Northwest Multiple Listing Service Press Release

Sparse supply spurring more competition among motivated home buyers in Western Washington
November Press Release

KIRKLAND, Washington (November 7, 2019) – “People are moving here, home prices will continue to increase, inventory shortages will occur. That’s our future,” remarked Dick Beeson, principal managing broker at RE/MAX Northwest in Gig Harbor, upon viewing the October statistics from Northwest Multiple Listing Service.

Active listings of homes and condos totaled 14,379, the lowest level since April. Compared to a year ago, last month’s selection declined more than 21% and was down 10% from September, according to the new report from Northwest MLS. The year-over-year and month-to-month volume of new listings also declined last month. On a positive note, MLS figures show system-wide gains in October’s pending sales (up nearly 5.6%), closed sales (up 4.1%) and prices (up nearly 7.7%) compared to a year ago.

Beeson, a member of the Northwest MLS board of directors, and other MLS leaders also commented on inventory shortages, which some refer to as the “new normal.” The sustained, lower levels of supply “drive some buyers crazy as they keep expecting to gain the upper hand,” Beeson reported, adding, “It’s not going to happen any time soon. The market has settled into a circadian rhythm of sorts.”

MLS figures for its 23-county service area show 1.73 months of supply overall. Ten counties, mostly in the Puget Sound area, have less than two months of supply of single family homes and condominiums, whereas 4-to-6 months is a level industry-watchers use as a gauge of a balanced market.

“With only 1.63 months of supply of single family homes (excluding condos), King County’s available listing inventory is notably below the national average of four months, as reported by the National Association of Realtors,” stated Gary O’Leyar, designated broker/owner of Berkshire Hathaway HomeServices Signature Properties in Seattle. The MLS report shows inventory as measured by months of supply was below King County’s figure in six counties.

Condo inventory is only slightly better, at just over two months of inventory, although that could improve with several highrise projects in Seattle and Bellevue in the pipeline. “We are still amid a very robust real estate market,” O’Leyar proclaimed.

Northwest MLS records show the last time the supply of homes and condos exceeded three months was February 2015, when there was just over 3.5 months of supply.

Compared to the same month a year ago, October’s supply of active listings declined by double-digits in 18 of the 23 counties in the NWMLS report. Thurston County had the sharpest decline (down 35.5%), followed by Pierce (down 28.7%) and Kitsap (down nearly 27%).

Despite the slim selection, demand was strong as the volume of pending sales (9,517) outgained the number of new listings added during October (8,394). Nine counties reported double-digit jumps in pending sales compared to 12 months ago.

“The most recent data certainly appears to bolster the idea of a ‘new normal,’ as we see the same trends continuing,” stated Mike Grady, president and COO of Coldwell Banker Bain. “Inventory is staying between 1.7 and 2.3 months and median sales prices are stabilizing” in many areas, he noted, adding, “Couple this with continuing positive economic news locally — including a positive forecast for job creation, interest rates at all-time lows, and several new condo projects in the pipeline (instead of apartments) given the legislature’s change this year in the construction defects laws – all these point to a new definition of a ‘balanced market’ of only two months of inventory instead of 4-to-6 months.”

OB Jacobi, president of Windermere Real Estate, also commented on the meager supply. “‘Tis the season for the number of homes for sale to start dropping, and we don’t expect to see a significant influx of new inventory until spring. That said, there are still plenty of buyers out there, so this drop in listings will lead to increased competition and will likely cause home price growth to increase modestly through the end of the year.”

Dean Rebhuhn, owner of Village Homes and Properties in Woodinville, said market hot spots are drawing multiple offers, fueled by the combination of moderating (or lowered) prices and strong job creation. He also noted first-time home buyers are taking advantage of many low down payment loan programs, such as state bonds, HomeReady mortgages by Fannie Mae, and other assistance from FHA, VA, and USDA (US Department of Agriculture). “More flexible underwriting guidelines are also allowing first-time home buyers a better opportunity to buy,” according to Rebhuhn.

Another company leader expects strong price hikes. “As we enter the last two months of the year, we see a pressure cooker developing in the more affordable and mid-price ranges, and we predict strong price appreciation in 2020,” stated J. Lennox Scott, chairman and CEO of John L. Scott Real Estate.

With the transition to the winter market, Scott anticipates a “clean-up” of unsold inventory when listings expire and some sellers take their homes off the market over the holidays, with plans to reposition them in the spring. “Each year during the November through February time period, we see the fewest new listings come on the market, resulting in the lowest point of unsold listings occurring after the first of the year,” he explained.

With the backdrop of “extremely strong job growth and interest rates in the threes,” Scott says the extra backlog of buyers will enter the market after the holidays, but new listings won’t show up in larger numbers until March. “Therefore, we predict healthy price appreciation after the first of the year.”

A similar scenario exists in Kitsap County where YOY inventory is down nearly 27%, and broker Frank Wilson believes “come January there will be even fewer homes on the market.” Both pending and closed sales are up in Kitsap County compared to last year, prompting Wilson, the branch managing broker and regional manager at John L. Scott Real Estate in Poulsbo, to suggest, “An end to the housing shortage is nowhere in sight.”

With fewer homes on the market and rising sales prices (up 12.6%) in Kitsap County, but a seasonal shrinkage of buyers, Wilson says sellers are asking if it’s a good time to put their home on the market. “The answer would be yes,” he stated, adding, “There are fewer active listings competing for your home, and active buyers at this time of year are serious.”

Wilson also cited strong traffic at open houses for new listings, multiple offers, and homes selling at list price with few or no seller concessions as further indicators of today’s market. Cash and conventional financing are the leading methods of purchase, he noted.

Northwest MLS figures show sales prices continue to be wide ranging, not only when comparing counties in the report, but also within many counties.

In King County, for example, the median price on last month’s 2,757 completed transactions was $605,000, down about 1.4% from a year ago – one of only two counties where YOY prices slipped. (Clark County reported a drop of 2.75%.) Within King County, where Northwest MLS tracks 30 sub-areas, median sales prices ranged from $371,000 (in Des Moines/Redondo Beach) to $1,892,500 (in Bellevue west of I-405).

Year-over-year price changes ranged from a drop of nearly 20% (in Vashon) to a jump of more than 21% (in Bellevue west of I-405).

Beeson said the South Sound market is experiencing sticker shock, citing an analysis published earlier this year by Redfin showing Tacoma outgained other metro areas across the nation with the fastest percentage of home equity increases since 2012. That surge may be moderating, as prices from a year ago are up more than 8.7%. Based on October figures, the median price is Pierce County, at $360,000, is more affordable than any of the nearby counties of Kitsap ($385,000), Snohomish ($475,000), and King ($605,000).

Northwest MLS members tallied 8,335 closed sales last month, improving on both the previous month (up 4.7%) and same month a year ago (up 4.1%). Through 10 months, closed sales are lagging 2018 totals by 1,140 units (-1.4%).

The area-wide median price on October’s completed transactions was $420,000, matching September and surpassing the year-ago price by nearly 7.7%.

Northwest Multiple Listing Service, founded in 1984, is a not-for-profit, member-owned organization created to facilitate cooperation among its member real estate firms. NWMLS (www.northwestmls.com) provides an array of products, services, support, and training to assist brokers in providing real estate brokerage services to consumers. With more than 2,300 member officers and 30,000 brokers across Washington state, the organization’s broad offerings include a property listing system, mobile applications, an online showing appointment scheduling service, statewide public real property database, online forms and electronic signature service, cloud storage, data analytics, keybox services, and 20 service centers.

NWMLS Brokers Say Transition to Fall Creating Opportunities for Buyers

KIRKLAND, Washington (October 7, 2019) – Northwest Multiple Listing Service brokers reported year-over-year gains in pending sales, closed sales and prices, but its report summarizing September activity also showed an 18% drop in inventory compared to a year ago.

“The transition into the fall housing market creates opportunities for homebuyers,” suggested J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “Although there are fewer listings than what buyers find during peak summer months, there is also less competition” for the available inventory, he added.

While the intensity of sales activity is typically lower for new listings in the fall and winter, Scott noted “It appears we are headed toward a more intense winter market than last year.” He said he expects the number of unsold listings will continue to decrease once the winter “clean-up” of inventory begins.

At the end of September, MLS brokers reported 15,982 total active listings, down more than 18% from the same month a year ago when the selection totaled 19,526 listings. Only three of the 23 counties served by Northwest MLS – Clark, San Juan and Whatcom – had year-over-year gains in inventory, while 18 counties had double-digit drops. Thurston County reported the sharpest shrinkage, at nearly 35%.

“September’s housing market was a bit of a roller coaster, up in certain areas and down in others,” commented OB Jacobi, president of Windermere Real Estate.. Within the four-county Puget Sound region, Pierce County prices rose more than 10% thanks to high demand and low inventory, he noted. “Buyers continue to be drawn to the area thanks to more affordable housing costs, but this influx is also driving up prices,” he remarked.

MLS data show the median price for last month’s home sales in Pierce County ($379,950) was $213,800 less than the median price in King County ($593,750). A comparison of single family prices (excluding condos) reveals a $275,500 difference between the two counties.

“In King County, prices were down nearly 2.7% while pending sales rose nearly 10%. This tells us there is no shortage of buyers in the Greater Seattle area,” stated Jacobi. He also said home prices normally start to taper off this time of year, “so this isn’t a major cause for concern.” Within King County, prices rose in four of the six sub-markets; only Seattle (down 3.2%) and Vashon (down almost 28%) reported drops.

The median price for single family homes and condos that sold last month in King County was $593,750, down from the year-ago figure of $610,000 and the first time it dipped below $600,000 since January. Three other counties, Okanogan, Pacific, and Clallam, also reported year-over-year price drops. Joining Pierce County with double-digit price increases from a year ago were eight other counties.

System-wide, prices were up 5%, rising from $400,000 a year ago to $420,000. The volume of closed sales increased about 4.4% from a year ago (7,962 versus 7,630).

“Home prices have stabilized, creating good opportunities for purchasers,” said Dean Rebhuhn, the owner of Village Homes and Properties in Woodinville. He expects prices to stay stable through the fall and winter markets.

“Continuing to drive the market are new jobs, lifestyle changes, and very low interest rates,” Rebhuhn remarked, adding, “FHA mortgages with 3.5% down payments are very popular with first-time homebuyers.”

The latest report from Northwest MLS shows pending sales were up about 9.8% from a year ago, with mutually accepted offers rising from 8,913 to 9,785. In the four-county Puget Sound region, Snohomish reported the largest gain at 18.3%, followed by Kitsap at nearly 11.9%, King at 9.8%, and Pierce at 5.4%.

Brokers were unable to replenish inventory to match demand as the volume of pending sales (9,785) outpaced new listings (9,435).

“Things were a bit different in September, but at this point it’s difficult to know if it’s an aberration or an actual trend,” stated Coldwell Banker Bain president and COO Mike Grady, pointing to “far fewer” new listings that were added last month compared to a year ago. Area-wide, Northwest MLS brokers added 9,435 new listings last month, a decline of 1,023 from the year-ago total (down nearly 9.8%).

“It’s still a seller’s market, and for more than a year we’ve seen only 1-to-2 months of inventory, so I’m starting to think we may be looking at a ‘new normal’ in relation to what a balanced market looks like,” commented Grady.. “With the international economy and trade issues continuing to be erratic, and interest rates staying low, these pressures will almost certainly be an influence, yet there’s no clear answer to how all of this will play out,” he added.

MLS figures show 2.01 months of inventory system-wide, with 12 of the counties reporting less than 2.5 months of supply. Real estate experts tend to use 4-to-6 months of inventory as an indicator of a balanced market.

Northwest MLS director Frank Leach, broker/owner of RE/MAX Platinum Services in Silverdale, said Kitsap County continues to have constrained inventory (down almost 25% from a year ago), with values stabilizing or increasing slightly. Homes priced around $350,000 and under sell quickly, while “inventory in upper ranges is taking a little longer to get traction and move to a sale,” according to Leach.

MLS figures show the median price of homes and condos that sold in Kitsap County last month was $384,000, up nearly 8.2% from the year-ago figure of $355,000.

Leach noted condominium inventory in Kitsap County rose more than 27% from a year ago, but the selection of single family homes dropped by the same percentage. He said several multifamily projects in the county have been submitted or approved, and those homes are expected to be absorbed in the market as soon as they’re available.

“Prices along the I-5 corridor between the Puget Sound and Portland once again outperformed as buyers seek value for money and job growth has expanded in the entire region,” observed James Young, director of the Washington Center for Real Estate Research (WCRER) at the University of Washington.

If millennials want to own houses, Young said the logical first step in the housing ladder is increasingly outside of King and Snohomish counties “and further afield along the I-5 corridor.” With interest rates near historic lows and employment levels at historic highs, first-time homebuyers are acting while they can to get on the housing ladder, “even though that may mean long commutes,” Young stated.

The September report from Northwest MLS shows single family activity outperforming condos. Year-over-year pending sales of single family homes jumped 11%, while condo sales were flat. Prices on last month’s closed sales of single family homes rose more than 5.5%, but condo prices declined by 1.2%.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,400 member offices includes more than 30,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

Statistical Summary By Counties
PRTables_Sep19

Home Buyers Seeking Affordability Are Expanding Search Outside Greater Seattle Job Centers


September 9, 2019



Current Market Snapshot Infographic | Statistical Reports


KIRKLAND, Washington (September 9, 2019) – Depleted inventory continues to frustrate would-be buyers in Western Washington. Many of these potential homeowners are expanding their search beyond the major job centers in King County, according to market watchers who commented on the latest statistics from Northwest Multiple Listing Service.

The MLS report summarizing August activity shows less than two months of supply system-wide, and only about 1.6 months of supply in the four-county Puget Sound region. The sparse selection is pushing up prices. For last month’s sales of single family homes and condos across the 23 counties served by Northwest MLS, prices rose nearly 6.2% compared to a year ago.

“Areas immediately outside the Puget Sound region and along the I-5 corridor continue to see double-digit house price growth,” noted James Young, director of the Washington Center for Real Estate Research (WCRER) at the University of Washington. He attributes the increase to high demand in these areas “due to first-time homebuyers who struggle to afford housing in King and Snohomish counties as well as from existing homeowners cashing out of Seattle and King County.”

“While August is always a slower time for listings and sales, what is really surprising this year is the  decrease in new listings taken, while pending sales increased,” observed Mike Grady, president and COO of Coldwell Banker Bain.

A comparison of year-over-year statistics for August shows the volume of new listings dropped nearly 13% system-wide and 18.5% in King County. Last month’s total number of new listings (10,488) declined 6.3% from July’s volume (11,193).

Brokers reported 10,602 pending sales (mutually accepted offers) during August for a 4.9% increase from a year ago. Pending sales rose nearly 6.6% in the Puget Sound region, led by Snohomish County with a gain of 15.8%. Six counties had double-digit gains while an equal number had declines.

Grady noted June and July were also lackluster this year with regard to listings “when typically they are both still fairly active coming off spring. The pending sales numbers indicate that buyers are indeed out there and willing to purchase, but there are simply not enough homes,” he commented, adding, “Everything that is listed is getting sold and fairly quickly.”

The volume of total active listings is down more than 10% from a year ago, with only four of the 23 counties in the report showing a year-over-year increase (Chelan, Grays Harbor, San Juan and Whatcom). Fourteen counties had double-digit drops. At month end there were 16,697 active listings in the MLS database, down from the year-ago total of 18,580.

MLS figures show only seven counties have more than three months of supply, with four-to-six months generally considered the volume needed for a balanced market.

