The Seattle area real estate housing supply heat maps are out for February 2010 and show a significant shift from what was primarily a Buyer’s Market in 2009 (green, defined as over 6 months of housing supply) to a Balanced Market in 2010 (yellow, defined as 3 to 6 months of housing supply.) Red areas indicated a Seller’s Market, defined as 0 to 3 months of housing supply.
Feb. 2010 Months of Housing Supply (right) compared to 2009 (left). Red = Seller's Market, Yellow = Balanced Market, Green = Buyer's Market.
Click the image to see a larger version of the heat maps. “Months of Supply” means the number of months that it would take to deplete the current housing inventory if homes continued to go off market at the current rate and no new listings were added.
As we draw near the April 30, 2010 deadline for the $8,000 First-Time Home Buyer Credit and the $6,500 Move-Up Home Buyer Credit, expect Seattle area home listings that are not short sales to increase in value compared to short sales.
Based on what I’m seeing (and hearing from my own clients), many people who currently have offers on short sale listings and who are still waiting to get their offers approved by the underlying lienholders may abandon their short sale offers and look for homes that are not short sales in order to get a deal signed around and closed by the credit deadlines. (In order to qualify for either credit, transactions must be mutually accepted by April 30, and closed by June 30, 2010.)
Whenever you have an increase in demand that affects one category of the housing market more than another, those home values increase in comparison. I expect non-short sale listings to reach a premium in April due to the many prospective buyers who qualify for one of the credits and the typically extremely lengthy period of time it still takes most lienholders to approve offers on short sales.
That being said, short sales are still providing competition in the housing market and non-short sale listings need to be priced competitively – just expect them to get a boost shortly.
Click ‘Play’ to hear me summarize proposed FHA loan program changes in 2010.
A few years ago FHA loans made up only around 3 percent of the home loan market. Now they make up closer to 50 percent, due to their lower down payment requirements (3.5.%) and less stringent qualification standards, combined with the virtual disappearance of conventional zero-down loans and second mortgages.
Some quick background: FHA loans are backed by the Federal Housing Administration, and despite their less strict qualification standards have typically had a pretty healthy rate of repayment; however, during the mortgage crisis many subprime borrowers turned to the FHA program, and it’s expected that the FHA loan repayment rate will worsen significantly over the next few years. Bankrate.com has a pretty good overview of the FHA loan program.
Changes in Store for FHA Loans:
On December 2 HUD Secretary Shaun Donovan announced the following proposed changes that will affect new FHA borrowers:
1. Increasing the required initial cash investment.
This could be done by increasing the down payment from the current minimum of 3.5%, and/or by not allowing borrowers to finance the FHA premium.
2. Increasing the minimum FICO (credit) scores requirement.
3. Increasing mortgage insurance premiums.
4. Reducing the allowable seller concession to the buyer from its current cap of 6 percent, to as low as 3 percent.
These are big changes, and not all of them need Congressional approval. In other words, some are expected to be implemented early in 2010, so if you know of someone planning to purchase a home with an FHA loan this year please let them know about this post!
A few weeks ago I stopped by Corey Hubbell’s glass design studio in Redmond at the urging of my friend Charles from AquaSports, and I was simply amazed at the quality and quantity of beautiful blown glassware Corey has for sale. Here are some shots I took of his warehouse with my Blackberry.
Prices that I saw ranged from around $20 for small pieces such as a Christmas ornament, to several hundred dollars for larger, ornate pieces. Right now he’s having a moving sale, with discounts of 15% to 50% off, so it’s a great time to stop by.
Also, Corey’s work helps support his own efforts as part of a mission team that aids in the maintaining and rebuilding of a school for disabled children in Peru – an even better reason to stop by! 
New Address: 7102 180th Avenue NE, Redmond, WA 98052 (Map below) 425-882-4971
View Larger Map
PENDING SUBJECT TO INSPECTION
This is a fabulous home just blocks from Microsoft and Nintendo, and minutes to Redmond Town Center, Marymoor, 520 and Grass Lawn Park. Light and bright kitchen with hardwoods and maple cabinets, new dishwasher and stove. New paint, new vinyl and tub/shower surrounds in baths, remodeled family room perfect for media room, double pane windows throughout. Large fully fenced yard is great for relaxing or play. Mud room, spacious garage with a shop area. Central air conditioning for those sweltering summer days! Wired for FIOS. Lake Washington school district. Not a short sale, just move in! For more information or a showing, call me at 206-335-3335 or click here to email me.
Details:
PENDING SUBJECT TO INSPECTION
Listed at $419,950
3 Bedrooms
2.50 Baths
1680 Square feet*
Built 1969, remodeled
5309 159th Ave NE, Redmond, WA 98052
MLS# 29155125
Information is taken from sources deemed to be reliable but is not guaranteed. Buyer/Selling Agent to verify all info.
I’ve just listed this gorgeous 2 bedroom, 1.75 bath top floor condo in a rare 4-unit building in the desirable Tanager complex. Big kitchen with granite counters, pantry, lots of cupboard space, great for entertaining. 2 large bedrooms, each with its own bath. Very private setting surrounded by trees. Minutes to Google, Microsoft, Evergreen Hospital, Cascadia College, and just a few blocks from Trader Joes, QFC & Starbucks. Very near Park & Ride and the new HOV access to 405. FHA-approved complex, not a short sale! For more information or a showing, call me at 206-335-3335 or click here to email me.
Details:
2 Bedrooms
1.75 Baths
923 Square feet*
Built 1990, remodeled
Tanager Complex – 11301 NE 128th St. #A201, Kirkland WA 98034
MLS# 29155047
Information is taken from sources deemed to be reliable but is not guaranteed. Buyer/Selling Agent to verify all info.
Here are the October 2009 housing inventory supply numbers going back five years for selected Seattle areas.* Months of Inventory (MOI) refers to the number of months it would take the current housing supply to be completely sold if no new listings were added.
The geographical area is marked at the top left of each chart. You can also click here to view stats for all Seattle and Eastside areas (opens as a pdf.)
*All reports published October 2009 based on data available at the end of September 2009. This representation is based in whole or in part on data supplied by the NWMLS. Neither the Board nor the MLS guarantees or is in any way responsible for its accuracy. Data supplied by the Board or the MLS may not reflect all real estate activity in the market. Report reflects all activity by brokers participating in the MLS.
