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Distressed Inventory Report 12-5-09

The numbers are showing a definite up-tick in the amount of foreclosed inventories and the NTS/Foreclosed homes. East Bellevue as usual has some odd numbers. The amount of distressed homes rose to a high of 106 but the NTS/Foreclosed ratio fell to 1.00. However the overall amount of distressed homes is rising. West Bellevue held steady with 69 distressed homes and the NTS/Foreclosed ratio stayed the same at .91667. South Bellevue saw both its number of distressed homes rise to 52 and the NTS/Foreclosure ratio also rose to 1.26. This is the first market in the last week to have more homes being NTS than foreclosed. As has been discussed before, this means potentially a rising number of foreclosed inventory overall as the system is being feed with a larger number of homes which have their notice of Trustee Sale (NTS). Theoretically as long as there are more homes with a NTS than foreclosed homes the number of bank owned homes will continue rising. If there are less NTS homes than foreclosed homes eventually the number of foreclosed homes will decline. The other factor is the rate of sales. Sales volumes are declining, probably for seasonal reasons while the number of foreclosed homes and NTS homes being brought to the market is slightly rising. In East Bellevue in August of this year there were 10 new homes that went NTS; however the market was absorbing inventory and the next week the amount of homes that were NTS actually declined to 65. Effectively this was a drop of 10 homes which sold. This indicated a high volume of sales. If you look at the Altos research market activity index this trend is confirmed because the index was in a full upward trend. Now you can see the market activity index falling, indicating falling sales volumes which is why I think we are seeing the results that are occurring now. The most interesting trend however is that overall inventories are declining while the number of distressed homes overall is rising. In my opinion this indicates that pricing and market conditions have not improved enough to bring the “discretionary” sellers to the market. Barring a new round of layoffs locally it looks like overall there will be fewer homes to select from in the spring. In another blog post I will discuss where I think the last round of layoffs will occur that need to be absorbed locally in 2010.

As we discussed earlier there is a buying opportunity in the near term with rising bank inventories overall, even if they aren’t listed. Banks need to sell even if it doesn’t seem like it when you make your offer. Again the Altos numbers confirm this near term trend as you can see values peaked in October and have been in a decline since. Given a near term slow down in sales volume and bank inventories this could keep values at a lower level for the next couple of months, however overall the decreased inventories will put a floor on prices so seeing a situation that happened last year with small sales volume and ballooning inventory and as a result plummeting values doesn’t look like it is in the cards. However there is nothing to drive prices up. The theories of Option Arm time bombs and readjustments causing another large down leg will help to keep values low but if the inventories remain low these homes will be absorbed by the market in the next two years.

What is interesting in this cycle is how quick employers were to cut jobs and how the lenders were totally unprepared to handle the wave of foreclosures. Employers can’t keep cutting jobs forever, especially if the global market keeps growing. However there is nothing driving up wages and salaries and there are large disincentives for employers to hire given the legislation proposed in congress. Looks like we are going to get drug along a sharp rocky bottom.

Here is the link to the spreadsheet. Bellevue Foreclosure Report 12-5-09

Tags: Distressed Inventory, Foreclosed, NTS, report, Weekly
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Weekly Scorecard 11-30-09

The inventory just seems to stay pegged around the 240 number. This week it was 241 homes. Seven homes sold this week; again a pretty good number, especially for this time of year. There was one short sale in this batch of closings and one new Camwest Home. The average per sq. ft. sales price was $214, under the predominate average of $214. The average home sale price was $542,929; slightly above the usual $500,000 average. However it looks like we have hit the wall reagrding pending sales. This week there was “0″. They had been tapering off lately with last week only seeing three sales. This is most likely due to the time of year. Things really slow done but will need to see how this trend plays out. Pricing appears flat and the market appears to be very price sensitive.

Tags: average price per sq. ft., pending sales, Scorecard, sold, Weekly
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Distressed Inventory Report 11-28-09

I hope everyone had a good Thanksgiving and is enjoying some relaxing time. will keep it short and sweet. Still seeing numbers gradually increasing as to the amount of distressed inventory. In West Bellevue and South Bellevue. The overall invetory was up slightly but most signigicant the NTS/Foreclosure ratio also went up slightly. If you remember the previous weeks there was a trend with increasing inventories but a falling NTS/Foreclosure ratio that appears to be coming into line. The East Bellevue numbers were a little confusing. Their overall inventory fell by one home but their NTS.Foreclosure ratio went back up slightly. Again this is counter-intuitive and we will have to see what trend develops over the few weeks.