Frank Wilson, Kitsap regional manager and branch managing broker at John L. Scott Real Estate in Poulsbo, also commented on depleted inventory, but expects improvement. “As we head into the fall market our listing inventory continues to lag last year’s numbers, but we should see a bump in activity now that kids are back to school and vacations are over.” He noted the supply crunch has led to rising values, with median prices for last month’s sales in Kitsap County surging 14.2% from twelve months ago.

Multiple offers are still commonplace with many buyers walking away disappointed, according to Wilson. “Traffic is strong at open houses and our average market time is still very low for correctly priced homes,” he added.

“The August numbers offered a few interesting nuggets,” stated OB Jacobi, president of Windermere Real Estate. “The Seattle area housing market is still coming off the ‘sugar high’ that we saw last summer, but homes sales and prices are stabilizing, which is reassuring to both buyers and sellers.”

Jacobi also noted buyers are drawn to areas outside King County in search of affordability. “Pierce County is now experiencing what King County did 24 months ago where a surplus of buyers and lack of supply are pushing up home prices. Snohomish County also saw a big bump with a massive 16% increase in pending sales year-over-year. This tells us the secret is clearly out that housing in the counties to the north and south of Seattle is more affordable.”

The median price for the single family homes and condos that sold last month in King County was $615,000, slightly higher than the year-ago figure of $610,000. In Snohomish County, last month’s median sales price was $470,000, up about 1.8% from the year-ago price of $461,832. The Pierce County price of $369,000 is $246,000 lower than King County. It’s up 6.1% from a year ago.

For all counties combined, prices are up nearly 6.2%, rising from the year-ago figure of $405,000 to last month’s figure of $429,925. Compared to January’s area-wide median price of $381,900, prices are up nearly 12.6%. Brokers reported 9,392 closed transactions during August, a slight 1.12% improvement over the same month a year ago.

Prices for single family homes (excluding condos) rose 6% from a year ago, while condo prices ticked up by only about 2%.

Brokers expect favorable conditions for both buyers and sellers in the coming months.

“As we enter the fall housing market, both interest rates and job growth in Puget Sound are extremely positive,” stated J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. Saying these are both key indicators of a strong housing market, Scott noted September and October are “historically the best for selection and availability out of the next six months,” adding, “With kids back in school and summer vacations over, homeowners who wish to sell their house before the winter season will look to put their home on the market soon. Similarly, buyers can take advantage of the market timing and low interest rates in the next two months to come.”

“Low interest rates, strong job creation, and lifestyle changes continue to attract buyers to the market,” said Dean Rebhuhn, the owner of Village Homes and Properties in Woodinville. He also reported the move-up market is very active, while acknowledging challenges for first-time home buyers. “A challenge for them is assembling the down payment,” he explained. “We are seeing FHA and VA financing being used for low and zero down mortgages. Also, family assistance is a big help.” He expects “very good activity” during September and October.

With brokers anticipating solid activity in the next few months, Wilson offered advice for both sellers and buyers. Sellers need to make sure their home goes on the open market in order to be exposed to as many buyers as possible, he emphasized. “To do anything else may be leaving money on the table.”

For buyers, Wilson stressed “getting all your ducks in a row. Meet with a lender for pre-approval before looking for homes, be clear as to what you can live with or without in your next home, and if at all possible, use cash or a conventional loan,” which he explained are more appealing to sellers in multiple-offer situations.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,300 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

 

 

 

 

 

 

 

 

 

 

 

Buyers Getting “Some Relief” as Key Indicators Point to Strong Summer for Housing Market

KIRKLAND, Washington (July 8, 2019) – Inventory, pending sales and prices all increased during June compared to a year ago, according to the latest report from Northwest Multiple Listing Service. The same report, which covers 23 counties in Washington state, shows year-over-year drops area-wide in both the volume of new listings and closed sales.

“Clearly we now see that the market is moderating – that is we’re definitely moving from a ‘hyper-market’ to one where a correction is underway compared to last year,” remarked Mike Grady, president and COO of Coldwell Banker Bain. “While it’s the best time to buy that we’ve seen in some time, and buyers are getting some relief, it is still a seller’s market,” he added, noting some buyers are experiencing multiple offer situations, or considering inspection waivers, or are even forced to consider markets outside King County for affordability.

Three Northwest MLS directors from Pierce and Kitsap counties suggest their counties are attracting some of the frustrated buyers from King County.

“The darling of the Puget Sound real estate market is Tacoma/Pierce County,” stated Dick Beeson, principal managing broker at RE/MAX Northwest Realtors in Gig Harbor, pointing to low inventory and appreciating values. “The secret is out about Pierce County,” agreed Mike Larson, the president at ALLEN Realtors in Lakewood. “You can buy twice the house for about half the price. You just have to be willing to deal with the traffic if you work north or south of here,” he proclaimed.

“The Kitsap market continues to be robust and is maintaining its velocity in sales,” added Frank C. Leach, broker/owner at RE/MAX Platinum Services in Silverdale. He believes Kitsap County will continue to be strong given its economic foundation together with its affordability factor and quick access to Seattle, but noted it is constrained by available inventory (currently at 1.4 months of supply).

MLS figures show the median price for single family homes and condos that sold last month in King County was $637,675. In Pierce County it was $372,500, about 58 percent of the King County price, and in Kitsap County it was $387,000, about 60 percent of the sales price in King County.

System-wide prices increased more than 3.5 percent from a year ago, from $425,000 to $440,000, although four counties registered declines, including Douglas, Ferry, Jefferson, and King. June’s median price was unchanged from May.

At midyear, the overall median price was $424,517, which compares to $405,000 for the first six months of 2018, an increase of 4.82 percent.

“As long as interest rates stay low and people seek value outside of King and Snohomish counties, house prices should continue their upward momentum,” stated James Young, director of the Washington Center for Real Estate Research (WCRER) at the University of Washington.

House hunters had a broader selection to consider as inventory at month end totaled 16,800 active listings, about 9.5 percent larger than at the same time a year ago. Brokers added 11,977 new listings during the month, a drop from both a year ago when they added, 13,153 new listings, and from May, when they added 14,689 new listings.

About half the counties reported gains in inventory, led by King County where the selection grew nearly 32 percent from a year ago.

“June listing inventory in King County exceeded the levels posted for this month over the past six years,” said John Deely, principal managing broker at Coldwell Banker Bain. “Currently, we are approaching 2012 listing inventory levels,” he noted.

Northwest MLS figures for King County show there were 5,931 active listings at the end June, the highest for that month since 2012 when the selection totaled 6,500 listings.

“Every summer, we see the highest level of new listings and homes going under contract. After the surge of new listings in May, areas close to the job centers saw listings return to the normal seasonal pattern in June,” commented J. Lennox Scott, chairman and CEO of John L. Scott Real Estate.

The Northwest MLS report indicates there is 1.76 months of inventory area-wide (matching May), with eight counties having less than two months of supply.

OB Jacobi, president of Windermere Real Estate, commented on a “considerable rise” in the number of listings priced above $1.5 million in King County. “This could be because of the changes to the Washington State Real Estate Excise Tax (REET) that take effect in 2020, which will significantly impact the tax burden of sellers whose homes sell for more than $1.5 million. I suspect we’ll see even more owners of higher priced homes trying to sell in the coming months in order to avoid the hike in taxes they’ll have to pay starting next January,” he stated.

The new tax measure changes the REET rate from a flat 1.28 percent of the selling price to a graduated rate for real property sales, with exceptions for timberland and agricultural land.

Commenting on the latest report from Northwest MLS, WCRER’s Young said “The perfect storm of low interest rates and falling inventory continues along the I-5 corridor, with double-digit house price increases also continuing.”

Beeson says the “new normal” inventory levels of 2-to-3 months of supply, rather than the traditional 4-to-6 months, makes Puget Sound different than most of the rest of the nation. In Puget Sound, homes sell twice as quickly as a traditional ‘normal’ market,” he stated, but acknowledged, “It feels kinda like things have slowed down. Folks are taking deeper breaths.”

Several brokers commented that buyers are becoming more deliberate in their searches and offers.

“Market savvy buyers are taking advantage of premium location and value pricing due to increased inventory. Price reductions are more commonplace as sellers align their expectations with today’s market,” according to Deely. He said demand remains strong, but “buyers are methodical in their search, and taking more time to jump into an offer.” Also, he noted there have been fewer multiple offers and fewer all-cash buyers in the mix when a listing has several buyers lined up to compete.

Buyers are more “tuned-in” than ever before, Beeson remarked, adding, “Buyers today have educated themselves on the vagaries of the home buying process and are better prepared to meet sellers on firmer ground. They are attentive, vigilant, and discerning toward the marketplace, knowing what they want in a home – and they are willing to wait longer to get it.”

Leach concurred. “Buyers are being very careful about what they buy and at what price,” he stated.

Commenting on King County’s numbers for new listings and new pending sales, Dean Rebhuhn said multiple offers are still occurring in the median price range, noting the 1.9 percent dip in year-over-year prices. “Buyers are seeing higher home availability while taking advantage of low interest rates.” Rebhuhn, the owner of Village Homes and Properties in Woodinville, believes those factors, coupled with summer weather and job creation will “continue to create a very active market for buyers and sellers.”

Scott also expects a “quick-action market” for many buyers when new listings come on the market, especially with interest rates in the upper threes. Looking to the months ahead, Scott anticipates strong sales activity close to job centers, while the surrounding area will experience intense, “frenzy-level sales activity” in the more affordable to mid-price ranges.

Larson believes “the big three” – interest rates, the economy, and consumer confidence – all point to a strong summer for the housing market, while contrasting King and Pierce counties. “For years, King County has been a bit like a top fuel dragster – high performing, thrilling, but maybe a bit temperamental. It got the headlines and values skyrocketed, but now it’s experiencing a bit of a hangover. Pierce County’s market is more like a diesel truck – steady, consistent, and less prone to dramatic market changes.”

Larson also offered advice for passive and first-time house hunters. “Every buyer, particularly at the entry level, needs to understand they can’t simply dip their toe in the water when competing for a home. They need to do a belly flop. They need to put their best foot forward right out of the gate.” He also urged buyers to work with a Realtor who understands the market and who can guide them through the process.

Several representatives from Northwest MLS also suggested sellers need to learn the “new normal” as Beeson calls it. “If you overprice your home or fail to get it in good condition for selling, it will cost you time and money in the end, he stated, adding, “Seller’s can’t afford to be tuned out to what the market is saying.”

For sellers in Kitsap County, broker Frank Wilson says pricing is becoming more important. “Our county is starting to feel some of the changes King County has experienced. List price has to more accurately reflect what the home will sell for in today’s market,” explained Wilson, Kitsap regional manager and branch managing broker at John L. Scott Real Estate in Poulsbo. Although Wilson reported multiple offer situations and good traffic at open houses, he emphasized sellers “can no longer chance shooting for the moon, pricewise, or they risk getting stuck on the launch pad.”

Condo activity was mixed during June with year-over-year declines in the number of new listings added to inventory, as well as in the volume of pending and closed sales. Total inventory grew more than 41 percent, although at month-end there was only about 1.9 months of supply. Prices overall were nearly unchanged from a year ago. The median price for June’s sales was $367,000, up about a percentage point from a year ago when the median price was $363,500.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,300 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

Statistical Summary By Counties
Market Activity Summary and 4-County Puget Sound Region Pending Sales (PDF)

 

Home Buyers Are “Better Off,” But Market is Heating Up

KIRKLAND, Washington (June 6, 2019) – The housing market in western Washington may not be as hot as it was last spring, but it is heating up, suggested one industry leader in commenting on the latest statistics from Northwest Multiple Listing Service.

Matt Deasy, president of Windermere Real Estate/East, Inc. said his analysis of single family home sales in King County reveals 7 out of 10 properties that sold during May had 15 or fewer days on the market. He also noted more than half the listings (55 percent) in the county sold for at or above list price, the highest ratio since July 2018.

Northwest MLS figures show last month’s 12,006 pending sales across its 23 county service area nearly matched the year-ago total of 12,168 mutually accepted offers. Nine counties notched increases.

Two other indicators of activity – the volume of new listings, and the number of closed sales – both showed slight gains from a year ago. MLS member brokers added 14,689 new listings to inventory during May, up 165 units from twelve months ago. Year-over-year (YOY) closed sales rose about 1.6 percent (from 9,011 in May 2018 to last month’s total of 9,153).

Several representatives of Northwest Multiple Listing Service commented on increasing activity:

  • “The housing market definitely got busier in May with brokers reporting an uptick in showings, open house traffic, and offers.”- OB Jacobi, Windermere Real Estate Co.
  • “We are swinging into our summer market at a little faster clip than last year, and have a few more houses for buyers to choose from.”- Frank Wilson, John L. Scott, Inc.
  • “The spring real estate market remains very good for both buyers and sellers.”- Dean Rebhuhn, Village Homes and Properties.
  • “Buyers rejoiced at lower interest rates in May.”- J. Lennox Scott, John L. Scott, Inc.

In addition to favorable financing, Scott said, “Increased inventory and continued job growth built on April’s momentum, translating to strong results in May.” While inventory has increased in many areas, Scott noted there are still severe shortages of listings in some price ranges.

Inventory improved 24.5 percent from a year ago, with brokers adding 14,689 new listings to outpace the 12,006 pending sales. The MLS report for May shows 16,133 active listings at month end, up from the year-ago total of 12,956. King County recorded the largest gain in total inventory, at more than 62 percent, but supply remained below 2 months in that and several other counties.

System-wide there was 1.76 months of supply at the end of May, well below the 4-to-6 months that experts say indicate a balanced market. “While our inventory has grown a little, we’re still well within the definition of a seller’s market,” said Frank Wilson, a broker in Kitsap County where there is only 1.46 months of supply.

An analysis of NWMLS inventory at the end of May underscores Scott’s point. It shows only 13.8 percent of the listings of single family homes in King County have asking prices under $600,000. That compares to 25.6 percent in Snohomish County, 31.2 percent in Pierce County and 35.3 percent in Kitsap County.

Comparing May’s prices by housing types and geographic areas shows wide variation. Prices for single family homes (up 5.2 percent) outperformed condos (up nearly 1.4 percent). System-wide, sales of single family homes and condos that closed during May increased nearly 4.8 percent YOY, and rose more than 3.5 percent from April. A county-by-county comparison shows price changes ranged from a year-over-year drop of more than 20 percent (in Okanogan County) to a jump of more than 52 percent (in Pacific County).

Single family homes:

Home prices for single family homes (excluding condominiums) are up 5.2 percent system-wide, rising from the year ago figure of $429,500 to last month’s figure of $451,800.

King County prices for single family homes show a 3.6 percent decline from a year ago, but are at the highest level since June when the median price was $715,000. Snohomish nearly matched last June’s figure of $510,000, the highest for the year. A review of figures for the past five years shows both Kitsap and Pierce counties reached new highs (at $385,000 and $370,000, respectively) for last month’s median prices for sales of single family homes.

Three other counties (in addition to King) reported year-over-year drops in median prices on single family homes, led by Okanogan County where selling prices plunged more than 20 percent. Also reporting declines were San Juan County (-0.51 percent) and Snohomish County (-0.01 percent).

Condos:

Condo prices also rose, but at a smaller rate, as inventory continued to build (up nearly 65 percent).  Area-wide prices increased about 1.4 percent from a year ago. Pierce County prices surged 18 percent, while condo prices in King County were mostly flat (up 0.7 percent). Only six counties reported year-over-year price declines.

