01-09-2013 12:39 PM
I work on the eastside and much of south Seattle. We have definitely seen business and new contacts slow dramatically, and Im trying to make the correlation aside from seasonality. Is inventory the issue? Those searching that haven't found reason to pull the trigger, please let me know why? Inventory appears to remain low, but with the anticipation of more price increases just around the corner that inventory will parallel this trend, or so I would think.
What are you guys observing?
01-09-2013 02:44 PM
We (my wife and myself) have been actively looking for a house on eastside, my first preference being Redmond (Education Hill to be more specific). We are hesitant to pull the trigger because of the following reasons:
1) Low inventory
2) Did not like what's available in the market for a good price range. For example, Hazelwood @ Education Hill has 3/4 br houses, but they are really small houses relatively.
3) Ridiculously high price. E.g a 3 br house with < 2k sqft for 568k and small kitchen (at least that's what we felt like) is over expensive in my opinion.
Overall, I am a first time buyer and these factors make me nervous before investing this amount. Since the houses are so expensive already, I wonder what are the chances for appreciation over 10% to be atleast breakeven, just in case I have to move to another location after 5-7 years. I would like to stay here for a long time, but since we are still in our 20's and don't have kids yet, we don't know where the future will take us. This does bring me back to the real question: Why should I buy a house then, why not just rent ? Well, because we can afford a house and more importantly, we don't want to throw away money on high rental prices. But on the other hand, would like to be wise while making the purchase, just like every other buyer.
01-09-2013 04:28 PM
Brian, what do you mean? Do you mean you are getting fewer phone calls from potential clients than you expect, or are there available houses that you are surprised aren't being snapped up? It seems like so many on this board are waiting for a reasonable house on the market. in my case, when one does, I face competitive bidding and haven't won yet. To buy something right now I would have to make such huge compromises that I'm better of with what I have. I can't see beyond the low inventory, so I'm curious what else you might be wondering about.
01-09-2013 09:57 PM
Inventory is way down. Wife and I have been looking but all the houses that were listed last year went off the market (not sold) and have been off the market. We put in offers for several homes only to get out bidded by mystery bidders or other agents who came back in attempt to sell back to us. Overall, it's a seller's market and home swappers want top dollar for their "investments".
Going to stop looking for a few months then come back to see if homes come back on the market.
01-10-2013 09:20 AM - edited 01-10-2013 03:45 PM
Just as others have said, low inventory and undesirable properties that have been languishing on the market for months because, well, they are undesireable--e.g. too old and not updated; on a main/busy street; across the street from, say, a car repair shop or an old apartment building; etc.--is what almost put me off looking altogether at one point.
I was looking in the Central District/Columbia City/Beacon Hill/Rainier Valley/Leschi and thereabouts, and was shocked to see how expensive homes are now in those areas. I bought my first home in the Central District in 2009 and there was tons of quality inventory in my price range at that time. More recently, though, when something awesome would come on the market in one of those areas and in my price range, it would go "pending" within 12 or 24 hours, it seemed, giving me nary enough time to even get out on tour to see it.
I had to compromise by looking in West Seattle. There, I was lucky to find a home that had been flipped beautifully, was priced reasonably, and was located in a desireable W. Seattle neighborhood. The one concession I had to make was living on a one-lane-each-way neighborhood thoroughfare rather than on a uber-quiet side street, but as the home was ideal in all other ways, I moved ahead with an offer that, thankfully, was accepted.
In the end, my motivation to buy a house stat was very high so, even though I sometimes got discouraged by the low, expensive, and sometimes less than quality inventory, I still continued to tour homes daily and to widen my net, so to speak, by looking at neighborhoods outside of my original list of fav neighbs. Those buyers who don't have the sense of urgency I had (due to personal/life circumstances) will probably find the current state of real estate market affairs rather grim and discouraging, and will choose to ride out this lull as a result, hoping the tide turns in their favor at some point.
01-10-2013 09:49 AM
For me it is mostly prices. I dont see any value and when it does rear its head there are five people willing to pay more than I would.
I would buy a place tomorrow if I thought the deal was good, but the competition is higher than I like and other people are clearly more motivated than I am. The only stuff around is the stupidly priced stuff which seems to be more "if the price is right" type of listings than real sellers.
In fact I kind of feeling like cashing out, but then what would I do..
01-11-2013 01:34 AM
I have only seen one home listed in the last two months that I found remotely appealing, and it is overpriced by at least $300k.
The only things I see listed are:
- New construction: The typical faux-craftsman tract houses where you can reach into your neighbor's bathroom from your kitchen.
- Slightly used variations of the above
- Overpriced fixers ($400k for something that needs $200k worth of work in a $500k neighborhood)
- Houses that most people couldn't dream of being able to afford.
There are only 65 4+ bedroom properties on the market in Kirkland, and only 42 3 bedroom. Kirkland seems like a SFH place to me, so these numbers seem incredibly low. Redmond is even worse.
My feeling, based on talking to people that I know were trying to sell in years past, is that a lot of people have refinanced into mortgages they can comfortably afford, but can't afford to sell either. I know if I tried to sell my current home right now I'd be taking at least a $50,000 loss including fees, so will most likely be renting it out after I move into a new place.
01-11-2013 09:08 AM
... so will most likely be renting it out after I move into a new place.
This has got to be part of it. I know a number of people who are actively searching for homes to buy in the area, but are not selling the home they live in. Not yet. Low interest rates which may encourage people to buy are in conflict with slowly appreciating home values that may encourage people to wait to sell. We may need to see a sharp drop in rental rates or a significant increase in home values to break this log jam.
01-11-2013 05:56 PM
There are only 40 3 bedroom, 1.25 bath houses in Kirkland for sale right now. 3-4 are on Redfin as for sale by owner, but I really don't trust the fsbo data. 5–6 of them I have been in are compete remodels. Add n a few mor that are way overpriced and there are only two dozen houses in a affordable for a normal family. That is preset abysmal inventory.
01-11-2013 09:13 PM
Way overpriced low-quality housing, flipped homes or cheap new construction. This is all that is available.
People aren't selling because they can't. This is driving prices up (banks are holding to encourage this also) on crappy properties. Not sure why anybody thinks this is going to improve housing prices since it's another artificial bubble of sorts. Not to mention that with such government instabililty (why does everyone seem to think housing is "different" from any other sector?), there's no reason at all to predict a stabilizing housing market. That's somebody wanting you to buy debt talking. It's the same in every industry. Everything is rosy even when it isn't. Isn't that what we're verifying here?