NWMLS: Sales, Prices Still Rolling Along the Gutter

May market stats were just published by the NWMLS. Here’s what they have to say about their numbers: Momentum building as home buyers respond to lower prices, favorable financing.

Northwest Multiple Listing Service members reported a 43 percent increase in pending sales of single family homes and condominiums during May compared to the same month a year ago.

I have to stop there to note that last year May was the first post-tax-credit hangover month for pending sales, so comparing pendings this May to last May is basically meaningless. Consider the following plot of phending sales for every year since 2000 overlaid on top of each other:

King County SFH Pending Sales

Note that it’s pretty normal for there to be a slight bump up between April and May, and this year was no different. The positive comparison to last year only really tells us that last year’s May was really lousy, not that this May was particularly hot.

I’ll dig into their press release a little more in tomorrow’s reporting roundup. For now let’s get to the stats.

CAUTION

NWMLS monthly reports include an undisclosed and varying number of
sales from previous months in their pending and closed sales statistics.

Here’s your King County SFH summary, with the arrows to show whether the year-over-year direction of each indicator is favorable or unfavorable news for buyers and sellers (green = favorable, red = unfavorable):

May 2011 Number MOM YOY Buyers Sellers
Active Listings 8,055 +1.0% -15.2%
Closed Sales 1,654 +7.9% -6.3%
SAAS (?) 1.65 -11.4% +15.4%
Pending Sales 2,485 +7.2% +38.9%
Months of Supply 3.24 -5.8% -38.9%
Median Price* $345,000 -1.4% -9.0%

Feel free to download the updated Seattle Bubble Spreadsheet (Excel 2003 format), but keep in mind the caution above.

Here’s your closed sales yearly comparison chart:

King County SFH Closed Sales

Here’s the graph of inventory with each year overlaid on the same chart.

King County SFH Inventory

Another a tiny increase in inventory, but well below what we normally see this time of year.

Here’s the supply/demand YOY graph. In place of the now-unreliable measure of pending sales, the “demand” in this chart is represented by closed sales, which have had a consistent definition throughout the decade.

King County Supply vs Demand % Change YOY

Both still falling. Who knows what is going on or how it will affect prices when both supply and demand are dropping off simultaneously.

Here’s the median home price YOY change graph:

King County SFH YOY Price Change

Slipped again, almost back into double-digit territory.

And lastly, here is the chart comparing King County SFH prices each month for every year back to 1994.

King County SFH Prices

May 2011: $345,000
February 2005: $342,500

Here’s the headline from the Seattle Times and the Seattle P-I:

Seattle Times: May home sales, median price in King County down from year ago
Seattle P-I: Jump in home sale deals may not last

Check back tomorrow for the full reporting roundup.

  

About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

29 comments:

  1. 1
    HappyRenter says:

    The spring bounce is flat.

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  2. 2

    RE: HappyRenter @ 1 – I would agree, and call the recent variation just noise, but when you look at the last chart, not many of the prior years showed that much of a bounce either, except 2006 and 2007, which most here would not consider “healthy” years.

    Maybe we’re in a more normal market, although one with low volumes?

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  3. 3
    HappyRenter says:

    RE: Kary L. Krismer @ 2
    I agree. What is then usually the “hottest” month for price increases?

    In order to figure that out, one could take the three-month average, then calculate the MOM change of that three-month average and average it over the last years back to 1993. One could do the same with the Case Shiller data, which is already a three-month average. Would that be a good idea? Or, judging from the plots it seems that July/August is generally the period of most price increases.

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  4. 4

    The first chart above is the first evidence we’ve seen of “The Tim bump.” ;-)

    Rate this comment: Thumb up 0

  5. 5
    Lurker says:

    I agree about a more normal market. It is interesting to compare levels now to ten years ago:

    pending sales are up around 10%, closed sales down around 20% and inventory levels about the same (if I’m reading the colors right)

    man, inventory levels were darn high in 2008.

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  6. 6
    Scotsman says:

    Sales (demand) up, supply (inventory) steady, prices still falling. What’s wrong with this picture? Somebody get Krugman on the horn- we’re going to need a creative explanation for this new paradigm.

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  7. 7

    RE: Scotsman @ 6

    SWE Krugman’s WAG

    Actually the Seattle area pending sales were down 22.5% from April 2010 to April 2011. That’s the number to watch. The approx 11% uptick in pending sales from April 2011 to May 2011 was still down from last year’s April 2010 peak. The more severe down tick in 2010 after the tax credit’s April 2010 deadline was “self-explanatory’.

