Case-Shiller: A Brutal Winter for Home Prices

It’s time (a bit past time, actually) for our monthly check-in of the S&P/Case-Shiller Home Price Indices (HPI). The Case-Shiller data is generally considered to be the most reliable measure of overall home price changes for a region, since they only consider repeat sales of homes when calculating their index, instead of looking at all the homes that sold in a given month.

For the full source data behind this post, hit the S&P/Case-Shiller website. For a more detailed explanation of how the Case-Shiller Home Price Index is calculated, check out their methodology pdf. Also remember that the data released on the last Tuesday of a given month is for the period two months prior (i.e. – December data is released in February).

Here are the basic Case-Shiller stats for the Seattle area* as of January:

Sixteen of the twenty metro areas tracked by Case-Shiller saw a decrease in their HPI between December and January (one less than between November and December): Washington DC joined Phoenix and Miami with an increase. No data was available for Charlotte in January. Oddly, San Francisco had the largest drop at 2.5%.

Here’s a look at the latest local tiered data, back through 2000:

And here’s a closer look at the recent changes, with the vertical and horizontal axes zoomed in to show just the last year:

Seattle’s low and middle tiers both fell in January, while the high tier was flat. Month to month, the low tier was down 3.1%, the middle tier fell 0.3%, and the high tier increased less than 0.1%.

In this next chart, I’ve visualized the month to month trends of all twenty Case-Shiller-tracked cities. Green and above the horizontal axis if they were increasing in the month charted, red and below the axis if they were decreasing. I’ve excluded 2000 through 2004 since they looked largely the same as 2005 (mostly green).

Another gain here, with the best January showing since 2006, when 11 markets were increasing.

Read the rest of this entry »

Where Are the Seattle Homes for Sale? Go West, Young Man!

The number of homes for sale was down 5.7% across Seattle in March, so we wondered which neighborhood still had the most yard signs. Come claim your prize, West Seattle!

While West Seattle’s inventory took a big hit (down 10.6% from February and 47.7% from last March) along with the rest, its 278 homes for sale beat out Rainier Valley (169), downtown Seattle (164) and Queen Anne (126) to keep the crown. Several popular areas within the neighborhood even had more homes for sale than in February:  Alki was up 11.1% and North Delridge was up 57.1%. Still, with more than a third of the homes for sale in West Seattle, Delridge’s fate became the fate of West Seattle, and inventory in Delridge fell 8.3% from February.

Of the different types of homes, single-family home inventory fared the best in West Seattle,  down only 8.7% month over month (44% year over year), while condos and townhomes were down 16% and 10% month over month respectively.

What about prices?

The median sale price for a single family home in West Seattle fell 18.5% from February to $299,000. That drop put it back below the median sale price for King County ($333,000), after a price spike drove it above King County median sale price in February.  The median sale price in Seattle was $422,500.

What does this mean for home buyers?

With the low inventory, buyers are putting up a fight for any move-in-ready home that gets put on the market. Redfin agent Dan Mullins took his clients to see a home in the Belvidere area of West Seattle at mid-day on the day the home was listed. They found that the home had sold for all cash, above asking price in the first 60 minutes on the market. Things are moving fast, so Dan recommends buyers in West Seattle move quickly and put their best offer in first, since they likely won’t get another shot.

Seattle Stagers, Handymen Now Available in Open Book

Once you decide to list your home, you may need some work done to make it sparkle on opening day. But, who will you trust to do the work? That is the $319,500* question.

You want the best referrals, ratings and information to make that decision. That’s why we’ve expanded Redfin Open Book to include reviews of handymen and stagers in Seattle.

Now home-selling clients can search for the best professionals to prepare their home, then rate and review the work done once the transaction closes. Every time a Redfin client uses a service provider, she’ll have an opportunity to review their work, and those reviews will accumulate over time. Open Book’s information is verifiable – only Redfin clients will review service providers—not some handyman’s brother making Mr. Joe Hammer look good when he’s actually just barely adequate. Plus if you sell with Redfin, we’ll match up to $250 toward your home improvements.

We’ve partnered with some of the best professionals we’ve worked with and screened them thoroughly. We’ll post every review, good, bad, or ugly, right on their profile just like we do with our own agents.

Besides Seattle, Open Book for Sellers is now available in the Bay Area, Boston, Chicago, Southern California and the Washington DC area.

* The median sale price of a single-family home in King County in February 2012.

Redfin Seattle Gets Personal

Last month, we rolled out a major service upgrade for home buyers in every market Redfin serves except Seattle and DC, where we needed to hire more agents. We hired 14 new agents in Seattle over the last two months, so the wait is over. We thought you might have some questions.

