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Dramatic Market Shift in Black & White

July 21, 2009 by  
Filed under Featured, Puget Sound Region, Weekly Sales Ratios

Ok, so it’s really shown in green (buyer’s market), yellow (balanced market) and red (seller’s market) color crayon. But, as you can see below, approximately one year ago the market was an extreme buyer’s market, based on the same statistics we post weekly for just the downtown market. Three months ago a trend started to emerge. Today, we’re seeing much more of a balance, and even some red which represents a seller’s market. Granted, the economy still has some improvements to make. However, the stats show that the window of opportunity appears to be closing. This however is not a sign that prices will skyrocket any time soon, but more of a sign that the market is simply stabilizing.

Color coding in the image below is based off of absorption rate statistics. The Absorption Rate is the ability of the real estate market to absorb or sell all of the houses for sale in a given amount of time. For example, if 10 homes are sold every month and there are 100 homes for sale, it will take 10 months to sell all of the homes currently for sale. If there are 240 homes for sale, the absorption rate will be 24 months (if there are 10 homes being sold a month). A sellers market is considered 0-3 months, a balanced market is 3-6 months, and a buyers market is over 6 months. The rate of absorption is ever changing, but is a great indication of market trends that we track. The trend is obvious at this time, and the window for buyers is closing. If you want more information, or a personal consultation, we have a great reputation for helping our clients make the best decision based on their individual situation. Contact us.


National Publication Reports Seattle Market as “Tight”

June 22, 2009 by  
Filed under Featured, National, Puget Sound Region

glutBusiness Week Magazine online featured an article about Seattle’s prevention of overbuilding last week, which clearly favors an optimistic view for current homeowners.  Consultant Richard M. Gollis, founder of the Concord Group in Newport California, was quoted as saying, “Give sales, demographics, and job growth, we expect the inventory in Seattle to burn off faster than in other markets.”

Just based on the city’s physical demographics alone, a local builder points out additional constraints when building, since the city is between the Puget Sound, and Lake Washington.  While the supply of homes nationally averages a rough nine months to swallow, Seattle’s estimated supply is an estimated five months.

“…cities with low inventory will bounce back sooner than the rest of the U.S. Tight supply in Seattle—much like in Dallas, Denver, and Portland—should set the stage for recovery in the next year or so.”

Still, many are waiting for the Seattle market to hit bottom, as if the city hasn’t already.  With Miami looking at a 40-month supply, numbers and expectations are skewed.  However, the article gives an example of homeowners who have recently received multiple (five) offers the day after going on to the market.  Additionally, we ourselves have had a buyer inquire about two properties that are now already pending.

Seattle, Washington

Building restrictions—and the city’s unique geography—should help lift prices




2009 Market Trends and Outlook

June 17, 2009 by  
Filed under Featured, National, Puget Sound Region

We had our 2009 Market Trends and Outlook meeting by local economist Matthew Gardner yesterday.  For the most part, Gardner has been right on with his predictions over the years and we really enjoy attending his speeches, since he’s also very good at presenting both the good and bad sides.  Gardner usually presents the bad, then the good and that’s important to know. A lot of his slides that we’ll be posting will agree with those who might prefer to trust in the gloom of the market, but will also show that comparably, the Seattle market fares extremely well over the rest.

Revolving Debt

Before jumping into how resilient Seattle is, lets first look at the positive side of the recession.  The U.S. is currently seeing a steep decline in revolving debt.


So, we’re saving money, which is good.  The flip side is that we can expect to see more Chapter 11’s filed in the retail sector.


National Home Sales

In addition, national home sale prices have in fact hit bottom back in January (almost half a year ago now).  Predicting that the market will pick up can no longer be assumed as a prediction considering that the last three months has shown positive appreciation in prices.


Over the last four months, we’ve continued to see an establishment of a base, but we feel pretty safe in saying that prices have shown they’re stabilizing.  Most importantly, they’re not going down.  Gardner is predicting the flatlining of prices will get a lot more first-time home buyers off the fence, which in turn will allow those selling to move up themselves.


