During 2015, low inventory has been a major topic in any conversation about Western Washington real estate. That has not changed as we’ve inched closer to the end the year. In fact, inventory in most counties served by the Northwest Multiple Listing Service (NWMLS) continue to see declines when compared to the same time last year. Year-over-year, NWMLS data demonstrated a 4.6% drop in the number of new listings added to our regional inventory during November, along with a 26.5% decline in the total number of active listings at month-end. 21 of the 23 counties that are part of the NWMLS saw double-digit declines in active listing volume by the end of November. Buyers continue to be active, even as the holiday season approached, which translated to a higher percentage of homes going under contact within 30 days of debuting on the housing market. OB Jacobi, president of Windermere Real Estate, continues to express concerns regarding low inventory levels, “Looking at the data as far back as 1999, we’ve never seen a lack of homes for sale to this degree.”
Data is also demonstrating the lowest inventory near major job centers, which is contributing to rising home prices for those areas. These numbers indicate buyers may be searching further out for homes that are within their budgets, and making purchases in those locales. Sellers need to be on alert regarding the pricing of their homes, as today’s buyers are incredibly savvy about housing market conditions and pricing within their desired neighborhoods. Homes that are overpriced, or not in top listing condition, are languishing on the market.
What does this mean for spring 2016? The frenzy of the spring housing may arrive earlier than it is normally anticipated.
Excerpts of the NWMLS press release for December are below. To read the release in its entirety, please click here.
Inventory remains “critically low,” but there are fewer house-hunters in the hunt during this holiday season so motivated sellers and buyers are seeing success, according to brokers with Northwest Multiple Listing Service. Its just-released statistics for November show year-over-year gains in pending sales, closed sales, and prices, but a steep decline in inventory.
Compared to a year ago, MLS figures show drops in the number of new listings added to inventory during November (down 4.6 percent) as well in the total number of active listings at month-end (down 26.5 percent).
Twenty-one of the 23 counties served by Northwest MLS reported double-digit declines in their volume of active listings last month compared to the same time period a year ago. For the overall area, there were 15,327 active listings, which compares to the year-ago total of 20,864. Of these totals, 5,268 were new listings added during the month; a year ago, members added 5,521 listings to the selection.
MLS members reported 7,511 pending sales during November for a 10 percent increase from a year ago when they notched 6,821 mutually accepted offers. Condo activity was brisk with pending sales jumping more than 21 percent from a year ago. Single family home sales rose about 8.5 percent.
… figures [are] showing only nine of the 23 counties served by Northwest MLS have more than six months of supply (a figure some use to indicate a balanced market…) Acute shortages are in evident King and Snohomish counties, both with less than two months of supply.
“The Snohomish County market continues to be extremely active,” said David Maider, designated broker/owner at Windermere Real Estate M2 in Everett and a member of the MLS board of directors. “With interest rates maintaining historically low levels and no indication that more property is headed for the market, we expect prices to increase in the first quarter of 2016. Multiple offers are happening on well priced and prepared properties, but not at the frequency that was occurring this past spring and summer,” he reported.
Even as prices rise, until supply improves, sellers will remain firmly in the driver’s seat of an “insanely competitive housing market,” commented OB Jacobi, president of Windermere Real Estate.
“I’m still very concerned with the lack of inventory in the Seattle housing market,” Jacobi stated, adding, “Even with the drop in inventory we normally see this time of year, the current levels are critically low. Looking at the data as far back as 1999, we’ve never seen a lack of homes for sale to this degree.”
… the combination of low listing inventory, the seasonal slowdown, and pent-up demand is fueling multiple offers on properties in all price ranges.
Northwest MLS data show extremely low supplies of both single family homes and condos in the map areas closest to the major job centers. Not surprisingly, prices in most of those areas are escalating.
Prices on homes and condos that closed last month rose nearly 6.6 percent from a year ago, from $289,000 to $308,000. For single family homes, the increase was about 5.7 percent, from $299,000 to $316,000, with seven counties reporting double-digit gains.
In King County, the median price for home sales that closed during November was $499,950, a jump of 13.6 percent from the year-ago figure of $440,000.
Condo prices surged 17.8 percent, rising from $225,000 to $265,000.
Prices can vary widely within counties. For example, within King County, where the MLS tracks 29 map areas, median prices for homes and condos that sold last month ranged a low of $235,000 in the Dash Point/Federal Way area to more than $1 million on Mercer Island.
“Given that the median home price of a single family home in King County is just shy of a half-million dollars, we can assume buyers are choosing to buy further away from Seattle and Bellevue in areas where homes are substantially cheaper,” remarked Jacobi. MLS figures reveal wide variation from county-to county. While the median selling price on last month’s sales in King County was $499,950, it was $350,000 in Snohomish County and even less in both Kitsap ($259,000) and Pierce ($249,900) counties…
MLS members reported modest increases in the number of completed transactions from a year ago, 5,999 versus 5,872 for a 2.2 percent gain.
…new TRID rules seem to be catching some lenders and closing service providers off guard while they adjust their operations and systems to deal with the new regulations.
Brokers who commented on the latest MLS report tended to express optimism for 2016.
Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of nearly 2,100 member offices includes more than 25,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in Washington state.