Last month, there were 6,321 houses and condos for sale in King, Kitsap, Piece and Snohomish counties. That's a decline of more than 31 percent.
Despite inventory shortages, Northwest MLS brokers report more than 88,000 sales valued at more than $34 billion during 2015
KIRKLAND, Wash. (Jan. 21, 2016) – Members of Northwest Multiple Listing Service reported 88,331 closed sales during 2015, outgaining the prior year’s volume of 77,276 transactions for a 14.3 percent increase.
Measured by dollars, last year’s sales of single family homes and condominiums were valued at more than $34 billion. Compared to 2014, that dollar volume represents a gain of nearly 23 percent.
The sales activity reflects the work of 23,800 brokers across 23 counties in the member-owned Northwest MLS.
Last year’s completed sales included 75,975 single family homes (about 86 percent of the total) and 12,356 condominiums. The total units and dollar volume surpassed the previous highs during 2007 when members registered 82,197 sales valued at $32.3 billion.
The area-wide median price for last year’s sales of single family homes and condominiums was $310,000, improving on the previous year’s figure of $285,000 (up nearly 8.8 percent). A comparison by county shows median sales prices ranged from $123,000 in Ferry County to $432,000 in King County.
Year-over-year prices for single family homes (excluding condominiums) increased almost 8.5 percent system-wide, rising from $295,000 in 2014 to last year’s median price of $320,000. Condo prices jumped 13.3 percent, from the 2014 figure of $225,000 to last year’s median selling price of $254,900.
Brokers scrambled to replenish inventory throughout 2015. They reported more than 116,000 pending sales (mutually accepted offers) during 2015, while adding 107,578 new listings to inventory. Brokers said depleted inventory often led to bidding wars for homes in the most desirable areas.
During 2015, the average area-wide supply, as measured by months of inventory, fell to 2.4 month, down from the previous year’s figure of 3.5 months. King County had the lowest level, averaging only 1.3 months of supply. Industry analysts tend to use a 4-to-6 month range as an indicator of a balanced market, favoring neither buyers nor sellers.
High-end sales also surged during 2015. Northwest MLS members reported 2,676 sales of single family homes priced at $1 million or more, up more than 29 percent from the 2014 total of 2,069 “luxury” sales. Condos priced at $1 million and up accounted for another 237 sales. A total of 1,459 condos commanded sales prices of $500,000, far outgaining 2014’s total of 878 half-million dollar-plus sales (up 66 percent).
The highest-priced single family home that sold during 2015 by a member of Northwest MLS was a property on Mercer Island that commanded $13.8 million. Topping the chart of high-priced condominiums was one in a downtown Seattle high-rise that sold for more than $3.1 million.
(2015 Annual Highlights) Jan. 21, 2016
Among other highlights in its annual compilation of statistics, Northwest Multiple Listing Service reported:
About 46 percent of last year’s single family home sales had three bedrooms, while the vast majority of condos (73 percent) had two bedrooms or fewer.
The median price for a 3-bedroom home that sold in 2015 was $283,250, about 7.9 percent higher than the previous year’s figure of $262,500. A comparison by county shows the median price for this size home ranged from $139,000 in Ferry County to $452,500 in San Juan County.
Of the condo sales, about six of every 10 (61.9 percent) were located in King County, primarily in Seattle or on the Eastside. That ratio matched the figure for 2014.
For the new construction component involving Northwest MLS brokers, newly built condos fetched higher prices than single family homes. Last year’s sales included 8,548 newly built single family homes that sold for a median price of $425,000, and 1,018 condos that sold for a median price of $449,950.
A comparison of 2015 and 2014 median prices of single family homes shows all but one county reported year-over-year gains, but most have not yet outgained the peaks reached in 2007.
Prices vary widely among school districts. Homes that sold last year in nine districts reported median prices of more than a half-million dollars, topped by Mercer Island at $1.2 million.
In addition to the comprehensive statistical summary for its members, Northwest MLS also reported enhancements to several services it provides to brokers. Among 2015 highlights in its year-end report to the brokers were major upgrades to various features of its database system and mobile applications. The MLS also announced plans to provide a new online scheduling and management tool in early 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.