Unfortunately we will start to see a lot of our builders closing their doors due to the lack of funding and high construction costs.  As a result, we should start to see much more of our current inventory taken up.  Like we’ve said before, if it’s not under construction, it won’t get built–especially when referring to the downtown market where we more than likely will not see any new inventory break ground other than that that are already under construction.

Escala (274 units)
ENSO (135 units)
Alex (units) until 2011 or later

SF = Single Family



In 2008, we saw 31.2% declines in San Francisco, 26.4% in Los Angeles, 24.8% in San Diego, 28.8% Miami, 33% in Las Vegas, and a whopping 34% decline in Phoenix.  Whose to say Seattle won’t see up-and-coming declines similar to those markets?  Our highest decline so far has been 17.1%.  Seattle has only experienced an appreciation of 17.1% in 2005 (during our local condo boom) while the other major markets in mention have seen 30%, 24.9%, 26.6%, 31.5%, 45.5% and 44.9% appreciation rates which are simply unsustainable!



But what about all those lost jobs?  Microsoft, Boeing, Starbucks…  ? Unemployment in Seattle is still lower than what it was during the dot com bust in 2001/02.


…not by much, but we still ended up on top when it came time to create more jobs.

viaductTo those who might worry the jobs just won’t be able to be created, consider the huge amount of upcoming city improvements.  The rapid transit/light rail is well underway and has already begun testing.   The amount of road construction for 2009 alone makes it impossible to even make out what’s even going on when attempting to look at the City-Wide Planning Transportation Construction page on  The Pike Place Market is undergoing $68 million of renovations which is expected to be completed in 2012.  Another very exciting improvement adding to the thousands of jobs we can expect to see over the next couple of years is the Alaskan Way Viaduct’s cremation and burial.  Although Gardner didn’t address all these new jobs, it is very much of a contributing factor to our city being the most likely to rebound as already mentioned in Forbes.

Unemployment is a lagging indicator rather than a leading indicator. -Gardner


Consumer Confidence

With all those “yeah, but’s,” we’re finding it really difficult of find any real data that our market has not shown a positive trend since the 1st quarter.  It does seem as though the hard climb we’ve had to make getting to somewhat of a level ground is over, and we can begin to get on with our lives during the final half of the year just as Gardner had predicted.


What’s your confidence level?

Sorry, there are no polls available at the moment.

Realogics Acquires OnSite Assets

June 11, 2009 by  
Filed under ESCALA, Featured, Gallery, Parc, Puget Sound Region

President and CEO of Realogics, Dean Jones, is announcing their recent acquisition of Windermere “OnSite” brokerage assets, which has been responsible for over 1,000 presales during the condo boom in downtown Seattle and Bellevue.

“An independent brokerage provides us flexibility to explore all opportunities while ensuring both continuity and the highest level of professionalism for our developer clients, the real estate community and the homebuyers for which we serve,” said Dean Jones, President and CEO of Realogics, Inc.  “Realogics will now expand its offering beyond new construction to provide a broader spectrum of marketing and real estate services under one roof.”

Jones also announced that Sam Cunningham, prior Vice President of Windermere Builder Services, will be appointed as Designated Broker.

“We recognize the approaching dearth of new construction projects in the supply pipeline – so this acquisition is well timed for us”, said Pat Grimm, a co-owner of Windermere OnSite and the designated broker (and sole owner) of Windermere Real Estate / Capitol Hill, Inc. “Realogics is an exceptional marketing and sales enterprise and they are well positioned to manage their brokerage operations moving forward.”

Through personal experience with our clients, Jones and Cunningham have done a superior job in handling our clients’ needs throughout the transaction process, and we are excited to see a company like Realogics joining the team of boutique brokers in Downtown Seattle.  In the meantime, OnSite will retain their builder-oriented franchise agreement with Windermere Real Estate. Realogics has listed both Fifteen Twenty-One Second and The Parc, and helped Windermere Onsite assign agents to seller’s in-house sales teams at Escala, Gallery, Equinox and Bravern Signature Residences.  Realogics will also continue its relationship as a marketing partner with both Escala and The Bravern. The firm also launched an updated website.

Quarterly Gardner Report on Current Market – Have We Hit Bottom?

