Around the Sound: No Relief for Buyers Anywhere

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It’s been a few months since we updated our monthly stats for the local regions outside of the King/Snohomish core. Here’s your August update to our “Around the Sound” statistics for Pierce, Kitsap, Thurston, Island, Skagit, and Whatcom counties.

Are things any better in the market right now for buyers outside of the core Seattle areas? Unfortunately, not really. It’s still a pretty terrible time to be buying a home just about anywhere in the Puget Sound area.

First up, a summary table:

August 2015 King Snohomish Pierce Kitsap Thurston Island Skagit Whatcom
Median Price $499,950 $366,825 $255,000 $259,975 $250,000 $306,227 $262,000 $285,000
Price YOY 14.4% 11.2% 6.3% 6.1% 4.2% 10.8% 5.3% 3.6%
Active Listings 3,490 2,245 3,105 999 1,120 559 614 1,084
Listings YOY -29.7% -17.5% -21.7% -32.7% -18.4% -27.0% -22.9% -24.5%
Closed Sales 2,575 1,156 1,267 392 395 169 178 323
Sales YOY 8.0% 18.3% 7.7% 4.5% 8.5% 16.6% 7.9% 17.9%
Months of Supply 1.4 1.9 2.5 2.5 2.8 3.3 3.4 3.4

Next let’s take a look at median prices in August compared to a year earlier. Not surprisinglyt, pices were up yet again from a year ago across the board. Gains ranged from as low as 4 percent in Whatcom to as high as 14 percent in Kitsap.

Median Sale Price Single-Family Homes

The number of listings on the market is still falling by double digits year-over-year in every county. The biggest loser of listings was Kitsap County, where listings fell 33 percent from a year ago. The smallest decrease was in Snohomish, where listings were down 17 percent from last year.

Active Listings of Single-Family Homes

Closed sales increased in August compared to a year earlier in all eight counties. The biggest gains were in Snohomish County, which saw 18 percent more sales than last August. The smallest gains were in Kitsap County, where sales increased 5 percent.

Closed Sales of Single-Family Homes

Here’s a chart showing months of supply this August and last August. The market was less balanced than a year ago, skewing more toward sellers in all eight counties. The least terrible market for buyers was in Skagit and Whatcom Counties, which still have just 3.4 months of supply.

Months of Supply Single Family Homes

To close things out, here’s a chart comparing May’s median price to the peak price in each county. Everybody but King County is still down from the peak, with drops ranging between 4 percent in Snohomish County to 14 percent in Skagit County. Note of course that this chart is not adjusted for inflation. Here’s a recent post that shows how King County home prices look when you take inflation into account.

Peak Median Sale Price Single-Family Homes

Still stinks to be buying a home right now, pretty much no matter where you look in the Greater Seattle Area.

If there is certain data you would like to see or ways you would like to see the data presented differently, drop a comment below and let me know.


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.

37 comments:

  1. 1

    Good Article Tim

    The lack of listings isn’t just hitting Seattle, its San Francisco, New York, Los Angeles, etc., etc…..

    Anywhere there’s high property taxes and high selling prices to earn the discretionary tax money for massive social supports for a growing population of poor. The current national formula that’s creating sanctuary cities.

  2. 2
    sleepless says:

    Income don’t matter, jobs don’t matter, interest rates don’t matter. Everyone now is a rich Chinese with a suitcase full of cash. Who needs mortgages nowadays, it is so 2000s… People now can buy houses with unicorns.

  3. 3
    Mike says:

    RE: softwarengineer @ 1 – I don’t know I’d call NY a Sanctuary City. They keep a pretty tight leash on misbehavior. Here’s a comparison:

    Sunny Saturday afternoon at Brooklyn Bridge park, thousands of people out and about, NOBODY drinking beer or smoking pot. A 4 year old child stands on a picnic table and a police officer is there in less than 2 minutes to let here know she’s not allowed to do that.

    Compare that to any Seattle park, and there’s 5 dudes drinking from open containers and passing a joint next to their tent. Inside the tent there’s a dude nodding off on Heroin. A meth addict is aggressively panhandling with his unregistered pit bull on a chain, and children are avoiding stepping in human waste left by someone that was recently released from a 24 hour psychiatric hold. No police visible anywhere.

  4. 4
    Erik says:

    RE: Mike @ 3
    Yeah, we party hard in Seattle.

  5. 5
    sleepless says:

    By Erik @ 4:

    RE: Mike @ 3
    Yeah, we party hard in Seattle.

    The party will be over soon.

  6. 6
    Erik says:

    RE: sleepless @ 5
    With inventory at an all time low? That would be nuts.

  7. 7
    ess says:

    Once again good news on the “home front”. As there are many more home owners than buyers, I would assume many more people are happy with the news presented in this column.

  8. 8
    ess says:

    Saw a report tonight on NBR on our local PBS station.
    Sorry the link for the story didn’t seem to work.

    That report indicated that new single family houses are considered good investments for institutional investors. At first those companies were scooping up repos, as those investments could make money for them and be sold off later. But now REITS and other institutional investors are buying new homes for the purpose of renting them out, as well as keeping the repos longer term. As people can’t or don’t want to buy homes, these investors are filling a housing need. Very interesting indeed!
    Has anyone observed these type of buyers in Seattle? I have heard of individual investors buying repos, but not the large investment companies buying new houses in this area to market as rentals. Perhaps that will be the wave of the future – but is it the wave of the present here?

  9. 9
    Ron says:

    I’m curious how many people that read this blog are actually buying right now.

  10. 10
    district says:

    RE: Ron @ 9

    That’s a really good question. How many of us are lurkers trying to figure out when to sell? [good poll option??]

    I’ll confess to being one of them, although I’m not merely trying to time the market. When to sell is a complicated decision for me, but I’ll admit that at least some of the complication comes from my expectation that their is still some gas in the rising-condo-price tank.

  11. 11
    ess says:

    Hopefully this is the article about investors buying new houses to rent

    http://www.cnbc.com/2015/09/10/investors-snapping-up-new-homes-for-rentals.html

  12. 12
    I'm just hear so I won't get fined says:

    RE: ess @ 8

    I’ve seen some institutional investing going on in my neighborhood. There is a company called ThistleDown LLC that has purchased several homes within a two block radios of me and is renting them out. I’ve done a little research and it seems to be a local company.

  13. 13
    Amy says:

    I’m one of those elusive buyers that has been lurking on this site for months. I have the admittedly “radical” view that homes should be thought of primarily as a place to live and secondarily as an investment, so I’m not willing to pay a huge percentage of my income just for a place to live. With prices as they are, I’m going to sit and accumulate more cash for the time being.

    I’ve suspected for several months now that what ess posted has been happening. As far as I’m concerned, it’s only one of many factors artificially driving prices up.

    1. Ridiculously low interest rates – the same monthly payment maps to a larger overall purchase price
    2. All-cash buyers – willing to pay more to get the house they want. Even if they pay 100k over asking, it’s still less than you’d pay over the course of a mortgage. (Discounting inflation reducing the real cost of your payments over time)
    3. Institutional investors – probably a decent percentage of #2. By snapping up houses to rent out, they artificially lower the supply of houses available for sale, which increases demand. They’ve also been sitting on inventory, further reducing supply.
    4. The economy – being as distorted and unstable as it is has artificially driven up the desire to rent for flexibility. I suspect most people would rather buy than rent, but are forced to rent because of the state of things.
    5. Lower supply of housing in general since builders haven’t kept up with demand.

    It’s pretty clear to me that the whole economy is in a bubble driven by the distorted percentage of income owned by the investor class. I don’t know when or what the trigger will be, but it will eventually burst. The most popular presidential candidates in both major parties right now are a pretty clear indicator that the middle class is fed up with the state of things.

  14. 14
    boater says:

    It might just be a logical adjustment to a morr mobile population. I think we all agree if you don’t plan on staying in a city for at least five years buying is not the wisest choice. Add more frequent job switching that includes moving and you have a recipe for low home ownership. Someone has to own the home. Investors are the ones left besides government. I wont be surprised to start hearing of corporate reits that are sub corps of things like Apple, Facebook and Google.

    But what happens when the structures are primarily owned by groups that can’t vote and the voters are people with no strong attachment to the structures or property they live in/on?

  15. 15
    wreckingbull says:

    RE: Amy @ 13 – If you spend any time with U.S. tax code, you realize that w-2 wage slaves get the shaft, while investment income gets a free pass. Don’t believe me? This guy paid zero taxes in 2014 on nearly 100K of income. (oh and also travels full time for a ‘living’)

    http://www.gocurrycracker.com/go-curry-cracker-2014-taxes/

    Keep expenses low, invest wisely, retire early, and enjoy your life while you have health. I did the math and the conclusion hit me me like a ton of bricks. A big house, new cars, and eating out are not worth paying with the healthy years of your life. Your take on our situation, as well as your plan are the sanest words I have read in the comments here in quite a while.