Alright ladies, if you’ve just about had it with the man cave trend that’s been taking the industry by storm the last few years, it’s time to put your foot down and demand your very own space. And no, we’re not talking about your bedroom sanctuary that hosts a reading nook where you can go to escape the daily grind and lose yourself in a good book. We’re talking she sheds.
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5.4% represents a healthy gain. Historically too much above or below 5% leads to an adjustment.
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Single-family home development in the Puget Sound region is down significantly, and experts say a lack of interest among millennials is one reason.
KIRKLAND, Washington (January 6, 2016) – Home prices have “clearly recovered” in King County and a few other areas served by Northwest Multiple Listing Service. Many member-brokers say prices are likely to keep rising as a backlog of buyers compete for depleted inventory.
Those were among reactions from brokers upon reviewing the December statistics from the MLS. The latest report shows the year ended on a mostly positive note with pending sales, closed sales and prices all showing year-over-year increases. Not surprisingly, listing activity dropped, in part because some sellers are balking at listing their home for fear of not finding a replacement.
Selling prices for single family homes and condominiums that sold across the Northwest MLS 23-county service area surged 8.6 percent from a year ago, rising from $290,000 to $315,000. The price of a single family home (excluding condos) that sold in King County during December jumped nearly 15.5 percent, from $440,000 to $508,000, prompting OB Jacobi, president of Windermere Real Estate to comment, “If December told us one thing, it’s that home prices have clearly recovered in King County. Last month the median price for single family homes broke the pre-recession record of $481,000 that was set in July 2007.”
Another industry leader, J. Lennox Scott, chairman and CEO of John L. Scott, noted the 9.2 percent drop in King County’s pending sales during December, saying “The only reason pending sales dropped in King County was due to a lack of inventory.” MLS figures show active listings in King County were down 39 percent (about 1,400 fewer properties) from 12 months ago.
Area-wide, inventory was off 29 percent from a year ago, plunging from 17,659 active listings to 12,522. That total includes 4,041 new listings the MLS brokers added during December, which was down from 4,367 the members added during the same month a year ago.
Inventory levels dropped well below the threshold many industry experts use to gauge a balanced market.
Area-wide there was just under 1.8 months of supply, with four-to-six months generally considered to be a “balanced” level. In King County, inventory dropped to less than one month (0.84). It was slightly better in the adjacent counties, with Snohomish at 1.13 months and Pierce at 1.76 months. Kitsap County also reported less than two months of supply. Only five of the 23 counties in the MLS report had more than six months of supply.
“The lack of inventory makes buyers twitch when a new listing hits the market,” observed Dick Beeson, a member of the Northwest MLS board of directors. “These buyers and their brokers are ready, willing and able to pounce on well-priced, well-located properties,” added Beeson, the principal managing broker at RE/MAX Professionals in Tacoma. These prepared buyers helped propel last month’s 15 percent increase in pending sales in Pierce County compared to a year ago.
Pending sales system-wide, which totaled 5,970 during December, clearly outpaced the brokers’ ability to replenish inventory. The sales volume was up 3 percent from a year ago when members reported 5,794 mutually accepted offers. Measured another way, last month’s pending sales outnumbered new listings by a wide margin – a differential of 1,929 units.
“With the backlog of buyers waiting in the wings, any new inventory that comes on the market will be snapped up immediately,” predicts Northwest MLS director Frank Wilson. He expects 2016 may be “very stressful” for some buyers, citing low inventory, increasing prices, rising interest rates, plus a growing pipeline of qualified buyers as sources of house-hunter anxiety.
Other factors could also come into play to squeeze inventory, according to Wilson. They include buyers whose credit has been repaired after foreclosures or short sales, investors who see real estate as an alternative to the stock market, escalating rents that prompt renters to consider home ownership, and buyers from outside the U.S.
Wilson, the branch managing broker at John L. Scott’s Poulsbo office, said the limited selection means “buyers are going to find themselves settling on a house because they need one instead of leisurely shopping for the home of their dreams.”
Lennox Scott also foresees a fast-paced, “intense” market, with prices escalating in areas where inventory is low. “The lack of inventory near job centers persists,” he remarked. Buyers come out in big numbers beginning January 1, he noted, but new listings come later, typically toward the end of February.
