Western Washington Real Estate Market Update – Q3 2019

The following analysis of the Western Washington real estate market is provided by Windermere Real Estate Chief Economist, Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact me!

ECONOMIC OVERVIEW

Washington State employment has softened slightly to an annual growth rate of 2%, which is still a respectable number compared to other West Coast states and the country as a whole. In all, I expect that Washington will continue to add jobs at a reasonable rate though it is clear that businesses are starting to feel the effects of the trade war with China and this is impacting hiring practices. The state unemployment rate was 4.6%, marginally higher than the 4.4% level of a year ago. My most recent economic forecast suggests that statewide job growth in 2019 will rise by 2.2%, with a total of 88,400 new jobs created.

HOME SALES

  • There were 22,685 home sales during the third quarter of 2019, representing a slight increase of 0.8% from the same period in 2018 and essentially at the same level as in the second quarter.
  • Listing activity — which rose substantially from the middle of last year — appears to have settled down. This is likely to slow sales as there is less choice in the market.
  • Compared to the third quarter of 2018, sales rose in five counties, remained static in one, and dropped in nine. The greatest growth was in Skagit and Clallam counties. Jefferson, Kitsap, and Cowlitz counties experienced significant declines.
  • The average number of homes for sale rose 11% between the second and third quarters. However, inventory is 14% lower than in the same quarter of 2018. In fact, no county contained in this report had more homes for sale in the third quarter than a year ago.

HOME PRICES

  • Home price growth in Western Washington notched a little higher in the third quarter, with average prices 4.2% higher than a year ago. The average sales price in Western Washington was $523,016. It is worth noting, though, that prices were down 3.3% compared to the second quarter of this year.
  • Home prices were higher in every county except Island, though the decline there was very small.
  • When compared to the same period a year ago, price growth was strongest in Grays Harbor County, where home prices were up 22%. San Juan, Jefferson, and Cowlitz counties also saw double-digit price increases.
  • Affordability issues are driving buyers further out which is resulting in above-average price growth in outlying markets. I expect home prices to continue appreciating as we move through 2020, but the pace of growth will continue to slow.

DAYS ON MARKET

  • The average number of days it took to sell a home dropped one day when compared to the third quarter of 2018.
  • Thurston County was the tightest market in Western Washington, with homes taking an average of only 20 days to sell. There were six counties where the length of time it took to sell a home dropped compared to the same period a year ago. Market time rose in six counties, while two counties were unchanged.
  • Across the entire region, it took an average of 38 days to sell a home in the third quarter. This was down 3 days compared to the second quarter of this year.
  • Market time remains below the long-term average across the region and this trend is likely to continue until more inventory comes to market, which I do not expect will happen until next spring.

CONCLUSIONS

This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors. I am leaving the needle in the same position as the first and second quarters, as demand appears to still be strong.

The market continues to benefit from low mortgage rates. The average 30-year fixed rates is currently around 3.6% and is unlikely to rise significantly anytime soon. Even as borrowing costs remain very competitive, it’s clear buyers are not necessarily jumping at any home that comes on the market. Although it’s still a sellers’ market, buyers have become increasingly price-conscious which is reflected in slowing home price growth.

As Chief Economist for Windermere Real Estate, Matthew Gardner is responsible for analyzing and interpreting economic data and its impact on the real estate market on both a local and national level. Matthew has over 30 years of professional experience both in the U.S. and U.K.

In addition to his day-to-day responsibilities, Matthew sits on the Washington State Governors Council of Economic Advisors; chairs the Board of Trustees at the Washington Center for Real Estate Research at the University of Washington; and is an Advisory Board Member at the Runstad Center for Real Estate Studies at the University of Washington where he also lectures in real estate economics.

This post originally appeared on the Windermere.com Blog.

Posted on October 28, 2019 at 7:31 am
Sandy Nicholls | Category: Home Buying, Housing Market News, Selling Your Home, The Gardner Report | Tagged , , , , , , , , , , , , ,

Local Market Update – October 2019

While fall usually brings a decrease in sales activity, the opposite was true in September. The number of listings on the market dropped by double digits and home sales rose. With interest rates near historic lows and employment levels at historic highs, the housing market is expected to stay strong throughout the fall and winter.

EASTSIDE

Long the most affluent area of King County, the Eastside continues to record the highest home prices in the region. The median price of a single-family home on the Eastside was $928,500 in September, an increase of 4% from a year ago and a decrease of less than 1% from August. The Eastside construction boom continues, indicating that developers remain confident in the strength of the local economy.

VIEW FULL EASTSIDE REPORT

KING COUNTY

The number of homes on the market in King County fell by almost 20% in September when compared to a year ago. However, last fall saw an increase in inventory that was unusual for the time of year. The median price of a single-family home was $660,000, down just 1% from the same time last year. Cities in King County, outside of Seattle, all saw price increases. Sales were up 7% indicating no shortage of buyers.

VIEW FULL KING COUNTY REPORT

SEATTLE

Prices remained relatively stable, with the median price of a single-family home in September dipping 3% over a year ago to $750,000. As tech companies continue to recruit top talent to the area, Seattle’s population keeps booming and demand for housing remains high. While home sales traditionally dip in the fall, the city saw sales increase by 12% in September as compared to last year. Rising rents may push more buyers into the market.

VIEW FULL SEATTLE REPORT

SNOHOMISH COUNTY

Buyers continue to be drawn to Snohomish County thanks to a strong economy and housing costs that are considerably more affordable than King County. That influx of buyers is also driving up prices. The median price of a single-family home in September was $492,500, up from $484,995 the same time last year. At $167,500 less than the median price in King County, it’s a relative bargain.

VIEW FULL SNOHOMISH COUNTY REPORT


This post originally appeared on GetTheWReport.com

Posted on October 18, 2019 at 5:06 pm
Sandy Nicholls | Category: Housing Market News, Local Market Updates, Selling Your Home | Tagged , , , , , , , , , , , , , , ,

Local Market Update – September 2019

A decrease in inventory coupled with an increase in sales activity led to fewer options for home shoppers in August. There is some good news for would-be buyers as mortgage rates have dropped to their lowest level in three years. Demand remains high but there simply aren’t enough homes on the market. Brokers are hoping to see the traditional seasonal influx of new inventory as we move forward.

EASTSIDE

The median price of a single-family home on the Eastside was $935,000 in August, unchanged from a year ago and up slightly from $925,000 in July. New commercial and residential construction projects are in the works. Strong demand for downtown condos has prompted plans for yet another high-rise tower to break ground next year.

VIEW FULL EASTSIDE REPORT

KING COUNTY

Home prices in King County were flat in August. The median price of a single-family home was $670,000, virtually unchanged from a year ago, and down just one percent from July. Southeast King County, which has some of the most reasonable housing values in the area, saw prices increase 9% over last year. Inventory remains very low. Year-over-year statistics show the volume of new listings dropped 18.5% in King County.

VIEW FULL KING COUNTY REPORT

SEATTLE

Homes sales were up 12% in Seattle for August, putting additional pressure on already slim inventory. There is just over six weeks of available supply. There are signs that prices here are stabilizing as the median home price of $760,000 was unchanged from a year ago and up less than one percent from July. With its booming economy, demand here is expected to stay strong.

VIEW FULL SEATTLE REPORT

SNOHOMISH COUNTY

Buyers looking for more affordable options outside of King County pushed pending sales, mutually accepted offers, up nearly 16% over a year ago. Home prices have softened slightly. The median price of a single-family home in August was $490,000, down slightly from the median of $492,225 the same time last year.