Prices overall (single family homes and condominiums):

Prices overall, including single family homes and condos are up $20,000 (nearly 4.8 percent) from a year ago, increasing from $420,000 to $440,000. In King County, the median sales price was $645,000, down less than a percent (-0.77) from a year ago. Snohomish County also reported a fractional drop, declining from $478,615 to $476,025 (down 0.54 percent).

“Home prices in the Seattle metro area are still lower than they were a year ago, but only marginally,” remarked Jacobi, but added, “Thanks to the pretty significant drop in interest rates last month, we can expect to see home prices trending higher through the end of the year, but at a far more moderate pace than the last several years.”

Rebhuhn agreed, crediting lower interest rates, lower median prices, and new jobs as driving factors in South King County, Pierce County and Tacoma. “We look for a very active summer market,” he remarked.

James Young, director of the Washington Center for Real Estate Research at the University of Washington, also attributed strong activity along the I-5 corridor and outer urban centers to low interest rates. Also noteworthy, he suggested, was Douglas County where YOY prices surged more than 24 percent.  “Cowlitz, Thurston, and Lewis counties continue to outperform,” he added.

Young said interest rates could drop further as 10-year yields continue to fall. “Given the search for value among those sellers trading down along with first-time buyers in all urban areas across the state, prices should continue to rise throughout the peak season,” he stated.

“The data for May extends the same phenomenon we’ve been part of for nearly five years,” said Mike Grady, president and COO of Coldwell Banker Bain. “Recall that just one year ago the headlines were asking, ‘Has the hot market ended?’ as inventory increased from 3-to-5 days to 1.8 months between May and August. Now, one year later, while we see many more listings are available, accepted offers are keeping pace and inventory remains relatively stable at 1.7-to-2 months.”

“A balanced market should have about a 6-month supply,” explained WCRER’s Young, noting the national month’s supply figure is at about 4 months. “Except for a few small counties, every county in the NWMLS area has a month’s supply of 4 or less. Except for Skagit County, with 2.2 months of supply, every county along the I-5 corridor has less than 2 months.”

Wilson, the Kitsap regional manager and branch managing broker at John L. Scott Real Estate in Poulsbo, emphasized “the numbers are all relative, relative to a ‘normal’ market which we are not in.” Noting the current inventory of 644 homes and condos is higher than last year when there were 519 active listings at this time, “it is half of what might be considered a balanced market here in Kitsap County.”

What people read about the Puget Sound market “is not reflective of our micro market” Wilson continued, noting one “huge difference” is the amount of vacant land that is available. “We have seen a bump in vacant land listings,” he reported, adding, “For those looking to build a home, there are a lot of opportunities in this area, though be prepared for a lengthy process to get a home plan approved and built here in Kitsap.”

“We’re in the midst of the four best months in the year for buyer activity,” Scott emphasized. “I recommend sellers ensure their home’s appearance, marketing strategy and broker associate relationship are all in tip-top shape,” he added.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Housing Market Rebounds From February Freeze
Press Release
Market Snapshot Infographic / Statistical Reports

KIRKLAND, Washington (April 5, 2019) – Both pending sales and new listing activity around Western Washington surged during March as buyers, sellers, and brokers emerged from February’s record snowfall.

Brokers added 10,516 new listings of single family homes and condos to the Northwest Multiple Listing Service inventory last month, the highest monthly volume since August 2018. Compared to the same month a year ago, new listings across the 23 counties in the report were down slightly (79 fewer units).

MLS members also reported 10,261 pending sales during the same timeframe, the highest number of mutually accepted offers since July, and nearly matching the year-ago total of 10,311.

“After the housing adjustment in 2018, this year’s spring market is back to frenzied in the more affordable and mid-price ranges,” remarked J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. Noting March is the start of the prime-time selling season, he expects this year “will be no exception.” He also commented on improved affordability from last fall’s price adjustments in the close-in job centers of Seattle and the Eastside. “This improved affordability, along with lower interest rates and very strong job growth, all point us in the right direction for red-hot acceleration again this year,” Scott stated.

Year-over-year prices area-wide were up 3.5 percent, rising from $401,761 to $415,950, with most counties reporting gains. King County was an exception. Prices there were flat (down 0.4 percent), slipping from the year-ago median of $625,000 to last month’s figure of $622,500, but rising from February’s price of $604,000.

Compared to February, prices rose 2.2 percent system-wide. The four-county Puget Sound region had larger month-to-month increases, led by Kitsap County, up 5.9 percent from February. Prices in Snohomish County jumped nearly 5.5 percent, while King County’s median prices rose more than 3 percent when comparing February to March.

Commenting on the uptick in new listings and new sales, broker Dean Rebhuhn pointed to lower mortgage interest rates and a growing selection of properties as drivers of activity. “Well-priced properties are selling. Buyers who are getting fully underwritten loan commitments are winning the prize – the home,” stated Rebhuhn, the owner of Village Homes and Properties in Woodinville.

At month end, there were 12,017 active listings of single family homes and condos in the Northwest MLS database. That represents an increase of more than 36 percent from a year ago when there were only 8,825 active listings. Inventory more than doubled in King County compared to a year ago, rising from 2,060 active listings to 4,263 at the end of March. Nine counties reported less inventory than 12 months ago.

Even with improving inventory, there is less than two months of supply overall and in seven counties, including Pierce (1.2 months), Snohomish (1.3 months), Kitsap (1.4 months) and King (nearly 1.9 months).

“March signaled the beginning of the annual rise in King County residential listing inventory, and this year’s active listings are building on a higher base of listings than previous years,” observed John Deely, principal managing broker at Coldwell Banker Bain in Seattle. He also noted pending sales (10,261 during March) kept pace with new listings (10,516) to slow the buildup of inventory.

“Many buyers found the increased inventory meant more choices and less competition in many market areas,” said Deely, a member of the Northwest MLS board of directors. “In core Seattle markets, new listings that are competitively priced are seeing multiple and contingency-stripped offers,” he added.

OB Jacobi, president of Windermere Real Estate, described March as an “eventful month for real estate,” as the snow finally melted and interest rates dropped, “nudging buyers off the fence and back into the market. The result was a spike in pending sales between February and March (up more than 49 percent), and a pop in price growth in several counties, suggesting we are entering an active spring market.”

Another MLS director, Meredith Hansen, attributed the downturn in last month’s closed sales to inclement weather. Tight inventory makes spring an excellent time for sellers to put their homes on the market, she suggested. “Buyers have more selection, good interest rates, and a less frenzied market to make solid decisions. Overall, I’d say it’s a win-win for both sides,” remarked Hansen, the owner/designated broker at Keller Williams Greater Seattle.

Brokers from Kitsap and South Sound markets are reporting strong activity, with pending sales outgaining new listings, and heavy traffic at open houses.

“In Kitsap County, the buyers have arrived to the market faster than sellers,” reported Frank Wilson, Kitsap regional manager and branch managing broker at John L. Scott’s Poulsbo office. “Low interest rates are giving buyers a break in house payments, which allows them to buy a little more house. Buyers have received the message about the spring market, but sellers are still waiting in the wings,” he commented.

Broker Dick Beeson said the South Sound market is somewhat of an anomaly, as prices continue to rise despite growing inventory. “Multiple offers are less frequent in this market, and, unlike 6-to-12 months ago, sellers are now agreeing to do repairs and pay buyer’s closing costs,” according to Beeson, principal managing broker at RE/MAX Northwest Realtors in Gig Harbor. “Some type of negotiation is once again prevalent in almost every sale,” he added.

Beeson said in certain higher price ranges buyers and sellers have “almost equal footing.” He suggested it could become a buyer’s market in South Sound “when the Seattle/King County market flattens out even more and can provide homes at affordable prices so those who don’t work in high tech can afford them.”

“Areas outside of King County and along the I-5 corridor outperform as people continue to look for value outside the main urban centers,” observed James Young, director of the Washington Center for Real Estate Research at the University of Washington. He expects the spring price growth will be “solid” as long as demand remains.

“The market is highly interest rate sensitive, and this is reflected in current price trends in the region,” Young stated. “Given interest rates are now 70 basis points lower than their peak in November last year (and back down near historic lows), house prices could rise by 8.4 percent and people could keep the same mortgage repayments. This means someone who could have purchased a $450,000 house six months ago can now purchase a house costing $487,800 and keep the same monthly repayment, an 8.2 percent increase,” he explained.

Northwest MLS members report 6,750 completed transactions during March, a drop of about 8.3 percent from a year ago, and likely a result of February’s heavy snows that resulted in hazardous roads and kept many people housebound for several days.

“Although closed sales were down in March, we believe February’s snowy weather slowed the closing of pending transactions,” suggested Mike Grady, president and COO of Coldwell Banker Bain. “Most notably in determining the strength of our market is the ratio of new listings and pending sales, which were close, resulting in less than two months of inventory in many areas. We expect the market to continue these trends as we head into what is always the busiest time of the year.”

Scott also expects momentum to continue. “Looking ahead, more new listings are on the way, and the more affordable and mid-price ranges will see strong price appreciation this year – just not at last year’s extreme levels,” he commented.

Deely said one change from past markets is the trend of buyers who are unwilling to participate in properties with an offer review date. “This has the notable effect of fewer competing offers and an increase in properties going past their offer review date without a sale.”

Condo activity remains mostly unremarkable, although inventory is improving. Brokers added 1,487 new listings to the selection last month and reported 1,387 pending sales. Inventory at month end stood at 1,610 active listings, up more than 85 percent from a year ago. That still leaves months of supply below two months in many areas, including King (1.95 months of supply), Snohomish (1.1 months), Pierce (0.83 months), and Kitsap (1.67 months).

MLS members reported 932 closed sales of condominiums during March with a median price of $367,150, about the same as the year-ago price of $365,000. In King County, the median sales price for condos was $434,000, a drop of almost 7 percent from twelve months ago.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

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Heavy Snowfall Ices February Housing Activity Around Western Washington
Latest Press Release
March 6, 2019
Current Statistical Reports

KIRKLAND, Washington (March 6, 2019) – Seattle’s snowiest month in 50 years had an obvious chilling effect on February’s housing activity, agreed officials with Northwest Multiple Listing Service. Statistics for last month show pending sales dropped nearly 14 percent compared to the same month a year ago.

“The winter weather brought the market to a halt,” stated John Deely, principal managing broker at Coldwell Banker Bain. He said last month’s series of snowstorms and frigid temperatures had a negative impact on the typical momentum that builds at the beginning of the year.

“Showing activity dropped more than 41 percent the week of the heaviest snow, and weekend keybox activity was down 80 percent,” Deely reported. “The end of the month picked up as cabin fever weary buyers unleashed themselves on the burgeoning inventory,” he added.

Despite the weather disruptions, brokers added 6,247 new listings to inventory during the month, 1,037 fewer than a year ago. At month end, Northwest MLS members reported 11,275 total active listings, a robust 42.3 percent jump from twelve months ago. Thirteen of the 23 counties served by the MLS reported year-over-year increases in inventory.

Dean Rebhuhn, owner of Village Homes and Properties, described February listings and sales as “very good,” pointing to low interest rates, new jobs, and lifestyle changes as market drivers. “New sales continue to absorb new listings,” he noted.

Northwest MLS figures show about 2.2 months of inventory system-wide, with four counties (Kitsap, Pierce, Snohomish, and Thurston having less than two months of supply. King County was slightly above two months (2.09).

“Snowmageddon notwithstanding, we saw nearly as many homes go pending (6,878) as came on the market (6,247) in February,” noted Mike Grady, president and COO of Coldwell Banker Bain. “In Snohomish and Pierce counties, the activity was even more impressive for this time of year, with our offices pointing to an uptick in the market.”

It seemed determined buyers were undeterred by nearly inaccessible neighborhoods, based on examples Grady cited.

“A Ballard listing priced at $635,000 went on the market on a Friday and drew a whopping 132 groups previewing it that weekend, yielding 14 offers by Monday. The home sold for 22 percent above listing price,” Grady said. “In Kirkland, we heard about five new listings over $1 million coming on the market during Snowmageddon week two, and all were sold that same week,” prompting him to declare he continues to be bullish on a continued strong market for 2019.

As February temperatures plunged, prices in most counties started heating up, rising from a year ago as well as when compared to January.

Area-wide median prices for the 5,145 sales of single family homes and condos that closed last month were up 5.7 percent from a year ago, rising from $385,000 to $407,000. Compared to January, prices increased 6.6 percent. Single family home prices increased 7.44 percent, while condo prices were nearly flat (up about 1.3 percent).

In King County, brokers reported a price gain of nearly 2.4 percent from a year ago. The median selling price jumped $14,000 from a year ago, from $590,000 to $604,000. The comparison to January shows a price increase of 6.9 percent.

J. Lennox Scott, chairman and CEO of John L. Scott Real Estate commented on the return of the multiple-offer market. “While the snow in February created a short distraction, the housing market is back on hot as we head into spring,” he remarked, reporting “Dedicated buyers braved the snow. The market is on track for a strong spring.”

“Between January and February, home prices in the tri-county King/Snohomish/Pierce area rose significantly, ending the month-over-month declines that started last May,” remarked OB Jacobi, president of Windermere Real Estate. He called the increase “pretty unexpected and likely a result of the drop in interest rates we saw in December.” Jacobi believes it’s too early to know if this is the start of a trend, but added “It might suggest that the slowing in prices that began last summer has come to an end.”

James Young, director of the Washington Center for Real Estate Research at the University of Washington, said last month’s weather made it difficult to comment on activity, but detected some patterns on prices. “Similar to previous months, prices are moving upwards the most consistently in exurban areas along the I-5 corridor. Look for prices outside the major urban areas to continue rising as the weather improves and the main selling season arrives.”

Areas outside the main Puget Sound urban regions continue to perform well, Young suggested, in part because older households continue to cash out of more expensive markets and move to the outskirts of the cities to areas that still offer good amenities for retirement and lifestyle.

Prices appear to have bottomed out to around year-ago levels, agreed Matt Dealy. Discussions with buyers who are back in the market suggest they believe prices are no longer going down and some feel like interest rates are on sale. House-hunters also seem to be encouraged by the growing selection, he remarked.

Frank Wilson, Kitsap regional manager and branch managing broker at John L. Scott’s Poulsbo office, said the market there has slowed considerably compared to last year when the spring market perked up before the more typical March and April timeframe.

“The reality is we still have low inventory, homes are going under contract faster than they are coming on the market, we are still seeing strong traffic at open houses, and we are still seeing multiple offers on correctly priced homes that are new on the market.” Wilson commented. “Waterfront homes are still at a premium on the Kitsap mainland,” he continued. “As we continue into the spring market, I think we’ll see a bump in buyers who are enjoying the continued low interest rates, although some may still be frustrated with the limited choices.”

Low and stable interest rates are particularly important to those closing larger mortgage loans, Young pointed out. “Buyers also appear to be responding to stable interest rates over the past couple of months, particularly in the higher priced areas of the region,” he commented, noting interest rates for jumbo mortgages (balances over $484,350) decreased to 4.40% from December’s rate of 4.59%.

As the pace of activity picks up, Scott emphasized the importance of buyer preparation to ensure they can secure the home of their choice. “We recommend working with a qualified broker, becoming fully underwritten by a lender, and signing up for text notifications for new listings to find success this spring.”

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

Attentive home buyers can find “good values and receptive sellers”
January 7, 2019
Current Statistics | Market Recaps

KIRKLAND, Washington (January 7, 2019) – December brought few surprises for real estate brokers in Western Washington with holidays, fluctuating interest rates, and volatility in consumer confidence contributing to slower activity. Several leaders from Northwest Multiple Listing Service described 2018 as a transition year for residential real estate.

New data from the MLS show inventory in its 23-county market area dipped below two months of supply for the first time since July. A year-over-year comparison of the number of new listings, pending sales, and closed sales show drops overall, while prices rose from the same month a year ago.

