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Weekly Scorecard 5-24-10

It appears inventories have peaked. When you look at the spreadsheet the inventory increase for now have leveled but while sales appear robust the pending sales have fallen off some. The combination of peaking inventory and peaking sales volumes will keep this market reading water. The actual closed sales look impressive and they are but the pending sales need to increase to keep any upward pressure on this market. For right now it appears to be just muddling along.

The spreadsheet is here: Weekly scorecard 5-24-10

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Distressed Inventory Report 5-22-10

Here we go. Definitely seeing an up trend. The amount of foreclosed homes is not spiking but the notice of trustee sales (NTS) are steadily increasing. In the weeks before we saw maybe one to to new NTS and in many cases the amount of homes selling was offsetting the new NTS. Not the case anymore. It appears that the sales of the foreclosed homes have slowed down and the NTS homes are coming to the market at about 4 to 5 a week in each area and then throw in a couple of projects that are going to auction and you have steadily increasing distressed inventory.

In the last cycle last year we saw prices soften until the inventory peaked and then declined. The best buys were on the backside of the decline in distressed inventory just after the peak. The overall economic news will keep rates lower and jobs seem to be going nowhere for now so I don’t see much upward pressure. The issue now is there is almost no new inventory and most of the inventory is now resale. In my opinion this means two things. The first is that if you are a and have a resale home fix it up as close to new as possible to get a jump on the competition. This will give you an edge over the short sales and bank owned homes that need a lot of work. Then price accordingly just because you have seen a number of homes in your neighborhood sell don’t delude yourself into thinking you will get any premium. You are going to struggle to get the sale.

If you are buyer don’t over estimate the amount of competitive buyers that come out of the woodwork all of a sudden for a good home at a good price. I see this happen over and over a few smart sellers price to sell and nothing else sells but there is a multiple offer situation on that one house. The reason is there is no shortage buyers but they will only pay a certain price and are very discretionary. My wife just went through this process. A buyer she had been working with for almost two years finally purchased a home. However the home was in good condition and priced well below the competition at almost $20 per sq. ft. less but at the average per sq. ft. sale price for the neighborhood last year. There were three offers on it two days and the home went for $5,000 over the list price. If he would not have received this obvious value he would have just stayed put. This will be the nature of the market for the next couple of years.

The spreadsheet is here: Bellevue Foreclosure Report 5-22-10

Tags: Bellevue Homes, Foreclosed, notice of trustee sale
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Weekly Scorecard 5-17-10

Well it is a double this week. Since I was out of town last week I didn’t do the report so I have combined two weeks. There are a coupled trends worth noting. The first is that East Bellevue which had seen inventroy building just saw a drop in inventory over the last couple of weeks. The other Bellevue areas West Bellevue and South Bellevue both saw their inventories continuing to rise. However sales appear strong but the pending sales were down. In general you will see sales starting to decline towards the summer doldrums last year that was not the case but it appears that this maybe occurring. Let’s see what the next couple of weeks bring.

The spreadsheet is here: Weekly scorecard 5-17-10

Tags: Bellevue Homes, East Bellevue, inventory, pending, sold, South Bellevue, West Bellevue
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April Numbers

The April numbers are in and a couple of observations. The news has published the information about the increasing number of sales but there is also more inventory being brought to the market. Inventories in some areas are reaching their Q1 09 peaks. In East Bellevue it is almost up to that point now with over 270 homes listed. The big question over the next couple of months is if the pending sales which are seeing dramatic increases will sustain that trend to absorb this new inventory. Many sellers that had been withholding product seem to have seen the sales in their neighborhood and appear to be brining their homes on the market. The other trend is that per sq. ft. prices in some Eastside markets look to be inching up. The big deal in my mind was that while the inventories had been declining and sales volumes were headed higher pricing seemed to be stuck. The per sq. ft. prices have been flat and they still are in King County but in some of the Eastside areas you can see that they are starting to trend up. In order to sustain this trend up sales volumes need to see their present levels.

The character of the market is changing. Overall distressed inventory is a smaller portion of the market with short sales now taking center stage as the form of distressed inventory with the most opportunity. Many lenders such as Bank of America appear to be putting more resources into short sales since they can dispose of the properties with out having to take possession. However as the distressed inventory works its way through the system there will be fewer distressed sellers overall and prices will start to firm up but there is also a back log of sellers who have withheld their homes from the market for the last two years and that inventory will also be coming available over the next year. The good news for the buyer is that this inventory being brought to the market will be better maintained and it will be easier to come to terms with the seller. The low interest rates appear to be around for the immediate future due to the overall economic weakness. However the day of sending in excessively low offers appears to be coming to an end for two reasons. The first is that sellers are pricing more realistically. Last spring when the market declining finding the right price was a matter of sending in offers and finding the most motivated seller. In this market sellers are pricing closer to the market since there has been a closed sales which show a trend. The second factor is that for the nicer inventory there is a lot more competition as more buyers are entering the market due to the stabilizing economy and the low interest rates.

In the next week in this Blog I will discuss the best strategies for both sellers and buyers. Bottom line is that sellers still are swimming upstream the next couple of years but the current is not quite as swift. For the buyers it will be finding the swirls and eddies in that stream to find where the best values pooling.

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Distressed Inventory Report May 15, 2010

Not much change but a slight drop from the big spike up last week. Still looks like the trend is to creep higher. Also the April numbers are in and you should check those out.

The spreadsheet is here: Bellevue Foreclosure Report 5-15-10

Tags: East Bellevue, foreclosure, Notice of trusteee sale, South Bellevue Bellevue Homes, WestBellevue
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Distressed Inventory Report May 8, 2010

Well I have been gone for the week and just got back but a lot has happened. The numbers have taken a big jump up but that is mainly due to a couple of condo projects brining units to the market but even without those units coming to the market there was an overall increase. In East Bellevue Homestreet Bank filed a notice of trustee sale on a condo covnersion project known as Champagne at Bellevue. This project should never have been contemplated it was a marginal 1970s low density surface park apartment buillding that was converted to condominiums. In my opinion this project should be sold by Homestreet as an apartment building and not try to sell as condos. Even in the best market this project would have struggled. In West Bellevue a speculator at Washington Square that actually closed on some of its units is now having them taken back and a notice of trustee sale has been filed. Tomorrow I will be updating this activity for the week of May 9th.

The spreadsheet is here: Bellevue Foreclosure Report 5-9-10

Tags: Bellevue Homes, foreclosure, notice of trustee sale
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