May 20, 2009 by  
Filed under Featured, Puget Sound Region

Every quarter, Matthew Gardner from Gardner Land Use Economics delivers a detailed analysis on the current market exclusively for Windermere.  Fresh off the press is The Gardner Report for the first quarter of 2009 and it appears to be on track with his predictions from the last time we posted his synopsis.

In his conclusion, Gardner is predicting that the market has hit bottom and suggests that transaction activity will continue.  Numbers are showing that sales are actually up 18.7 percent compared to March of 2008, but unfortunately many of those sales are from a result in increased foreclosures, he reports.  At the same time, Gardner points out that prices are not moving upward, but rather beginning to plateau even though he expects some declines–just not as excessive.  Overall his data didn’t present anything extremely promising, but it does show a solid slowing in the rapid decline.

Pending sales, a good indicator of market stability when taken in context with available inventory, saw a decline of just 4 percent over the same period in 2008.  If we counter this with a 14 percent decline in total active inventory, the result leads us to believe that the signs of a bottoming market might be upon us.


So, while the reports’ pieces and parts weren’t all that great of news, the overall regional real estate message was moderately good.  The same goes for his regional economics study on employment.  People losing their jobs are likely to be the worst result of the recession and the slowdown in layoffs is also being used by Gardner as an indicator that the market has bottomed out.  A whopping 100,000 estimated private sector jobs were lost in the last year, which will of course extend the delay of any potential skyrocketing prices as the market begins to stabilize.  From the sudden upward spike in consumer confidence, we also believe the worst is over, but time will tell.


The government has kept rates low, prices are “soft,” and there certainly is some increased foot traffic among hesitant buyers.  As buyers continue to see that prices are stabilizing at a level which seems to be considered affordable, it seems as though buyers should be leaping over the fence, but that may not happen until interest rates start to tighten.  Gardners’ prediction is that tightening on rates will happen during the second half of 2010.

It’s a smart time to buy!  Let’s talk!

Will an Energy Audit become a Mandate for Sellers?

May 15, 2009 by  
Filed under Featured, Puget Sound Region, Selling

The City of Seattle is proposing that all homes in Seattle go through an audit which will score the address on its carbon footprint and energy efficiency.  So far, the program is only being proposed as a mandate on residential homes and small multi-family transactions.  If approved, the performance of the audit would require sellers to disclose the  results to prospective buyers.

Inspiration for the mandate comes from the city’s desire to be a leader in greenhouse gas reduction.  Jurisdictions in California, Oregon, Texas, and Colorado are also discussing the idea.  However, there is a list of concerns regarding the transaction itself which could prevent the idea from becomoing legal:

  • Mandate places another burden on an already complicated, stressful and costly process.
  • Preservation of cash and ease of transactions are critical.  Additional dollars often are scarce for both the buyer and seller.
  • Buyers are already struggling to afford their first house or move-up house.
  • Sellers are seeking to preserve equity at a time in our history when low or no down payment options have meant that sellers have very little equity in thier home.  Sellers’ equity enables the purchase of a more expensive house or, for seniors, cash to supplement savings and fixed income.
  • Both buyers and sellers value a transaction free of last-minute obstacles to closing.
  • At such a time when the program expands to not just require an energy audit, but also require energy improvements that raise the energy performance score, we would expect to see reduction in homeownership options for middle-income earners within the city.
  • Concerns that the proposed audit mandate will expand to include a requirement that energy improvements are made to the residence as a condition of sale.

Currently, SKCAR (Seattle King-County Association of Realtors) is urging Realtors to use this as an opportunity to encourage their clients (sellers) to do the audit voluntarily.

Here’s a Do it Yourself Home Audit if you’re interested in testing your own energy usage.

Should $86 Million Housing Levy increase to $145 Million?

May 4, 2009 by  
Filed under Featured, Puget Sound Region

greg_nickelsA housing levy put into action in 2002 to assist in rental housing for people earning low wages, with disabilities, who are homeless or need emergency rent assistance to prevent homelessness, and downpayment assistance for first-time buyers expires at the end of 2009. Mayor Greg Nickels is proposing to renew the levy this November.  The controversy over the subject is that the new proposal is seeking to increase the amount from the current $86 million to $145 million.