    The bottom line is the tax credit did not affect pending home sales in King County in 2011, in that it did not goose future sales or make them at least constant without tax props. They dropped from the tax credit heydays by about 11% in May 2011.

    The rest of the nation was not as fortunate as Seattle, their MOM pending sales declined by 11.5% from April to May 2011. meaning, the tax credit YOY ineffectiveness was even worse on a national level.

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  8. 8
    Ben says:

    It looks like we will be under the yellow 2004 price line by August perhaps? I hope no more tax credits prevent the market from finding a true bottom. It’s been too long and I want want to join Tim in a home purchase, but just not yet. QE2 is ending, there is no will for more stimulus can kicking, and this is the typical peak for seasonal home prices. The summer and fall will be interesting in realtor land to say the least.

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  9. 9

    By Lurker @ 5:

    man, inventory levels were darn high in 2008.

    More supply at higher prices isn’t surprising, but many/most of those sellers wanted to get into something else even more expensive.

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  10. 10
    Eastsider says:

    It would be nice if you throw in a chart of home prices adjusted for inflation.

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  11. 11
    LocalYokel says:

    By Eastsider @ 10:

    It would be nice if you throw in a chart of home prices adjusted for inflation.

    RE: Eastsider @ 10

    +1.

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  12. 12

    By Eastsider @ 10:

    It would be nice if you throw in a chart of home prices adjusted for inflation.

    He did that with Case Shiller just last week. C-S and the median are rather highly correlated.

    http://seattlebubble.com/blog/2011/06/03/real-seattle-home-prices-rewound-to-march-2000/

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  13. 13
    Lurker says:

    The Tim just recently posted a graph showing real pricing if you are interested in that.

    http://seattlebubble.com/blog/2011/06/03/real-seattle-home-prices-rewound-to-march-2000/

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  14. 14
    Cheap South says:

    Ok, the last chart makes it official. Sadly, my price range is between the ’93-’96 lines.Tim; when do we get the off peak price comparison?

    Rate this comment: Thumb up 0

  15. 15
    Lurker says:

    RE: Kary L. Krismer @ 12

    beat me to it, Kary!

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  16. 16
    Phil says:

    Tim, I downloaded the .xls but it didn’t contain the data necessary to generate the same chart series for KingCo Hi Tier (as defined in your June 1, 2011 post). Is the same data available for KingCo High Tier only? And, would it be possible to include Sold $/sf data to drive a plot of High Tier Sold $/sf versus month for the past several years? Probably not useful for most on this blog, but I’m interested in the high tier trends.

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  17. 17
    toad37 says:

    OK guys, need your professional opinions. I just looked at this house.

    http://www.redfin.com/WA/Bellevue/1823-100th-Ave-NE-98004/home/506128

    It is a desirable area. There are some newer construction around that sell for well over 1 million.

    How about low-ballin’ for 475k. If they took it, sit on it for 2 years, then build a nice house and turn a tidy little profit… thoughts?

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  18. 18
    Scotsman says:

    Ok, I get it- you’re just trolling. I’ll bite

    Hey, why not! Location, location, location- and it’s hard to beat the NE exposure of north Bellevue, especially on the eastern side of the hill, looking over . . . Bellevue way? That’s where I’d want to buy a $1.5M home, assuming you follow the rule of thumb where the land is 1/3. The good news is labor will be cheap in two years, really cheap. Materials, harder to say. And then there’s the market for $1.5M homes- even in Bellevue. I know, I know, everyone wants to live there- except the vast majority of the people in Seattle, who hate it. But there’s always foreign money, and you know- they aren’t making any more land.

    Or, you could just by it and hold it- the original 1951 painted cabinets have a certain charm, and the tastefully upgraded ’60’s wood paneling is always popular- in Kent. Looks like any easy way to lose a hundred grand- but what do I know?

    That area, despite being close in, was the last to start to redevelop during the bubble. When I went to Bellevue High in the ’70’s it was the land of forgotten shopping centers and cheap apartments. there was a reason then, and it still holds true now. A joyless hollow, a land forgotten. Go for it!

