Here is the official press release on April Home Sales from the Northwest Multiple Listing Service (I don’t believe many of the people who were quoted and question whether they believe themselves):
Northwest MLS Reports Inventory Gains, Along with Price Increases
KIRKLAND, Wash. (May 5, 2006) – “I assure you we would have more sales if we had more inventory,” proclaimed Mike Skahen, a board member of the Northwest Multiple Listing Service in reaction to April results. Just-released figures show pending sales slipped about 9 percent last month compared to a year ago, while prices are still climbing.
A snapshot of last month’s activity for the MLS market area that covers 17 counties in Western and Central Washington shows:
· Inventory is improving but demand still outstrips supply in many areas;
· Buyers can expect to pay more;
· Competition for homes in neighborhoods with easy access to job centers is fairly intense and not likely to disappear in an era of rising gas prices.
MLS members reported 9,702 pending sales (offers made and accepted, but not yet closed) during April. That figure lags the year-ago total of 10,677 pending sales (a drop of 9.1 percent). Only three counties — Grant, Thurston and San Juan — had more pending sales last month than 12 months ago.
The inventory picture brightened in several areas last month. Members added 12,594 new listings to inventory, improving on the year-ago total of 12,116, and falling just shy of the March figure of 12,639. The new listings included 10,740 single family homes and 1,854 condominiums.
With those additions, the inventory at month end totaled 25,215 listings, a jump of almost 21 percent from the same month a year ago. Only three counties — King, Cowlitz and Grant — reported having fewer listings than 12 months ago, with only a slight drop in all three areas.
Six counties had inventory gains of 25 percent of more, led by Grays Harbor (up 63.4 percent). Other counties with sizable increases were Thurston (up 60.9 percent), Kitsap (up 35.2 percent), Pierce (up 29.2 percent), Island (up 26.6 percent) and Kittitas (up 25 percent).
Despite having more choices in some areas, would-be homebuyers “should not foot drag right now,” advises Dick Beeson, broker at the new Windermere Real Estate/Commencement Associates office in Tacoma. Noting a pause in the Federal Reserve’s interest rate hikes, he urges buyers to “make a move while the movin’ is good.” He also cautions sellers to take the time and effort to price their property correctly, emphasizing, “They stand head and shoulders above the hopefuls who overprice.”
The bigger selection is not resulting in much softening of prices, based on MLS data.
The median asking price for the current inventory of single family homes is $359,950, almost $40,000 more than a year ago (a 12.5 percent increase). In King County, the median list price is $519,000. That is $72,000 more than the year ago asking price of $447,000 (a 16.1 percent increase).
For condominiums, the median asking price is $259,950, up 15.8 percent ($35,450) from a year ago when the median price was $224,500. In King County, where nearly 60 percent of the condo inventory is located, the median asking price jumped 25.9 percent from a year ago, rising from $235,000 to $295,950.
NWMLS members reported 8,044 closed sales last month at a median selling price of $299,500. Those completed transactions (including single family homes and condominiums) fetched 14.7 percent more than properties that sold a year ago. Seven counties reported price jumps of 20 percent of more, topped by Jefferson County where prices spiked 33 percent compared to 12 months ago.
“April was just as intense in Seattle as last April, and last April was a record,” Skahen remarked, adding “I think fears of a bubble in Seattle have vanished with recent news about our strong economy and above-average rates of appreciation.”
Skahen, the owner/broker of Lake & Co. Real Estate near Greenlake in Seattle, said rising interest rates are also spurring demand. He said his office had several recent listings in close-in neighborhoods priced from $400,000 to $500,000 that drew multiple offers before selling for $80,000 or more over list price.
Ballard, Wedgwood and Madison Valley are “hot” neighborhoods in Seattle, according to Skahen, who also noted a home in Ravenna priced at $850,000 drew more than 100 visitors at an open house last Sunday. It sold for “considerably more” than the list price with three would-be buyers vying for ownership.
Lennox Scott, chairman and CEO of John L. Scott Real Estate, characterized the job centers in Bellevue and Seattle as “the epicenter of sales activity.” Commenting on current conditions, he said, “We continue to see a quick action market and a strong surge of buyers, but there simply isn’t enough housing supply to meet the demand.”
NWMLS director Ken Bacon concurred. “Our inventory levels remain less than the buyer demands. Builders are not building without a presale buyer so no overbuilding has occurred like in other parts of the country,” he stated. He also noted new construction is limited due to the lack of available land.
Asked to identify the hubs of activity in his primary market areas, Bacon, the broker at Windermere Real Estate in Redmond, replied “close in communities priced below $1 million.” Education Hill, Timberline in Sammamish and communities around Microsoft’s Redmond campus are among the most active, he said. “Every week we are seeing multiple offers in all price ranges below $1 million,” he remarked. Updated condos that are close to job corridors are also popular, accounting for about 30 percent of recent sales, according to Bacon.
Location is an amenity that people are looking for more than in the past, Bacon said. Also likely to draw multiple offers and rapid appreciation are homes with acreage (“the newer the better”), homes with water or mountain views, and waterfront properties.
Despite modest increases in mortgage rates, brokers say attractive financing, including many options for first-time buyers, is sustaining activity. The latest weekly survey of large lenders by Bankrate.com pegs the benchmark 30-year fixed-rate mortgage at 6.67 percent. That marked the sixth consecutive week of increases for a 30-year mortgage, and the highest rate since June 2002. A year ago, the mortgage index was 5.81 percent.