Member-brokers added 3,631 new listings of single family homes and condominiums during December (10.4 percent fewer than a year ago), boosting total active listings to 12,275, up from the year-ago volume of 8,553. Pending sales were down about 8.4 percent from twelve months ago (5,677 versus 6,198), and the volume of closed sales dropped nearly 16.6 percent (6,374 versus 7,642).

For 2018, members of Northwest MLS reported completing 92,555 transactions, which compares with 99,345 closed sales during 2017 for a drop of about 6.8 percent. The median price on last year’s closed sales of single family homes and condominiums combined was $402,000, up $32,000 (8.64 percent) from 2017.

Commenting on inventory, declines in closed sales and the drop in month’s supply, MLS director Dick Beeson said, “There’s lots of speculation as to the reasons why. One thing for sure: this situation can make for a deliciously deceptive market for either buyers or sellers.” The veteran Realtor said buyers who are paying attention will find very good values and receptive sellers.

“Timing the interest rate market is beyond the capability of most everyone. Therefore, buyers should act now, act deliberately, act decisively, and act in conjunction with an experienced real estate professional,” advised Beeson, the principal managing broker at RE/MAX Northwest in Gig Harbor.

Brokers said many of last month’s buyers took advantage of the shifting market.

“Buyers in December were reaping the benefits of market-weary sellers who were willing to give up part of their bloated home equity to make a deal and move on,” reported John Deely, principal managing broker at Coldwell Banker Bain.

James Young, director of the Washington Center for Real Estate Research at the University of Washington, noted last month was a very different December from a year ago. “While active listings are up significantly (43.5 percent) from a year ago, interest rates have also gone up by over 80 basis points, meaning the typical mortgage repayment has increased by about 10 percent for those looking to buy. That limits spending power and stops buyers from bidding up for the house they want rather than the house they can afford.”

The 12,275 active listings in the MLS database at year end was down from November when inventory totaled 15,830 properties, and down from 2018’s peak of 19,526 listings at the end of September. Measured another way, there was 1.93 months of supply at the end of December, with four-to-six months typically considered to be a balanced market. A year ago there was only 1.12 months of supply. On a percentage basis, year-over-year inventory has climbed each month since May.

Five counties had less than two months of supply at year end, with Kitsap having the scarcest selection at only 1.48 months of supply. Other counties reporting less than two months of supply were Pierce (1.52), Snohomish (1.53), Thurston (1.58), and King (1.71). Brokers note some of the December shrinkage is seasonal since some sellers take their home off the market during the holidays.

Condo inventory surged, notably in King County which now has more than four times the number of condo listings than 12 months ago.

“We’re continuing to see a balancing of the market, yet it is still seller-leaning, driven by our region’s continued job formation and a lack of inventory,” observed Mike Grady, president and COO of Coldwell Banker Bain. “For all the talk of doom and gloom in real estate” he said his calculations show home values have increased at four times the rate of inflation since December 2014 when the “hot market” began.

Grady pointed to the gap between December’s closed sales (6,374) and the volume of new listings (3,631) to replenish supply. He expects more growth in inventory this year, “but still not to the level of a truly balanced market of five or so months of supply.” Grady also anticipates prices increases, “although not at the rate they have been. So, still a great time for both buyers and sellers to enter the market.”

Other industry leaders also described the market in terms of a transition or recovery.

Lennox Scott, chairman and CEO of John L. Scott Real Estate, said a favorable market is returning for home buyers in Seattle and the Eastside. “Improved affordability, with both lower interest rates and adjusted lower housing prices from the spring of 2018 will lead the way,” he stated, adding “Although unsold inventory of homes for sale is still considered a shortage, the larger number of unsold homes, combined with new listings, will moderate the price increases in the year ahead.”

“Last year was a recovery year,” said George Moorhead, who believes 2019 will mirror it in several ways. “Balancing inventory, moderate appreciation of home values, tempered buyer demand with rising interest rates and reduced tax incentives” are among his expectations. “Buyer affordability in 2019 will be based on perception of good value and mortgage interest rates,” suggested Moorhead, the designated broker and owner of Bentley Properties. “The looming feeling of a hard-hitting recession keeps many would-be homeowners on the sidelines, thinking ‘It is better to watch and wait’ even though economic factors point towards a continued healthy, yet moderate market.”

John Deely called 2018 “the transition year for the traditional Pacific Northwest 10-year market cycle.” The swing from a sellers’ market to a more balanced market was evident by the second quarter of 2018 as the absorption of new and standing inventory slowed due to a decrease in pending sales explained Deely, a member of the Northwest MLS board of directors.

Three factors contributed to the change, according to Deely. He listed accelerated and unsustainable home price growth, rising interest rates, and waning consumer confidence and sentiment as those factors, noting “The market is mimicking the strong recession recovery cycles of 2012 to 2014.”

“The year ended with more of a splutter than a bang as home price growth continued to slow in December,” stated OB Jacobi, president of Windermere Real Estate. “But it’s important to keep things in perspective,” he emphasized, saying 2018 was a very good year for Seattle-area home sales. “The shift we’re experiencing is only bringing us closer to a more balanced market. My crystal ball tells me this trend will continue in the coming year with home prices rising, but at a slower rate of around 5.5 percent.”

Young, from the Center for Real Estate Research, commented on activity moving away from core urban areas to outlying regions where prices are cheaper. Demand is pushing prices higher and shortening market time in several counties, he stated, naming Cowlitz, Lewis and Thurston, which all experienced year-over-year price gains of at least 12.4 percent.

“Regardless of what the news is saying about the Seattle market, at the end of the day, the Kitsap median home price is significantly lower than a home in King County,” said Frank Wilson, Kitsap regional manager and branch managing broker at John L. Scott Real Estate in Poulsbo. Northwest MLS data show the median price for homes and condos that sold last month in Kitsap County was $343,000, while in King County it was 74 percent higher ($597,000).

“This will be what keeps our inventory low due to the improved mobility between Colman Dock and Kingston, Bremerton, and eventually Port Orchard,” Wilson remarked. He noted the early success of the fast ferry on the Kingston run is leading to talks about adding more boats.

Wilson said Kitsap brokers report good traffic at open houses and multiple offers on correctly priced homes. “We’ve also seen prices of homes in the north end go up, as well as an increase in new construction in the area,” added Wilson, who is also a director at NWMLS.

Beeson also commented on the importance of pricing. “Sellers who recognize a market shift has occurred will price their homes accordingly and sell in a reasonable amount of time, 30 days or less – not one day.”

Young said buyers are very aware of the changing housing finance environment and are still active in the marketplace even if they are not as aggressive as they have been in the past. Mortgage applications are declining due to short-term uncertainty, he said, even though 30-year fixed rate mortgage interest rates are continuing to fall.

Moorhead echoed that thought. “Buyers are being much more methodical about their purchase with some taking as long as eight months before making their final decision,” he reported.

Jacobi believes 2019 will bring the continued resurgence of first-time buyers, especially millennials as they form new households, get married, and have children. “Although many of them will face significant obstacles to buying due to student debt, lack of down payments, and Seattle’s high-priced housing, this group is likely to buy more homes in 2019 than any other demographic,” Jacobi predicts.

Wilson characterized the seasonally slower December/early January period as “the calm before the storm,” noting the spring market usually brings a surge of buyers that surpass the increase in listings.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

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Home Buyers Have “Window of Opportunity” With Shift to More Balanced Market
Latest Press Release
See below: Current Statistics | Market Recaps | Market Snapshot Infographic

KIRKLAND, Washington (December 6, 2018) – With more plentiful inventory, recently announced increases in lending limits, and moderating prices, prospective home buyers are finding more options around Western Washington, according to industry experts from Northwest Multiple Listing Service.

“Moderating interest rates over the past few weeks could provide a window of opportunity for buyers this month, even if the Fed is widely expected to raise them again in December,” said Mike Grady, president and COO of Coldwell Banker Bain.

“We are continuing to see a balancing of the market,” Grady stated, citing moderating prices and increasing inventory as contributing factors in comments about the latest figures from Northwest Multiple Listing Service.

House hunters have a much bigger selection than a year ago. Northwest MLS figures for the 23 counties in its report show the year-over-year volume of inventory rose from 11,193 homes and condos to 15,830. The increase in active listings represents a gain of more than 41 percent. Members added 6,399 new listings to inventory last month, up from 6,098 for the same month a year ago.

King County registered the biggest gains, with active inventory surging 135 percent from a year ago. The number of single family homes more than doubled from a year ago, rising from 1,879 to 4,020, while the condo selection more than tripled, jumping from 355 active listings twelve months ago to last month’s total of 1,221. Eight counties reported fewer listings than a year ago.

“Months of inventory is still slim compared to historical norms,” Grady emphasized. Using this metric, both King County and the Northwest MLS market area overall have 2.3 months of supply. While supply is improving, it’s still well below the 4-to-6 month level industry analysts use as a gauge of a balanced market.

The surge in supply is not yet reflected in sales during this typically slower holiday season. Pending sales for November were down 10.4 percent from a year ago. Thirteen of the 23 counties in the report registered drops in pending sales versus a year ago. Compared with October, mutually accepted offers fell 17.5 percent. That was less than the falloff in 2017, when the volume of pending sales from October to November shrunk by 21.5 percent.

Closed sales declined about 15.3 percent from twelve months ago, with 13 counties reporting double-digit drops. Year-over-year prices still rose (up 4.2 percent overall). Ten counties had double-digit appreciation in their median sales price for single family homes and condos (combined).

Condo activity was also mixed. The number of active listings more than doubled area-wide, and more than tripled in King County. Pending and closed sales were weaker than a year ago. Prices rose slightly (1.5 percent), from $330,000 to $335,000. The median price in King County, which accounted for 55 percent of last month’s closings, rose 5.2 percent, from $384,990 a year ago to $405,000.

“This massive increase in the number of homes for sale in King County last month means we are officially on our way back to a more balanced market,” remarked OB Jacobi, president of Windermere Real Estate. “This is good news for buyers who just a year ago were in fierce competitions for very limited inventory,” he added.

“Buyers who were forced to look at outlying areas in Pierce or Snohomish counties are now coming back to core communities in King County,” reported George Moorhead, designated broker and owner of Bentley Properties. He said many such buyers are aggressively looking for their next home during the November to January timeframe, knowing they may be able to get concessions that were unavailable the past two years and also that “sellers tend to be more negotiable.”

“This resurgence seems to be gaining momentum,” Moorhead noted, dismissing reports of “our real estate market teetering on a collapse.” Such reports “could not be further from the truth,” he stated.

Moorhead also called the bump up in lending limits for certain types of loans, announced in late November, as long overdue and “great news for buyers of homes in the most popular communities.”

Loan limits for mortgages to be acquired by Fannie Mae and Freddie Mac in 2019 are increasing for both conforming and jumbo loans. The Federal Housing Financing Agency [FHFA] announced the loan limit will rise from $453,100 to $484,350; the new ceiling for jumbo loans in high cost areas — including King, Snohomish, and Pierce counties – will be $726,525.

Northwest MLS director Dick Beeson said the combination of stabilizing factors, including more inventory and only slightly increased interest rates, coupled with “more receptive and savvy sellers” are resulting in a “more reasoned approach to buying and selling.” As inventory grows, he believes price increases will be “slower and smaller.”

Beeson, the principal managing broker at RE/MAX Northwest in Gig Harbor, suggested South Sound buyers should get ready for steady, sustained price increases, pointing to the wide gap between King County’s median price for a single family home and Pierce County’s.

A comparison of median prices for single family homes in the tri-county region illustrates his point. Since January, the median price in King County is up about 2.5 percent. In Snohomish County, it has climbed about 4.4 percent. But in Pierce County, the median price of a single family home has jumped more than 10 percent since January.

Median prices by county (single family homes only)

AREA
JAN
NOV
% CHANGE
JAN-NOV
King County Total
$628,388 $643,913 2.47%
Snohomish County Total
$450,000 $470,000 4.44%
Pierce County Total
$312,925 $344,950 10.23%

The Kitsap County market is also different than Seattle, according to Frank Wilson, Kitsap regional manager and a branch managing broker at John L. Scott Real Estate in Poulsbo.

“Kitsap still has a good deal of pent-up demand, although our listing inventory is beginning to grow,” he stated. Even with a gain in the number of active listings of nearly 16 percent compared with a year ago, the current supply of 624 homes and condos is well below the 1,400 to 1,600 listings that typifies a “normal” market, according to Wilson.

“We still only have about 1.8 months of supply, we continue to see good traffic at our open houses and multiple offers on newly listed homes, and a correctly priced home will still sell in less than 30 days,” reported Wilson, a member of the Northwest MLS board of directors.

Another MLS director, John Deely, said recent increases in listings have led to changes in the Seattle market. “Most notably, buyers are taking more time and not feeling rushed to make quick decisions,” he stated. “Most of the contingencies allowing buyers to perform their due diligence, including financing and inspection, have returned to the purchase and sale agreements,” explained Deely, the principal managing broker at Coldwell Banker Bain.

Deely reported multiple offers on properly priced properties still occur but the escalating prices driven by multiple offers and cash buyers paying crazy “got to have it prices” are giving way to a “more normal and sane market.”

Northwest MLS representatives expect the tilt toward a more balanced market to continue:

“I expect this trend (to a more balance market) to continue into 2019, which will cause appreciation to slow somewhat, while giving buyers more options,” stated Jacobi. “This does not mean the real estate sky is falling, rather it’s a much-needed shift towards a more sustainable, balanced market,” he emphasized.
J. Lennox Scott, chairman and CEO at John L. Scott Real Estate, expects slightly higher unsold inventory between now and February “for the first time in years, instead of a market that’s virtually sold out.” Describing 2018 as a “transition year” from an extreme frenzy market to a “strong” housing market, he predicts the holiday backlog of buyers will start searching in January. “We will experience a strong/surge housing market in the spring, which will taper off to a strong market for the remainder of 2019.”
Wilson forecasts a sellers’ market to start off 2019, and perhaps into the first part of the year. He suggests more areas of Kitsap County, such as Port Orchard, will experience positive effects of the new fast ferry, continuing what is already occurring in Port Orchard and Kingston.
Moorhead said builders will still bank on continued job growth “even though huge concessions are being offered for completed homes as the yearend nears.” He predicts rising interest rates will have a modest impact on buyers entering or re-entering the market.

The Mortgage Banker Association, Freddie Mac and Realtor.com all expect mortgage interest rates to rise soon to a range of 4.8 percent to 5.1 percent.

Months Of Inventory Real Estate Tables November 2018

Recap 2018_Nov18Recaps

Recap November 2018 King County Breakouts

Recap 2018_Nov18 Snohomish County Breakouts

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

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KIRKLAND, Washington (November 6, 2018) – Seven months of steadily rising housing inventory reversed course in October when Northwest Multiple Listing Service brokers added the fewest new listings since February, according to a new report. MLS members believe the onset of wintry weather and transition to the holiday season are factors, but suggested the slower pace also signals improving conditions for house-hunters.

“After months of inventory growth that more than quadrupled the number of homes buyers have to choose from, things got back on a seasonal track with new listings and total supply falling in October,” said Robert Wasser, a director with Northwest MLS, when comparing those metrics with September.

“Buyers are catching on to their newfound ability to negotiate. For the first time since 2012, closed sales system-wide rose from September to October,” noted Wasser, a branch manager with Windermere Real Estate in Bellevue.

