February market stats were published by the NWMLS this morning. Here’s a snippet from their press release: Western Washington housing indicators aligned "for spring market to remember".
Real estate brokers around Washington state agree today’s market is far different than two years ago, with one industry veteran summing it up by saying key indicators “are in perfect alignment for a spring market to remember.”
…
“In my 37 years working in the real estate industry, I have never seen inventory this low,” remarked Diedre Haines, regional managing broker for Coldwell Bank Bain-Snohomish County and a member of the Northwest MLS board of directors.
…
Compounding the shortage is the fact that about one-fourth of the MLS inventory is classified as “distressed,” meaning they are short sales or bank-owned. Such homes are sometimes in need of significant repairs or have prolonged transaction times, which may make them less desirable.“The market is struggling to provide enough inventory for anxious buyers seeking to take advantage of low interest rates,” reported Dick Beeson, principal managing broker of RE/MAX Professionals in Tacoma. Also, he lamented, considering 25 percent of the selection is distressed, “It leaves some buyers with tough choices.”
Like a broken record, low inventory is still the big story in today’s market. Every time you think it can’t get any lower, somehow it does.
All righty, on with our usual monthly stats.
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):
| February 2013 | Number | MOM | YOY | Buyers | Sellers |
|---|---|---|---|---|---|
| Active Listings | 2,947 | -0.9% | -43.1% |  |
 |
| Closed Sales | 1,307 | -4.1% | +6.3% | |
|
| SAAS (?) | 1.41 | +33.9% | -4.0% | |
|
| Pending Sales | 2,469 | +17.1% | +1.6% | |
|
| Months of Supply | 1.19 | -15.4% | -44.0% | |
|
| Median Price* | $365,000 | +4.3% | +18.5% | |
|
Feel free to download the updated Seattle Bubble Spreadsheet (Excel 2003 format), but keep in mind the caution above.
For the second month in a row, we’re looking at the lowest months of supply has ever been as far back as my data goes (January 2000). Remember thoug that the NWMLS changed the definition of “active listing” in July 2008, so months of supply before and after that point aren’t really directly comparable. But still… 1.2 months of supply. Crazy.
Here’s your closed sales yearly comparison chart:
Not much increase from a year ago, but that’s because there just aren’t many homes to buy.
Here’s the graph of inventory with each year overlaid on the same chart.
Another month-to-month decrease. Sigh.
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.
Same story as ever, supply down, demand up.
Here’s the median home price YOY change graph:
Slight boost from last month, but we’re still a relatively non-distressed market to a heavily distressed market from a year ago.
And lastly, here is the chart comparing King County SFH prices each month for every year back to 1994.
February 2013: $365,000
March 2005: $362,000
Check back tomorrow for the full reporting roundup.
+30
Again, builders what are you waiting for? Do you think you will ever experience a more favorable situation? I don’t.
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There actually seems to be quite a bit of new SFH construction, just not in the neighborhoods experiencing the most extreme lack of inventory. Heck, they’re back to building the 3500 sq ft exurban castles out in the hinterlands of Pierce county, something I didn’t expect to see for quite some time.
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RE: patient @ 1 –
I’ve never seen so much construction at one time in my neighborhood…Fremont. A builder is working long days and weekends trying to finish one up across the street from me. Interesting times.
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Well, closed sales year over year will most likely go negative next month. At least that will be something new to talk about. Won’t mean much of course, but it’ll make for some dramatic media headlines that might suggest hope for buyers (which will be short lived given the way inventory is going).
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By patient @ 1:
I have to say, that doesn’t sound very patient.
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RE: whatsmyname @ 5 –
Hehe, it’s not that I’m in any hurry but I would like to understand the reasoning of not building everywhere possible when there is almost no competition and money is cheaper than ever. We have a 10 year outlook on buying. If the market doesn’t get less corrupt by then we will stay renting until it’s retirement time. Maybe buy a beach home in a warm location before that.
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I’d like to see inventory go down by atleast 3 just so we can see a new record. It should go down even further this summer with people selling to try and make a profit. I am going to be the first to predict the bottom of the inventory will be 2700 in august.
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Less corrupt? Ha! Between the realtors and bankers lobby, we little people don’t stand a chance. Want to find out the true value of a property? Start by removing the mortgage interest tax deduction and go from there.
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By Erik @ 7:
What?
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RE: patient @ 1 –
Talk to Building Contractors
I have. The price of everything to build has sky rocketed with high energy costs and a lot of the cheap labor went back to their motherlands. Inventory shortages there too [IMO the legal citizen semi skilled carpenter is a dinosaur now]….its called building contractors trying to negotiate price increases to cover the lower unit costs with a scarcity of trained workers now.
Its gonna take a year or so to train up some legal citizen Millenials to do sheet rock and such…and they want livable wages too…
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Yet more evidence in favor of being willing to rent for another year or two until supply gets more in line with demand.
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RE: Erik @ 7 –
I have been watching the Kenmore/Bothell area since last year. Starting from the end of January there is always a few new listings coming online every week. The only difference now is that the new listings get offers within the first few hours and the final sale price is always at least 10% higher the listing price.
I think any new listings from now forward will be priced a lot higher than comp. All the buyers are getting very aggressive especially on properties that are move in ready conditions. If you think the inventory is going to get even lower in the summer, I am pretty sure the sale prices will go at least 20% over listing.
Apparently there are a lot of people that can come up with at least 20% down plus the extra to meet 80% LVT loan requirements.
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RE: Marc @ 4 – At this stage in the market, I would have to say that the decline in closed sales is mostly caused by the record low inventory.
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RE: David B. @ 13 – Bingo.
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RE: top @ 12 –
Interesting. I am in south juanita. I would sell this summer, but i’m close to owning my place for 2 years and i don’t want to pay capital gains tax, so i’ll wait and sell next summer and hope for the best.
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RE: Erik @ 15 –
Looking the zestimates, eppraisals and comp. to gauge property values is pretty worthless right now. You can probably sell your place for a lot higher prices with the current market dynamics. It is hard to tell where prices will be next summer, however, if the interest rates continue to remain at the current level, i.e. 3.5% for 30 yr fixed the chances that the prices will raise is very high.
Personally, I am very shock at how much money people are willing to pay for the kind of properties they are bidding. Maybe I need to find a better paying job. :).
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1.2 months of inventory.. What the hell is going on?? Its crazy… What are the predictions on when the inventory will get back to close to 3/4??
Don’t people understand that when they bid on something with 4 others, the winner is actually the loser?? I am very surprised that people are so hasty..
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