VIEW FULL SNOHOMISH COUNTY REPORT


This post originally appeared on GetTheWReport.com

Posted on September 19, 2019 at 8:57 am
Sandy Nicholls | Category: Housing Market News, Local Market Updates | Tagged , , , , , , , , , , , , , , ,

Local Market Update – January

 

A cool-down in prices and a surge in inventory spelled out good news for buyers in December. Median home prices throughout the region continued to moderate. The number of homes for sale more than doubled over a year ago. Condo inventory more than quadrupled. While we’re still far short of the four to six months that are considered a balanced market, December moved us closer in that direction. As winter months traditionally bring slower sales and lower prices, we’ll be able to determine a more solid trend when the peak real estate season comes this spring.

Eastside

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The number of single-family homes and condos on the market in December tripled as compared to a year ago on the Eastside. With an abundance of choices for buyers, homes here took longer to sell. However, well-priced homes still sold within weeks rather than days, which was the case earlier in the year. As with all of King County, home prices here continued to moderate. The median price of a single-family home was $909,000. That’s down 3 percent from a year ago, but up from November’s median price of $885,000.

King County

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In December, the median price of a single-family King County home was $639,000. That is 0.6 percent more than the same time last year and a welcome respite from the double-digit increases we saw for much of 2018. Inventory was up as well, soaring 143 percent from a year prior. The trend toward a more balanced market is good news for buyers. Instead of having to make a decision in a matter of hours, buyers now can take the time to consider their options and negotiate a price and terms that work best for them.

Seattle

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Last December there were only 299 homes on the market in Seattle. This December there were 1,111. Despite the sharp uptick, Seattle has the tightest inventory in King County with less than two months of supply. Demand is predicted to stay high in 2019. With an abundance of high-paying jobs and not enough people to fill them, Seattle’s population is expected to grow at twice the national rate this year. Prices have continued to moderate from the unsustainable increases of last year. The median price of a single-family home inched up 2 percent from the year prior to $739,000.

Snohomish County

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The median price of a single-family home was up 4 percent from last year to $470,000 in December – the same price the area posted the previous month. Inventory has more than doubled in the past year due to more sellers listing their homes and fewer sales. However, at 2.6 months of supply the area has a long way to go before becoming a balanced market.

This post originally appeared on the WindermereEastside.com Blog.

Posted on January 11, 2019 at 4:23 pm
Sandy Nicholls | Category: Local Market Updates, Uncategorized | Tagged , , , , , ,

Market Update – December 2018

The real estate market continued to improve for buyers in November. Interest rates dropped slightly, price increases slowed and inventory soared. It’s important to note that inventory increases, while significant, are being compared to the record low supply of last year. We’re still far short of the inventory needed for a truly balanced market, however buyers have greater choice and less competition than they’ve had in years. Sellers who price their home according to current market conditions continue to see strong interest. Heading into the holiday season, there’s something for everyone to celebrate.

Eastside

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The Eastside economy continues to be very strong. Heavy investment in commercial construction from companies such as Vulcan boost expectations that the area will continue to thrive. The median price of a single-family home in November hit $885,000 on the Eastside. Although an increase of 4 percent from a year ago, home prices have remained steady since this fall. With continued demand and only 2.4 months of inventory, the market has a long way to go to becoming balanced.

King County

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Price increases continued to slow in King County. The median single-family home price was $643,913 in November, an increase of 2 percent over a year ago. South King County, where the most affordable homes in the county are located, saw significantly greater increases compared to a year ago. North King County also posted greater increases than the county overall. Inventory has skyrocketed as the number of homes for sale in King County more than doubled year-over-year. While that’s good news for buyers, there is only 2.1 months of available inventory in the county, slightly down from October and not nearly enough to meet demand.

Seattle

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The median price of a single-family home in Seattle was $760,000 in November. This is up 3 percent from a year ago and slightly up from October. Inventory jumped 177 percent year-over-year however, at just two months of supply, the Seattle area has the tightest inventory in King County. With the city’s strong economy and lifestyle appeal, that’s not expected to change any time soon. Forbes recently named Seattle as the best place for business and careers in the nation. U.S. News & World Report ranked the University of Washington among the top ten universities in the world with Money Magazine rating Seattle the #5 Best Big City to Live In.

