Here comes this month’s market reporting roundup. After seven months of declining/flat prices, declining year-over-year sales in 27 of the last 28 months, and 23 straight months of an ever-increasing number of homes on the market, I think we can officially declare that the Seattle-area housing market is in a slump. Of course, while the newspapers seem to have finally caught on to that fact, don’t expect most local real estate agents to admit it. Despite all the measurable data pointing to the market getting worse before it gets better, I think we can expect plenty of upbeat predictions and bottom-calling throughout this drop.
Click below to find out for yourself.
Elizabeth Rhodes, Seattle Times: King County home sales still soft, prices flat
In King County, single-family house and condominium sales were down 36 percent last month, available properties increased 69 percent and prices were nearly unchanged from a year earlier, the Northwest Multiple Listing Service reported Wednesday.
The median single-family house price had been unchanged for three months until it fell $5,000 in February to $429,900, but that price was just $25 less than in the previous February.
There were fewer buyers and abundant inventory for King County condominiums, whose prices were up a slim 1.3 percent to $289,000 year-over-year.
The number of available condos almost doubled, while sales fell 45 percent.
Surrounding counties also reported slow sales, price breaks and lots to choose from.
“It’s a whole different atmosphere,” seconds Diedre Haines, a Coldwell Banker Bain managing broker.
“In the last five years, we saw very little negotiation. Instead it was multiple offers with escalator clauses. Now sellers are more open to negotiation than they were a year ago.”
“The reality is we’re not desperate; we’re not California; we’re not Florida,” [real estate agent Kari Scott] says, recalling a recent bid. Those two states are among the national leaders in foreclosures and home-price declines. Someone offered 30 percent less than the asking price for a million-dollar house. The sellers laughed.
“It’s fruitless when people put in a ridiculous offer instead of a reasonable offer,” Scott says.
Which is more fruitless, a low offer from a buyer, or a seller’s stubborn insistence on asking 2007 prices? When the home languishes on the market for month after month, unreasonably high asking prices seem pretty fruitless, too. Our market not being as bad as California or Florida isn’t much consolation when you needed to sell your home in 60 days, but it’s been on the market 120 days.
Aubrey Cohen, Seattle P-I: Housing market perking up
Increased traffic at open houses and reports of homes fetching multiple offers also are “signs of an emerging spring market,” [the NWMLS press release] said.
“In March, the real estate market is set to get its mojo back,” J. Lennox Scott, chairman and chief executive of John L. Scott Real Estate, said in the statement. “We’re already seeing the momentum build.”
The pending sales numbers appear to show that this year is typical — sales are picking up as the days get longer and warmer.
But compared with the same month a year ago, February’s pending sales were down 22 percent in Seattle, 36 percent in King County and 31 percent in Western Washington.
The number of homes on the market in February increased 64 percent in Seattle, nearly 69 percent in King County and 39 percent in Western Washington from February 2007.
Some economists say Seattle-area prices could fall around 5 percent this year and then stay relatively flat.
“We won’t see a strong housing market for maybe as many as five years,” said [Altos Research CEO Michael] Simonsen, although he declined to predict when the market would bottom out.
Builders are adjusting to the new market, cutting prices and offering incentives, but other sellers are taking longer to understand a market in which they no longer have the advantage, [real estate agent Nick] Upshaw said.
“Sellers have effectively beat up on buyers for the last 20 years,” he said. “They don’t really grasp the depth of the change.”
Other than the quotes from the NWMLS press release and the headline (which interestingly was rewritten from last night’s “Spring housing surge? May be too soon to tell” to today’s “Housing market perking up”), there’s not much positive news in Mr. Cohen’s piece this month. Of course, I have to point that Mr. Cohen has become the first major local newspaper reporter to actually mention/quote Seattle Bubble in an article:
Over at Seattle Bubble, a blog dedicated to the proposition that Seattle has a housing bubble, the headline of a post about February’s statistics proclaimed, “Inventory Skyrocketing, Sales in the Gutter (Still).”
“Apparently the market is so bad that the only way they can make it seem good is to compare month-to-month stats from what is traditionally the second-slowest month of the year. Awesome,” said blog editor Timothy Ellis, mocking the listing service’s news release.
Thanks for the mention, Aubrey.
Kelly Kearsley, Tacoma News Tribune: Pierce County home prices continue downward
Pierce County’s median home price has declined for five of the past six months – and February witnessed the largest drop yet, according to figures released Wednesday by the Northwest Multiple Listing Service.
The county recorded a median home price of $260,000 in February, a decrease of 7.8 percent compared to the same month in 2007. There was no change in the median price from January.
“The buying population has changed,” said Sharon Benson, Realtor and associate broker with Coldwell Banker Bain in Tacoma. “It’s been more affected by the changing (finance) regulations, hearing the real estate news, and maybe they are thinking the bottom of the market is not here.”
Now wait a minute. Last month’s Tribune quoted Lakewood Realtor Mike Larson as saying “The bottom is here or pretty soon, I think. I would be surprised if things don’t turn around real quickly.” How can prices still be falling? I thought last month was the bottom!
Mike Benbow, Everett Herald: Home buyers seeking stability
Snohomish County home sales fell in February and prices remained flat, but real estate agents say there were some hopeful signs that things will improve this spring along with the weather.
“The atmosphere is definitely changing,” said Diedre Haines, a broker with Coldwell Banker Bain in Lynnwood, who is also a director of the Northwest Multiple Listing Service.
General concern about the economy and frequent news stories about the sagging real estate market in many parts of the country have clearly had an effect, said Dick Beeson, a Tacoma broker and a director of the listing service.
“Buyers need stability to trust that all is well and that they’ll be able to obtain financing,” he said.
Real estate agents hope the stronger economy in the Northwest and the new bank rules will provide potential buyers with the assurance their seeking.
When all the data shows decline, I guess all you can do is cling to abstract concepts like atmosphere, stability, and hope.
Rolf Boone, The Olympian: Thurston home prices steady
While median home prices continue to fall in other Western Washington counties, including an 11 percent drop in Kitsap County last month, Thurston County homes continue to go up in value.
Several factors are propping up South Sound home prices, said Pete Swensson, senior planner for the Thurston Regional Planning Council.
The region’s job market remains strong, it has avoided overbuilding by home developers, and it is attractive to buyers unable to afford more expensive King and Pierce county homes, Swensson said.
Wait, wait, wait. Are “home prices steady,” or are they “going up in value”? I’m not sure how a 5.8% decline since July’s peak could be characterized as either of those. When prices start to show a year-over-year decline, I wonder if that means the job market suddenly collapsed overnight. Say, prices are declining in King County, so does that mean that our job market isn’t strong anymore? Hmm.
(Elizabeth Rhodes, Seattle Times, 03.06.2008)
(Aubrey Cohen, Seattle P-I, 03.05.2008)
(Kelly Kearsley, Tacoma News Tribune, 03.06.2008)
(Mike Benbow, Everett Herald, 03.06.2008)
(Rolf Boone, Olympian, 03.06.2008)