What’s changed?

The big change is that now you can have a one-on-one, personal relationship with your agent.  She meets you on your first tour, sees the home you love before writing the offer, negotiates your deal and hands you the keys once you’ve closed. She’ll get to know you personally and guide you at every step, backed by a team that’s always available to answer questions.

What hasn’t changed?

We keep hearing how important it is to have an agent that’s 100% on your side, paid on your satisfaction, not commission. It’s how Redfin has always done business, and that’s not changing. With our new service in Seattle, you get personal service backed by a team and online tools that keep you in the loop at every step.

What does this mean for my refund?

As a result, the commission refund we offer buyers will change from a flat 50% of our commission (with Redfin’s minimum $6,000 fee) to a range between 15% and 50%, depending on the list price of the home, with no minimum fee. Since the refund is now based on the list price instead of the sale price, we’ll always put the estimated refund amount in the upper-right corner of the listing page. Our fee for selling a home is still 1.5% of the home price.

If you’ve already contacted us to tour a home, talk to an agent or write an offer, we’ll either honor the old refund pricing, or give you the new pricing, depending on which gives you more money back. You just need to close on a home by June 29, 2012.

Why the change?

We talked to hundreds of customers and heard loud and clear that they wanted a more personal relationship with their agent. We launched the new service in Boston in June of last year. In the first six months, we saw a 38% year over year increase in the rate at which people bought a home with Redfin within 90 days of taking a first home tour with us. The average client satisfaction score also went up by more than 10% in Boston after the launch. So more people wanted to work with Redfin from start to finish, and those that did were happier that they did. People love getting personal service from agents who are not paid on commission, and saving money at the end of the process without compromising.

For more of the scoop on the upgrade, read the blog post or connect with a Redfin Seattle agent who can show you how the whole process works. Check out the reviews of our Seattle-area agents and find the right one for you.

Redfin Brings Transparency to Inspection and Mortgage in Seattle

Big news! Today, Redfin is launching a major expansion to our charter as a technology-powered real estate broker: Redfin Open Book, a local reviews site for lenders and inspectors, is now available in Seattle.

Soon, we’ll add the stagers, landscapers and handymen used by sellers to get their home on the market.

Our goal is to ensure our customers get the best service at every step of a deal, by bringing together the best local team and holding that team accountable for the best result.

The Goal: Better Service
Unlike Angie’s List, Open Book is completely free. And unlike Yelp, it’s completely focused on the folks who serve our customers when buying or selling a home. And it’s better ‘policed’ than Yelp, because the reviewers are our customers, and we can vouch that they actually used the service they’re reviewing. It’s not the business owner’s college roommate or best friend’s uncle leaving the review.

There are no kickbacks from anyone we include or recommend. In fact, there’s no revenue model at all for Open Book; not now, nor in the foreseeable future.

The goal is simply better customer service. The best real estate agent in any market is good because of her own skills, but also because of her team, and her ability to hold that team’s feet to the fire when a loan or a listing is on the line.

As Redfin’s online traffic and transaction volume grows, our influence over all the folks who provide real estate services grows too. We want that influence to lead to better performance across the board for our customers.

This means that our focus is quality, not quantity. We don’t want to be the phone book, showing every lender or inspector in town. We want to be a reliable guide to the partners you should actually use, in any market we serve.

Today, people mostly take their agent’s recommendation for an inspector or a lender. But we think customer recommendations are important too, in finding an inspector who will tell you when to walk away from a crumbling house, or a lender who will steer you toward a cheaper loan, even if it pays him less.

This is crucial information, which is why Open Book, while intended for our own customers, is available to everyone browsing our site.

Our Advantage: Redfin-Certified Reviews
No one else could build such a reliable reviews site for real estate vendors.

Because we honcho a transaction the whole way through, hundreds of times a month, we know which inspectors and lenders our customers are using. Redfin’s online Deal Room, for tracking who is supposed to do what to close on time, stores information about thousands of vendors in a big database.

And we already survey every customer, deal or no deal, so it’s easy to ask each customer about his lender, inspector or stager. This means that we can validate every review, to avoid the bogus reviews from vendors’ friends and competitors that plague most review sites.

At some point, we’ll probably solicit reviews from the general public, but we’ll always highlight the reviews that came from actual customers, just because we can verify that the customer did in fact use the vendor she’s reviewing.

Our Investment: Redfin-Certified Partners
As with our brokerage, we aren’t just offering technology; we also offer a human touch. The inspectors, lenders and stagers who get the best reviews qualify for an additional level of certification, as Redfin partners.

