Western Washington home sales continue at sizzling pace

Published 1:18 pm Thursday, August 4, 2016

Home sales around Western Washington continued at a torrid pace during June, but a 10 percent year-over-year increase in new listings has some brokers with Northwest Multiple Listing Service suggesting a little relief may be emerging.

“We have a long way to go to catch up with the demand,” said Mike Grady, president and COO of Coldwell Banker Bain, in a media release.

Citing reports of projected job growth in the region (pegged at 70,000 new employees) but only 8,000 new residential units in the same forecast, he said this imbalance is rippling to outlying counties.

Inventory is now shrinking at a greater rate in some of the outlying counties than in the tri-county area of King, Snohomish and Pierce counties. Pending sales in some of these areas are rising at a faster clip, noted Grady, a past chairman of the MLS board.

“It’s as if the splash in the center of Seattle’s pond is finally making ripples to the outlying counties,” he said.

J. Lennox Scott, chairman and CEO of John L. Scott, Inc., described the market as “frenzy hot” in June, but suggested there was a “short breath of fresh air for homebuyers.” He credits the combination of more inventory coming on the market and lower interest rates with bringing some “welcome relief to the backlog of buyers who have been waiting to purchase a home.”

There were fewer multiple offers for each new listing, according to Scott’s analysis of the latest data, but he said 80 percent of new listings are still selling within the first 30 days in price ranges where 90 percent of the sales activity is taking place. That, he said, contrasts with a “healthy” (more balanced) market when only around 30 percent of listings are selling in the first 30 days.

Northwest MLS members reported 11,995 mutually accepted offers last month for a 4.73 percent increase over the year-ago volume of pending sales. For the four-county Puget Sound area, brokers reported 8,869 pending sales, the highest total for the month of June since 2005.

New listing activity improved compared to a year ago with 12,759 sellers putting their home or condo on the market. That’s a 10.2 percent improvement from 12 months ago and marks the largest number of new listings added in a single month since March 2010 when brokers replenished supply with 12,994 new listings. Last month’s additions brought the number of total active listings up to 16,838 properties. A year ago, across the 23 counties in the report, buyers could choose from 20,333 listings.

With only 1.7 months of supply system-wide (for single family homes and condos combined), inventory is well below the four-to-six month level many industry analysts use as an indicator of a balanced market. Both King and Snohomish counties have barely more than one month of supply.

Inventory of condos is more meager, hovering near 1.1 months area-wide. In both King and Snohomish counties there is less than a month of supply (0.80). For single family homes only, there is 1.82 months of supply – and even less than that level in all four central Puget Sound counties.

Not surprisingly, prices continue to escalate. In fact, a recent report from CoreLogic, a property analytics company, indicated home prices are rising faster in Washington than in any other state in the nation.

Last month’s 9,805 closed sales across all counties in the MLS report had a median selling price of $350,000, which is nearly 8.9 percent higher than the year-ago figure of $321,500. Seventeen of the 23 counties experienced double-digit increases, led by Grant County (up 24.9 percent), Jefferson County (up 24.4 percent) and Skagit County (up nearly 23.8 percent).

In King County, which accounted for about 40 percent of the sales, the median price surged 13.3 percent from a year ago, rising from $450,000 to $510,000. For single family homes only (excluding condos), prices in King County rose 14.7 percent, from $500,000 to $573,522. Condo prices skyrocketed nearly 22 percent compared to a year ago. The median sales price last month was $350,000; 12 months ago the buyer of a median-priced condo in King County paid $287,000