Northwest MLS members added 8,865 new listings to inventory last month in the 23 counties it encompasses, down from September’s volume of 10,458, but up 4.7 percent from the year-ago total of 8,466 new listings. Compared to September, last month’s number of total active listings shrunk nearly 6.7 percent, but year-over-year inventory rose 33.2 percent, from 13,680 to 18,223 offerings.

Brokers generally welcomed the bump-up in inventory.

Real estate veteran Mike Grady, the president and COO of Coldwell Banker Bain, commented on the current “win-win” conditions. “We’re entering that time of year when historically the market slows a bit as we head into the holidays. Buyers continue to see an improving market compared to last year with the inventory increasingly to 2.4 months of supply in King County, compared to the year-ago figure of less than a month (0.98),” he stated.

Area-wide there is nearly 2.3 months of inventory, slipping from more than 2.5 months in September, and improving on the year-ago figure of about 1.5 months of supply.

The year-over-year gains in supply, while notable, are still “way off from a balanced market that provides five to six months of inventory,” Grady remarked, adding, “Contrary to recent media reports, the sky is not falling,” he emphasized, pointing to rising prices and strong jobs reports as factors for a positive outlook. (The State Employment Security Department reported Washington gained 4,500 jobs in September.)

“Home prices in King County are up nearly 8.6 percent year over year, so we’re still experiencing significant appreciation,” Grady stated. Given continued reports of hiring by companies in the Puget Sound region and recent increases in inventory, he expects homebuyers will continue entering the market, adding, “And sellers can still expect to get good prices — all this without the frenzy. A win-win,” he proclaimed.

Northwest MLS figures for October show median prices system-wide for homes and condos are up about 4.6 percent from a year ago, rising from $373,000 to $390,000. King County prices jumped from $565,000 to $613,509 for a gain of about 8.6 percent. All but four of the 23 counties in the report experienced price increases from a year ago.

Condo prices are up 7.8 percent from a year ago. In King County, which accounted for more than half of last month’s condo sales, prices rose 5.8 percent, from $378,000 to $400,000. Median prices in King County peaked so far this year (at $466,500) in the spring when sales closed at several newly built condos in downtown Seattle and Bellevue. The median price on newly built condos that have sold in King County so far in 2018 is $830,287.

Both pending sales (mutually accepted offers) and closed sales dipped by double-digits during October. MLS members reported 9,015 pending sales, down 14.8 percent from the year-ago total of 10,586, but up slightly from the previous month’s figure of 8,913.

The volume of closed sales declined nearly 11 percent area-wide, although eight counties reported double-digit year-over-year increases. For the four-county Puget Sound region, the number of completed transactions fell 15.3 percent from a year ago, but rose 5.2 percent compared with September.

Commenting on the latest MLS statistics, J. Lennox Scott noted “unsold inventory levels are higher than we’ve seen in the past three years,” adding, “We’ve gone from being virtually sold out in many areas close to the job centers to healthier inventory levels.” Instead of an “extreme shortage,” there is now just a “shortage level” of unsold inventory in the more affordable and mid-price ranges, according to Scott, the chairman and CEO of John L. Scott.

Scott believes the current market provides opportunities for those looking to move before the New Year, even with a home-to-sell contingency. “It’s okay to buy and sell within same-market timing, although it remains crucial for those looking to purchase a home to be buyer-ready for the best chance to get their chosen property,” he advised.

“The increase in standing listing inventory brought more choices to buyers and the meteoric price increases of the spring market have slowed,” stated MLS director John Deely, principal managing broker at Coldwell Banker Bain in Seattle. “Sellers responded by capturing available buyers with competitive pricing or by quickly adjusting pricing,” he reported.

Many sellers are feeling the change, Deely noted. “Longer market times upset their expectations of a quick sale,” he explained. Also, he said, brokers are reporting some sellers’ pricing remains flexible “even after a price reduction as buyers take advantage of a seller’s desire to beat the competition.” He also noted that despite downward trending prices, year-over-year pricing is up.

Brokerage owner George Moorhead of Bentley Properties has noticed a “significant uptick in buyer activity during the past three weeks,” calling it typical for this time of year. “Buyers are more than testing the waters as they see better pricing, less competition, and have a desire to secure their next home for the holidays.”

In response to persistent questions about a possible housing bubble, Moorhead said the clear answer is “Absolutely not.” As buyers, sellers and even brokers adjust to a more balanced and healthy market, “there will be some feeling of the unknown,” he believes.

“When you look at the big picture, inventory is still below what we call a balanced market, the economy is performing above average, and home appreciation is still increasing.” Moorhead stated. Even more important is that homes that are priced correctly are still selling quickly, “under 15 days” he remarked.

Northwest MLS director Dick Beeson also commented on the changing market in the South Sound region, although it is at a less pronounced level than the Greater Seattle area.

Unlike King County where the volume of active listings more than doubled from a year ago, the Pierce-Thurston counties area had modest inventory gains in the 9-to-12 percent range, noted Beeson, principal managing broker at RE/MAX Professionals in Gig Harbor. Year-over-year pending sales are off 12.3 percent while prices rose about 8.3 percent.

“When choices are more abundant, buyers become more discerning, and they make better choices on the homes they select,” Beeson observed, while offering advice to sellers. “Some sellers need to become more discerning with their asking price. That’s the pathway to being sold.”

Recent rises in interest rates are of some concern, according to some industry leaders.

“The rise in interest rates has some sellers and buyers concerned as it erodes the affordability of our already price sensitive market,” stated Deely.

Moorhead reported buyers have expressed little concern, but are more worried about home prices and future values over the next 3-to-5 years. With a diminishing pool of buyers as the year winds down, builders are ramping up incentives, according to Moorhead. He said mortgage interest rate buydowns are among the incentives, along with custom upgrades and payment of closing costs.

Lawrence Yun, chief economist at the National Association of Realtors, expressed concern about inventory and interest rates. “The insufficient supply of low to-mid-priced homes in metro markets with strong job growth continues to drive up prices and push prospective buyers out of the market,” he said in a NAR report on third quarter activity.

“As mortgage rates continue to rise, reaching the decade’s highest rates this quarter, an increase in the supply of affordable homes has become even more important to help temper price growth across the country,” Yun commented.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

Statistical Summary By Counties
MonthsOfInventoryRealEstateTables_Nov18

http://www.northwestmls.com/index.cfm?/News–Information/page/Latest-Press-Release

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Balance “finally returning” to housing market as buyers welcome more choices, moderating prices
Latest Press Release
Current Statistics | Market Recaps | Market Snapshot Infographic

KIRKLAND, Washington (October 4, 2018) – Housing inventory continued to improve during September while the pace of sales slowed in many counties served by Northwest Multiple Listing Service. “Balance is finally returning to the market, and with it, slowing home price growth,” stated OB Jacobi, president of Windermere Real Estate.

A new report from Northwest MLS shows double-digit increases in inventory in several of the 23 counties it serves, led by a 78 percent year-over-year gain in King County. Despite improving selection in the central Puget Sound region, a dozen counties reported drops in the number of active listings compared to last year.

System-wide, the month ended with 2.56 months of supply of single family homes and condos, well below the 4-to-6 months analysts use as an indicator of a balanced market between sellers and buyers. The current level is the highest since February 2015 when member-brokers reported 3.56 months of inventory. In King County, supply exceeded two months for the first time since January 2015.

Condo inventory remains sparse, with only 0.34 months of supply area wide, despite improving inventory (up nearly 70 percent from a year ago). The shortage is expected to ease as construction progresses on several recently-announced high-rise projects.

Brokers added 10,458 new listings of single family homes and condos to the MLS database during September, slightly more than the year-ago figure of 10,120. At month end, buyers could choose from 19,526 listings, a 22.9 percent improvement from twelve months ago when selection totaled 15,888 listings.

Commenting on the wider selection, Mike Grady said buyers “are at long last now seeing properties that stay on the market longer.” Listings that are priced appropriately, “and not based on the feverish market we saw just a few months ago are still selling quickly, and home prices are still showing 8 percent appreciation year-over-year – more than double the rate of inflation,” added Grady, the president and COO of Coldwell Banker Bain.

With improving inventory, some brokers suggest the market may be showing signs of pausing, if not softening. A market shift may be under way, but they believe activity will stay strong.

J. Lennox Scott, chairman and CEO of John L. Scott Real Estate, encouraged would-be buyers to “put extra focus on October,” which he described as the last great month for new listings until March 2019. “Over the winter, new monthly resale listings will lower by approximately 50 percent compared to summer months.” He also noted interest rates, currently in the upper 4 percent, are projected to rise in the coming months.

“This is a more traditional yearly market cycle taking the place of the unusually overheated real estate market of the past several years,” said John Deely, principal managing broker at Coldwell Banker Bain.

“Given there doesn’t appear to be an end in sight related to the region’s job growth, with employees moving here and not enough units being built to accommodate them, we believe this market normalization will continue,” stated Grady. (For every six new jobs created in the Seattle/Tacoma/Bellevue region, there was only one single-family permit issued, according to data from the National Association of REALTORS®.)

Northwest MLS director Robert Wasser reported the recent re-balancing of the market “has led to fewer listings with offer review dates and pre-inspections,” which he said is a positive for buyers hoping to retain their contingencies. His analysis of MLS statistics indicated the median marketing time in King County has risen to 14 days. Also, prices for closed sales are at 100 percent of their list price for a third straight month.

“In the South Sound the market has shifted into neutral and is idling at the moment,” commented Dick Beeson, principal managing broker at RE/MAX Professionals in Gig Harbor. Noting inventory has improved in both Pierce and Thurston counties “but nowhere near what King County has experienced,” Beeson said buyers can see more homes available for sale for the first time in three years. “Buyers are taking deep breaths as they survey this new territory.”

Beeson thinks the “new normal” at two-plus months of inventory is “healthy and long anticipated.” He also believes the steep curve of ever-increasing prices and scarcity of properties has crested.

Ken Anderson, another Realtor in South Puget Sound, noted the bigger selection for buyers is good timing with interest rates on the rise. “We are finding buyers eager to get into homes this fall to take advantage of the still incredibly low borrowing rates.” Sellers need to be mindful of softening sales, he suggested, adding “they’ll have to keep a sharp eye on this trend and have a pricing strategy to match.”

Anderson, the president/owner and designated broker at Coldwell Banker Evergreen in Olympia, said sales remain robust, describing last month as the “second best September on record for closed sales.” Even though pending sales “softened a bit” he said they remain high by historical standards and says “we remain solidly in a seller’s market” but are trending toward balance. “This is welcomed as prices here have risen much faster than our market’s long-term trend line.”

Pending sales (mutually accepted offers) were down nearly 14 percent area-wide, with about half the counties in the MLS report showing double-digit declines. Members notched 8,913 pending sales last month, a slippage of 1,435 sales when compared to the same month a year ago.

Closed sales also reflected slower activity. Members reported 7,630 completed transactions during September, down 18.6 percent from the year-ago volume of 9,371. Through nine months, this year’s closings are down 4.4 percent compared to 2017.

Prices across the 23 counties in the Northwest MLS report are up about 5 percent from a year ago, with ten counties reporting double-digit gains. The median price for last month’s completed sales of single family homes and condos system-wide was $400,000, up from the year-ago median price of $381,000. Last month’s price was down $15,000 (-3.6 percent) from August and $25,000 (-5.9 percent) from the year’s peak (so far), which occurred in June when the median price was $425,000.

For the four-county Puget Sound region, the median price for September’s completed transactions was $455,000, up about 5.8 percent from a year ago.

Despite slower sales, Northwest MLS spokespeople remain upbeat.

“The housing market close to the job centers has gone from a historic extreme-frenzy market in the spring down a few levels of hotness to a strong level of pending sales activity for new listings,” said Scott.

“Rising interest rates and slowing home prices are affecting the psychology of the region’s housing market, and causing some to speculate that we’re heading towards another housing crash, but that’s definitely not the case,” commented Jacobi. Noting it’s been more than 15 years since this area experienced a “normal” market, Jacobi suggested “people have just forgotten what it looks like. As long as the local economy remains strong, there’s little cause for concern about the shift we’re experiencing.”

He believes “there’s little cause for concern about the shift we’re experiencing,” so long as the local economy remains strong.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

Improving supply helps slow escalating home prices in Western Washington
September 7, 2018
Current Statistics | Market Recaps | Market Snapshot Infographic

KIRKLAND, Washington (September 7, 2018) – House-hunters in Western Washington can choose from the largest supply of homes in three years, and they are facing fewer bidding wars, according to officials from Northwest Multiple Listing Service.

New statistics from the MLS show prices appear to be moderating (up about 6.7 percent overall), but brokers say they are not bracing for a bubble, or even anticipating a quick shift to a buyers’ market.

“There have been incremental increases in listing inventory the past few months,” noted Gary O’Leyar, the designated broker/owner at Berkshire Hathaway HomeServices Signature Properties, but, he added, “By no means have inventory levels reached a point that is deemed to be a balanced market.”

Area-wide, the number of active listings of single family homes and condos (combined) rose 16.2 percent, but 16 counties reported year-over-year drops in inventory; of those, nine had double-digit decreases from twelve months ago. At month end there were 18,580 active listings, the highest level since September 2015 when buyers could choose from 19,724 listings. Compared to July, inventory was up nearly 11 percent.

The latest numbers from Northwest MLS show wide-ranging changes in the volume of active listings when comparing the 23 counties in the report. In Clark County, inventory doubled from a year ago to lead the list based on percentage gains. King County was runner-up with a 74.3 percent increase, rising from 3,329 active listings a year ago to 5,803 at the end of August.

System-wide there is about two months of supply, but less than that in the four-county Puget Sound region – well below the “balanced market” range of four-to-six months.

Supply was replenished in part by the addition of 11,994 new listings during the month, up slightly from the year-ago total of 11,781.

A slower pace of sales also contributed to the boost in supply. Brokers reported 10,109 mutually accepted offers last month, a drop of 14.8 percent from a year ago when they tallied 11,867 pending sales.

“The Puget Sound residential housing market remains positive, though the market has transitioned from a frenzied state to one of strong sales activity,” remarked J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “We are seeing stability in the affordable and mid-price ranges in all market areas,” he said, citing “one of the best job growth markets in the nation” and favorable interest rates as contributing factors.

George Moorhead, designated broker at Bentley Properties, commented on buyers “still sitting on the sidelines despite clear indicators.” He believes, “This is the best time in three years to be aggressive in the marketplace” given rising inventory, a significant increase in the number of cancelled and expired listings, and more incentives being offered by builders. “We are now seeing price reductions in new home communities as builders try to move inventory of completed homes,” he noted.

With expanding inventories “buyers are definitely taking more time to make a purchase,” stated Mike Grady, president and COO of Coldwell Banker Bain. “This creates a declining curve in pending transactions compared to last year,” he explained. MLS figures show last month’s pending sales in the four-county region were the fewest during August since 2012.

In the four-county Puget Sound region, pending sales were down more than 20 percent, ranging from a 12 percent decline in Pierce County to a drop of more than 23 percent in King County. Referring to King County’s sparse, 1.9 months of supply, Grady emphasized it’s “still a seller-oriented market” with prices continuing to rise at a faster clip than the rate of inflation and the historical 10-year average sales price increase of 3-to 3.5 percent annually.

Unlike most counties, Thurston County nearly matched year-ago levels for both pending and closed sales. “Last month was the second best ever for closed sales in our area,” noted Ken Anderson, president/owner of Coldwell Banker Evergreen in Olympia. He attributes the achievement to the area’s relative affordability. “We continue to present the most affordable options when compared to the other major counties along I-5,” Anderson stated, adding “Demand is very high.”