We’ve hired a team of former Redfin agents to interview potential partners, briefing each one on Redfin’s mission and our service expectations. We then monitor the partner’s performance. The ones that make the grade are certified as official Redfin partners. In Open Book, a tiny Redfin ribbon appears beside their profiles.

These are the folks our agents are most likely to recommend to our customers.

Over time, we’ll ask each certified partner to deliver premium service to our customers. This may entail attaching digital photos to an inspection report, or offering to refund the inspection fee if an unexpected repair crops up within 60 days of the closing.

We expect to drive plenty of customers toward our partners; if history is any guide, we’ll have to be careful to ensure no one gets overwhelmed.

And of course we’ll also be careful to strike a balance between ensuring our partners build a profitable business, and giving Redfin customers premium service. Inspectors, stagers and lenders who want to apply to be a certified partner can email us at openbook (at) redfin (dot) com.

Where We’re Starting
Right now, the reviews are available in the Bay Area, Seattle, Boston, Chicago, Washington DC and Southern California.

To find Open Book, just click the “Buying” link at the top right of any page on Redfin.com, and choose “Open Book” from the menu. As we capture more reviews in the coming months, we’ll launch Open Book in more markets, for a wider range of services.

38% of Sales in King County Were Purchased With Cash in 2011

With a sudden spike this year of reports from our agents in the field that they were coming up against multiple offer situations in which buyers were making all-cash offers, I was curious to know what percentage of homes sold in King County recently were bought with all-cash.

Since any job worth doing is worth over-doing, I decided to pull all financing types for sale in King County dating all the way back to 2000 and visualize it in my fancy new copy of Tableau (an awesome company based right here in Fremont, by the way). The result is the following interactive chart.

Select which type of financing you want to view on the heat map (zero down, 20%+, or all cash), then drag the “Heat Map Year” control to view a zip code heat map for any year. Zip codes where less than 15% of the sales for that year were of the selected financing type are colored in blue shades on the map, while above 15% will show up in shades of red. Float your mouse pointer over a zip code or a point in the chart below to get the details for your selected year.

What I find really interesting about this chart is how closely the sales volume line (brown) and the zero down line (orange) trend to each other over the years. Meanwhile, as the bottom fell out of zero down purchases, the number of all cash sales has been soaring, up from just 12% of the market in 2006 to 38% in 2011. So far 2012 is following the same trend, as well.

What’s driving the big boost in all cash financing? My theory is that it’s a combination of investors taking advantage of low prices and increasing rents and purchases by well-paid tech workers as various cash-flush companies (Amazon, Microsoft, Google, Facebook, etc.) continue to ramp up their hiring.

What’s your theory? If you’ve been out there trying to buy a home today have you come up against competing all cash offers on homes you’ve tried to buy?

Case-Shiller: Seattle’s Middle Tier Took the Biggest Hit in December

It’s time (a bit past time, actually) for our monthly check-in of the S&P/Case-Shiller Home Price Indices (HPI). The Case-Shiller data is generally considered to be the most reliable measure of overall home price changes for a region, since they only consider repeat sales of homes when calculating their index, instead of looking at all the homes that sold in a given month.

For the full source data behind this post, hit the S&P/Case-Shiller website. For a more detailed explanation of how the Case-Shiller Home Price Index is calculated, check out their methodology pdf. Also remember that the data released on the last Tuesday of a given month is for the period two months prior (i.e. – December data is released in February).

Here are the basic Case-Shiller stats for the Seattle area* as of December:

Eighteen of the twenty metro areas tracked by Case-Shiller saw a decrease in their HPI between November and December (one less than between October and November): Only Phoenix (for the third month in a row) and Miami saw an increase. This month Detrioit beat out Chicago and Atlanta for the bottom spot, falling 3.8% in a single month.

Here’s a look at the latest local tiered data, back through 2000:

And here’s a closer look at the recent changes, with the vertical and horizontal axes zoomed in to show just the last year:

All three of Seattle’s tiers fell in December. Month to month, the low tier was down 0.2%, the middle tier fell 1.7%, and the high tier decreased 0.9%.

In this next chart, I’ve visualized the month to month trends of all twenty Case-Shiller-tracked cities. Green and above the horizontal axis if they were increasing in the month charted, red and below the axis if they were decreasing. I’ve excluded 2000 through 2004 since they looked largely the same as 2005 (mostly green).

Tiny improvement, better than a year ago, but worse than December 2009, when 5 cities saw an increase.

