Home buying has changed over a decade - Puget Sound Business Journal (Seattle):

Home buying has changed over a decade - Puget Sound Business Journal (Seattle):

Eastside Housing Market, Post-Nov 30 Tax Credit

Inventory Down, but for how long?  We're experiencing an exaggerated, temporary inventory squeeze due to 3 factors--great year/year comparisons, sales driven by the tax credit expiration, and inventory pulled in November for the holidays. 

Feeling a Buyer Smorgasbord in the New Year  New listings are exceeding deals in the pipeline, with a lot coming on in January, due to renewed foreclosure activity and as homeowners selling to take advantage of the new credit.  I forecast inventory building steadily into April, affording buyers newfound strength and choices. 

When is Kirkland going to wake up?

"let us be cheerful and brave in the face of everything, reflecting that it is nothing of our own that perishes."  [Seneca] 

Kirkland and other affluent Eastside enclaves embody a disturbing, Stepford-y stoicism in the face of bleak market data.  111 homes in Kirkland are currently offered over $1 million.  95 of the 111 have been on the market 60+ days.  7 sold in the month of November.  Spotting a trend?  Without a slew of foreclosures as competition, too many Eastside sellers are able to delude themselves as to their home's value.  The reality check will arrive early in 2010, as foreclosures move up-market driven by unemployment and strategic default.

Poll: Predict the Tax Credit Legislation

 
  

 What form, if any, will the homebuyer tax credit extension take?

 

 

     
• 
         
              None.  First time homebuyer credit expires Nov 30th.
   
• 
         
              Extension for first-timers only to June 2010.
   
• 
         
              Expansion of the credit to homebuyers and anyone who hasn't bought a residence in 5 yrs.
   
• 
         
              $15,000 credit for any home purchase.
   
• 
         
              The Federal government gives everyone a house.
     

view results
Free vote poll

 

No surprise...Eastside market still rockin' in October

As Congress debates whether to extend, expand, or sunset the first-time homebuyer tax credit it's worth taking a look at pending sales through October 15th, the unofficial deadline for taking advantage of the tax credit.  Unofficial because most transactions with financing assume 45 day close, which has to record by November 30th to claim the credit.

Holy favorable year-over-year comparisons, Batman!  380 houses went pending in the first 15 days of this month, vs 310 for all of October 2008.  At that pace, we'd finish the month at 760, exceeding September '09 (753 pendings), itself a robust month.  Housing bears like Zillow's Stan Humphries fear these "stimulated" sales figures will induce sellers waiting for the bottom to list, flooding the market with new listings against a suddenly "unstimulated" buyer appetite.

Bring on the Pent-Up Supply:  In a couple of weeks, when we're reasonably clear of tax-credit seekers, I'll be taking a look at inventory levels.  I suspect we'll be at levels below any seen in 2009 or 2008.  There will be an opportunity for sellers bold enough to list in the dead of winter.  We'll have to wait a few months to see if this sales bump and artificially low mortgage rates have truly pulled us off the bottom or merely produced a temporary seller opportunity.

[Required disclosure out of the way:  although these data come entirely from Northwest MLS, "Statistics not compiled or published by the Northwest Multiple Listing Service"]

Short Sale Watch: More Selling, Less Waiting

We're finally getting data to assess the short sale process end-to-end, since the field only became available in the MLS in April.  I took a look at short sales as a percentage of all house sales for King, Pierce, and Snohomish counties, along with the average cumulative days on market (CDOM).

The rise in September is partly due to wider adoption of the short sale field in MLS, but also reflects a greater number actually closing, as opposed to falling into foreclosure.

It's critical to our recovery to get the short sale process working--getting CDOM under 100 days would mean the banks have the infrastructure and desire to get short sales sold, rather than let them slide into foreclosure.  It's a win-win, as the distressed seller can move on, the house sells closer to full market value, and the toxic mortgage often linked to the property is cleared off the lender's books.

[Required disclosure out of the way:  although these data come entirely from Northwest MLS, "Statistics not compiled or published by the Northwest Multiple Listing Service"]