Clink on the link for the spreadsheet. Bellevue Foreclosure Report 11-28-09

Tags: Distressed Inventory, foreclosure, notice of trustee sale, report, Weekly
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Weekly Scorecard 11-23-09

Well better late than never. I am busy obtaining clock hours for me RE License renewal so a little bit behind. So here goes. The inventories just seem to be stable. This week there was 240 homes on the market. Down from the 247 last week. This time last year inventories were escalating and a lot of it was distressed inventory. This year that does not seem to be the case. It looks like a more traditional cycle where you may have sellers removing inventory from the market for the holidays and then trying again next spring. We will need to wait to see if inventories increase next year.

The sales volume was impressive at 10 homes. However the per sq. ft. sales price was $215; below the traditional $225 per sq. ft. average. So low prices equals greater volume. There was only one bank owned home in this batch of sales. Two sales very interesting. First the bank owned home was on the market for only 9 days and was listed at $360,000 and the closing sale price was $401,000 so it looks like a bidding war occurred here. The per sq. ft. price sales price was pretty low at about $160 per sq. ft. and the home was a “fixer”. We are seeing this strategy used more often by some sellers of listing at an obvious low asking price to generate urgency and it has been working. This strategy relies on the assumption there is a pool of buyers trolling for good deals and this sales method of “obvious value”, brings out those buyers. The other notable sale was a Camwest new home sale. The reason the sale was notable was that the sale price and the list price were the same price and at the original list price; this is a first. As I have discussed before new construction inventory is reaching depletion and good operators like Eric Campbell at Camwest appears are starting to see benefits from this trend. The buyers however have drawn a line in the sand and pricing is very important. The average home sale price this week was $523,590.

There were only three homes that went pending this week. Pretty typical for this time of year. The average listed price was pretty high $619,983 but the per sq. ft. price was $211. So it looks like price sells. It is very evident we have a pool of discretionary buyers that make their purchases on obvious value. I suspect this trend will continue sometime frustrating sellers who anticipate potential price pressure but never see it develop because the buyer refuses to participate in the market. We don’t have enough new job growth moving in to put any upward pressure on pricing. However the good news is that it appears we have enough people with a good job and some savings to purchase when they see the price is right.

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Distressed Inventory Report 11-21-09

The distressed inventory is still treading water with no real break out trend other than it appears the swimmer is starting to get tired. East Bellevue this week saw its overall inventory rise by one home to an all time of 100 homes which can be categorized as distressed. However its NTS/Foreclosure ratio fell to is lowest level of 1.0. As I have said before this trend has to break one way or the other and so far it is just prolonging itself with no clear direction. West Bellevue is stuck at the same numbers as last week. No clear direction there. South Bellevue was the only that broke a little bit to the downward side and had a clear direction this week. Its inventory and NTS/foreclosure ratio were both up. The move was slight with the overall inventory up by only two homes and the NTS/Foreclosure ratio bumped up from .91 to 1.00. For a clear downward trend to emerge that ratio needs to go over 1.00 which indicates more preforeclosure NTS inventory entering the system which will ultimately increase the number of bank owned homes. Like the economy overall no clear trends just a real muddle.

The XL chart is on the link below.

Bellevue Foreclosure Report 11-21-09

Tags: Distressed Inventory, Foreclosed, inventory, notice of trustee sale, NTS, NTS/foreclosure ratio, Weekly
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Weekly Scorecard 11-16-09

Well the listings continue to hover aroound the 250 mark. This week we are at 248 total listings and last week we were 247. I thought it would be a little higher with the usual seasonal downturn in sales. The number of sales were five this week with the average sales price a very typical East Bellevue number at $481,770. The average per sq. ft. price was pretty low at $207 per sq. ft. Typically East Bellevue has been around $225 per sq. ft. All of the homes this week were older homes so that may be the reason but there was no bank owned homes or short sales in this group of closings. Six homes went pending this week and the average listed price for the homes was $449,958 and the average per sq. ft. list price was $214. Looks like all the action is under $500,000 this week.

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