Pending sales, closed sales and prices all increased in August compared to a year ago, according to the latest figures from Northwest Multiple Listing Service. Those key indicators, coupled with the persistent shortage of inventory, prompted one industry leader to declare the market has flipped.
Brokers reported 8,338 pending sales of single family homes and condominiums last month for a year-over-year increase of 9.3 percent. Fourteen of the 21 counties in the Northwest MLS service area reported double-digit gains in the number of mutually accepted offers.
Last month’s pending transactions nearly equaled the July total of 8,416 sales and marked the fifth consecutive month of at least 8,000 pending sales.
Closed sales, reflecting several months of strong pending sales, reached the highest volume so far in 2012. Brokers tallied 6,612 closings last month, continuing a streak of four months of 6,000-plus completed transactions.
“In housing markets, slow and steady recoveries are good,” said MLS director Frank Wilson, the branch managing broker at John L. Scott’s Poulsbo office. “A market that runs too high or too fast leads to a quick decline in short order,” he commented, adding he expects good momentum to continue into the fall.
The median price on last month’s closed sales rose more than 5.9 percent, to an area-wide figure of $250,000. That’s up from the year-ago median sales price of $236,000 for single family homes and condos combined, but tapered off from the July figure of $254,900. Clark County claimed the largest year-over-year gain at 18.3 percent, followed by Cowlitz (18 percent), Mason (nearly 16 percent), and Kittitas (13.7 percent) counties.
For single family homes only (excluding condos), prices jumped nearly 6.7 percent, from $247,000 to $263,500. Buyers of single family homes in King County paid $378,000 for last month’s sales, an increase of 8 percent from the year-ago median selling price of $350,000.
Northwest MLS directors OB Jacobi and Joe Spencer are encouraged by the latest numbers, mentioning steady momentum, rising consumer confidence, low inventory, a pickup of activity in new construction, and improving prospects for homeowners who are underwater.
Northwest MLS members were hard-pressed to replenish inventory last month. They added 8,379 new listings to inventory — 749 fewer new listings than a year ago, and about the same as the number of pending sales (8,338). Last month’s additions brought the month-end total to 25,506 listings, down more than 28 percent from the year-ago inventory of 36,907 homes and condos.
“Inventory levels are incredibly low, but our hope is that many homeowners who were underwater can now afford to sell because of the continued appreciation of home prices,” remarked OB Jacobi, president of Windermere Real Estate Company. He also noted a pick-up of activity in the new construction housing market, which he expects will add much needed inventory throughout Puget Sound.
Wilson said he expects activity in Kitsap to pick up there once school resumes and after a typical “pause” around Labor Day. Noting increases in pending sales, closed sales and prices, he said “the only number that is down is the steady decrease in inventory. Lower inventory combined with low interest rates are what is going to carry this momentum forward into the fall,” he remarked.
Another MLS director, Joe Spencer, said the low inventory and heightened buyer activity are resulting in an imbalance of supply and demand, but he believes that “bodes well as we move into the fall season, which typically ushers in an increase in buyer activity.”
Buyers and sellers are “clearly more confident,” reported Spencer, the area director for Keller Williams. These consumers “are looking to take advantage of the market rebound in what appears to be a continued slow and sustainable recovery.”
The condo market showed mixed results. Both pending and closed sales increased, but inventory is at about half the levels of a year ago, and prices are essentially flat.
Brokers reported 1,130 pending sales of condos for a 7.5 percent gain from a year ago and a slight uptick from the total for July (1,188).
MLS members reported 889 closed sales of condominiums area-wide for a 16.1 percent year-over-year gain. The median sales price on those sales was $174,000, which is $1,000 less than a year ago (down 0.57 percent).
Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership includes more than 21,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 21 counties in Washington state.