Read the rest of this entry »

Redfin Expands Partner Service to Thurston & Whatcom Counties

We’re happy to announce that people looking to buy or sell a home in Thurston and Whatcom Counties can now buy and sell with a Redfin partner agent. This means that areas such as Olympia, Lacey, Tumwater and Yelm (Thurston County) and Bellingham, Ferndale and Lynden (Whatcom County) now have access to a real estate agent held to the same standards as Redfin’s own agents.

Every Redfin partner agent was chosen because he or she shares our values of customer service, experience and transparency. We carefully interview each candidate, check at least three customer references, and ensure that each agent has completed at least 15 local transactions. Our team of partner agents in Thurston and Whatcom Counties have already won rave reviews from customers.

If you have any questions about our new partner agent service in Thurston & Whatcom Counties, please let us know.

Meet Our Thurston County Agents

	Jenah Mahan Serving Pierce & Thurston Counties Homes Closed: 80+
	Zenika Gandara Serving Pierce & Thurston Counties Homes Closed: 39+
	Brenda Kelley Serving South King County, Pierce County & Thurston County Homes Closed: 144+
	Jessica Chase Serving Thurston County Homes Closed: 693+
	Mitch Dietz Serving Thurston, Lewis, Pierce & Grays Harbor Counties Homes Closed: 29+
	Shannon Brent Serving South Pierce & Thurston Counties Homes Closed: 102+

Meet Our Whatcom County Agents

	Grant LaMothe Serving Whatcom & Skagit Counties Homes Closed: 46+
	Chris Erdmann Serving Whatcom County Homes Closed: 111+
	Joe Hoppis & Joy Brown Serving Bellingham & Whatcom County Homes Closed: 317+
	Todd Peed Serving Bellingham & Whatcom County Homes Closed: 100+

Coming soon!

Jeff Braimes Serving Bellingham & Whatcom County

Case-Shiller: Another Winter for Home Prices

It’s time for our monthly check-in of the S&P/Case-Shiller Home Price Indices (HPI). The Case-Shiller data is generally considered to be the most reliable measure of overall home price changes for a region, since they only consider repeat sales of homes when calculating their index, instead of looking at all the homes that sold in a given month.

For the full source data behind this post, hit the S&P/Case-Shiller website. For a more detailed explanation of how the Case-Shiller Home Price Index is calculated, check out their methodology pdf. Also remember that the data released on the last Tuesday of a given month is for the period two months prior (i.e. – November data is released in January).

Here are the basic Case-Shiller stats for the Seattle area* as of November:

Nineteen of the twenty metro areas tracked by Case-Shiller saw a decrease in their HPI between October and November (the same as between September and October): Only Phoenix saw an increase, for the second month in a row. This month Chicago bumped Atlanta out of the bottom spot, falling 3.4% in a single month.

Here’s a look at the latest local tiered data, back through 2000:

And here’s a closer look at the recent changes, with the vertical and horizontal axes zoomed in to show just the last year:

All three of Seattle’s tiers fell in November. Month to month, the low tier was down 2.3%, the middle tier fell 1.8%, and the high tier decreased 0.4%.

In this next chart, I’ve visualized the month to month trends of all twenty Case-Shiller-tracked cities. Green and above the horizontal axis if they were increasing in the month charted, red and below the axis if they were decreasing. I’ve excluded 2000 through 2004 since they looked largely the same as 2005 (mostly green).

Just five months ago, all twenty cities saw month to month gains. Now just one is not the red.

Read the rest of this entry »

Luxury Real Estate in King County Kept Buyers Smiling in 2011

Got $3 million and a dream? The luxury housing market in King County was a good place to be in 2011! The average price per square foot, average sale price and number of homes on the market all point to the continuation of a huge buyer’s market in these higher price brackets. While there’s no set definition of what the “luxury” market is ($1 million buys a lot more home in Phoenix than it does in Seattle), for this we’re looking at homes that sold for $3 million or more.

The by-the-numbers list below shows a steady decrease in price per square foot, and on top of that, at the current pace of sales, it would take four years for all those homes to sell. In a balanced market, there would only be 4-6 months of supply.

Redfin area manager Febe Cude works mostly in Mercer Island, Laurelhurst, Ravenna and Queen Anne. She says all the high end inventory we’ve seen lately has given buyers the luxury to pick and choose, but even that segment of the market is unpredictable. “Late last summer, there were more luxury properties on the market than I’d seen in a long time, most of which had been there for months, and some for years, “ she said. “My clients were just narrowing their list down when many of the homes they were considering went pending in the matter of 4-5 weeks. They still found their dream home, but the lesson was learned: It’s definitely still a buyer’s market, but when you see the right home, you need to move quickly.”

Here’s a by-the-numbers breakdown of interesting facts about the 2011 luxury housing market in King County: