Western Washington housing market remains active

Home sales in Western Washington continued to outpace year-ago activity, but member-brokers at Northwest Multiple Listing Service say persistent inventory shortages are constraining activity.

Despite a sparse selection in many areas, an expected summer slowdown, and “appraisal conundrums,” Northwest MLS members notched 11,898 pending sales during August, eclipsing the same month a year ago by 1,295 transactions for a 12.2 percent gain, according to a Northwest MLS media release. There were 8,628 pending sales in the four-county Puget Sound region — the best August for mutually accepted offers since 2005 when members tallied 8,874 sales.

Brokers added 11,411 new listings to the Northwest MLS database during August, but they presented offers for even more buyers (11,898) to keep inventory below two months of supply. At month-end, there were 18,336 active listings in the MLS system, a decrease of 11.6 percent from a year ago, resulting in only 1.9 months of supply. (Four to six months is generally considered to be a “neutral” or balanced market for buyers and sellers.)

“The market remains just as intense as July,” said J. Lennox Scott, chairman and CEO at John L. Scott, Inc. “The best opportunity for home buyers to find a home will be in the next 60 days.”

Scott said the number of new listings coming on the market is likely to drop by 50 percent each month between November and February.

“We expect a repeat of conditions from last winter when every available home that came on the market in areas with a shortage of inventory received quick action,” he said.

“Buyers in the Seattle area are plentiful in all price ranges, but the entry-level housing demand continues to be the highest,” said John Deely, principal managing broker at Coldwell Banker Bain.

As an example, he said a recent open house for a condo listing in the South Lake Union area drew more than 100 visitors in a single day. Tech workers continue to dominate the primary buyer demographic, he said, adding that a significant number of their parents are relocating here to purchase properties close to their children.

Buyers in most of the 23 counties served by Northwest MLS can expect to pay more than they would have twelve months ago, with most areas showing double-digit year-over-year price increases. System-wide, the median price for last month’s 9,767 closed sales of single family homes and condominiums was $350,000, up more than 11 percent from the year-ago figure of $315,000.

In King County, the median price on 3,656 sales that closed during August was just under $500,000. That’s up nearly 11 percent from the year ago figure of $450,700, but slightly lower than July’s median sales price of $505,000. Prices on single family homes (excluding condos) that closed in King County jumped 10 percent year-over-year, rising from $499,950 to $550,000.

Condo prices area-wide surged nearly 16 percent from a year ago, rising from $258,750 to $299,950. King County has the highest median sales price at $335,000, which is a 12 percent jump from a year ago. That county also has the most meager supply of condos, with only 28 days or so (0.91 months).

“We expect median prices to continue to increase, and likely at an accelerated pace through the fall,” said Mike Grady, president and COO at Coldwell Banker Bain. He attributes the anticipated increase to shrinking inventories.

Grady, a past chairman of the MLS board, also noted that the price gap between homes in King County versus Pierce and Kitsap counties is narrowing. Both counties experienced higher percentage price gains than King County, while Snohomish County trailed.

There is a difference of $250,550 in the price of a single family home in Kitsap County versus King County, and a gap of $265,000 when comparing Pierce County prices with those in King County, according to the latest MLS statistics. Snohomish County’s prices are $150,000 lower than King County’s.

“It’s possible demand is shifting to the lower prices of Pierce County where commuting times into King County are similar (to Snohomish County’s),” Grady said.