Snohomish County

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Inventory in Snohomish County continued to climb, surging 88 percent in November as compared to a year ago. That said, the area has fewer homes for sale than King County with just 1.8 months of inventory. This is still far short of the four to six months of supply that is considered a balanced market. The median price of a single-family home sold in November was up 6 percent from last year to $470,000, virtually unchanged from October.

This post originally appeared on the WindermereEastside.com blog.

Posted on December 13, 2018 at 10:00 am
Sandy Nicholls | Category: Home Buying, Housing Market News, Local Market Updates, Selling Your Home, Uncategorized | Tagged , , , , , ,

Market Update – November 2018

 

 

Increased inventory, slower sales and more price reductions all point to a balancing market—welcome news for price-shocked buyers. Sales prices are up from last October and down from the all-time high reached this spring. Despite the slowdown, it’s important to point out that we’re only moving back toward what a normal market looks like. King and Snohomish counties each have over two months of available inventory. While that is double the inventory of a year ago, it’s far short of the four to six months supply that is considered a balanced market. Sellers looking to list their home now can be sure there remains plenty of interest among home buyers.

Eastside

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The median home on the Eastside sold for $890,000 in October, up 5 percent from a year ago and unchanged from the previous month. While year-over-year price increases were in the single digits for the Eastside overall, several areas, including Kirkland, Woodinville and Mercer Island, experienced double-digit price gains. Buyers are still having to pay a premium for desirable Eastside properties. However, with more choices and less buyer urgency, sellers need to price their home correctly to maximize their chances of getting the best possible return.

King County

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Inventory in King County for all homes, both single-family and condominium, soared 102 percent over last October. The increase was due to an influx of new listings and the fact that homes are now taking longer to sell than at the peak of the market this spring. While buyers now have more breathing room to make their decisions, the 2.4 months of inventory in King County is still far from a balanced market. The median price of a single-family home in October was $670,999, an increase of 7 percent from the same time last year, and virtually unchanged from August and September. South King County showed larger increases, with prices rising more than 10 percent from a year ago in Auburn, Kent and Renton.

Seattle

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In October, the median price of a single-family home in Seattle was $750,000, up 2 percent from last October and down slightly from last month. While inventory doubled over a year ago, Seattle falls behind most areas of King County in supply with just under two months of inventory available. Demand is predicted to stay high, with Seattle’s population projected to grow at twice the national rate next year. That said, buyers are in the position to be able to negotiate. A recent analysis named Seattle as one of the top markets in the country where it makes the most sense to buy this winter.

Snohomish County

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Inventory in Snohomish County soared 65 percent in October as compared to a year ago. The area now has 2.4 months of inventory, about the same relative supply as King County. As with most of the Puget Sound area, the increase in inventory was due to a higher number of sellers listing their homes and fewer sales. Year-over-year, the median price of a single-family home sold in October in Snohomish County grew 8 percent to $473,000. The median price in September was $485,000.

This post originally appeared on the Windermere Eastside Blog.

Posted on November 13, 2018 at 9:50 am
Sandy Nicholls | Category: Housing Market News, Local Market Updates, Selling Your Home, Uncategorized | Tagged , , , , , , , , , , , ,

The Gardner Report – Third Quarter 2018

The following analysis of the Western Washington real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere Agent. 

Economic Overview

Washington State continues to be one of the fastest growing states in the nation and there is little to suggest that there will be any marked slowdown in the foreseeable future. Over the past year, the state has added 105,900 new jobs, representing an annual growth rate of 3.2%. This remains well above the national rate of 1.65%. Private sector employment gains continue to be robust, increasing at an annual rate of 3.7%. The strongest growth sectors were Construction (+7.4%), Information (+6.2%), and Professional & Business Services (+6.1%). The state’s unemployment rate was 4.5%, down from 4.8% a year ago.

