The temperatures in Western Washington aren’t the only thing soaring – during the month of June 11,453 homes went pending. This was the highest amount of pending sales recorded in our housing market since August of 2005. Also noteworthy, June was the fourth consecutive month of 11,000-plus pending transactions in 2015. First time home buyers and rising Seattle area rents are among the forces fueling our robust housing market during a season that traditionally experiences slowing. Our inventory remains at about the same level as new listings just about broke even with pending sales during June. 11,581 new listings were brought to market, a number close to the same active listings year-over-year.
By the end of June, the active listings in the Northwest Multiple Listing Service (NWMLS) totaled 20,333 properties. Compared to 25,342 active listings on the market last June, the NWMLS showed a year-over-year drop of 19.8%! The numbers for King County’s active listings are down even further, at 24% when compared to a year ago; Kitsap County’s active listings are down 35% when compared to last June’s volume.
Since the brisk sales activity continues to outstrip the new active listings, our total supply within the NWMLS is at 2.2 months. A balanced market is is typically defined as four-to-six months of supply by real estate industry experts. Area-wide, prices are up for both condos and single family residences. Since January, the median price for condos have experiences a 13.6% gain in sales prices. Single family homes, especially in King County, have also experienced significant increases in their median selling prices. All together, these market conditions are adding the sizzle to home buying experiences across our region.
Below are excerpts of the NWMLS’ July press release. Click here to read the whole article.
Temperatures around Western Washington were not the only thing sizzling during June. Northwest Multiple Listing Service members reported 11,453 pending sales last month, the highest volume since August 2005 when members notched 11,546 mutually accepted offers. Last month also marked the fourth consecutive month of 11,000-plus pending transactions.
MLS members credit first-time buyers, an influx of relocating workers, and escalating rents for part of the surge. [Both first time home buyers and returning buyers are educating themselves about market conditions in their preferred neighborhoods before they start looking. And with the complexities of our current housing market, the challenges of a transaction effect all involved – the buyers, sellers and real estate brokers. The major hurdle troubling our Western Washington housing market is still low inventory – the same as the last several months.]
Brokers added 11,581 new listings to inventory during June, about the same number as a year ago (11,541), but pending sales outgained the same month last year by nearly 16 percent, depleting the selection. At the end of June, the number of active listings across the 23 counties in the MLS report totaled 20,333. That compares to 25,342 for the same month a year ago for a drop of 19.8 percent.
OB Jacobi, president of Windermere Real Estate noted some improvement in inventory over the past three months. “I’m happy to see the total number of homes listed has grown by nearly 20 percent since March. That’s still down compared to last year, and well below historic averages, but we are trending in the right direction,” he remarked.
Most counties in the MLS service area reported double-digit drops in inventory compared to a year ago. In King County, the number of active listings is down almost 24 percent compared to a year ago, while in Kitsap County the volume plummeted nearly 35 percent.
The imbalance between listings and sales means shrinking “months of supply,” an indicator of sales velocity. Industry experts use a figure of four-to-six months of supply as one gauge of a balanced market. For the Northwest MLS market overall, only 2.2 months of inventory existed at the end of June. In King County it was down to less than 1.2 months. Snohomish County had about 1.7 months of supply at month end. Both Pierce and Kitsap counties reported about 2.2 months of inventory.
[Our unseasonably warm weather, vacation schedules and summer holidays have not impacted the house sales like they typically would. Open houses are well attended, market time is still low for most properties and multiple offers are often on the table.] For first-time buyers, the competitive bidding can be daunting, which … underscores the importance of relying on experienced brokers. Anxious buyers have a sense of urgency as prices rise…[An experienced real estate broker is an asset, especially in multiple offer situations.] ”
Rising prices are prompting some house-hunters to broaden their search beyond primary job centers. [Buyers are widening their searches north and south as home prices trend upward in King County, especially close to Seattle.] Median prices continue to trend upward, according to Northwest MLS figures.
The area-wide median price for last month’s 9,163 closed sales of single family homes and condos was $321,500. That’s up 7.4 percent from a year ago, when the median price was $299,335 and up 1.4 percent from May’s figure of $317,000. Since January, prices are up 13.6 percent.
In King County, the median price for sales that were completed during June was $450,000. That compares to a price of $410,000 for the same month last year for a year-over-year increase of nearly 9.8 percent. Compared to May, prices in King County are up about 3.7 percent.
For single family homes only (excluding condos) in King County, the median selling price for sales that closed during May was $500,000, an increase of 10.3 percent from the year-ago figure of $453,500.
Rising prices are prompting some worries about affordability… the growth rate in jobs and the [number of relocating employees entering the Seattle area housing market appear to make our current pace of growth sustainable for the long haul] … despite some uncertainty around reaching the upper limit in pricing and the likelihood of rising interest rates.
Referring to a list compiled by Forbes magazine that rank the Seattle-Bellevue-Everett area as an “overpriced area,”… [it may actually be] a matter of value. Appraisals are also concerning to some. Low appraisals are a big challenge…[as properties are experiencing a resurgence of low appraisals. This issue can be a frustrating challenge for both the buyer and the seller.]
Several brokers were surprised the record-setting temperatures in June didn’t deter activity. [ The great weather highlights the opportunities here in Western Washington for both employment and lifestyle. Pair that with continued low interest rates, and the demand for homes in our area is still high. This is good news for homeowners who want to move up, underscoring why now is the time to make the move.]
Rising rents are another contributor to brisk sales. [The cost of rentals versus a mortgage is helping fuel strong home sale gains. Renters may want to explore their options for buying a home. Looking into pre-qualifying for a mortgage would be a worthwhile endeavor for many who currently rent. These potential home buyers would know how much of a home they can afford, and how it compares to what they are spending each month of rent. ]
Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership includes more than 23,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 23 counties in Washington state.