Nickels is quoted as feeling confident that voters will support the increased tax considering that, “…in hard times there’s even more need.  That’s what we saw in 2002 in what was actually a worse economy locally.”  However, both the Downtown Seattle Association and Greater Seattle Chamber of Commerce are asking to renew the levy, but not increase it.  While Nickels is pushing for the increased tax to cater to public need during the current financial squeeze, the Association and Chamber are asking to not increase the levy due to the current financial squeeze.  No one seems to be opposing the renewal as of yet.

Areas of improvement for the seven-year levy renewal include:

  • $104 million affecting 1,670 rental units.
  • $9.1 million in loans assisting first-time homebuyers in approximately 180 homes.
  • $7.9 million dedicated to 220 apartments for disabled and elderly.
  • $6.5 million to buy land or buildings for future homes.
  • $4.2 million in rent assistance.
  • $14 million to administrate programs.

No buyers that have been aided by the city has faced foreclosure…

How much have Seattle prices fallen since the July ’07 peak?

April 30, 2009 by  
Filed under Finance, Puget Sound Region

Comparably, Seattle prices have fallen much less than the rest of the nation–a fact that may raise eyebrows for investors once the dust has settled.  But by how much?  Since the market peaked in ’07, Seattle prices have fallen 20.9 percent.

According to the Standard & Poor’s/Case-Shiller index, February was the first time in 25 months that price declines did not set a new record low.

King County Condo Weekly Sales Ratios for March 26th, 2009

March 28, 2009 by  
Filed under Puget Sound Region, Weekly Sales Ratios

Condo Only, NWMLS Area 701 (Belltown & Downtown Seattle)


Active Listings and Pending Sales by NWMLS Area 701

Active Listings and Pending Sales by NWMLS Area 701

odds_03-26-09Good news in the attached report:

  • Last week was the highest King County weekly sales this year at 401!
  • Twelve NWMLS areas in King County are balanced markets (16 areas are buyers market with over 6 months supply)!  The report doesn’t show price, but there is a correlation with price and months supply of inventory

Important Report Formatting Note:
The report shows months supply of inventory not weeks supply.  The active inventory is divided by the weekly sales and then converted*1 to month supply.

*1  The conversion is done by dividing by 52 weeks per year and then times by 12 months per year.  For example 26 weeks supply is converted to 6 months supply (26 divided by 52 times by 12).


Months Supply King County Residential for weeks ended 02-12-09 to 03-26-09

Months Supply King County Condo for weeks ended 02-12-09 to 03-26-09

Condo Buyer Boot Camp in Wallingford on Wednesday

February 19, 2009 by  
Filed under Finance, MISC, Puget Sound Region

When to buy?

What can I afford?

Why a condo?

This is a complimentary class that seems to offer some value for those who beginning their search, and may still need some guidance on loans/credit.  We usually try to stay away from promoting things like this, and try to use it more for just sharing knowledge and providing a resource to those who are still deciding who to contact when it comes time to call a Realtor.  But, this group of individuals are really good at providing unbiased information, and answering questions honestly.

Here’s the message in their marketing material:

Wednesday, February 25th
7:00 to 8:30 pm
Tavona Condominiums — Unit 104
3333 Wallingford Ave N, Seattle WA 98103

As the first in a series of educational market insight events offered by Urban Condominiums, Condo Buyer Boot Camp will provide you with direct access to a panel of experts to answer all your questions about today’s dynamic real estate market.  Join other homebuyers just like you and explore your future home buying opportunities including:

• Real estate market snapshot – the myths and facts
• Developing your personal home buyer profile
How to research and compare properties
• The condominium buying process
All about home loans and credit scores
• Financial planning

Click here to RSVP


Marco Kronen, Urban Condominiums
Craig Walker, Cascade Mortgage
Tim Nausin, Financial Advisor
Roger Cruise, Eukopia Credit Solutions


The last class they offered had about 30 people show up, so seating is limited.  Be sure to RSVP.

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