Housing prices in the Puget Sound market continue to go up and inventory remains tight.
“It’s straight up a crazy, frenzy market in King and Snohomish counties,” said Lennox Scott, chairman and CEO of John L. Scott Real Estate in a media release about the Northwest Multiple Listing Services April Report released Thursday. “Over 75 percent of homes are selling within the first 30 days. With more buyers coming on the market, we’ve been waiting for new inventory to help replenish the inventory.
“We are heading in the right direction, as a substantial number of new listings came on in March compared to February in the four-county area of King, Snohomish, Pierce, and Kitsap Counties. In fact, new listings rose 30 percent or more in each of the four counties, but the typical March volume is down in King, Snohomish, and Kitsap Counties, with Pierce County being the only county with more new listings than a year ago. The lack of inventory is creating buyer frenzy for each new listing in the more affordable and mid-price ranges.”
The residential median home price in King County hit $599,950 in March, up 12.93 percent from one year earlier.
March sales activity is lower than previous March due to the fact that the market is virtually sold out, Scott said. The luxury market close to the job centers is red hot with multiple offers on many new listings as they come on the market.
Seller gridlock should abate later this summer for sellers who are waiting to put their home on the market. As more inventory hits the market it will be just as easy for them to purchase their next home as it is to sell their current home, Scott said.
New listings were down across the board in each of the NWMLS’s 24 counties compared to a year ago, but up in a big way from February, which means while we are having a slow start to spring, we are seeing positive improvement.
Pending sales were down in King, Snohomish, Pierce and Kitsap counties. Some of the smaller outlying counties saw an increase in pending sales. For example, Mason County was up 34.09 percent and Clallam County up 49.30 percent in residential and condo combined.
March 2017 market characteristics:
These market conditions will continue until at least into the summer of 2018.
1. For buyers, it continues to feel like they’re going up against multiple offer situations on every property. Sellers continue to get premium pricing for their homes.
2. In King County, the residential median home price in March 2017 was $599,950 vs. $560,000 in February.
3. The decrease in sales is not a buyer issue it’s an inventory issue.
4. The market momentum continues to be frenzy hot as we experience a slow start to the spring market.
5. We are experiencing an extreme shortage of listings available in the more affordable and mid-price ranges.
7. Luxury homes in the $1 to $3 million-range are selling in big numbers in areas near job centers. The shortage of luxury is unheard of. Sales of luxury homes in 2016 were up substantially over 2015.
8. Sales activity in King and Snohomish counties would be higher if there were more homes for sale.
9. Every new listing is getting frenzy action from homebuyers, setting up many multiple offer situations, especially in the more affordable and mid price ranges where 90 percent of sales activity is taking place.
10. Leading indicators that drive housing market:
• Job growth – predicted to lower from extremely strong back down to very strong starting in year 2017 (Puget Sound economic forecasters) From 3 percent to the 2 percent range.
• Interest rates – Interest rates have risen into the low 4s. At this level they are considered amazing on a historical basis (when interest rates were in the 3s, they were considered unbelievable).