We’ll bounce back
Your recent front-page headline “Fear sinks homes sales” [page one, Nov. 7] is dangerously misleading. As a community, we need to come to grips with the realities of the real-estate situation in the Northwest. The fact is that prices went up too far and too fast. This rapid appreciation was not based on fundamental improvements in the economy, but rather a mixture of irrational exuberance and creative lending.
As the rest of the country is painfully learning, real-estate valuations can and do fall. For some reason, however, Seattle residents seem to be in denial that we will avert this crisis and home prices will rise again in the near future. Given our current economic environment and lack of available financing, sustainable growth in the industry will continue to be a fleeting memory for many years to come.
While I hate to be the bearer of bad news, I believe the sooner we accept this reality, the sooner we can get back to being a vibrant economy. That entails having real-estate valuations at a level where young adults can afford to buy a home. Only then will we have some semblance of stability in the markets. It is unclear where the pendulum needs to swing in order to make that a reality, but if the rest of the country is any indication, we are far from it in the Seattle region.
— Scott Weitz, Kirkland