For some reason, the NWMLS press release still has not been posted to their public site yet.
[Update: Here’s a link to the press release on NWMLS.com: Northwest MLS brokers say housing market is recovering, but still “spongy”. My favorite part is “July’s unseasonably hot weather curtailed activity for several showings and open houses, as brokers and agents said buyers and sellers postponed tours, saying it was just too hot.” “Several” people may have delayed their home shopping by a few days, and that’s even worth mentioning? Wow.]
Before we get into this month’s news reports crowing about the increase in sales, here’s a little chart that shows the time between when pending sales went negative year-over-year and when the median price went negative year-over-year.
Pending sales had been negative for over two years before prices began to fall. Keep that in mind when you hear claims that a few months of year-over-year positive sales data is allegedly a sign that prices will stabilize in the short term. Not likely.
Here’s another chart, this one showing the year-to-date change in the median price, both in 2008 and 2009:
Does the fact that prices have risen from their March low indicate price drops are over? Probably not.
Read on for this month’s reporting roundup from the Times, P-I, Herald, News-Tribune, and Olympian.
Eric Pryne, Seattle Times: King County home sales climb to 2-year high
The median price of a King County single-family home that sold in July was $384,000 — down 2.9 percent from $395,000 in June and down 13.7 percent from $445,000 in July 2008. No turnaround evident here.
But closed sales — which reflect demand — were up more than 10 percent from the same month last year, surging to their highest level since August 2007.
…
“If we’re not quite there [at the bottom] yet, I think we’re nearing it,” said Ron Sparks, managing vice president in the Bellevue office of Coldwell Banker Bain.Perhaps prices aren’t rebounding just yet because buyers’ perceptions haven’t caught up with market realities, he said — just as stubborn sellers kept prices relatively high in early 2008 despite declining sales and growing inventory.
Market forces eventually prevailed: Median prices plummeted during the second half of last year.
Well, perhaps somebody’s “perceptions haven’t caught up with market realities,” yet anyway.
Aubrey Cohen, Seattle P-I: Home sales up more than 10 percent in King County
King County house sales surged by more than 10 percent in July from a year earlier, according to a new report.
…
“I’m delighted to see the volume of home sales up from a year ago,” said Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University. “That’s good news, but it’s obviously coming at the expense of some of the values of the properties.”
…
In a news release accompanying the report, listing service members said July’s weather curtailed potential sales, because people found it too hot to look at homes.
…
First-time buyers are apparently motivated by the federal $8,000 tax credit for first-time purchases that close by the end of November, Crellin said.“Anything that’s going on is to some extent artificially influenced by the tax credit,” he said. “I’m delighted that it’s there, but in the absence of that incentive to bring people into the market I don’t know where we’d be.”
All that the incentive is doing is continuing to borrow more demand from the future. The exact same thing that low rates and loose financing did during the boom, but to a lesser degree.
Mike Benbow, Everett Herald: Snohomish County home sales up 19% in July
Home sales in Snohomish County rose in July for the second straight month, buoyed by a drop in prices and a federal tax break set to end in November.
Closed sales rose nearly 19 percent last month after rising about 1 percent in June, making agents hopeful that the real estate market had broken a two-year downward spiral.
…
A continuing fall in home prices certainly helped sales. The combined median price of single-family homes and condominiums was $292,000 in July, a drop of more than 12 percent from a year ago.
Duh. This is exactly what has happened in other markets where prices started falling before they did in Seattle. When prices get low enough, sales pick up. Of course, prices keep falling until they get to a point that is actually supported by the local economic fundamentals—a point Seattle has not yet reached.
C.R. Roberts, Tacoma News Tribune: 21% more home sales pending than a year ago in Pierce County
More home sales closed in Pierce County in July than were closed in any month since August 2007.
Nearly 21 percent more sales – of single-family homes and condominiums – were pending than were pending a year ago.
“I’m a happy camper at the moment,” said Windermere Real Estate broker and Northwest Multiple Listing Service director Dick Beeson on Wednesday.
“It’s good news on a lot of levels,” he said.
…
“It tells me, number one, that buyers are getting smarter, they’re taking action, they’re getting off the fence,” Beeson said. “Number two, the median price has stabilized. We’ve literally stayed the same. With buyer demand going up, and inventory going down, we’re getting back to a near-normal market.”
When a salesman tells you that you’re “making a smart move,” isn’t that usually a cause for concern? And what’s with using the worthless pending sales number in the headline? Major credibility hit there for the News Tribune.
Rolf Boone, The Olympian: Thurston County: Sales fall last month, but pending deals rise 13 percent
Thurston County home sales fell from June to July, although the number of homes sold last month still was much higher than in most recent months, according to Northwest Multiple Listing Service data released Wednesday.
…
One explanation for the home-sales drop from June to July was the long July 4 holiday weekend, real-estate agent Blake Knoblauch said Wednesday. Knoblauch, of Greene Realty Group, expects sales to pick up in August and September as first-time buyers take advantage of the $8,000 tax-credit program before it expires later this year, he said.
Again with the pending sales data in the headline. Tsk.
Here’s one more added bonus chart. Pending sales and closed sales for King County SFH so far this year:
It looks like the change in closed sales is lagging the change in pending sales by about two months. From February to May, pending sales increased 78%. From April to July, closed sales increased 72%. If the pattern continues to hold, this month will probably see between about 1,800 and 1,900 closed sales, with September coming in lower.
(Eric Pryne, Seattle Times, 08.05.2009)
(Eric Pryne, Seattle Times, 08.06.2009)
(Aubrey Cohen, Seattle P-I, 08.05.2009)
(Mike Benbow, Everett Herald, 08.06.2009)
(C.R. Roberts, Tacoma News Tribune, 08.06.2009)
(Rolf Boone, Olympian, 08.06.2009)