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Bob Chapman
Managing Broker

Windermere Real Estate
Lake Stevens, Inc.

9327 4th St. NE, Ste #3
Lake Stevens, WA 98258
USA
Ph: (425) 268-2940
Fax: (425) 335-1838

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Washington State Real Estate Newsletter February 2018REAL ESTATE NEWS & INFORMATION

Washington State Real Estate Newsletter February 2018

February 6, 2018

*Sparse Inventory in Western Washington State Driving Up Prices, Especially Desirably Located Condominiums*

Kirkland, WA – February 5, 2018: “The Seattle area real estate market hasn’t skipped a beat with pent-up demand from buyers is stronger than ever,” remarked broker John Deely in reacting to the latest statistics from Northwest Multiple Listing Service. The report on January activity shows a slight year-over-year gain in pending sales, a double-digit increase in prices, and continued shortages of inventory.

Deely, the principal managing broker at a real estate franchise brokerage in Seattle, Washington and a board member at Northwest MLS, noted a shift in the ratio of pending sales to new listings in King County.

Member brokers added 6,805 new listings of single family homes and condominiums to the system-wide database last month for a gain of about 4.6 percent from a year ago. During the same period, they reported 7,820 pending sales. In King County, the number of new listings outgained pending sales for the first time since September:

King County (SFH+Condos)Jan-18Dec-17Nov-17Oct-17Sep-17
New Listings23261165210230883856
Pending Sales22821850283135333514
Difference45-685-729-445342

“Sellers that have put their properties on the market early this year have less competition and are seeing multiple offers. Open houses are experiencing heavy traffic with hundreds of potential buyers attending,” reported Deely.

For the MLS overall, last month’s 7,820 pending sales marked a slight increase compared to January 2017 when members reported 7,724 mutually accepted offers, a gain in of 1.24 percent. Not all areas reported increases. Of 23 counties served by Northwest MLS, eight counties, including three in the Puget Sound region (King, Kitsap and Snohomish), reported fewer pending sales than a year ago. In King County, where acute inventory shortages exist in many neighborhoods, pending sales dropped 7.5 percent and closings dropped 18.5 percent.

“The decline in sales last month can’t be blamed on the holidays, weather or football. It’s simply due to the ongoing shortage of housing that continues to plague markets throughout Western Washington,” said OB Jacobi, the president of Windermere Real Estate.

With January’s additions, the number of total active listings at month end stood at 8,037 homes and condos, down nearly 17.6 percent from a year ago when the selection totaled 9,750 listings. Measured by months of supply, there was only about 1.5 months overall, well below the 4-to-6 month level many industry experts use as a gauge of a balanced market.

Condo inventory is especially tight in Snohomish County (0.8 months of supply) and King County (0.92 months). System-wide there is under a month’s supply (0.93 months). For the four-county Puget Sound region, there were only 427 active condo listings at month end, down almost 31 percent from a year ago.

Despite the sparse selection, brokers expect inventory to improve.

“I actually believe 2018 will bring us moderately more listings, which should help offset the growing demand that continues to result from the area’s strong economy,” remarked Jacobi.

George Moorhead, designated broker at a real estate brokerage in Bothell, WA, agreed. “January still saw aggressive buyers as they jockeyed for homes in some of the hottest areas in Seattle and the Eastside,” he commented.

Prices continue to rise in all but a few counties, even as the volume of closed sales fell about 9.3 percent. For January’s 5,325 closed sales, the median price was $363,500, a jump of about 11 percent from the year-ago figure of $327,500. Twelve counties reported double-digit spikes.

Within the four-county Puget Sound region, King County had the largest year-over-year gain. Prices for homes and condos combined shot up 20.3 percent in that county, rising from $475,000 to $571,250. Pierce County reported a jump of 15 percent, followed by Snohomish County at about 12.2 percent and Kitsap County at nearly 3.5 percent.

The depleted supply of condos meant premium prices. Area-wide the median price for last month’s completed transactions rose nearly 18.6 percent, from $269,900 to $320,000. Snohomish County’s condo prices surged nearly 25.5 percent, followed by King County at nearly 22.6 percent.

Some brokers expect the hefty price gains to ease.

“As interest rates rise, the rate of price increases will slow down,” predicts Northwest MLS director Dick Beeson, principal managing broker at a real estate brokerage in Gig Harbor, WA. Despite this expectation, he believes sparse supply and the area’s appeal both nationally and internationally will mean ongoing competition and multiple offer situations.

“What it costs to rent small spaces astounds me,” he remarked citing recent reports that put Tacoma and Olympia on lists of top cities for increased rents during 2017. “Investors, because rents are high, compete daily with home buyers, and they often win the deal in the lower priced homes. Because they are buying all cash, they consistently beat out buyers who have to get loans.”

Builders are trying to respond to the pent-up demand, according to Moorhead. Seattle and the Eastside are seeing a growing number of infill homes in the core areas, some on lots as small as 3,000 square feet, he said. Builders are doing smaller releases and setting offer review dates, and then determine price ranges for the next phase.

“What used to be an affordable way to build homes has now become more mainstream for both smaller and larger builders,” Moorhead stated, adding, “Historically, infill homes did not get the same return as homes built in large community plats, but now they’re realizing similar price points.”

The luxury market is also off to a quick start in 2018. “Close to job centers, the luxury market is gaining positive momentum due to the wealth effect of the stock market, the strength of the U.S. economy, and homebuyers from the Pacific Rim, especially China,” noted Lennox Scott.

Northwest MLS figures show sales of homes selling for $2 million or more are far outpacing year-ago activity. Last month, member-brokers reported selling 55 residences at this price threshold. That’s up 66 percent from the same month a year ago when brokers sold 33 such homes.

Washington State Real Estate Newsletter February 2018

I am a Short Sale specialist for Seller’s needing to list their home for sale or Buyer’s wanting to obtain a Great deal by Buying a Short Sale home!

Referrals are a “very” important part of my business. Please let me know of anyone that you know who may be considering Buying or Selling real estate – or please give them my name and contact information!

Thank You!

Bob Chapman

Washington State Real Estate Newsletter February 2018

Statistical Summary by Counties:

Click Here Market Activity Summary for January 2018
4-County Puget Sound Region Pending Sales (SFH + Condo combined)
(Totals include King, Snohomish, Pierce & Kitsap counties)

Information and statistics compiled and reported by Northwest Multiple Listing Service, owned by its member brokers, is the largest full-service MLS in the Northwest. Its membership of nearly 2,200 member offices includes more than 28,000 brokers and agents. The organization, based in Kirkland, currently serves 23 counties in Western and Central Washington.

Washington State Real Estate Newsletter January 2018, copyright 2018. All material contained herein is owned and protected. Any attempts to reproduce this information without the express written consent from the owner will be prosecuted.

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