FOR IMMEDIATE RELEASE: February 6, 2012

Housing market “healing itself,” numbers are “astoundingly good”

NWMLS KIRKLAND, WA. (Feb. 6, 2012) – Pending sales may not appear to be much higher than 2011 (up 13.7 percent in January), but the numbers are “astoundingly good,” considering such factors as harsh weather and the tax credits that boosted sales at this time a year ago, said Ken Anderson, president and designated broker at Coldwell Banker Evergreen Olympic Realty in Olympia.

The latest figures from Northwest Multiple Listing Service show pending sales in January outgained the same month a year ago by 739 transactions.  Brokers reported 6,132 mutually accepted offers in January to start the year with a 13.7 increase over the January 2011 figure of 5,393 pending sales.   

“Given that we lost a week with some of the worst weather in 16 years, the numbers are astoundingly good,” remarked Anderson, a director for Northwest MLS. “This is the first January in four that we can make a reasonable year-over-year comparison,” he added, noting numbers are no longer skewed by the artificial stimulus of various tax credits and incentives that date to 2009. “The improvement in the numbers show that the market is healing itself and standing on its own.” Anderson commented. 

Declining inventory, extremely low interest rates, and positive job growth are contributing to rising optimism among industry professionals, but Northwest MLS directors say distressed properties continue to be a drag on the market’s recovery.

Inventory is down almost 20 percent from a year ago. Brokers added 6,666 new listings to inventory during January, with single family homes making up about 85 percent of those additions. At month end, MLS members reported 26,226 total active listings; a year ago, there were 32,647 active listings.

Despite the smaller selection, the price choices overall are wide ranging, from a low of $13,000 for a manufactured home in Sultan to an asking price of $26.8 million for a waterfront home on Mercer Island.

Snohomish County reported the sharpest drop in inventory, with the selection at about two-thirds of the year-ago levels (a decline of 32.6 percent).  Several of the 29 MLS map areas within King County also reported declines of 30 percent or more in the total number of active listings.

“The ongoing reduction of available inventory is still impacting the market,” said OB Jacobi, president of Windermere Real Estate and a member of the Northwest MLS board of directors. “We have plenty of qualified buyers who are ready to buy if they could just find a home,” he noted.

The lower number of new listings coming on the market is due to a combination of factors, said J. Lennox Scott, CEO and chairman of John L. Scott Real Estate.  Among them, he mentioned underwater sellers (who owe more on their homes than the current value), sellers with equity holding off for higher prices, and the lack of new construction/condominiums. “The low number of new listings combined with the increase in sales activity is creating the shortage of homes for sale in specific areas and price ranges,” Scott reported.

Northwest MLS reported 3,469 closed sales last month, up nearly 8.2 percent from a year ago when members reported 3,207 completed transactions.

“A sellers’ market has returned in the areas close to the job centers of Seattle and Bellevue, up to the one million dollar price point,” Scott noted, adding, “We are also seeing the same situation in the more affordable price ranges in the surrounding market areas, caused by a shortage of inventory and healthy-to-strong sales activity.”

Echoing that sentiment was Northwest MLS director Frank Wilson, who said, “Inventory in many price points and locations is dropping and what buyers are finding are overpriced or under staged homes.” Wilson, the branch managing broker at John L. Scott Real Estate in Poulsbo, also foresees upward pressure on prices as choices become narrower.

For now, however, prices are showing mixed signs –stabilizing in some areas while declining or increasing in other areas.

The median price for last month’s closed sales of single family homes and condominiums (combined) was $214,990, down about 11.7 percent from a year ago when the median selling price was $243,500.  The price changes ranged from year-over-year increases reported in five counties (Ferry, Grant, Kittitas, Mason, and Pacific) to declines of up to 40 percent (in Clallam and Grays Harbor counties).

“Price increases are muted by short sales and foreclosures that are causing low appraisal values,” observed Scott.

MLS directors Jacobi and Wilson agreed.

“We are simultaneously seeing the continued rise in pending and closed sales,” Jacobi stated. “Usually pent up demand and rising sales means that prices will be going up. But, unfortunately, that isn’t the case thanks to the high level of distressed properties that continue to drag down the entire market,” he explained.

“What is tempering our real estate recovery in Kitsap and much of Puget Sound are the short sales and REO properties that are on the market and the way the banks are dealing with their sales process,” said Wilson, while pointing to several encouraging signs. 
 
