KIRKLAND, WA, September 4, 2009 –Pending sales around Western Washington during August jumped nearly 21 percent from a year ago and inventory dropped more than 18 percent, according to new figures from Northwest Multiple Listing Service. MLS member-brokers say those indicators, along with signs of stabilizing prices, set the stage for brisk activity in the next few months as first-time buyers try to take advantage of the Nov. 30 deadline for tax credits.
"The typical August cool down in the market did not happen this year," observed NWMLS director Kathy Estey, managing broker at John L. Scott's office in downtown Bellevue. She said agents are busy with both first-time and move-up buyers and they're reporting multiple offers on homes priced up to $700,000.
Brokers reported 7,539 pending sales (offers made and accepted but not yet closed) for August, up 20.7 percent from a year ago. That volume outgained July's total by 260 transactions.
In the four-county Puget Sound region, pending sales of single family homes and condominiums (combined) surged 25.7 percent from a year ago.
Within King County, pending sales activity improved 25.1 percent from a year ago, and was especially robust in the North King County area (up 38.7 percent) and on the Eastside (up nearly 36 percent). Excluding condos, two sub-areas of King County notched gains of more than 40 percent for pending sales of single family homes – Southeast King County (up 40.4 percent) and the Eastside (up 42.5 percent).
On the downside, Estey said many transactions are missing their closing date "for seemingly irrational reasons." Last minute demands from lenders are common and final underwriting reviews are causing delays, she noted, adding, "Inexperienced appraisers are gumming up the works as well." She urges first-time buyers who want to capture the $8,000 tax credit to plan ahead and allow for delays.
Another MLS director, Dick Beeson, the broker/owner of Windermere Commencement Associates in Tacoma, said stabilizing prices "bode well for the near term."
For the 19 counties in the Northwest MLS service area, the median price for single family homes and condominiums that sold and closed last month was $$275,945, down about 8.8 percent from the year ago sales price of $302,500. Since January, however, prices area-wide have edged up about 1.1 percent, with seven of the 19 counties notching increases.
Prices for single family homes (excluding condos) that sold throughout the NWMLS area are up about 3.3 percent since January, although down about 9.2 percent from twelve months ago. In the four-county Puget Sound region, the median sales price for single family homes that closed last month was $310,000, down about 11.4 percent from twelve months ago, but back up to match January's figure of $310,000.
Condo prices remain depressed. For last month's completed transactions, the median sales price was $235,000 off 5 percent from the year ago figure of $247,500. Compared to January's sales, condo prices have dropped about 6 percent
J. Lennox Scott, chairman and CEO of John L. Scott Real Estate, expects strong activity in the coming months. "It's exciting to see that home sales continue to be brisk in the more affordable and mid price ranges," he remarked. "I anticipate that September will see a surge of sales activity because of the tax credit's impending deadline which, when combined with historically low interest rates and increased affordability, provides a rare opportunity for first time homebuyers," Scott stated.
Current house-hunters have fewer listings to consider than a year ago: 41,528 active listings at the end of August compared to 50,772 for same month a year ago, a decline of 18.2 percent. Prices on current offerings, which include single family homes and condominiums, range from $13,000 to $32 million.
Northwest MLS members added 10,132 new listings to inventory during August, nearly 1,300 fewer than twelve months ago. Inventory shrunk in 16 of the 19 NWMLS counties, with twelve counties reporting double-digit drops.
Lower listing inventory is one of the building blocks of a housing recovery, according to Ron Sparks, managing vice president of Coldwell Banker Bain. "With fewer homes for sale, better affordability and buyer incentives like the $8,000 first-time buyer tax credit, we are seeing supply and demand become much more balanced in many areas, and this will help support more stable prices," he explained.
Sparks also commented on the momentum reflected in last month's activity. "It's very good to see that the number of pending sales is still rising in most areas, especially when we might typically expect a seasonal slowdown in demand." He called the nearly 21 percent overall improvement in last month's pending sales "particularly impressive."
Open house traffic has been steady with high interest among first-time buyers being the driver, reports NWMLS director Beeson. Despite high interest, he said many potential buyers are still confused about how the tax credit program works.
On a cautionary note, Beeson expects a new round of bank owned properties to come on the market later this year and into next year. "This inventory will have to be absorbed over time and no one knows for sure just how this will influence prices," he acknowledged, adding, "The best guess is it will be negative, although we have experienced many foreclosures already on the market. . .with no appreciable drop in prices since the beginning of the year."
Summing up last month's activity, Sparks of CBB, said, "A healthy, balanced market is in everyone's best interest, and the August report tells us we're definitely getting closer."
Northwest Multiple Listing Service, owned by its member brokers, is the largest full-service MLS in the Northwest. Its membership includes more than 24,000 brokers and agents. The organization, based in Kirkland, currently serves 19 counties in western and central Washington.
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David J Edwards
Real Estate Agent & REALTOR
The David J Edwards Team
Keller Williams Realty Southeast Sound
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