With more homes on the market in the tri-county area, growth of home prices has slowed, noted OB Jacobi, president of Windermere Real Estate. “Buyers are under less pressure to bid on any home that comes on the market,” he remarked. “Despite what some of the headlines may read, this is no cause for panic; in fact, it’s good news because it’s an indication that we are moving closer to a more balanced market,” he suggested.

The median sales price on the 9,288 completed sales of single family homes and condos during August was $405,000, up nearly 6.9 percent from the year-ago figure of $379,000. All but one county reported price gains, including a dozen counties with double-digit increases; the exception (San Juan County) had only a small 1.7 percent decrease.

For single family homes, the median sales price was $415,000 overall, a 6.4 percent year-over-year increase. Single family homes in King County continue to command the highest price at $669,000, up 2.9 percent from the year-ago price of $650,000, but down from May when a countywide median price of $726,275 was reached, the highest so far this year.

Condo prices also rose by 8.1 percent area wide and 11.3 percent in King County. That segment also experienced a slowdown in sales, with closed transactions off by about 15 percent. Inventory shows signs of improving, with active listings jumping nearly 58 percent, but there was still only about 1.7 months of supply at the end of August.

“The real estate sky isn’t falling,” said Dick Beeson, who acknowledged the “huge increase in inventory the past few months speaks volumes about the anxiety levels sellers have as they try to get all they can before the market crashes, which it won’t. The Northwest still has the best economy in America,” Beeson emphasized.

Why the run-up in listings?, Beeson asked rhetorically. Sellers have read about exorbitant prices and the need for inventory, he explained, adding “I guess we should have schooled them a bit about a phasing in process and not to bunch up at the listing house door.” The velocity of the market is still strong, with well priced and conditioned homes still selling in a matter of days or a few weeks, Beeson stated. “Only now there are just 3-to-5 offers, not 50.”

Several brokers commented on the importance of realistic pricing. “You can’t underprice a home in today’s market, but you can overprice it,” Beeson stated.

Northwest MLS director John Deely agreed. “Sellers should be careful to avoid overpricing as savvy buyers are wary of properties pushing the upper end of the market. Properly priced properties will still see heavy activity in this market. Sellers of homes that linger on the market are reducing their prices to spur activity.”

Deely also said many buyers are coming back into the market but being more cautious by presenting offers with standard contingencies such as inspection and financing provisions.

“Homes that are priced and presented right are still garnering multiple offers, but unlike the past few years, buyers aren’t having to waive protections with their offers,” Scott said.

“Pricing is becoming increasingly important,” Grady emphasized. According to his analysis, recent listings are averaging 22 cumulative days on the market, while other properties listed prior to August are now averaging almost 50 days of marketing time. “This points to pricing and how sellers may have overpriced their homes in the spring and early summer and now have to adjust their asking price.”

Affordability is an ongoing concern, particularly for first-time buyers wanting to live near job centers. In King County, for example, nearly 60 percent of the current inventory of homes and condos has an asking price of $750,000 or higher. Despite that challenge, brokers are upbeat about what Scott describes as a more “normal pace” with buyers having greater selection and availability.

“Even with some doom and gloom about sales being down in many counties, inventory doubling in some areas, and appreciation holding at around 8 percent for the year, our market is still very healthy and recovering from the depleted inventory of the past three years,” remarked Moorhead.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

Brokers Seeing “Simple Economic Recipe for a Softening Housing Market”
July 5, 2018
Current Statistics | Market Recaps | Market Snapshot Infographic

KIRKLAND, Washington (July 5, 2018) – Home buyers around many parts of Washington state had more choices and less competition during June, prompting some industry leaders to comment on “a feeling of change in the market.”

“Inventory is up and demand has dropped,” reported Robert Wasser, an officer with the board of directors at Northwest Multiple Listing Service. That combination is “a pretty simple economic recipe for a softening market,” he added in commenting on the latest MLS statistics.

Figures for June show a 5.2 percent improvement in the number of active listings system-wide, coupled with drops in the volume of pending sales (down 8.4 percent) and closed sales (down .07 percent) compared with a year ago. Despite the shift of some indicators favoring buyers, prices area-wide continued to rise, increasing more than 10 percent from twelve months ago.

“There was a feeling of change in the market this June and the numbers supported that feeling,” remarked John Deely, principal managing broker at Coldwell Banker Bain. He noted many brokers also reported an increase in properties going past their offer review date, more price reductions, and an increase in reverse prospecting (a tool that allows the listing broker to view a list of brokers with potential buyers for that listing). “We’re also experiencing a decrease in multiple offers and the number of buyers participating in multiple offers,” added Deely.

Northwest MLS brokers added 13,153 new listings to inventory during June, a drop from both a year ago when they added 13,658, and from May when 14,524 new listings were added. With new listings outgaining sales, total inventory as measured by active listings and months of supply improved.

At month end, Northwest MLS reported 15,234 active listings and 1.5 months of supply. Inventory of single family homes and condos reached its highest level since October. The supply of active listings in King County surged 47 percent from a year ago, boosting the months of supply to just under 1.3 months — the highest level since September 2016 when there was 1.37 months of supply.

“Although still a quick response market, with more new listings coming on the market during the summer months, we experienced dispersed buyer energy due to the greater availability and selection,” stated J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. He estimates sales activity is off 15-to-20 percent for each new listing’s first 30 days on the market. “Now through October will be the best time of year for homebuyers,” he remarked.

“Sellers are becoming more active in the market as they sense buyers pulling back,” suggested George Moorhead, designated broker and owner at Bentley Properties. Improving supply, a marked increase in expired or cancelled listings, and market times almost doubling are factors he mentioned when describing the market as “more than just lackluster” with summer showing no sign of improvement.

Windermere president OB Jacobi also saw the second straight month with a “pretty significant rise in the number of homes for sale across the Western Washington region” as encouraging. “This is great news for home buyers because not only does it mean more selection, but also less competition.”

Commenting on the steady improvement of supply with more choices for buyers, Mike Grady emphasized “We still remain far below a balanced market of 3-to-5 months of inventory.” The imbalance is reflected by rising prices, up more than 10 percent in King County and nearly 15.5 percent in Snohomish County, he noted. “As long as we are creating 100,000-plus net new jobs annually in the Pacific Northwest and building fewer than 30,000 new single family homes, these trends will continue,” suggested Grady, the president and COO of Coldwell Banker Bain.

Frank Wilson, Kitsap regional manager and branch managing broker at John L. Scott Real Estate in Poulsbo said the market there has slowed “but not to the degree that Seattle has. There are fewer listings coming on the market, to a large degree because potential sellers cannot find a home to buy.”

MLS figures show inventory in Kitsap County is down more than 20 percent from a year ago and pending sales declined 5 percent. Wilson said some potential sellers are opting to stay in their current house and remodel citing rising prices and limited selection as reasons for their decision.

“This market is reaching westward to Jefferson and Clallam counties,” Wilson reported, noting Port Ludlow, Port Townsend and Port Angeles are all feeling a bump in value and shrinking inventory. Jefferson County inventory dropped 32.2 percent year-over-year while prices surged 29.8 percent. The supply in Clallam County shrunk nearly 30 percent, with prices jumping 10.4 percent.

Twenty of the 23 counties covered by the Northwest MLS report had double-digit increases in median sales prices. Grant, Kitsap, and Skagit counties were the exceptions, each with gains under 6 percent.

Of the 29 map areas the MLS tracks within King County, six areas, including Queen Anne/Magnolia and most sub-areas of the Eastside, reported median prices topping $1 million for sales of single family homes and condos that closed during June.

Despite the overall gains, buyers might be cheered by one notable figure: The median sales price of a single family home (excluding condos) in King County fell from May, at $726,275, to June, a $715,000, for a drop of nearly 1.6 percent. That May-to-June decline hasn’t happened since pre-recession, noted MLS director Wasser, owner/broker at Prospera Real Estate in Seattle.

“While home prices are still trending above average rates, the pace is moderately slowing as the housing market becomes less frenetic,” Jacobi stated, adding, “We have a ways to go before we approach anything close to a balanced market, but we’re certainly trending in the right direction.”

The softening was evident in the four-county Puget Sound region where pending sales (mutually accepted offers) were down nearly 11 percent from a year ago. Last month’s 8,052 mutually accepted offers in King, Kitsap, Pierce and Snohomish counties was the lowest total for June since 2014.

Wasser agreed. “It’s still a seller’s market out there, but I’m seeing signs of a more balanced market on the horizon,” he stated.

While year-over-year prices rose in all counties, compared to May they were flat in some areas, including King County where the median price of $650,000 was unchanged. The overall median of $425,000 for June’s closed sales was only $5,000 higher than the previous month.

Buyers who want to live in King County still face hefty prices for existing inventory. Deely said his analysis of active listings of single family homes revealed more than a third of the choices for single family homes has asking prices of more than $1 million. And, he added, there are fewer than 80 listings (only about 2 percent) are priced below the US national median sales price of $313,000.

Escalating prices and depleted inventory in desired neighborhoods are top concerns Moorhead hears from buyers, but “they have another challenge on the list: rising interest rates.” The hikes — with more expected — are pushing buyers into a lower price point, or forcing them to come up with a larger down payment, he added.

Grady also commented on rising mortgage rates, resulting in some buyers being priced out of mortgage qualification. He also suggested the slowdown in pending sales has an international angle. “There have been slightly fewer sales to international buyers as China continues to make taking cash out of China more difficult,” he stated.

Home builders continue to be challenged. Wilson noted builders are “struggling to ramp up production to meet demand” with local regulations and processes being inhibitors.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of more than 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

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Improving Inventory Creating Long-awaited Opportunities for Buyers
Latest Press Release
June 6, 2018
Current Statistics | Market Recaps | Market Snapshot Infographic

KIRKLAND, Washington (June 5, 2018) – Member-brokers of Northwest Multiple Listing Service added 14,524 new listings during May, the first time that volume topped 14,000 since May 2008.

“With eyes peeled for potential shifts in a market that’s felt like ‘more of the same,’ the recent uptick in new listings hitting the market catches my eye — the most new listings in more than a decade,” commented Robert Wasser, owner/broker at Prospera Real Estate in Seattle and an officer with Northwest MLS.

Total active listings snapped a streak of 44 months of negative numbers during May when the year-over-year comparison showed an increase of 3.8 percent. That uptick marked the first time members of Northwest Multiple Listing Service reported a gain for that statistic since August 2014.

King County has more than a month’s supply for the first time since September 2017, and only the third time since October 2016. For the MLS area overall, there is 1.44 months of supply. Only four counties of the 23 counties served by Northwest MLS reported having more than four months of supply, the minimum level most industry experts use as a gauge of a balanced market.

Brokers welcomed the figures showing healthy gains in inventory, but some say they are keeping a watchful eye on rising prices and interest rates, as well as on buyer profiles, including retiring boomers.

New figures from the MLS show slight drops in both pending and closed sales, a likely consequence of persistent inventory shortages. Brokers also cite the market imbalance as a factor in rising prices: compared to a year ago, the median sales price for transactions of single family homes and condos that closed area-wide during May was $420,000, a jump of nearly 11 percent from the year ago price of $378,475.

“What we are experiencing is actually a good thing as inventory leans toward a more balanced market,” remarked George Moorhead, designated broker at Bentley Properties. He also reported a shift from move-up and luxury home buyers to more first-time buyers with “a more level playing field between buyers and sellers.”

Moorhead said there “never was a spring market this year” like what was experienced in the past four years. He points to rising interest rates, lack of inventory, increased home prices, frustration with presenting multiple offers without success, requirements for larger down payments, and an increase in the cost of living as reasons.

Unlike recent past years, “buyers will definitely be able to capitalize on a softer summer market this year,” according to Moorhead, who noted expired listings are on the rise.

Last month’s number of new listings was a significant gain from April when members added 11,271 new listings, a gain of nearly 29 percent.

“It’s the best time of the year for potential home buyers,” proclaimed J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “At this time of year we always see the highest number of new listings come on the market on a monthly basis,” he explained, adding, “More new listings creates more opportunity for home buyers.”

Even with the improving inventory, today’s market “still takes instant response as sales activity remains at a frenzy level for these new listings,” Scott emphasized.

“The good news for home buyers in King County is that compared to last month, there were almost 1,000 more homes for sale,” noted OB Jacobi, president of Windermere Real Estate. “Hopefully,” he added, “this is the beginning of a trend in which we will continue to see inventory levels improve. On the flip side, home prices in the county are up 16 percent year-over-year, which, when combined with rising interest rates, is forcing some buyers to expand their search to Pierce and Snohomish counties so they can find something they can afford to buy.”

Sellers in the 23 counties served by Northwest MLS accepted offers from 12,168 buyers during May, slightly below the number from twelve months ago when pending sales totaled 12,511 (a decline of 2.7 percent). Thirteen counties reported decreases in mutually accepted offers compared to the same month a year ago, with four of them (Cowlitz, Kittitas, Okanogan, and Skagit) tallying double-digit drops.

Closed sales fell slightly, from 9,106 a year ago to 9,011, a drop of just over one percent. Ten counties reported fewer closed sales during May when compared to a year ago. A comparison to April’s completed transactions shows an increase of 1,285 transactions for a gain of 16.6 percent.

Mike Grady, president and COO of Coldwell Banker Bain, said the significant increase in inventory means a slightly easier time for buyers to locate and purchase homes “for the time being.” He said the broader selection enables more buyers to purchase homes regardless of escalating prices, slightly higher interest rates, and fewer cash sales involving Chinese nationals. Grady attributes the dip in Chinese activity to that country’s policies making it more difficult for people to take their cash out of China.

“While there is slightly more inventory available, the market time for most listings is less than a month, and multiple-offer situations occur daily even though there may only be five offers instead of 10 or more,” stated Grady.

Brokers say the continuing bidding wars are helping push prices up. Fifteen counties had double-digit price hikes for single family homes and condos (combined) from a year ago. In the four-county Puget Sound region, Snohomish County has the smallest year-over-year price gain at just under 14 percent, while Kitsap County claimed the largest jump in the region at nearly 17.2 percent.

In King County, the median sales price on all homes rose just over 16 percent, from $560,000 to $650,000. The median price for a single family home rose 14.64 percent, from $633,500 to $726,275.

The condo market showed signs of improvement with inventory growing by nearly 21.4 percent, boosted by the addition of 1,803 new listings during May (up 11.3 percent from a year ago). Even so, there is less than a month’s supply system-wide.

Brokers reported slightly fewer pending sales and closed sales of condos. Year-over-year prices for condos system-wide rose nearly17.5 percent, from $315,000 to $370,000. In King County, which accounted for 55 percent of last month’s condo sales, the median price of a condo that sold was $427,000, a $53,000 increase from a year ago.

For the luxury market close to job centers, Scott noted sales continue to be extremely strong, especially up to the $5 million price point, which he attributes in part to the year-over-year increase in luxury listings. Northwest MLS figures show sales of homes and condos priced at $1 million-plus are up nearly 27 percent from a year ago, rising from 557 sales in May 2017 to last month’s total of 706.

As an aside, Grady suggested the recently enacted head tax in Seattle and retiring boomers will be worth watching. If jobs move from Seattle to the Eastside, workers may relocate as well, he speculates. Commenting on the inclination of more homeowners who are willing to list and sell at this time, he is hearing of more boomers and friends planning to move to states where housing costs less. “One good friend decided Seattle was too expensive to live in his retirement, so they’re selling their 1,400 sq. ft. $600,000 home in Lynnwood and retiring in North Carolina where they purchased a 3,000 sq. ft. home for $300,000,” he said adding, “It may be something to watch as our boomer population retires.”