  16. 16
    Adam says:

    For many would be buyers, the high prices might not be as much of a problem as the lack of inventory.
    I am house hunting in the suburbs (lower median price than Seattle for sure) and I had to bump my budget from $350K to $450K. I still can’t find what I am looking for and adding another $100K probably won’t help either.

    A house is a place to live for some people. For others it’s a financial investment. I am willing to lose money here but unwilling to live in the wrong place. Unfortunately a crash won’t bring any more inventory. A recession might reduce the competition with other buyers. I don’t see an end to this, but I bet a lot of people were saying that in 2007.

  17. 17
    MD says:

    RE: Amy @ 13 – Well said. One of the best comments I’ve read on here in a while.

  18. 18
    Erik says:

    RE: MD @ 16
    The comment was well thought out and executed, but Amy couldn’t be more wrong. Housing prices will continue upward in Seattle for years to come as we are still expanding. Prices will taper off eventually, but we have a ways to go yet.

  19. 19
    nathan118 says:

    By Erik @ 17:

    RE: MD @ 16
    The comment was well thought out and executed, but Amy couldn’t be more wrong. Housing prices will continue upward in Seattle for years to come as we are still expanding. Prices will taper off eventually, but we have a ways to go yet.

    Soooo…none of what Amy said is right….but Erik offers no reasons why! Great argument!

    I’m with Amy. Everything she said applies here in So. Cal too.,

  20. 20
    Ron says:

    I don’t think Amy is wrong. I think the bubble will burst eventually, but who knows when that will happen. And even if prices decline drastically, it could still be from a new – unseen high which means prices could still be quite high.

    Seattle specifically has quite low inventory especially within the city. The trend is definitely to live closer to the city and I imagine that those areas will still have heavy competition for a while due to lack of inventory / space.

    The only thing for certain now is that prices are quite high. If you are middle class, you will either be stuck in a condo, renting, have a long commute, or be house poor. It is definitely not the rosy world of yesteryear where everyone could easily buy their very own single family residentials

  21. 21
    ess says:

    The only thing for certain now is that prices are quite high. If you are middle class, you will either be stuck in a condo, renting, have a long commute, or be house poor. It is definitely not the rosy world of yesteryear where everyone could easily buy their very own single family residentials

    Yes, Seattle prices are quite high as compared to many parts of the country such as the midwest or in the south, but not so much for a typical west coast city, either in the US or Canada. Those high prices are the result of many factors, including but not limited to limited area available to construct single family houses due to both geographic and political factors, a growing population that is outstripping single family housing construction, the development of high paying jobs in the tech sector that has created a new class of upper middle class buyers, outside investors from other states and other countries that can easily pay the increasing prices.

    Is this a bad thing – yes and no – depending on which side of the ownership divide one finds oneself. For owners and small property investors rising prices are usually a good thing, for those who don’t have the wherewithal to purchase a home, not so great. But the first group clearly outnumbers the second, thus many more people benefit from rising prices. While those who are unable to purchase a place to reside may find it an unfortunate situation, for both the much larger group of owners, as well as the city and region as a whole, rising prices are a much better “problem” to have. Those who have visited or lived in cities with dramatically declining housing prices, as well as the urban blight and problems that often accompany that situation intuitively understand that Seattle’s current housing situation with its problems for a select few is infinitely better than a long residential decline which presents problems for a much larger percentage of the population

  22. 22
    Cap''n says:

    RE: Amy @ 13

    So I don’t understand number 4. More people wanting to rent for flexibility drives up home prices? Is the logic that the increase in rental demand raises rents and therefore housing costs can increase further and the home price to rent ratio is not out of control? Assuming a much larger proportion of potential traditional buyers are now “wanting” to rent, that slack in demand is not enough to take the wind out of the increase in demand/decrease in supply resulting from institutional investors, etc. ? Your other points make sense to me but still trying to get this one.

  23. 23
    Erik says:

    RE: nathan118 @ 19
    We are still early in the expansion period. The expansion period generally lasts the longest after a recovery.

    What I’m saying is that per the recovery timeline, we are not at the bursting point. It will likely be years until this thing blows up in our faces. We need more supply than demand to even start asking if real estate prices are going to start tanking. If you want to know if prices are going to tank, study recovery after a housing bubble burst.

