Western Washington Real Estate is “red hot” to “slowly healing”

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Eastside Seattle

Brokers report some skittishness among both buyers and sellers, but the latest statistics from NWMLS indicate the housing market is continuing to rebound.  Both the number of pending sales and the number of new listings added to inventory during April reached their highest levels in 11 months.

  • Closed sales of single family homes and condominiums were slightly below the year-ago volume, while the median sales price rose slightly (up about 1.9%).
  • The residential market is red hot with multiple offers are the “norm” for new listings, with about two-thirds of homes near job centers selling in the first 30 days.  That’s about twice the normal rate!
  • Many areas outside the Greater Seattle job centers also show signs of positive activity, but at a more moderate pace.
  • “The real estate market continues to show positive signs both locally and nationally”
  • MLS members reported 9,590 pending sales of single family homes and condominiums during April, about even with the same period a year ago when brokers tallied 9,600 mutually accepted offers.
  • Last month’s total marks the highest level since May 2013 when the MLS reported 10,045 pending sales across its 21-county area
  • Improving inventory is helping to boost sale, but MLS officials say the number of distressed sales in some areas, and shortages of the “right kinds” of inventory persist, are causing some drag on activity
  • Some brokers also expressed concern about the sluggish pace of new construction.
  • Members added 11,043 new listings to inventory during April, about 700 more than a year ago for a 6.7% gain.  At month end, there were 21,390 listings system-wide, up nearly 7.9% from twelve months ago when active listings totaled 19,826.
  • A lot of potential sellers who would like to move up are reluctant to list due to uncertainty that there will be something on the market they would want or be able to purchase
  • We are still desperate for inventory in spite of statistics indicating we have more listings
  • The result is a catch-22 situation “because nearly no one will accept a contingent offer”
  • MLS figures show there is slightly less than 3.5 months of supply area-wide, but amounts vary widely around its service area.  Eight counties are below the 6-month threshold, including three counties with less than four months of supply: King(1.74 months), Snohomish(2.47 months), and Pierce(3.6 months)
  • The median price on last month’s sales area-wide was $275,000, rising from the year-ago figure of $269,950 for a gain of nearly 1.9%.
  • Twelve counties reported year-over-year increases.  For single family homes the median price was $287,500, up about 2.7% from a year ago.
  • The median price for condos that sold last month jumped nearly 8.3% from a year ago, rising from $203,000 to $219,750.
  • In the Puget Sound region, price changes for sales of single family homes and condos were mixed.  King County had the sharpest gain at 9.7% versus a year ago, followed by Snohomish County, up about 7.6%.  Prices dipped slightly in Pierce County (down 0.9%) and were basically unchanged in Kitsap County (down 0.15%).
  • We have noted a surge of sales of high-end properties in King County.  Our analysis of year-to-date sales shows the number of closed units is up about 25%, rising from 377 for the first four months of 2013 to this year’s total of 473.
  • Research by Core Logic that shows a correlation between million dollar homes sales and stock market gains.  “We are experiencing that effect here as well”
  • Most of the new construction we are seeing are by big builders who were able to buy up much of the foreclosed approved plats, raw land and new developments that were lost by the smaller builders during the recession
  • “The smaller plat developers and builders who are trying to recover and rebuild their business are, understandably so, a bit gun shy”
  • We are seeing for the first time the big developers/builders utilizing in-house employees to manage and sell their plats as opposed to the historical practice of listing them through NWMLS by using traditional real estate firms and their brokers
  • New construction is mostly limited to a few large production builders
  • Other sources of worry for some MLS members are “buyer fatigue” and consequences of bidding wars
  • “We are seeing some “push-back” by buyers who have seen prices rising so fast and are tired of competing in multiple offer situations”
  • For example sellers sometimes set a “review date” for considering offers.  Buyers preview the house but may wait to make an offer until that date passes.  “In some situations the day to review comes, but offers do not.  Then one or two days later, several offers materialize.”  This same phenomenon took place late last spring.
  • In markets where multiple offers are common, “it is even more imperative that sellers demand that their home be exposed to the full market.  Such full exposure to all MLS brokers and active buyers will help ensure sellers receive full market value.

April2014

4countyApril2014

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