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of more than 2,200 member offices includes more than 28,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

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KIRKLAND, Washington (May 7, 2018) – Home buyers may be cheered by an uptick in inventory, but the improving supply is unlikely to reverse rising prices, suggest industry leaders from Northwest Multiple Listing Service.

Commenting on just-released figures for April, which showed the highest level of active listings since August, OB Jacobi, president of Windermere Real Estate said, “For the first time in a long time we had good news for buyers.” Noting supply is still lower than year-ago levels (down 5.6 percent), it jumped 14 percent from March, which Jacobi said “is a pretty significant increase even for this time of year.”

Northwest MLS brokers added 11,271 new listings to inventory during April, a gain of 6.3 percent when compared to March, and up nearly 5.9 percent versus a year ago. April’s pending sales (mutually accepted offers) totaled 10,574, improving on the same month a year ago and the previous month.

At month end, the active listings selection included 10,079 single family homes and condos, eclipsing the total of 8,825 listings at the end of March. The condo segment grew 10.9 percent from March.

Of the 23 counties in the Northwest MLS service area, only six of them reported year-over-year gains in inventory compared to a year ago. King County was the only one in the Puget Sound region to notch a gain, up 13.6 percent from a year ago.

Commenting on the uptick, Mike Grady, president and COO, Coldwell Banker Bain, remarked “We are still WAY below a balanced market of five months of inventory, and this is even with interest rates ticking slightly upward.”

Area-wide there is 1.3 months of supply, with 4-to-6 months used as a gauge of a balanced market. Three counties – King, Kitsap, and Snohomish — reported less than a month of supply. The condo component remains very tight with slightly more than three weeks (0.87 months) of supply.

Prices are still climbing at double-digit rates in most counties. Year-over-year prices for single family homes and condos combined jumped about 15.3 percent overall, from $360,000 to $415,000. Within the four-county Puget Sound region, King County notched the biggest gain at nearly 18.2 percent. Prices there rose $100,000 from a year ago, from $550,000 to $650,000.

“There’s little reason to think we’ll be seeing a change in this frantic market anytime soon,” commented Grady, citing double-digit appreciation in many of the most populous counties, expansion plans by Alaska Airlines and Amazon, and other positive economic news as reasons for that expectation.

“Huge jumps in home prices to the north of us are pushing a lot of people to our county, which is among the most affordable on the Puget Sound,” commented Thurston County broker Ken Anderson.

MLS figures show a median price of $300,000 for homes and condos that sold in Thurston County last month, slightly less than Pierce County ($337,950), and significantly lower than both Snohomish County ($475,000) and King County ($650,000).

Despite the cost differential favoring Thurston County, Anderson, the president and owner of Coldwell Banker Evergreen Olympic Realty in Tumwater, said sellers are seeing price gains “they didn’t think possible just a couple of years ago.” Prices in that county are up more than 7.5 percent from twelve months ago. He also reported new construction is not keeping up with the population growth. “That alone will ensure prices will continue to rise in the near to intermediate term,” he commented, adding, “Buyers are seeing the trends and jumping into the market before prices and interest rates climb even higher.”

George Moorhead, designated broker at Bentley Properties, said while prices are still increasing, both inventory and the number of expired listings are also rising. He noted the steady climb in King County’s inventory of single family homes, with April rising more than 25 percent from March. Expired listings surged 86 percent from March, which Moorhead said is another example of some flattening in the market.

Moorhead also believes rising interest rates are having a “moderate impact” with buyers, forcing some to look at homes in lower price points. Buyers still want a good home in a good area, he reported, but some are reconsidering just how much they want to pay, saying they don’t want to be “house payment poor.”

Northwest MLS director Frank Wilson is also detecting some shifts in behavior by both buyers and sellers as the market changes. “As King County buyers spill into Kitsap, they realize they have to be more strategic in their offers, and sellers are paying more attention to the details of an offer, and not always taking the first offer presented,” stated Wilson, the Kitsap regional manager and branch managing broker at John L. Scott Real Estate in Poulsbo.

Wilson said multiple offers (often higher than the list price) are becoming more common on new listings in Kitsap County. When that occurs, he said buyers are being asked to make up the difference should the appraisal not match the increased offer price.

Meanwhile, sellers are beginning to realize the amount offered over list price may not be bankable unless buyers are willing to make up the difference. Consequently, Wilson said they are being more discretionary with the offers they consider. Local, proactive lenders, increased earnest money, preferring verifiable cash offers or conventional over VA or FHA, higher down payments, shorter closing times, and setting some future date when they will review all offers are examples he cited.

Wilson noted Kitsap was one of a half-dozen counties in the MLS report where last month’s pending sales surpassed the number of new listings. “This means the listing deficit is deepening,” he remarked.

J. Lennox Scott, chairman and CEO of John L. Scott, joined the chorus of brokers who believe better times are ahead for home buyers. “Eventually, higher interest rates will moderate the rapid home price appreciation,” he stated, but added, “We have not yet arrived at that tipping point.” He expects the Seattle metro area to probably tie and maybe break the 20-month home price appreciation record for the Case-Shiller index. (The latest S&P CoreLogic Case-Shiller Home Price Indices, released late last month for February, shows Seattle’s 12.7 percent increase led the list of 20 cities it compares.)

Commenting on April’s report showing more new listings than pending sales area-wide, Scott said that pattern is consistent with the annual housing cycle. “New listings will continue to spike, providing slight relief for the backlog of home buyers.”

Scott also expects the market for homes in the more affordable and mid-price ranges to remain at a frenzied pace into the summer of 2019. “For luxury listings in the $1-to-$2 million range and close to job centers, the market remains extremely competitive,” he predicts.

The competitive market is exposing several misconceptions held by buyers and sellers, according to Wilson, who has worked in the industry since 1990. He listed several including:

“It’s all about the price.” Wilson says it’s more about the possibility of a successful closing, using the example of an all-cash offer that is 30 percent above list price that doesn’t close, versus a solid, verifiable conventional offer at 5 percent above list price that actually closes;
“Seller has to take the highest offer” is another myth Wilson listed, explaining a seller can accept any of the offers that are presented.
Similarly, “if multiple offers are made, the seller has to take or work with the first one first,” is also untrue. A seller can address any of the offers in any order.
“Cash is always king.” Wilson emphasized if the cash is not verifiable to the seller’s satisfaction, a conventional offer may actually have a better chance of success.
“Pre-approval with a lender is the same as pre-underwritten,” is another misbelief. The farther down the path a loan application can go, the more likely it is to be approved.
Buying or selling a home can involve nearly two dozen people, Wilson noted, while encouraging buyers and sellers to work with a broker who is well-versed in the process and able to coordinate all the participants to assure a successful closing.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of more than 2,200 member offices includes more than 28,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

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Housing Market Back to “Pressure Cooker Situation” But Brokers Remind Sellers “Pricing Is Still Important”
Latest Press Release

KIRKLAND, Washington (April 5, 2018) – Job growth and a recent run-up in mortgage rates has created an “extremely intense market for each new listing,” stated J. Lennox Scott, chairman and CEO of John L. Scott Real Estate in commenting on the latest statistics from Northwest Multiple Listing Service.

MLS figures for March show a surge in both new listings and pending sales compared to February as the spring market heats up. Compared to a month ago, pending sales climbed more than 29 percent (from 7,980 in February to 10,311 in March), while the volume of new listings jumped more than 45 percent from February to March.

“What used to be a quick action market for buyers is now, once again, an instant response market, and this has been the case since the first of the year,” remarked Scott, adding “This is especially true in the more affordable and mid-price ranges in all markets, and also pertains to luxury properties close to the job centers.”

Whether defined as $1 million or more or $2 million-plus, Northwest MLS figures confirm sales of luxury homes are surging. A comparison of first quarters show the year-over-year volume of sales of homes priced at $2 million or more is up 30 percent. Members reported 136 such sales during first quarter 2017; this year, the number is 177. For homes priced at $1 million or more, sales rose from 941 during first quarter last year to 1,204 this year, a gain of nearly 28 percent.

Prices overall are up about 13.2 percent from a year ago, and even more so in the four-county Puget Sound region. Among these four counties, Kitsap had the largest year-over-year increase at 19 percent, but King County homes are still the priciest. The median price for last month’s sales of single family homes and condos combined in King County is $625,000, up 17.9 percent from a year ago. For single family homes, excluding condos, the median price for last month’s sales was $689,950.

Year-over-year prices are up more than 18 percent in Pierce County and about 14.3 percent in Snohomish County.

Commenting on rising prices, veteran broker Mike Grady said “The market continues to trend hot” with no apparent end in sight. The slight rise in mortgage interest rates since January 1 could mean “some minor impact on non-cash first-time homebuyers,” he suggested, adding, “Only time will tell.” Grady, the president and COO of Coldwell Banker Bain, said his company’s tracking and analysis based on average prices (instead of median prices) shows that “along the I-5 corridor, our average sales price is tracking slightly higher than what the NWMLS median sales prices show.”

Northwest MLS member brokers continue to scramble to replenish supply. They added 10,595 new listings during March, slightly more than a year ago when they added 10,321 properties to the selection. Last month’s additions marked a big gain from February when 7,284 new listings were added.

As has been the pattern, pending sales nearly equaled the number of new listings. Brokers reported 10,311 pending sales last month, a slight drop from the year-ago figure of 10,415. Tight inventory may be to blame as the number of total active listings stood at 8,825 at month end, down nearly 9.7 percent from the year-ago total of 9,772. Fourteen of the 23 counties in the Northwest MLS market area reported drops in pending sales.

“We have returned to an extremely intense market for each new listing due to extremely strong job growth and eager buyers who want to purchase before interest rates go higher,” Scott reported. “The housing market is back to a pressure cooker situation and we are witnessing high levels of sales activity intensity for each new listing coming on the market,” he commented.

Dick Beeson, principal managing broker at RE/MAX Professionals in Tacoma, commented on the frustration many would-be homebuyers are experiencing. “I think this last quarter especially, many buyers are feeling like they brought a knife to a gunfight, there’s been so much competition to buy a home.”

The tri-county area comprised of King, Snohomish and Pierce counties added essentially the same number of new listings during first quarter 2018 as the same period a year ago, Beeson noted, while the actual number of sales dropped slightly. “Why? Because there are too few properties for sale and rental rates are through the roof. People are desperate to find a home,” he stated. He likened the situation to Nordstrom not being able to keep their clothing racks filled because customers storm the store each day buying everything that’s available.

Housing inventory remains well below “normal” ranges based on a level of 4-to-6 months of supply used as an indicator of a balanced market. Area-wide, Northwest MLS figures show there is about 1.2 months of supply, with four counties reporting less than a month’s supply. Snohomish has the sparsest selection at 0.67 months, followed by King (0.83 months), Kitsap (0.95 months), and Pierce (0.99 months).

“Despite the low inventory and sellers’ market, proper pricing is still important,” emphasized John Deely, principal managing broker at Coldwell Banker Bain in Seattle.

“In March we saw more listings where sellers pushed the price envelope causing the property to go past their offer review date with no offers in hand,” Deely reported. “It is not uncommon for buyers to consider a property on the market over 10 days as having something wrong with it,” he added.

Nevertheless, Deely said many buyers are returning from taking a break during the winter after having lost out on several attempts to win in the multiple offer competition. “Throwing caution to the wind, these seasoned veterans of the multiple offer bidding wars are pulling out all the stops (contingencies) to win.”

Rising interest rates and keen competition are motivating some buyers to make compromises, according to George Moorhead, designated broker at Bentley Properties.

“I was asked recently why some communities are seeing a higher sales volume then last year,” Moorhead stated. “I explained this was simple logic with buyers in that instead of competing at their maximum price point in closer in communities and losing out on the perfect home, they compete in a lesser priced area where they can be more aggressive on the better homes in those areas. They may compromise on schools, public services, and commute times, but the opportunity of ownership increases significantly. The second key reason is that 30-year mortgage interest rates have increased .5% since the beginning of the year which erodes home affordability and pushes some buyers out of market places.”

Commenting on the uptick in interest rates, the president of a mortgage firm who trains brokers around the country recently noted, “While $100 a month might not sound like too much, it might adjust a client’s debt-to-loan ratio, which could push the size of a house they can afford down by $40,000 or $50,000.”

Moorhead dismissed “chatter about a looming real estate bubble” based on prices and what used to be the norm. “The key is to understand the normal cyclical pattern of our real estate market. A healthy market has corrections and booms with a mix of flattening cycles,” he stated, noting “Markets without these healthy cycles have catastrophic events much like we experienced in 2007 to 2011.”

Instead of competing in today’s market, some current owners are opting to remodel. “We are getting more and more requests for quality contractors for current homeowners looking to make updates to their home, instead of trying to move up to a better home or community,” Moorhead said. “Just in the last 30 days we know of 12 homeowners starting home improvements in the $100,000 and up range, more out of sheer frustration that they cannot find or secure a move-up home to purchase. What this means on the larger scale is a continued lack of inventory coming on the market to feed the voracious appetite of the buyers in our marketplace.”

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of more than 2,200 member offices includes more than 28,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

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Home Buyers, Sellers Feel “Looming Pressure” But Western Washington Market Stays Strong
March 6, 2018
Current Statistics | Market Recaps | Market Snapshot Infographic

KIRKLAND, Washington (March 6, 2018) – Interest rates are creeping up, inventory is still squeezed, and some feared revised tax laws would have a chilling effect on home sales, but Northwest Multiple Listing Service leaders say the local market remains competitive.

“It seemed like there would have been a chilling effect on the real estate market at the start of 2018 with the newly revised tax laws limiting mortgage interest deductions,” suggested Gary O’Leyar, designated broker and owner at Berkshire Hathaway HomeServices Signature Properties. “Not only did the revisions not have a chilling effect, if anything, the local market has been even hotter and more competitive than last year at this time,” he added in commenting on new MLS numbers summarizing February activity.

Northwest MLS figures for last month show a slight year-over-year decrease (about 2.8 percent) in overall pending sales, a likely consequence of inventory being down nearly 12.9 percent. Other key indicators of the market – new listings, closed sales, and selling prices – all showed gains in February compared to 12 months ago.

The just-released report from Northwest MLS shows 7,980 pending sales last month, down from the year-ago volume of 8,209 mutually accepted offers for single family homes and condos. Thirteen of the 23 counties in the report had more pending sales than at this time last year.

Closed sales outgained last year’s volume, 5,548 to 5,358, for an increase of nearly 3.6 percent. Median prices on those sales surged almost 14.8 percent area-wide, rising from the year ago figure of $335,515 to last month’s price of $385,000.

Among the four Puget Sound area counties, Snohomish had the largest year-over-year price increase at 18.8 percent. Its countywide median price for February’s sales spiked to $460,000 from $387,250, but that is $130,000 below the $590,000 median price for transactions that closed in King County last month.

For single family homes (excluding condos), prices rose 13.7 percent overall, from $343,000 to $390,000. Within King County, the median price was $649,950, with three areas (Mercer Island, Bellevue west of I-405, and Kirkland-Bridle Trails) reporting median prices of more than $1 million for single family homes.

“As was the case the last two years, home values spiked in February, thanks to a cyclical low point in supply,” commented Robert Wasser, owner/broker at Prospera Real Estate. Prices are now back around the peak levels of last summer, and cyclically speaking, are headed for additional increases until summer arrives,” commented Wasser, a board member at Northwest MLS.

Brokers added 7,284 new listings of single family homes and condos during February, an improvement of nearly 6.4 percent from a year ago when they added 6,848 new listings. Like many months during 2017, last month’s pending sales (7,980) outgained new listings (7,284), keeping inventory depleted in many areas.