  24. 24

    Very Good String of Blog Opinions By All

    Enjoyed reading them, and I can’t add to the opinions presented better.

  25. 25
    Scotsman says:

    I was down in San Jose 2 weeks ago talking with my daughter about housing and career choices. If Seattle is slowly buy surely becoming the next silicon valley we have quite a ways to go- today’s prices could seem quite reasonably in another 5 years.

  26. 26
    Amy says:

    RE: Cap”n @ 22

    Point 4 is a bit convoluted, I’ll admit. ;-)

    Basically, what I see there is that rental prices have been going up a lot too due to the pressure from the economy and the lack of apartments to fill the demand. In a healthy economy, rental prices should be lower than a mortgage because you’re not gaining any equity. Renting is usually what people do for a few years while they save for a down payment if they want to own long term. (It’s what I’m doing right now myself) So basically, I think the rising rental rates are putting perceptive upward pressure on housing as well. My current rent is almost $1800. Add parking, and I’m basically paying the same as a 30-year $400,000 mortgage. Admittedly I live in a popular area of Seattle, but my rent is on the low end for this area. If people see rentals going for that much and more, they’re going to be more willing to pay more to own.

  27. 27
    Cornix says:

    I agree with Amy on all points too. We’ve dropped out of the home search long term. I have no idea if things will change, but it makes the most sense for us to put our energies elsewhere. If prices only go up and away, then it is already too late for us and nothing changes. If things cool off, we’ll have a bigger down payment, a solid retirement, and be in a great spot to look. But, who knows if and when that will happen. For us a house is a stable place to live above all else.

  28. 28
    Ron says:

    RE: Cornix @ 27 – I am curious where Cornix and Amy are looking and for what type of house? What would a “reasonable” price be for that house and neighborhood?

  29. 29
    Erik says:

    RE: Ron @ 28
    Cornix has no relation to corn dogs. Cornix knows nothing.

  30. 30
    David B. says:

    It was just under a year ago that I bought something. Prior to that, I was looking for either something suitable to buy, or something suitable to rent long-term. (I was in a rental that I was putting up with and didn’t want to be in long-term.)

    Chance played a big part in it: I really wanted to pursue long-term stability so buying something was preferable. And I got lucky and that’s what happened. It took nearly a year for the right thing to come up, and I had to move fast, but I got it. However, if all those pieces wouldn’t have fallen into place, and I would have found a nice rental first, I’d now be happily ensconced there and waiting for this market to tip more in the favor of buyers.

    Ultimately, the overall raw numbers aren’t what really mattered: for me, it only took finding one suitable property for ownership to make sense. So my advice for frustrated buyers is to not write the present market off completely, but to be flexible and willing to entertain multiple strategies.

  31. 31
    Bob says:

    The housing market is highly correlated with the stock market. If the stock market tanks, employers will become more conservative and cut jobs, consumer spending will decline, and housing will suffer. Predicting the stock market is a tough thing to do, but it appears very pricy based on historical comparisons. Many people believe a 30-50% drop is in the cards. I have lots of money to buy a house now, but I’ve decided to rent until the next recession plays out.

  32. 32
    Jay says:

    RE: David B. @ 30 – Very good advice! Also for married couples with kids, write a cover letter to impress the old owners, they do prefer to sell to families than landlords.

  33. 33
    greg says:

    RE: Scotsman @ 25

    we don’t have the weather to ever become San Jose, and no amount of global warming is going to change that in the next 50 years….

  34. 34

    RE: Amy @ 26
    Yes Amy

    I heard even Issaquah’s 1 bdrms are similar to $2200/mo like San Francisco style, four $10/hr workers to an apartment. Did anyone say bunk beds?

    $1800/mo in Issaquah for a 1 bdrm reported rent from my brother in law’s daughter.

    No wonder the Boomers and X Gens have no way to rid themselves of low paid Millennials.

  35. 35

    RE: Scotsman @ 25
    Hi Scotsman

    Haven’t heard from you in a while, how’s the new home you built? I’m sure your daughter is thriving in California?…..so she wants a new job in Seattle?

    Perhaps get her take on Seattle Bubble?

  36. 36
    JoJo says:

    Just Took out some equity out of an eastside home and rolled it into a Portland Oregon house…Ride the bubble…Portland is feeling the pressure too..

  37. 37
    Erik says:

    RE: JoJo @ 36
    Smart. Keep the good asset and foreclose on the other if we burst again, right? Now that is smart thinking.

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