Tuesday, October 16, 2012

Critical Housing Shortage On the Horizon in Seattle Could Cause Another Real Estate Bubble.

There are interesting new dynamics setting up in the King and Snohomish County housing markets:  Pending sale have been out pacing new listings to come on the market for 12 months straight.

Currently buyers have been frustrated wilth the low amount of inventory to choose from in the market place.  Well priced homes in select areas are seeing multiple offers, many of which are turning into bidding wars in a return of the bubble days of 2006-2007.  Current active listings have now dropped below the 2006-2007 inventory levels.

This is not a healthy balanced housing market and could cause home prices to spike dramatically in the near future.  This could change if more inventory hits the market or mortgage interest rates rise significantly, neither of which are in the forecast.

But wait, aren't we expecting more foreclosures to come on the market?  Well, yes.  But not enough to put a dent in the low inventory numbers.  As a matter of fact, forelosure rates are at 3 year lows and there are no signs of any significant rise in the numbers any time soon.

What will the Seattle housing market look like in the Spring of 2013?  If you are a home buyer, it won't look pretty.  But if you are a home seller, it may be time to take advantage of regained property values and make that move you've been waiting to make for 5 years.

Friday, October 5, 2012

Snohomish County Home Prices Soar 15% In September 2012

As we move into the the fall real estate market we see the typical slow down in sales volume, but this is not keeping prices down by any means.  Snohomish County average home prices rose 15% year over year for September 2012.

We have seen home prices bump up and down throughout the year, but every bump up is higher than the previous.

Home prices are rising because buyers are now back in the market again and these factors contribute to rising prices:

  • Low Inventory (Supply & Demand)
  • Historical Low Interest Rates (Fear of missing out on low rates)
  • Pent up demand from prior years  (After waiting 5 years)
  • Fears of missing the bottom of the market (Timing)

Prices are expected to remain strong for the unforseeable future.  Unless we see a rise in inventory or interest rates don't expect any significant pull back in home prices.

Monday, August 6, 2012

Snohomish County Average Home Prices Up 8% For July 2012

Snohomish County average home prices rose 8% year over year for July 2012.  Year over year average home prices in Snohomish County have risen over the last four consecutive months reversing the trend of falling home prices over the last four years.  This is a good indication that we have reached the bottom of the market.  However, it is typical to see home prices dip slightly in late summer only to rally again during the next spring market.  It will be interesting to see if the year over year gains continue to hold up during the fall market.

Click on Graph to enlarge

Thursday, May 17, 2012

King County Foreclosure Rates at Lowest Level In 4 Years

The rate of foreclosed home in King County dropped to its lowest level in nearly four years.  In April we saw only 185 homes foreclosed on which was the lowest amount since June 2008.  This tells us that the market is continuing to heal and that the banks have moved through most of their seriously delinquent mortgages.   They also continue to improve their rate of loan modifications to keep families in their homes.

In Snohomish County we see similar declines, but our records only go back to 2009.  The month with the highest amount of foreclosures was January 2010, over 2 years ago.

We do not anticipate any significant increase in future foreclosures as bankers are also reporting fewer mortgage delinquencies.

Tuesday, April 10, 2012

Average Home Prices Up in King & Snohomish County

King County average home prices rose 6% in the month of March, while home prices rose 5.5% in Snohomish County.

The spring home buying season has arrived and reports are home buyers are having a difficult time finding decent inventory to pick from.

Wednesday, March 7, 2012

King and Snohomish County Foreclosure Rates Continue Dramatic Declines

The foreclosure rates for both King and Snohomish County continue to fall at a dramatic pace. Finally receding from record levels, we are seeing 3 year lows for February 2012, as banks continue to increase home retention through loan modifications and short sales.

The reduction in foreclosures is a postive sign of a healing real estate market. We are confident that the worst is behind us as home prices are also showing signs if stability. With continued low interest rates along with an increase in home sales we are definately on the road to recovery.

Tuesday, January 10, 2012

King County REO Bank Sales By Price Range 2011

(click on graph to enlarge)
In King County last year 33% of all the property sales were distress sales. Of that total 22% were REO Bank Sales (foreclosed properties).

In this chart (blue=2010, green-2011) we can see that sales of bank owned properties were very strong for 2011.

But the chart tells us even a bigger picture - a majority of the bank owned properties that sold were in the $100K - $200K range.

Another thing this chart tells us, is there are very few foreclosures above $399,000. Above that the the monthly sales numbers are mostly in the single digits.

What you might find interesting is the average home prices for different sales types for residential properties:

Average Sales Price 2011:
  • REO/Bank Sales: $231,598
  • Short Sale: $333,450
  • Regular Sale: $474,383

This indicates that the lower priced housing market has been the most affected by the down turn in our economy.