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  19. 19
    toad37 says:

    RE: Scotsman @ 18
    Hi Scotsman, I appreciate your viewpoint. Thanks. My Realtor said building costs have dropped to $120-130 per sq. ft. Will have to verify this.

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  20. 20
    corncob says:

    By toad37 @ 19:

    RE: Scotsman @ 18
    Hi Scotsman, I appreciate your viewpoint. Thanks. My Realtor said building costs have dropped to $120-130 per sq. ft. Will have to verify this.

    Building prices are whatever you want them to be in a pretty wide range. For houses in the $1m+ category you are going to have to spend a lot more than $120-130/ft for the finishes the customers will expect.

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  21. 21
    toad37 says:

    RE: corncob @ 20
    Sounded light to me as well. golly Realtors. :-)

    I’m waiting to here back from my brother-in-law. He builds homes in that range.

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  22. 22
    Scotsman says:

    RE: corncob @ 20RE: toad37 @ 19

    I’m not sure about Bellevue, but many communities have GFAR maximums of 35% of the lot size, so you’d be limited to something under 3500 square feet for the house. To get to $1.5m at that size it’s got to be pretty spectacular. That won’t happen @ $130/sft.

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  23. 23
    toad37 says:

    RE: Scotsman @ 22 – I wouldn’t argue that. I just text my friend who is a professional architect, here is the convo- I kid you not-

    Me- How much does it cost per sq. ft. to build a nice house locally?
    Him- That varies. Nice is a broad term. $100 / sf
    Me- Would $120 be really nice?
    Him- Not sure on residential rates these days. Cheap material and labor may get you a killer house for that.

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  24. 24
    deejayoh says:

    RE: toad37 @ 23 – Architects are not great estimators of construction cost – so good luck building something for $100/sq other than a cracker box.

    Buddy of mine just finished a place in Clyde Hill with a deal from another friend as the GC (he just wanted to keep his subs busy) I am pretty sure it was well north of $200/square. That’s with basically no GC margins.

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  25. 25
    toad37 says:

    RE: deejayoh @ 24
    That is good information Deejayoh, thanks. It’s looking like the consensus here is that 120-130 ain’t going to cut it… I’ll keep researching, thanks for input.

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  26. 26

    By Scotsman @ 22:

    RE: corncob @ 20RE: toad37 @ 19

    I’m not sure about Bellevue, but many communities have GFAR maximums of 35% of the lot size, so you’d be limited to something under 3500 square feet for the house. To get to $1.5m at that size it’s got to be pretty spectacular. That won’t happen @ $130/sft.

    Keep in mind you have to pay for the lot too out of that 1.5M, and that a few days ago I posted a link to the lot selling for 14M.

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  27. 27
    ARDELL says:

    RE: toad37 @ 25

    I checked with a builder a while back and the rate was $165 if you stuck with “in stock” type of materials. With new construction down, especially on the high end, the cost of custom or semi-custom finishes has skyrocketed, due to decreased demand. They are no longer pumping those things out in high quantities to keep prices low.

    You are better off building a house with readily available and lower cost materials, than dreaming up something as to interior finishes that creates custom work and custom prices. That’s why some start off at $165 per sf and end up at over $200 per sf. It’s not the builder costs as much as the buyer’s chosen material costs.

    People tend to choose wisely when selecting the builder…but then get carried away with expensive finishes, and wind up much higher per sf than their original bid and intent.

    The increased cost of custom finishes is also one of the reasons you saw high end jobs being abandoned completely with no interior work done. When the cost of the interior finish materials doubled, the builders just walked away, as the increase in material costs sucked up their profit margin.

    That’s also the reason most builders have dramatically limited the options available to a few styles they can buy more cheaply and in bulk. They also make the buyer pay in advance for any upgrades, and that money is forfeited if you don’t close, as they won’t be about to get custom prices from a different buyer. Even if you have a finance contingency in your contract, that does not cover monies you paid in advance for upgrades, even for a tract home.

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  28. 28
    toad37 says:

    RE: ARDELL @ 27
    Thanks Ardell, excellent info. I’ll report back when I touch base with my brother-in-law. HE builds the high end stuff and will tell it to me straight.

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  29. 29
    toad37 says:

    RE: Kary L. Krismer @ 26
    Hi Kary, looks like you missed this… the lot would be scraping this in a couple years-

    http://www.redfin.com/WA/Bellevue/1823-100th-Ave-NE-98004/home/506128

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