“The low inventory in the Seattle area market will send many first-time homebuyers looking at suburbs and put additional pressure on multifamily properties,” said John Deely, principal managing broker at Coldwell Banker Bain n Seattle. He points to the formation of new households due to the strong job market as a factor in the imbalanced market. “Our economy is being charged by a multi-faceted job base and this is driving employment to new all-time highs,” he observed.
Deely, a director with Northwest MLS, said both long-time homeowners and new homebuyers are feeling the impact of rising prices and interest rates.
One consequence Deely noted is decreased buying power. “For buyers, every 1 percentage point increase in interest rates decreases buying power by about 10 percent,” he explained. He believes the diminished power coupled with rising prices will push buyers who are on the fence to make their move. “The same two factors will also motivate long-time homeowners to jump into the market as they looking to maximize their profit and find suitable replacement properties,” he remarked.
Gary O’Leyar, a former chairman of the Northwest MLS board, also commented on interest rates. “There’s been a lot of buzz about the recent increase in rates. It has been nearly 10 years since the Fed raised its benchmark rate. Many current homeowners and would-be homeowners may not have been born, and/or may not recall the days when long term mortgage rates were 10 percent or higher.”
Some brokers say rising prices are more worrisome than upticks in interest rates.
Noting differences in the tri-county area where pending sales declined by 9.2 percent in King County but increased by double digits in both Snohomish and Pierce counties, Jacobi thinks price hikes in King County are “clearly pricing many buyers out and into the adjacent areas.”
MLS figures show wide differences in prices within the Central Puget Sound region. Pierce County had the lowest median price for December’s sales at $249,950, while King County had the highest at $450,000. Homes and condos that sold in Kitsap County last month had a median price of $266,500; in Snohomish County the median sales price was $335,500.
The median price on December’s sales increased 8.6 percent area-wide compared to a year ago. Ten counties reported double-digit gains; four counties had year-over-year decreases in median sales prices.
Condo prices increased about 6.7 percent, from $239,000 to $255,000. In King County, which accounted for about 55 percent of the sales, the median sales price was $279,975. That’s up about 7.7 percent from a year ago.
Despite rising prices in most areas, closed sales ended the year on a strong note. Brokers reported 7,091 closings during the month to out gain the year-ago total of 6,284 by more than 12.8 percent. For the year, Northwest MLS members logged 88,831 closed sales, up from 2014’s total of 77,276 for a 14.3 percent gain.
Jan 4 2016, 1:00PM
Freddie Mac is dismissing concerns of some analysts that the change in the Federal Reserve's monetary policy may bode ill for the housing industry. The company's vice president and chief economist Sean Becketti welcomed the New Year with an upbeat rebuttal of those concerns on Freddie Mac's Executive Perspectives blog.
Becketti said that he does not share the worries about the December hike in the fed funds interest rates boosting mortgage rates, reducing home affordability, or reversing the recent improvements in housing numbers. He cites several reasons for his view.
The Federal Reserve is aware that the economic recovery remains fragile and has committed to a policy of gradual monetary tightening. They should be taken at their word, Becketti says, and we should expect only a few modest increases in short-term rates this year.
Further, the connection between short-term rates controlled by the Fed and long-term rates including those for mortgages is "tenuous." He cites the example of the 17 consecutive monthly rate hikes made by the Fed in the mid-2000s. They had virtually no effect on mortgages rates which remained around 6 percent.
Sure, in some ways, a property is a “product”. You want to sell that product quickly and for the best price, so you can buy your next dream home.
A home, however, is also a place filled with memories and emotional attachments. You’ll think of the rec room where the kids’ birthday parties were held; the dining room where you had countless family dinners; and the backyard deck where many afternoons were spent enjoying the sunshine.
That’s why managing the emotional side of selling your home is so important. Here are some tips:
- Have your kids draw pictures of the fun they’ll have in their new home.
- Remind your kids that they’ll be able to stay in touch with their old friends, while making new ones.
- Visit neighborhoods where you’d like to find your next home. Walk around. Get a sense of what it’s going to be like to live there.
- Consider taking a keepsake with you from your old home to help ease the transition.
Want more ideas for making your next move go smoothly? Call today.
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