Bellevue Real Estate Forecast (Seattle, Sammamish: for sale, foreclosures, mortgage)

[SYS]

My first post... so hello to everyone!

I'm planning on relocating my family of 4 to Bellevue from Colorado Springs, CO, and my timeline for relocating is approximately within 6 months to 1 year from now.

The way our economy is looking, what do you folks think about the housing (only single-family owned) market in Bellevue is going to be like around then? I know that this is mostly an exercise in conjecture on everyone's part, but I still like to pick your brain on this topic...

[Ira500]

Hi SYS,
Home prices in Bellevue are continuing to drop. So, are you asking when will the dropping stop and how much lower will prices go?
Opinions are all over the place. A lot of real estate professionals ( me excluded) say that we have hit bottom and that with the combination of lower prices and low interest rates, there's never been a better time to buy than right now. But when has a real estate professional ( other than me) say that now is not a good time to buy?
My guess is that prices will continue to drop until at least the 3rd quarter of 2009, and possibly up to another year longer than that. So if you bought a house a year from now it might be at or very close to the bottom. Home prices in Bellevue and elsewhere around here have dropped, and if you look hard enough there are places for sale right now that are substantially reduced from either their original asking price or their value of two years ago...There's no harm in looking and taking your time to find the house you want at the price you want to pay. It's highly doubtful that home prices are going to start rising within the next year, and don't let a real estate professional pressure you into believing otherwise. It's like asking a barber if you need a haircut.

[SYS]

Ira500 - thank you so much for your honest views. It's rather hard to get an objective perspective from a professional in a highly competitive industry. You're an exception, I'd say!!

Your forecast pretty much is in line with what I've been thinking. I was actually thinking about relocating to Bellevue about 2-3 years ago, but the housing market there was a bit beyond what my comfort level dictated. I'm hoping to find more affordable housing in a year's time.

[70Ford]

Late 2012. Massive alt A loans will cause more foreclosures. The vast majoraty are due to reset iin 2011....with it petering out around 2012. A higher jobless force will not be able to absorb the mounting rise in foreclosures. Prices still have a ways to drop to compensate for the massive runup in housing prices in Seattle since 2000.

http://mrmortgage.ml-implode.com/wp-...arm_reset2.jpg

The way that many homes in Seattle were afforded was with loans that are easy to pay back with 140K in take home a year. One of the striking things happening now is that the sale of "middle point homes" has tanked. Low, low cost housing/crack houses are doing OK. Slightly higher end (1 mililion plus) is doing ~ Ok, but the last time I checked, there was an 8 month supply of 1 million + homes...and they are still building them. The proiblem is that the people who "sold and moved up" to middle can't sell for what they need to to keep the gravy train rolling. It's a combination of joblessness/lack of raises/appraisals becoming more realistic. The hilarious thing is that the tax on that home is based on a prior appraisal...so...in essence, your paying taxes on something that isn't worth what they say it is worth for tax purposes.

There's a lot of people asking for their home to be reassessed for taxes these days. Funny how that works out. With King county facing a budget crises like it has not seen for decades, I doubt everyone will be happy with the results of their request.

The way I see it, if you buy a home now, you are buying a depreciating asset while being taxed on the appreciation someone else got to enjoy. Kind of like buying a used car with 2/3rds of its original horsepower.

Another way of looking at it is if home prices only decrease by 2 percent next year, and you paid 300k for that home, you just lost 6,000 bones. Which is only 500 bucks a month. Which you could have given me. What? You wouldn't give me 500 bucks a month? Why not?

Yeah, I don't like losing money either. Ira is right, it is a good time to buy if you're ready to commit for a while. The next home I buy won't be my last, methinks...so I don't want to lose money in the process. The market (in my opinion) is too unstable to be thinking about throwing away cash money. I am planning on buying one around 2012, though.

[azoria]

Originally Posted by 70Ford

One of the striking things happening now is that the sale of "middle point homes" has tanked. Low, low cost housing/crack houses are doing OK.

This is a *cottage* not a crack house, m'kay? And in Magnolia! Bellvue be dammed.

From craigslist, "Very clean and cute two bedroom nice layout , It is its own house and yard. It has all new paint inside."

[teamirene]

I agree with Ira 500, we are still going to see the fallout of the layoffs, etc that are happening now and projected to happen over the next few months - it takes time for those effects to be felt. Now is not a bad time to buy if you plan to hold onto your home for a while and can handle some depreciation early on, however I think your timing is going to work out well for you if you're looking at 6 to 12 months - after that, like Ira500 says, it's truly up in the air - you could be looking at the bottom, or not, depending on how the economy is doing - that's anybody's guess.

[SYS]

Obviously the most ideal situation would be for any home buyers is to purchase the house when both the price and the mortgage rate have bottomed out. I just hope that the mortgage rate looks as good as now in 6-12 months... If so, I wouldn't worry all that much about trying to "time" the house pricing bottoming out... I'm just hoping to get lucky finding a house at around $500,000 in peaceful, clean, and family oriented neighborhood somewhere in Bellevue...

Along with the topic of real estate forecasting, anyone care to forecast the mortgage rate trend in the near future?

[Ira500]

I'm just hoping to get lucky finding a house at around $500,000 in peaceful, clean, and family oriented neighborhood somewhere in Bellevue...

Two years ago there was almost nothing available in Bellevue for under 500k, and what was for sale were the kind of houses you needed to hold your noses when entering.
That's changed a lot, and recently I've seen a bunch of fairly nice homes for under 500 thousand in both Bellevue and Issaquah...

About interest rates: In the past there was a relationship between home prices and interest rates...if rates rose, home prices would often drop, and if rates dropped, home prices would rise. It's way too simplistic, and that was not in a national recession...Right now prices and rates have both been dropping.

[SYS]

If I don't have kids, I'd be looking at Woodinville or another place that is more "bucolic" and away from the city life. But I'm looking out for the best interests of my 9 and 11 year old boys. I'm targeting Bellevue until they graduate from high school and leave home for college, so I'm looking to settle in Bellevue for about a decade. Afterwards, if my wife and I love the place and see no compelling reason to move, then we'll retire there. If not, then we'll move to Woodinville or a similar place for retirement years.

I chose Bellevue because I'm interested in:

1) Newport Senior or Bellevue High School
2) Bellevue Youth Symphony
3) Bellevue Swim Club

1) I think Newport Senior High has a better orchestra than Bellevue High. The former seem to have better academic scores than Bellevue or at least similar. I know that both are "Gold Medal" schools that are in top 100 in the nation for best public schools, not that I have much of a respect for the magazine that does the ranking... Nevertheless, it's an indicator -- one indicator...

2) I don't want to be driving in to Bellevue in order to participate in the Bellevue Youth Symphony, having heard so many horror stories about the traffic jams going in and out of Bellevue. Also, it's my guess that it's more likely to find excellent private instructors in violin and piano in a city that has both the youth symphony and the philharmonic. Again, I don't want to be driving into Bellevue from elsewhere in order to have a weekly lesson for my boys.

3) My boys are also competitive in swimming and tennis. From what I know, the Bellevue Swim Club is excellent. Given my boys' current times in all strokes, I think they can swim for Newport Senior High School swim team when they get into high school, although I get the sense that it's not the best high school swim team.

Anyway, these are some of my current best thinking that I can come up with without having the first-hand experience ever seeing the place. I'm hoping to make our first visit within the next several months, perhaps this coming summer. I'd very much appreciate if anyone's willing to CORRECT my possibly error-ridden thinking. I'm extremely open when it comes to such....

[Ira500]

Sammamish High School in Bellevue is also very well regarded, though I don't know about orchestra or swim team...But academically it's one with very high ratings.