How much do you think real estate prices in Olympia will drop over the next 2 years?

Thursday, August 21, 2008

July statistics for Thurston County

The July NWMLS statistics are in. Here are the year-over-year changes in Jul-08 compared with Jul-07 for Thurston County for single family houses:

median price: -5.8%
active listings: -6.1%
pending sales: -24.8%
closed sales: -22.2%

July 2007 was the highest median price on record. The median price in July 2008 has dropped 5.8% or about $16,000 from the peak ($275,910 in Jul-07 versus $259,950 in Jul-08).

The median price shows a significant declining trend that is similar to other counties around Puget Sound and elsewhere around the country. One surprise is that the median price is declining even though number of active listings are decreasing (2165 active listings in Jul-08 versus in 2306 in Jul-07). Pierce County was the only other Puget Sound county to show negative YOY for active listings.

Here are the charts for the last 2 years of YOY changes for Thurston County compared with the average of all Puget Sound counties:

Thursday, August 14, 2008

Home sales dip again in July

From The Olympian, August 14, 2008:

Home sales dip again in July

The median price of single family homes and condos fell 6.85 percent in July compared with a year ago. The median price fell from $275,173 last July to $256,326 this July. The number of sales dropped 18 percent. New home construction has slowed, and many potential sellers are taking their homes off the market and "waiting for the market to improve".

Monday, August 4, 2008

Home sellers turn to incentives to draw buyers

From The Olympian, August 4, 2008:

Home sellers turn to incentives to draw buyers

Some local sellers are offering scooters, trips to the Caribbean, or free gasoline to attract buyers.

Sunday, July 20, 2008

Housing prices haven't hit bottom yet

From The Olympian, July 20, 2008:

Housing prices haven't hit bottom yet

A senior ecomonist for Wachovia expects real estate to market to be weak until 2011 to 2012. Before bottoming out, nationwide prices are expected to drop 22% to 29%. If Olympia's recent 9% drop is the start of the local bubble bursting, then it is possible for another 20% drop in Olympia over the next 3-4 years.

Wednesday, July 16, 2008

Thurston County's retail sales tumble

From The Olympian, July 16, 2008:

Thurston County's retail sales tumble

Taxable retail sales fell for the first time in 13 years led by slow sales of new and used cars in Olympia. Sales were up in 3 of the 4 largest cities but were down about 5% in Olympia and down 1.29% in all of Thurston County compared with the same period in 2007.

Tuesday, July 15, 2008

Worst financial crisis since the great depression

We are only about halfway through the worst financial crisis since the great depression, according to Nouriel Roubini on Bloomberg TV this morning, being interviewed about financial markets, the economy and the testimony by Bernanke. Here are a few highlights:

  • Roubini expects dozens of large regional banks to fail as well as hundreds of smaller banks before this is over.
  • The FDIC has already used up 10% of its funds for IndyMac.
  • The stock market will probably drop another 20%.
  • The economies of the rest of the world are also going down.
  • This will be a long, ugly and nasty U-shaped recession lasting 12 to 18 months, not the mild 6 month V-shaped recession that the delusional consensus expects.

According to Roubini, "Fannie and Freddie are insolvent and the Treasury bailout plan (the mother of all moral hazard bailout) is socialism for the rich, the well connected and Wall Street, and a continuation of a corrupt system where profits are privatized and losses are socialized."

Friday, July 11, 2008

Fannie Mae and Freddie Mac tumble

Fannie Mae and Freddie Mac tumble

Fannie Mae and Freddie Mac are a huge chunk of the US economy. Together they own or guarantee about half of the total $12 trillion in US mortgages, more than the total amount of US treasury notes. Both of these companies have lost more than 80% of the their stock value in the last year and more than 50% in the last 5 days (see charts of Fannie Mae and Freddie Mac stock prices). The government may soon be forced to take over both of these companies.

Thursday, July 10, 2008

House prices tumble in June

From The Olympian, July 10, 2008:

House prices tumble in June

Thurston County home prices dropped more than 9 percent from June 2007 to June 2008.

Wednesday, July 9, 2008

Long and deep recession for 12-15 more months?

Will pressure on the US economy lead to a long and deep recession? Nouriel Roubini, chairman of and professor of economics at NYU, thinks so in this interview on CNBC.