October Monthly Meeting

Monthly Report On Real Estate ActivityMonthly Report On Real Estate ActivityIn The Pacific Northwest RegionIn The Pacific Northwest Region Ken BellKen Bell

October 2009 Monthly Meeting

For For REALTY EXECUTIVESREALTY EXECUTIVES


For the first time in five years, existing-home sales have increased for four months in a row,

according to the National Association of REALTORS®.

Existing-home sales – up 7.2% Existing-home sales – up 7.2%

annual rate of 5.24 million units annual rate of 5.24 million units

Sales are 5.0 percent above the 4.99 million-Sales are 5.0 percent above the 4.99 million-unit pace in July 2008. unit pace in July 2008.

The last time sales rose for four consecutive The last time sales rose for four consecutive months was in June 2004,months was in June 2004,

and the last time salesand the last time sales

were higher than a yearwere higher than a year

earlier was November 2005earlier was November 2005


New Study

Despite all of the bad news in the media about Despite all of the bad news in the media about homeownership and mortgages, most homeownership and mortgages, most Americans still believe buying a home is a Americans still believe buying a home is a great investment, according to a new study great investment, according to a new study commissioned by Bankrate.com.commissioned by Bankrate.com.


Among the findings from the study:

- 92 percent say that a home is a good investment - 92 percent say that a home is a good investment for the future. for the future. - 48 percent worry about losing or being unable - 48 percent worry about losing or being unable to afford their homes.to afford their homes.


Northwest MLS brokers agree "there's a lot to be optimistic

about"

"There's a lot to be optimistic about," "There's a lot to be optimistic about," according to one director of the Northwest according to one director of the Northwest Multiple Listing Service upon reviewing Multiple Listing Service upon reviewing summary statistics for September's summary statistics for September's housing activity. housing activity.


The report shows a big jump in pending The report shows a big jump in pending sales compared to a year ago (up almost sales compared to a year ago (up almost 27 percent), continued drops in inventory 27 percent), continued drops in inventory (down 17.7 percent versus a year ago) and (down 17.7 percent versus a year ago) and brisk demand for homes at the lower end brisk demand for homes at the lower end of the price spectrum.of the price spectrum.


Distressed properties in the system continue to Distressed properties in the system continue to be a drag on prices – median prices for last be a drag on prices – median prices for last month's sales were down about 7.5 percent month's sales were down about 7.5 percent from a year agofrom a year ago

Brokers continue to voice frustration with slow Brokers continue to voice frustration with slow response time by lenders. (Banks are taking response time by lenders. (Banks are taking 9.5 weeks to respond to short-sale requests, 9.5 weeks to respond to short-sale requests, versus 4.5 weeks a year ago, according to versus 4.5 weeks a year ago, according to research by Campbell Communicationsresearch by Campbell Communications

of Washington, D.C.)of Washington, D.C.)


The industry estimates up to 10 percent of The industry estimates up to 10 percent of pending sales do not close because they're pending sales do not close because they're caught in the short sale cycle. Still, "There caught in the short sale cycle. Still, "There is a lot to be optimistic about." Interest is a lot to be optimistic about." Interest rates that are now in the high four rates that are now in the high four percents as bordering "on being epic" and percents as bordering "on being epic" and the federal tax credit as stimulants to the the federal tax credit as stimulants to the market.market.


Northwest MLS brokers reported 7,581 Northwest MLS brokers reported 7,581 pending sales during Septemberpending sales during September

Outgaining the same period a year ago by Outgaining the same period a year ago by 1,599 transactions for a 26.7 percent 1,599 transactions for a 26.7 percent increase.increase.

Last month's condominium sales surged, Last month's condominium sales surged, with pending sales up nearly 25 percent with pending sales up nearly 25 percent from a year agofrom a year ago


During September, members added 10,054 During September, members added 10,054 new listings of single family homes and new listings of single family homes and condominiums to inventory, about 7.6 condominiums to inventory, about 7.6 percent fewer than a year ago.percent fewer than a year ago.

With the combination of fewer new listings With the combination of fewer new listings and more sales, inventory at month end and more sales, inventory at month end dipped to its lowest level since March.dipped to its lowest level since March.

At month end, the selection included 40,041 At month end, the selection included 40,041 properties for sale (33,332 single family properties for sale (33,332 single family homes and 6,709 condominiums).homes and 6,709 condominiums).

