How Seattle Rides Real Estate Storms
This article and letter to a customer (from March 08 with subsequent updates) are a brief collection of my thoughts on Seattle’s ability to ride out the current national economic storm. As with all research, anyone can tweak any data to mean what they wish, so I have tried to find the most balanced perspective possible. I do believe in Seattle Real-Estate as a sound real-estate investment in comparison to other parts of the country. When to sell ? When to buy? That’s as individual as yourselves. Where to buy? HERE as soon as you find a place that’s comfortable. How much to buy, what percentage of your debt to income ratio? Likely up to somewhere around 41% of your gross income, including all your debts is the old standard before this last unregulated splurge that got many in trouble. Well here it is, hope this is of some help.
info added 11/19/08
Forbes where to invest in real-estate
(specifically commercial but homes follow that market closely)
http://realestate.msn.com/buying/Article_Forbes.aspx?cp-documentid=12808843>1=35000
Info added 10/30/08
New US home price comparative graphs 1990-2008 US as a whole and select markets Seattle SanDiego, Miami, etc
http://mysite.verizon.net/vodkajim/housingbubble/
Seattle is an area of excellent opportunity in real estate. The most stable is King County. Currently, home prices are down 1-6% + – over last year in King county (the area Seattle, Bellevue and Redmond are in), each micro area has its own story most readily explainable. Most stable are the areas just north of Seattle’s city core and then east through north Bellevue and Redmond. These areas are home to Microsoft, Amazon.Com, Zymogenetics, UW, and their employees. Many Boeing management employees also live in these areas. Boeing plants are south and north of town and while the areas around the plants are susceptible to air tanker, and dream liner, sales and losses (causing housing to fluctuate) the management core doesn’t fluctuate as much.
The historical charts show somewhere between 3 to 5 years for the average slump which is usually fairly flat then turns upwards. By my count we’re at about 18 months in and hopefully near the bottom of the curve but who really knows. My family has been in real-estate in WA state since 1914. My Grandmother was a real-estate lawyer in a downtown Seattle office. She always said real-estate was a sure deal, but always buy it knowing it could be a 20 year investment. You might be able to sell it at 5 or 10 years at a profit but who can tell? At somewhere between 10 and 20 years it was her feeling you would always have an opportunity to net a sizeable gain. Choosing just when to sell was the art … I guess some things never change.
I think right now or fairly soon is a good time to invest. How much? That depends on your available funds … Properties at the $250-350k are “affordable housing” and every house flipper/investor or newlywed/first time buyer are eating them up. Many of the GREAT deals seem to be in new construction town homes $500-600K or you can look for the last $700K house on the cul-de-sac because the builder wants to be done with that plat.
This article (admittedly from March 08) excepting the new US market comparative graphs at http://mysite.verizon.net/vodkajim/housingbubble/
These links are some of the best I have found on defending Seattle’s ability to ride out the current national economic storm. Obviously, there is no crystal ball, but next is one of the best single sources of a fairly balanced view that I’ve found, as well as a couple of links to some graphs I found interesting: http://seattlebubble.com/blog/2006/09/03/seattle-times-we-are-immune-so-says-history/
http://seattlebubble.com/blog/2008/02/19/king-county-home-prices-1946-2007/ http://seattlebubble.com/blog/2008/02/28/king-county-affordability-1950-2007/#more-1621http://www.zillow.com/static/images/quarterlies/2008-Q1/Home-Price-Appreciation-Seattle-WA.jpg
Zillow can be kind of up and down on their pricing/valuing of current homes on the market, however these links are the compiled home prices sold last year and not their “zestimates”.
http://seattlebubble.com/blog/
For continued discussion of the local market, the Seattle Bubble blog is a fairly well balanced neither Polyanna nor the Harbinger of Doom.
Larry Baumgartner | Realtor