All year I’ve been predicting that Washington State’s annual job growth would outperform the nation as a whole, and we now know with certainty that this is going to be the case. Furthermore, I am now able to predict that statewide job growth in 2019 will be equally strong, with an expected increase of 2.6%.

Home Sales Activity

  • There were 22,310 home sales during the third quarter of 2018. This is a significant drop of 12.7% compared to the third quarter of 2017.

  • The number of homes for sale last quarter was up 14.5% compared to the third quarter of 2017, continuing a trend that started earlier in the year. However, the increase in listings was only in Seattle’s tri-county area (King, Pierce, and Snohomish Counties) while listing activity was down across the balance of the region.

  • Only two counties had a year-over-year increase in home sales, while the rest of Western Washington saw sales decrease.

  • The region has reached an inflection point. With the increase in the number of homes for sale, buyers now have more choices and time to make​ a decision about what home to buy.

Home Prices

  • Home prices, although higher than a year ago, continue to slow due to the significant increase in the number of homes for sale. This, in my opinion, is a very good thing.​​

  • When compared to the same period a year ago, price growth was strongest in Lewis County, where home prices were up 15.3%. Six other counties experienced double-digit price increases.

  • Slowing price growth was inevitable; we simply could not sustain the increases we’ve experienced in recent years. Lower rates of appreciation will continue until wage growth catches up.

Days on Market

  • The average number of days it took to sell a home dropped by four days compared to the same quarter of 2017.

  • Across the entire region, it took an average of 39 days to sell a home in the third quarter of this year. This is down from 43 days in the third quarter of 2017 and down 2 days when compared to the second quarter of 2018.​
  • King County continues to be the tightest market in Western Washington, with homes taking an average of only 19 days to sell. Every county in the region other than Skagit and King — which both saw the time on the market rise by 2 days — saw the length of time it took to sell a home drop when compared to the same period a year ago.

  • More choice in the market would normally suggest that the length of time it takes to sell a home should rise, but the data has yet to show that. That said, compared to last quarter, we are seeing some marked increases in days on market in several counties, which will be reflected in future reports.

Conclusions

This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors. I started to move the needle toward buyers last quarter and have moved it even further this quarter. Price growth continues to slow, but more significant is the rise in listings, which I expect to continue as we move toward the quieter winter period.

I believe that psychology will start to play a part in the housing market going forward. It has been more than 15 years since we’ve experienced a “balanced” market, so many home buyers and sellers have a hard time remembering what one looks like. Concerns over price drops are overrated and the length of time it’s taking to sell a home is simply trending back to where it used to be in the early 2000s.

 

Matthew Gardner is the Chief Economist for Windermere Real Estate, specializing in residential market analysis, commercial/industrial market analysis, financial analysis, and land use and regional economics. He is the former Principal of Gardner Economics, and has more than 30 years of professional experience both in the U.S. and U.K.

 

This post originally appeared on the Windermere.com Blog.

Posted on October 29, 2018 at 2:02 pm
Sandy Nicholls | Category: Home Buying, Housing Market News, Local Market Updates, Selling Your Home, Uncategorized | Tagged , , , ,

Market Update – October 2018

 

It appears that balance is slowly returning to the local housing market. Home price growth slowed in September. Inventory continued to climb, but is still far short of the four to six months that indicate a normal market. Homes are staying on the market longer, giving buyers the breathing room to make the right choice for their situation. With our region’s healthy job growth, and demand still exceeding supply, it’s likely to take some time to move to a fully balanced market.

Eastside

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Home price increases moderated into the single-digits in September. The median price of a single-family home on the Eastside was up 4 percent from the same time last year to $890,0000 but down from a median price of $935,000 in August. Inventory increased significantly and price drops jumped. While the market is softening, the recent expanded presence of Google and Facebook on the Eastside means demand should stay strong. In addition, the area’s excellent school system continues to be a large draw for buyers both locally and internationally.