That's down 17.7 percent from twelveThat's down 17.7 percent from twelve months ago.months ago.


““Demand is at its highest level in two years. Demand is at its highest level in two years. For all the challenges that remain, it would For all the challenges that remain, it would be difficult to not appreciate the be difficult to not appreciate the reemerging market vitality that continues reemerging market vitality that continues to build even as the summer buying to build even as the summer buying season closes." season closes."


Emphasizing recovery comes in stages, Emphasizing recovery comes in stages, Beeson acknowledged some "hard Beeson acknowledged some "hard adjustments" are being made in higher adjustments" are being made in higher priced homes where inventories remain priced homes where inventories remain high, but expects that segment to recoverhigh, but expects that segment to recover

Example of 36 over a million dollar Example of 36 over a million dollar homes/condo’s in Bellevue 1 sold in homes/condo’s in Bellevue 1 sold in SeptemberSeptember

Five went pending or 7 month supplyFive went pending or 7 month supply


He said the main focus of many agents is He said the main focus of many agents is meeting the needs of the first-time buyers meeting the needs of the first-time buyers and those who have needs because of and those who have needs because of lifestyle changeslifestyle changes

An example of under $400,000 homes in An example of under $400,000 homes in Bellevue only 8 are active, while 8 are Bellevue only 8 are active, while 8 are pending, and 4 sold and closedpending, and 4 sold and closed

While in Condo’s 75 active, 38 pendingWhile in Condo’s 75 active, 38 pending

and 15 soldand 15 sold


Beware Craigslist scam on rentals

NWMLS has been notified of a scam NWMLS has been notified of a scam involving the placement of active involving the placement of active residential listings on Craigslist as rentals.residential listings on Craigslist as rentals.

The perpetrator posted the address, the The perpetrator posted the address, the listing agent’s photos and verbiage in the listing agent’s photos and verbiage in the false ad. false ad.

When the public show up at house the lease When the public show up at house the lease is signed checks given and keys areis signed checks given and keys are

exchangedexchanged

Then the owner finds squatters at homeThen the owner finds squatters at home


24 Hour Market Watch inThe NWMLS

Last MonthLast Month September 09September 09

1.1. New Listings New Listings 499499 635635

2.2. Back on MarketBack on Market 155155 236 236

3.3. Price IncreasesPrice Increases 2929 29 29

4.4. Price ReductionsPrice Reductions 585585 613 613

5.5. ContingentsContingents 88 9 9

6.6. PendingsPendings 347 347 351351

7.7. SoldsSolds 187187 378378

8.8. ExpiredsExpireds 9898 559 559

9.9. InactivesInactives 286286 273273


How will you know when the market hits bottom

An critical point for Buyers in spite of the fact that An critical point for Buyers in spite of the fact that the prices, inventory and interest rates will never the prices, inventory and interest rates will never be in a better balance is:be in a better balance is:

But can it drop even more?But can it drop even more?

How will I know that we have hit bottom?How will I know that we have hit bottom?

The answer is:The answer is:

We will notice it 4 months laterWe will notice it 4 months later


V Shaped Recovery

Back in June when I first saw these charts the Back in June when I first saw these charts the economy was starting a V shaped recovery.economy was starting a V shaped recovery.

Now 4 months later, the economy has Now 4 months later, the economy has strengthened noticeably, with the data strengthened noticeably, with the data exceeding consensus expectationsexceeding consensus expectations

Market forces – particularly production levels that Market forces – particularly production levels that were brought down below sales to clearwere brought down below sales to clear

out inventories which started the fallout inventories which started the fall

bottomedbottomed


Consumer Confidence


Non Farm Payroll


Richmond Fed Index


Crude Oil Prices


Gold Prices


Market TrendsIf you would like to know what we think of the Real If you would like to know what we think of the Real

Estate Market in The Pacific Northwest there is Estate Market in The Pacific Northwest there is only one correct answer!only one correct answer!

IT DEPENDS…IT DEPENDS…

There has never been a better time to buyThere has never been a better time to buy

If you need to sell, If you need to sell,

you must take more consideration onyou must take more consideration on

market positioning as foreclosures andmarket positioning as foreclosures and

short sales set priceshort sales set price

October Monthly Meeting

Real Estate

Transcript of October Monthly Meeting