So here is my brief, but researched, recap of 2010.
After a rough couple of years (2007-2010), it appears that the local and national economy is in the process of recovering.
The Stock Market climbed its way up over 2010-October 2009 the Dow Jones closed around 9,700 versus 11,200 in Oct 2010.
Unemployment is down nationally from 9.5 to 9.0 in Metropolitan Statistical Areas according to the Bureau of Labor. In the Seattle-Tacoma-Bellevue MSA the October 2009 unemployment rate was 9.0 compared to Oct 2010 at 8.8, down -0.2.
The national economy and real estate market is finally showing signs of recovery. The initial jobless claims continued to edge down in December 2010, falling 3,000 to 420,000. New claims still need to fall to the 400,000 level before the economy can sustainably create jobs. The largest increases in initial claims for the week ending Dec. 11 were in Kentucky, California, Iowa, and Massachusetts, while the largest decreases were in New York, North Carolina, Georgia, Pennsylvania, and Washington state, where the construction and manufacturing industries showed improvement.
A separate report on income and spending showed income growth of 0.3 percent in November after a 0.4 increase in October. The wages and salaries components were quite slow though, edging up only 0.1 percent. Consumer spending continued to rise due to the holiday season shopping (my husband and I contributed our share) and indicates that consumers are relatively more confident about the economy. Personal consumption expenditures increased 0.4 percent, following a 0.7 percent jump in October, suggesting healthy growth for the last quarter of 2010.
Finally, consumer sentiment and new housing sales reports, both released December 23, 2010, show improvement in the economy overall. New home sales increased 5.5 percent to a 290,000 unit annual rate. Regional data are still mixed, with the South showing the biggest increase of 5.8 percent. Prices were also up a solid 8 percent, while the supply fell to 8.2 months from 8.8 months but still above September's 7.9 months. Consumer sentiment increased slightly from October and is still at the best levels since the second quarter.
Locally, the real estate market appears to have stabilized. After seeing a decline in values the last half of 2008 and all of 2009, real estate values have stabilized 'in-city' and 'close-in' Seattle during 2010. This year the median sales price increased by 1.1 percent from a year ago to $637,000. And while 'first-time homes' and 'entry level/lower priced homes' recovered first, I am now seeing an increase in homes sales for properties priced $800,000 and above. Just checking in on my neighborhood (Montlake, Arboretum, Roanoke Park, and Portage Bay) 10 homes over $800,000 sold in 2010 versus 5 in 2009. But while transaction levels have increased slightly, as have values, the length of time it takes to sell a home (Days on Market) has increased 46 to 61 days in 2010.
For the Seller, this market can be challenging but transactions are being executed for those who remain flexible and are listening to the market. For the Buyer, financing is at some of the lowest rates in history, and great opportunities exist with homes price corrected back to 2005, and before in some cases.
In looking back, it appears we may be somewhere near the bottom of the market. How long we stay here is unknown. My prediction is that we will be bouncing along the bottom for a few more years.
I hope this information has helped. If you would like more data or want/need a better understanding of your home's value, just let me know. As always, I am happy to help.
From my home to yours, I wish you a healthy, happy and secure 2011!
Until next week,
la chasse au bonheur