King County

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Inventory was up 68 percent year-over-year in King County due to a higher number of sellers listing their homes and fewer sales. There is now more than two months of inventory in the county, a number we haven’t seen in nearly four years. Despite the increase, there is a long way to go to reach the four to six months of inventory that is considered balanced. In September, the median price of a single-family home was $668,000; an increase of 7 percent from the same time last year and virtually unchanged from August.

Seattle

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Inventory in Seattle surged in September from a year ago. Only San Jose, CA saw the number of homes for sale rise faster than Seattle last month. The median home price in September was $775,000. Up slightly from the $760,000 median price in August and a 7 percent increase from last year. The double-digit price growth of past years appear to be waning and overzealous sellers who listed their homes at unrealistically high prices have been forced to reduce them. Bidding wars have declined and the typical well-priced house is now selling right at asking price.

Snohomish County

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While not nearly as dramatic as the case in King County, inventory in Snohomish County was up 40 percent. The area has just over two months of inventory with home prices moderating. The median price of a single-family home increased 8 percent over a year ago to $485,000. That’s down from the $492,000 median reached in August and $26,000 less than the peak of the market reached in spring.

This post originally appeared on the WindermereEastside.com Blog.

Posted on October 10, 2018 at 8:23 am
Sandy Nicholls | Category: Housing Market News, Local Market Updates, Selling Your Home, Uncategorized | Tagged , , , , , , , , , ,

Local Market Update – September 2018

 

The number of homes for sale in August increased dramatically over the same time a year ago. This is the result of a moderate increase in new listings and a much slower pace of sales. Homes are staying on the market longer, giving buyers more choices and more time to make an informed decision. While home prices are up compared to a year ago, the rate of increase was in the single digits rather than the double-digit surges of past months. It’s still a seller’s market, but sellers need to have realistic expectations about pricing their homes as the market softens.

Eastside

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The median price of a single-family home on the Eastside was up nearly 10 percent from the same time last year to $935,000. Home prices have declined each month from the all-time high of $977,759 set in June. Inventory increased 73 percent over last August. With supply soaring and home prices moderating, sellers need to work with their broker to price their home to meet the current market conditions. A year ago 47 percent of the homes on the Eastside sold for over list price. This August that number was down to 29 percent.

King County

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King County experienced yet another flood of inventory with the number of homes for sale jumping 65 percent over the previous year. Despite the growth, the county has just 1.9 months of inventory and remains a seller-oriented market. The market has slowed but it remains fast-paced, with 62 percent of the properties here selling in fewer than 15 days. While home prices were up 3 percent from a year ago, the median price of $669,000 represented the third straight month of declines from the record-high of $726,275 reached in May.

Seattle

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After leading the nation in home price growth for nearly two years, Seattle is finally cooling off. The median home price in August was $760,000, up just 4 percent from last year and down from the record $830,000 reached in May. Inventory soared in August, but the city still has just two months of supply, far short of the four to six months that is considered balanced. Bidding wars are becoming less common and price drops more common. Sellers must adjust their expectations to what appears to be a long waited moderating of the market.

Snohomish County

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Mirroring the market slowdown in King County, Snohomish County also experienced a cooling off in August. The median price of a single-family home was $492,000, up 8 percent from a year ago but down from the record high of $511,000 two months prior. Inventory increased nearly 30 percent, but at just 1.6 months of supply the market remains very tight and sales are brisk. Sixty percent of homes here sold within 15 days.

This post originally appeared on the WindermereEastside.com Blog.

Posted on September 12, 2018 at 10:56 am
Sandy Nicholls | Category: For Your Home, Home Buying, Housing Market News, Local Market Updates, Selling Your Home, Uncategorized | Tagged , , , , , , , ,