For all of 2007, existing home prices fell 1.8% and represented the first nationwide decline in houses since Realtors started tracking data over 40 years ago. BUT think of this, we have experienced historic gains of over 100% in the past several years in many parts of the country, so how bad is a 1.8% year over year decline. If the Stock market doubled in the past three years and the market then declined 1.8%- would it even make the headlines? Think about it!!  We are seeing a buyers real estate market along with mortgage rates at three year lows, when was the last time we have experienced this type of market? Once again, this is still a great time to buy real estate!

According to the Census Bureau about 14% of the population- about 39.8 million people- moved between 2005 and 2006, about the same percent as moved the year before. The Bureau report said:

• Nearly half of the reason given for moving (18.4 million) were housing-related, such as wanting a bigger or smaller house.
• The West had the highest moving rate (16 percent), followed by the South (15 percent), the Midwest (13 percent), and the Northeast (10 percent).
• Hispanics had the highest moving rate (18 percent), followed by blacks (17 percent), Asians (14 percent) and non-Hispanic whites (12 percent).
• In 2006, nearly one-third (30 percent) of all people living in renter-occupied housing units lived elsewhere a year earlier. The moving rate for people living in owner-occupied housing units were seven percent.
• Most movers stayed within the same county (62 percent), while 20 percent moved from a different county within the same state; 14 percent moved from a different state and three percent moved from abroad.

This article is from The Real Estate Digest courtesy of Chicago Title.

The foreclosure increase is not just limited to the United States, a Scottish reporting agency says as many as 170,000 families are now struggling to meet their mortgage commitments and is forecasting that some 45,000 will be forced from their homes next year. The estimates come as the global housing crisis spreads from the United States to the United Kingdom and even China, where hot markets have suddenly turned cold and overextended homeowners are unable to make payments. Scotlands Council of Mortgage Lenders is forecasting that home prices will increase one percent next year and property sales will fall by 15 percent. The country's mortgage approval rate already has dropped to its lowest point in decades. This article is from the Real Estate Digest.

Not ony is the Seattle area real estate market out performing other states but we are also out performing other country's. One common trend I see in both the United States and other country's is that the overextended homeowner is the one getting into trouble. A little advice, don't buy more home than you can afford on a "junk" loan!!

I came across this article in the Real Estate Digest  (complements of Chicago Title) and found it to be very informative. Here what the article says...Why are certain metropolitan areas able to double and even triple the national population growth rate? After examining the Top 10 Growing Markets in the U.S., NuWire, a market research firm, discovered that each market owed its growth to  a different and unique combination of economic factors, but there were similarities common to all.

Job growth was a key factor underlying the population growth of the Top 10 Growing Markets. Retiree and pre-retiree populations made up a significant portion of the growth in most of the markets, while young adults and children were also a substantial part of the growth in some of the markets.

Real estate in the Southwest is booming, with growth in almost every age group. A temperate climate, recreational and entertainment opportunities and an affordable cost of living and housing were advantages common to many of the Top 10 Growing Markets. Some areas experienced more growth in suburbs than in urban centers.

The Top 10 Growing Markets were selected based on the U.S. Census Bureau's population growth statistics for Metropolitian Statistical Areas with populations of at least one million people. The market ranked in order of percentage growth during the period from 2000 to 2006.

The Top 10 Growing Markets were:

1. Las Vegas, Nevada
2. Phoenix, Arizona
3. Riverside, California
4. Alanta, Georgia
5. Orlando, Florida
6. Austin, Texas
7. Charlotte, North Carolina
8. Houston, Texas
9. Dallas, Texas
10. Sacramento, California

My take on this article was that the Seattle area might not have the climate but we do have the job growth. Our local population growth might not have been in the top 10 but our real estate market sure didn't get hit like of the above mentioned area's. Maybe population growth at that rate isn't really a good thing for real estate? What is your take?

I received an article from the Real Estate Digest courtesy of Chicago Title and I wanted to pass this information on to you.  Here is what the article said about subprime- quote " Although subprime has become a dirty word in the country's collective lexicon, mortgage bankers say you can count on this: subprime shall return.

But the next generation of subprime mortgages will look much different than the loans issued during the height of the housing boom in the first half of the decade, mortgage professionals say.  "So long as we have a policy position in this country of maintaining or further increasing homeownership rates there is going to be subprime lending," said Mark Fleming, chief economist with First American CoreLogic.

As such, subprime mortgage products are slowly being redefined, he said. "There has been a shift back to basics across the entire mortgage lending spectrum, using more reasonable assessments of what buyers can afford," Fleming said.  People now need better credit scores and a larger down payment to get a mortgage, in addition to documenting their incomes and providing where they work, he pointed out.

The more stringent guidelines are important for another reason; for subprime products to come back to the market with any significance, it's necessary to first build up the confidence of those who invest in them, Fleming said. How will the confidence be fully regained? For one: "We have to do a better job of making sure a high percentage of the loans aren't headed for default to begin with," Fleming said.

In the mortgage industry, expect to see a return in focus to the writing of quality loans- not just doing a large quantity of them, Fleming said. And perhaps part of the lender's mission should also be helping subprime borrowers graduate into prime loans, he added." end quote.

I believe as the mortgage industry changes we will start to see a increase in the real estate market and it is starting to happen already!

On July 22, 2007 there was a new law that went into place that required a contractors license to sell a home with in 12 monts of purchasing it. Fortunately, the Department of Labor and Industry has not completed the regulations to enforce it but these regulations should complete in 2008. As it stands right now you need to be a licensed contractor to sell your home with in 12 months of purchasing it. These means buying land and building on it and then selling with in 12 months. This means buying a home fixing it up and selling it with in 12 months.  I believe the new regulations will explain this law in greater detail but as for now we need to read it literally. The intent of this new law is to stop investors from buying a home doing repairs to the home that are sub-standard and then selling it without the buyer having any recourse on the one who performed the work. Now a buyer can use a failure to register as leverage in any claim or dispute. The consequences as it stands right now is a gross misdemeanor and punashable up to a year in county jail and a fine of $5,000. Each property is a seperate offense. So, if this describes you I suggest consulting a real estate attorney on what do as a "flipper" and as a buyer. This blog is not intended to be used as legal advice but make the public aware!

Snohomish County Stat Comparison	December	November	October	September
Residential Home Sales	441	445	544	586
Residential Home Pending Sales	743*	868	997	1,120
Active Residential Listings	4,239	5,021	5,404	5,489

*299 went pending in the month of December.

As expected, the real estate market slowed down over the holiday season. The question is what will happen in January? We are still experiencing a market characterized by low interest rates, a great economy, job growth, stabiling home prices. That said, we should start to experience an increase in activity both from the buyer and the seller side. I look for January to follow the latest trends but see the real estate market picking up in the spring. It is still a great time buy or move up to a larger home!

For a breakdown of December’s sales by price go to SalesBreakdownbyMonth.xls

Interest rates are still hovering around 6% with no points.