There is about 1.4 months of supply area-wide, but both King and Snohomish counties have less than a month’s supply. For condos, there is only 0.88 months of supply – and even less than that in King, Snohomish, and Kitsap counties.

Many brokers expect inventory levels to improve. “The arrival of daylight savings triggers a burst in new listings,” proclaimed J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “More listings lead to more sales. In real estate, it’s all about the new listing,” he stated.

Scott expects the boost in home price appreciation during the winter market when inventory is reduced will moderate. “Over the second half of the year, as more listings come on the market, home price appreciation tends to flatten out,” he explained while noting small upticks in mortgage interest rates. Such increases have led to slightly higher mortgage payments, Scott said, “but they have not put a damper on the market.”

New construction could also help ease some of the pressure, suggests Mike Grady, president and COO at Coldwell Banker Bain. “Even though Commerce Department data show purchases of newly built single-family homes nationwide fell 7.8 percent in January after dropping 7.6 percent in December, and purchases have declined for four of the past six months, we are not seeing that trend in the Northwest.”

Inventory is improving in some areas, Grady noted, adding, “The hyper job market in the Pacific Northwest continues to outpace almost every metro area in the nation, and thus our housing market is booming; for now, there is no end in sight.”

Ken Anderson, president/owner and designated broker at Coldwell Banker Evergreen in Olympia, noted some buyers are frustrated with what appears to be lack of choice. “The reality is, we have an 8-year high in the number of homes coming to market in Thurston County,” he stated. His analysis of MLS data show the total number of new listings added in that county in the first two months of this year is at the highest level since 2010.

“The challenge is that the number of buyers is near record highs, too,” said Anderson. Given this competition, he believes “The right plan, including help from a skilled broker, can help buyers find success in this fast-paced market.”

“Many buyers and sellers feel looming pressure, and with a mix of doom and elation, both are preparing for a flurry of activity,” reported George Moorhead, designated broker at Bentley Properties. “We have not seen the typical aggressive spring market yet,” he added, noting “Buyers are coming to the harsh reality that high home prices are here to stay” and they need to consider smaller homes or longer than hoped-for drive times.

Moorhead also noted 30-year mortgage rates climbed slightly for the seventh consecutive weekly increase, but he said these small increases “are not yet creating too much of a stir.” Conversations with buyers are “more around the cost of commuting and time away from home versus floor plan and home size.”

For some wage earners in the Seattle area, “Kitsap looks very affordable,” said Northwest MLS board member Frank Wilson. “Kitsap’s real estate market continues at a flurry pace with homes going off the market almost as fast as they come on. Available inventory in our county is down 32 percent compared to a year ago, which continues to put upward pressure on prices and buyer’s nerves,” stated Wilson, the branch managing broker at John L. Scott Real Estate in Poulsbo.

As commuters flock to the more affordable side of the sound, “affordability gets further and further in the rearview mirror for many,” Wilson lamented. MLS statistics for February show year-over-year prices in Kitsap County jumped more than 15.7 percent, with single family home prices up 17.5 percent. Compared to January, last month’s prices for homes and condos in that county rose another $25,000 (8.3 percent).

“Kingston, Bremerton, and Port Orchard markets are surfing in the wake of the new foot ferry service with attention being paid to those from the east side of Puget Sound seeking affordability to the west,” Wilson reported. In fact, he added, “It is becoming more common in Kitsap to see all cash offers, no inspection contingency, and sellers that are reviewing all offers on a future date.”

Similar practices are occurring elsewhere. Commenting on the competitive market in many parts of the Northwest MLS service area, O’Leyar reported instances of “buyers making offers with zero contingencies and having the seller fill in the sales price!”

“History tells us that the real estate market is cyclical,” acknowledged O’Leyar, who also mentioned the Federal Reserve chairman hinting at further rate increases and possible impacts on the pace of appreciation and the availability of listings. “Hopefully,” he suggested, “Any changes in interest rates will have a moderating effect, easing the extremely difficult times some buyers are having in purchasing real estate in the Greater Seattle/Puget Sound market.”

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of more than 2,200 member offices includes more than 28,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

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Home Buyers Still Competing for Sparse Inventory in Western Washington, Driving Up Prices – Especially for Sought-After Condominiums
Latest Press Release
February 5, 2018
Current Statistics | Market Recaps

KIRKLAND, Washington (February 5, 2018) – “The Seattle area real estate market hasn’t skipped a beat with pent-up demand from buyers is stronger than ever,” remarked broker John Deely in reacting to the latest statistics from Northwest Multiple Listing Service. The report on January activity shows a slight year-over-year gain in pending sales, a double-digit increase in prices, and continued shortages of inventory.

Deely, the principal managing broker at Coldwell Banker Bain in Seattle and a board member at Northwest MLS, noted a shift in the ratio of pending sales to new listings in King County.

Member brokers added 6,805 new listings of single family homes and condominiums to the system-wide database last month for a gain of about 4.6 percent from a year ago. During the same period, they reported 7,820 pending sales. In King County, the number of new listings outgained pending sales for the first time since September:

King County (SFH+Condos) Jan-18 Dec-17 Nov-17 Oct-17 Sep-17
New Listings 2326 1165 2102 3088 3856
Pending Sales 2282 1850 2831 3533 3514
Difference 45 -685 -729 -445 342

“Sellers that have put their properties on the market early this year have less competition and are seeing multiple offers. Open houses are experiencing heavy traffic with hundreds of potential buyers attending,” reported Deely.

For the MLS overall, last month’s 7,820 pending sales marked a slight increase compared to January 2017 when members reported 7,724 mutually accepted offers, a gain in of 1.24 percent. Not all areas reported increases. Of 23 counties served by Northwest MLS, eight counties, including three in the Puget Sound region (King, Kitsap and Snohomish), reported fewer pending sales than a year ago. In King County, where acute inventory shortages exist in many neighborhoods, pending sales dropped 7.5 percent and closings dropped 18.5 percent.

“The decline in sales last month can’t be blamed on the holidays, weather or football. It’s simply due to the ongoing shortage of housing that continues to plague markets throughout Western Washington,” said OB Jacobi, the president of Windermere Real Estate.

With January’s additions, the number of total active listings at month end stood at 8,037 homes and condos, down nearly 17.6 percent from a year ago when the selection totaled 9,750 listings. Measured by months of supply, there was only about 1.5 months overall, well below the 4-to-6 month level many industry experts use as a gauge of a balanced market.

Condo inventory is especially tight in Snohomish County (0.8 months of supply) and King County (0.92 months). System-wide there is under a month’s supply (0.93 months). For the four-county Puget Sound region, there were only 427 active condo listings at month end, down almost 31 percent from a year ago.

Despite the sparse selection, brokers expect inventory to improve.

“I actually believe 2018 will bring us moderately more listings, which should help offset the growing demand that continues to result from the area’s strong economy,” remarked Jacobi.

“The month of March can’t come soon enough for home buyers,” said J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “In March, the number of new listings will bump up substantially from the low number of new listings typical for winter months. Better selection will start in March as we enter the spring housing season,” Scott predicts.

In the meantime, Scott reported “a multiple-offer everything, virtually sold out market” in all price ranges close to job centers and in the more affordable and mid-price ranges in surrounding counties. “Sellers are receiving premium pricing and home buyers are pouncing on each new listing,” he added.

George Moorhead, designated broker at Bentley Properties, agreed. “January still saw aggressive buyers as they jockeyed for homes in some of the hottest areas in Seattle and the Eastside,” he commented.

Prices continue to rise in all but a few counties, even as the volume of closed sales fell about 9.3 percent. For January’s 5,325 closed sales, the median price was $363,500, a jump of about 11 percent from the year-ago figure of $327,500. Twelve counties reported double-digit spikes.

Within the four-county Puget Sound region, King County had the largest year-over-year gain. Prices for homes and condos combined shot up 20.3 percent in that county, rising from $475,000 to $571,250. Pierce County reported a jump of 15 percent, followed by Snohomish County at about 12.2 percent and Kitsap County at nearly 3.5 percent.

The depleted supply of condos meant premium prices. Area-wide the median price for last month’s completed transactions rose nearly 18.6 percent, from $269,900 to $320,000. Snohomish County’s condo prices surged nearly 25.5 percent, followed by King County at nearly 22.6 percent.

Some brokers expect the hefty price gains to ease.

“As interest rates rise, the rate of price increases will slow down,” predicts Northwest MLS director Dick Beeson, principal managing broker at RE/MAX Professionals in Gig Harbor. Despite this expectation, he believes sparse supply and the area’s appeal both nationally and internationally will mean ongoing competition and multiple offer situations.

“What it costs to rent small spaces astounds me,” he remarked citing recent reports that put Tacoma and Olympia on lists of top cities for increased rents during 2017. “Investors, because rents are high, compete daily with home buyers, and they often win the deal in the lower priced homes. Because they are buying all cash, they consistently beat out buyers who have to get loans.”

Builders are trying to respond to the pent-up demand, according to Moorhead. Seattle and the Eastside are seeing a growing number of infill homes in the core areas, some on lots as small as 3,000 square feet, he said. Builders are doing smaller releases and setting offer review dates, and then determine price ranges for the next phase.

“What used to be an affordable way to build homes has now become more mainstream for both smaller and larger builders,” Moorhead stated, adding, “Historically, infill homes did not get the same return as homes built in large community plats, but now they’re realizing similar price points.”

The luxury market is also off to a quick start in 2018. “Close to job centers, the luxury market is gaining positive momentum due to the wealth effect of the stock market, the strength of the U.S. economy, and homebuyers from the Pacific Rim, especially China,” noted Lennox Scott.

Northwest MLS figures show sales of homes selling for $2 million or more are far outpacing year-ago activity. Last month, member-brokers reported selling 55 residences at this price threshold. That’s up 66 percent from the same month a year ago when brokers sold 33 such homes.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of more than 2,200 member offices includes more than 28,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

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“Exceptionally low” inventory slows year-end home sales, contributes to steep price hikes around Greater Seattle region
Latest Press Release
January 5, 2017

KIRKLAND, Washington (January 5, 2018) – The year 2017 may be in the books and for many members of Northwest Multiple Listing Service it was a memorable one with December’s activity being no exception. Brokers reported historic lows for inventory and year-over-year price gains in most areas.

“I’ve never seen inventory this low in Kitsap County in 27 years,” remarked Northwest MLS director Frank Wilson, branch managing broker at John L. Scott Real Estate in Poulsbo. That county’s number of active listings last month plunged nearly 40 percent from year-ago levels.

At month end, there were only 397 active listings in Kitsap County (down from the year-ago total of 659), a level Wilson described as “exceptionally low,” even accounting for seasonal factors. “A normal inventory in Kitsap County used to be 1,500 to 1,700, but we have not seen this number of active listings in several years,” he lamented (Northwest MLS data show the last time inventory topped 1,500 in that county was in July 2014 when there were 1,503 listings at month end).

For the MLS area overall, inventory shrunk 19 percent, from 10,569 active listings at the end of 2016 to last month’s figure of 8,553. That’s the smallest selection for any month in the past decade. For the fourth time this year, monthly inventory dipped below the 10,000 mark, a level not reached at any other time during the 10-year comparison.

Despite the paltry supply, last month’s sales remained remarkably strong, with closings up slightly (0.88 percent) from a year ago. Northwest MLS members reported 7,642 closed sales, about the same volume as a year ago when completed transactions totaled 7,575.

Year-over-year pending sales of single family homes and condos (combined) fell about 3 percent, from 6,390 to 6,198, but far outgained the number of new listings added to inventory (4,053).

“December, which has historically been a slower month, picked up momentum and never let up,” reported George Moorhead, designated broker at Bentley Properties. Unlike October through November, which he described as slower than what had been seen the past three years, “December drew aggressive buyers, some motivated by expectations of a flattening market, with others trying to beat anticipated interest rate hikes.” Purchasers were from all buying demographics, noted Moorhead, a member of the Northwest MLS board of directors.

Several MLS leaders commented on the consequences of depleted inventory, including OB Jacobi, president of Windermere Real Estate.

“While pending sales are down double digits in King County, it’s not because there are fewer people buying, it’s because there is far less to buy,” according to Jacobi. “That’s why home prices tell the true story of this market and the huge discrepancy between supply and demand. As long as this imbalance remains, prices will continue to see steep increases, just as they did in December and throughout 2017.”

Northwest MLS statistics show prices rose 11.4 percent system-wide for the 7,642 completed sales of homes and condos. Thirteen of the 23 counties in the report had double-digit price hikes from a year ago. Two counties reported price drops: Chelan (-11.2 percent) and Douglas (-6.5 percent).

Within the Puget Sound region, King County registered the sharpest escalations at nearly 16 percent. Year-over-year prices jumped from $505,000 to $585,000. For single family homes in King County, the hike was similar (about 15.5 percent), rising from $550,000 to $635,000 at year end.

Condo prices surged 28 percent in King County over the past twelve months, from $315,000 to $402,000. During the same year-over-year period, active listings fell from 346 units to 206 (down more than 40 percent), leaving only about 10 days of supply (0.35 months of inventory).

System-wide, there is a little more than a month’s supply (1.12 months) of homes and condos, with the shortages most pronounced in the four-county Puget Sound region. Three of those counties – King, Kitsap and Snohomish – have less than a months supply; Pierce County is somewhat better off with 1.1 months.

“While all year we’ve been bemoaning lack of inventory and escalating prices, the statistics show 2017 was a banner year in many respects for real estate in the Puget Sound region and throughout the Northwest,” stated Mike Grady, president and COO of Coldwell Banker Bain. He cited year-over-year gains in both prices and values, commenting “As a result of this strong market, homeowners are experiencing bountiful gains in property values.”

Brokers expect momentum to continue despite uncertainty about interest rates and taxes.

J. Lennox Scott, chairman and CEO of John L. Scott Real Estate believes the Central Puget Sound housing market will remain one of the strongest in the nation. “It will be another happy new year for real estate activity.” As the new year unfolds, he expects buyers “will emerge from winter holiday hibernation in big numbers” in part thanks to the Seahawks. “Without the Seahawks in the football playoffs, the 2018 housing market will be more intense earlier in January rather than heating up after the Super Bowl,” Scott remarked.

Scott also anticipates a “frenzied, multiple-offer market” in the more affordable and mid-price ranges, as well as “good-to-strong” sales activity in the luxury market close to the job centers. Positive job growth and attractive interest rates will propel activity, he suggests, adding “In the more affordable and mid-price ranges, the impact of the new federal tax policy is minimal.”

Wilson also believes the new tax code will not have an immediate impact on home sales in Kitsap County. “The majority of our purchasers are buying for lifestyle reasons such as a new job, transfer of job or duty station, or household size expanding or contracting.” He suggests 2018 “will look a lot like 2017” but everything will be amplified due to the extreme shortage of active listings.

Grady concurred. “As we look forward to 2018 we continue to believe this is a great time to buy real estate. We see only positive returns for homeowners and real estate investors this year and likely for several years to come.”

Moorhead anticipates aggressive buyer activity through May, but expects some short-term flattening thereafter with single-digit appreciation in the range of 5-to-7 percent. Builders still have memories of 2008, but with moderate activity and price increases likely to be sustained, “they are cautiously optimistic.”

Luxury buyers seem to be undeterred by the change in the mortgage interest deduction, Moorhead noted (the bill lowered the cap from $1 million to $750,000 for primary residences). He said they polled their top 30 luxury home buyers regarding the change. The most common responses were “disappointment at losing a great tax planning deduction,” Moorhead reported, but added, “Those surveyed said it would not change the style of home or price point for the homes they are looking to purchase.”

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of more than 2,200 member offices includes more than 26,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

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