“Some real estate sales people wonder whether the market can absorb the hundreds of UNEMPLOYED REALTORS that will go on the market beginning next fall through the summer of 2007.
Those who sell the downtown projects say several factors are driving the housing boom and attracting buyers to an area that just a few years ago was the new housing equivalent of the Sahara Desert.”
Yeah. MOSTLY STUPIDITY
Tacoma is also in the projected path for when the local volcano goes. Great place to bring up a family.
Hey c’mon now, Tacoma’s actually a pretty nice place. Glad to hear they’re overbuilding.
It used to be a decent escape route from high Seattle prices.
Looks like maybe they’ll be coming down in tandem.
Ahhh…. a return to normalcy.
‘We’ll have to wait until 2007 to see the blood bath.’”
Luving it when the professionals concede the truth.
Simmssays…
http://www.AmericanInventorSpot.com
Attn: Ben
Key West workers struggle to find affordable housing
Maids, nursing aides, landscapers, cooks and security guards fill every seat, and the aisle, too, with some riding more than two hours to jobs that pay more than similar ones on the mainland.
“You got to do what you got to do,” says Florida City resident Jerry Thomas, 53, about his nearly five-hour round trip to a Marathon lawn company.
The fleet of private buses that ferry hundreds of bottom-rung wage-earners such as Thomas up and down the Keys every day is the most visible sign of the affordable-housing crisis threatening the economic viability and social fabric of Monroe County.
Harder to see is the flow of teachers, paramedics, cops, bank tellers, managers and other moderate and even upper-income professionals who are heading north for good.
Many are cashing in on homes bought long ago, often leaving behind empty jobs.
The reason? They can’t afford to stay in Monroe County, and their would-be replacements can’t afford to move there. Not when the average sale price of a single-family home in the Keys was $960,096 last year — up from $368,048 in 2001, according to Coldwell Banker Schmitt Real Estate…..
And this is different from every other desireable place to live since time immemorial how? “Affordable housing” is the new guilt tool government is trying to use to combat the shocking and obviously unsustainble rise in affluence.
Attn: Ben
Key West workers struggle to find affordable housing
Attn: Ben Jones
In buyer’s market, creativity can help
When these gas prices really decide to skyrocket, you can forget about people buying homes. Like I said before, the housing market in contingent on many things especially energy and prices. Expect the recession to begin in August of 06 and carry through to 2010+.
I’ve noticed that years beginning with a “2.” (2000, 2001, 2002, etc) have been very good for housing prices. I also notice that years beginning with a “2.” (2000, 2001, 2002, etc) have been very good for energy prices. There has been a massive housing price rise but we can’t look at every supposed economic influence and discover the secret pin that pops the bubble.
I’m not sure that high gas prices will do all that much to agregate housing prices. I do think that high prices could change the importance of “commute distance” in the list of many thing that people are willing to pay for in a house. This means that those exurban 1.5hours + from city center developments may fall harder, but might mean that close in condos fall say, 40% instead of 50% in price. Of course like everything else about the housing bubble popping this would be in slooow motion.
Just saw the news here, its over $3 gallon in California, new York, Vegas etc.
Can we finally be seeing the point of consumers starting to stop spending what they don’t have?
Simmsays…
http://www.AmericanInventorSpot.com
Gas, energy, gas, energy, yadda, yadda, yadda. No insult intended but there isn’t anyone that can connect the dots with a housing bubble. Let’s give it a rest shall we? I am certain the sun will come up tomorrow a little earlier than yesterday and I’m almost certain housing prices will be a little lower. Come this fall I’m certain the sun will come up a little later and housing prices will be a lot lower. Lots of people spend more on lattes and mineral water than gas but no one ever tries to draw that connection. Transit fares are skyrocketing yet…
You want to try price corellations? How about the cost of lumber and labor making it expensive to upgrade exisitng homes causing people to buy up rather than remodel? A perfectly fair and logical conclusion except that it doesn’t fit the bubble model so it is chucked. See my point? No, I can people don’t. Try this then; the high price of gas will cause people to stay home thus increasing their willingness to spend more for the place they spend more time and increasing their willingness to improve their homes for energy efficiency and their willingness to hit the housing ATM for the costs andthese expenditures will stimulate the economy and raise the average price of homes. Perfectly logical and totally unacceptable if you are one of the energy prices will kill conventional housing clarions.
Prices of homes are determined by finding someone who can meet the sellers lowest expectations. If the dumbest buyer can not afford what the most desparate seller can take, the house will not sell.
As the buyer has to pay more for gas (or food, botox, viagra, cable tv, or any other American necessity), their ability to pay for a house decreases.
Just because a seller becomes more house-bound, does not mean he will become more fond of it, and charge more for it. In fact, his earnings will be reduced due to higher commute costs, thus making him more vulnerable to getting into a forced sale situation.
If we were paying $20/gallon, would we all have $1M homes?
Let me tell you that my wife and I who live in Irvine took a trip to Palm Desert today and I have never seen so many homes for sale both by agents and owners. We actually stopped at an open house for new homes in La Quinta and the entire tract was sold out and the prices started at $750,000 and went to over a million. We asked each other , WHO is buying these? UNBELIEVABLE
Nina Smith -was- buying them. Don’t confuse for sale prices with selling prices. I personally don’t understand how things got so out of control. The idea of a retired or semi-retied lifestyle out there made sense when it was about no mortgage and low country club dues and just an a/c bill and a couple grand a year in taxes but now? Those club dues are going to be an interesting thing to watch. My golf course the one I live on but down’t belong to was $3-5,0000 to join at the last bottom and is $35,000+ today. Country club memberships bear watching this time as well.
On Saturday I spoke with my Friend/ RE Agent in Boston, that is where I us to live, She stated she was looking to do other kinds of work because the market is so slow and its just not keeping her busy enough, She has been in the business for over 25 yrs so for her its not as much about the money but the love of it.
That is just a view from a RE agent’s eyes…. Seems not even people looking….