All the pieces are in place for a more normal market in much of Kitsap, Wilson said. “With pending sales up 17 percent in Kitsap, buyers are taking advantage of the values this market is offering and the extremely low interest rates. If this trend continues we should begin seeing price appreciation as we progress into the year,” he remarked.

Improving numbers show the artificial stimulus of the tax credits was not the key to the recovering market, suggested Anderson.  “Instead, today’s affordability has buyers in all price segments returning – and feeling more confident about the future.”

Northwest MLS director Darin Stenvers believes “the perfect storm is brewing.”  He said the pent-up need for homes in good condition is creating shorter market times and sales close to the original asking price. “It is a great time for sellers who have been waiting,” said Stenvers, the office managing broker at John L. Scott Real Estate in Bellingham.

“The market is almost done with the needed correction,” Stenvers stated, adding, “Distressed homes and REOs are not going away fast but have slowed and should soon level off.” He also foresees a loosening of overly restrictive lending guidelines.

Reflecting on a real estate career that dates to 1990, Wilson said, “I remember at the height of the market people would say ‘I wish I would have bought some waterfront back in 2001…or I wish I would have picked up a couple of rentals a few years ago’.”  For these people, “the clock has been rolled back and you now have an opportunity to purchase real estate near the bottom of the market,” he suggested.

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 22,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 21 counties in Washington state.

Statistical Summary by Counties: Market Activity Summary – Jan. 2011

Single
Family
Homes
+ Condos

LISTINGS

PENDING
SALES

CLOSED SALES

New
Listings
Total
Active
# Pending
Sales
# Closings
Avg.
Price
Median
Price
King

2503

7360

2418

1429

$360,082

$280,000

Snohomish

1103

3162

1150

593

$233,984

$210,000

Pierce

1043

4142

1061

551

$198,220

$174,950

Kitsap

375

1420

292

131

$231,175

$177,900

Mason

100

581

63

40

$188,199

$160,400

Skagit

123

831

122

66

$199,380

$170,750

Grays Harbor

124

725

67

21

$92,221

$77,900

Lewis

82

612

41

36

$145,730

$137,000

Cowlitz

105

472

68

49

$131,226

$140,000

Grant

72

472

47

46

$172,544

$154,638

Thurston

262

1321

245

156

$238,041

$205,783

San Juan

36

336

20

14

$372,579

$297,000

Island

117

743

84

46

$231,548

$198,000

Kittitas

50

398

41

30

$228,958

$180,500

Jefferson

59

427

30

23

$225,361

$215,000

Okanogan

26

336

18

8

$204,344

$153,000

Whatcom

241

1260

178

118

$233,943

$220,500

Clark

47

210

46

38

$152,650

$153,750

Pacific

45

342

14

15

$109,480

$119,000

Ferry

1

55

1

2

$176,000

$176,000

Clallam

29

342

28

16

$161,350

$131,000

Others

123

679

98

41

$205,860

$179,500

MLS TOTAL

6,666

26,226

6,132

3,469

$273,324

$214,990

4-County Puget Sound Region Pending Sales (SFH + Condo combined)
(Totals include King, Snohomish, Pierce & Kitsap counties)

 

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

2000

3706

4778

5903

5116

5490

5079

4928

5432

4569

4675

4126

3166

2001

4334

5056

5722

5399

5631

5568

5434

5544

4040

4387

4155

3430

2002

4293

4735

5569

5436

6131

5212

5525

6215

5394

5777

4966

4153

2003

4746

5290

6889

6837

7148

7202

7673

7135

6698

6552

4904

4454

2004

4521

6284

8073

7910

7888

8186

7583

7464

6984

6761

6228

5195

2005

5426

6833

8801

8420

8610

8896

8207

8784

7561

7157

6188

4837

2006

5275

6032

8174

7651

8411

8094

7121

7692

6216

6403

5292

4346

2007

4869

6239

7192

6974

7311

6876

6371

5580

4153

4447

3896

2975

2008

3291

4167

4520

4624

4526

4765

4580

4584

4445

3346 2841 2432
2009 3250 3407 4262 5372 5498 5963 5551 5764 5825 5702 3829 3440
2010 4381 5211 6821 7368 4058 4239 4306 4520 4350 4376 3938 3474
2011 4272 4767 6049 5732 5963 5868 5657 5944 5299 5384 4814 4197
2012 4921                      

Current Statistical Reports

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