Around the Sound: Strong Seller’s Market Everywhere

It has been a while since we checked up on stats outside of the King/Snohomish core, so let’s update our “Around the Sound” statistics for Pierce, Kitsap, Thurston, Island, Skagit, and Whatcom counties.

This month’s story in a nutshell: Bad news for buyers, great news for sellers. It’s pretty much a terrible time to buy and an excellent time to sell no matter what part of the Puget Sound area you’re in.

First up, a summary table:

April 2015 King Snohomish Pierce Kitsap Thurston Island Skagit Whatcom
Median Price $480,000 $359,975 $249,950 $256,750 $234,000 $250,000 $241,900 $289,000
Price YOY 11.5% 12.5% 13.6% 8.1% 7.3% -9.1% 7.5% 12.7%
Active Listings 3,003 1,644 2,622 807 1,086 515 496 896
Listings YOY -15.2% -16.3% -16.2% -30.9% -4.1% -23.5% -28.0% -21.8%
Closed Sales 2,352 1,024 1,228 328 332 131 165 251
Sales YOY 16.7% 34.0% 39.4% 21.5% 23.9% 42.4% 20.4% 47.6%
Months of Supply 1.3 1.6 2.1 2.5 3.3 3.9 3.0 3.6

Next let’s take a look at median prices in April compared to a year earlier. Prices were up from a year ago everywhere but Island County. Gains ranged from as low as 7 percent in Thurston to as high as 14 percent in Pierce.

Median Sale Price Single-Family Homes

The number of listings on the market fell year-over-year everywhere. The biggest loser of listings was Kitsap County, where listings fell 31 percent from a year ago. The smallest decrease was in Thurston, where listings were down 4 percent from last year.

Active Listings of Single-Family Homes

Closed sales increased in April compared to a year earlier in all eight counties. The biggest gains were in Island County, which saw 42 percent more sales than last April. The smallest gains were in King County, where sales increased “just” 17 percent.

Closed Sales of Single-Family Homes

Here’s a chart showing months of supply this April and last April. The market was less balanced than a year ago, skewing more toward sellers in all eight counties.

Months of Supply Single Family Homes

To close things out, here’s a chart comparing April’s median price to the peak price in each county. Everybody is still down from the peak, with drops ranging between just 0.2 percent in King County to 29 percent in Island County.

Peak Median Sale Price Single-Family Homes

If I had been thinking of buying a home this year, I would probably shelf those plans in this kind of market. In my opinion it is just not worth it for buyers right now.

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.

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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. Tim also hosts the weekly improv comedy sci-fi podcast Dispatches from the Multiverse.

34 comments:

  1. 1
    Tommy Unger says:

    I think you’re on target with your summary of the market. Less sure about the conclusion. And I’ll use history as a guide. Let’s say it’s 2003. Prices are already frothy. It’s not a great time to buy. You decide to wait. You’d end up waiting 8 years for prices to get back to 2003 levels. If you’ve got a family, and are looking for a place to settle down, those 8 years of waiting could be very difficult. And if you’re talking about 8 years of renting, pretty expensive too.

    I don’t like the Seattle market right now from a buyer’s perspective. It’s truly painful. I just didn’t come to the same conclusion about waiting. We want to raise our kids in a family-friendly place while having enough space for a family of 4. My conclusion… if we plan to stay in our home for 10+ years, it’s at least an ok time to buy. Seattle’s a pretty unique place, and there’s really no place we’d rather live. So, we’ll ride out the potential short-term ups and downs while enjoying all this great city has to offer.

    Final thoughts. The ways I think the market can stabilize: 1. local new construction, 2. local economy recession, 3. macro economy recession. #1 is happening, I don’t think #2 is likely, and #3 looks to be at least a year or two (or more) out. And even with #1, I don’t think #1 includes enough SFR construction. We have a lot of 1/2br units coming online, but SFR construction has been suppressed for a solid 8 years now (at least in Seattle/King County).

  2. 2
    The Tim says:

    RE: Tommy Unger @ – I’m all for using history as a guide. I just think the current market is more like 2005 than 2003.

    In 2005 I was actually shopping for a home for the first time. If I had bought something mid-2005, for the next couple years it would have looked like I’d made a great choice. But if I could have waited a few years, there was a lot more selection and much better prices 2009-2012.

    Yes, the 2005 buyer who stayed put for 10 years through the present is doing okay, as prices are now up in general around 15% in the Seattle area from mid-2005. Of course, you lose about 10% of your equity to excise taxes, agent fees, and other costs if you sell, so 2005 buyers aren’t exactly in a great move-up situation unless they’ve done well with other investments.

    On the other hand, by waiting until 2011 to buy, I was able to buy a much nice house, for a lot less money.

    Anyway, I’m just saying that buying in a market like this feels like a gamble based on an assumption of continued good times and housing market frenzy. Personally it’s not a gamble I’d be willing to make.

  3. 3
    herrbrahms says:

    RE: Tommy Unger @ – I just hope you had a 20% down payment for your purchase.

    If you bought with less than that and are paying mortgage insurance, you rely upon appreciation in addition to your payments to get your LTV below 80%. If the market were to tank before you could get out from under PMI’s thumb, you might be stuck paying that penalty rate for a great many years.

    I also hope you bought the right house. Given that right now, anything with four walls and a roof goes pending in five minutes, there’s this itch that develops to take anything that looks habitable instead of stepping back and asking yourself whether this house is the right house. This becomes even more important in your case, since you are glued to this plot for 10 years +.

  4. 4
    whatsmyname says:

    RE: The Tim @ – Tim, you did manage a great feat of market timing, no doubt. Since you like using history as a guide, you should remember that you significantly benefited in this from the largest recession in 80 years. (I don’t know whether you should encourage people to gamble that two of those will occur back to back). You should also be aware that in addition to nominal price of your house, part of your normalized strategic cost is 6 years of extra house payments. Congratulations, nonetheless.

  5. 5
    Erik says:

    RE: Tommy Unger @
    I think Seattle real estate will continue to go up until there are 6000 houses for sale in Seattle based on supply and demand. Seattle real estate has a lot of potential to go up in value. The Feds won’t allow crazy loans for a long time. Buying now is a good gamble.

  6. 6
    I'm just here so I won't get fined says:

    RE: herrbrahms @

    I may be mistaken but I think the rules for FHA loans have changed such that PMI sticks with you for the life of the loan now. So in order to get rid of it you have to refinance in which case you would be dependent on appreciation.

    With that said. I’m not sure if I’m in the position of the 2003 buyer or the 2005 buyer that Tim was talking about. I purchased in late winter of 2013. Its been nice riding prices up for the past couple of years and my wife and I put 20% down so we are have plenty of equity. We were willing to take the gamble because we wanted to settle down for the long term and start a family. I with I could have bought between 09 and 2011, but I had just graduated college and was saving up for my 20% down payment. We missed the bottom of the market but we are happy with our Shoreline home. Buying a personal residence factors in more than just market conditions. Life, career and financial situations have a lot to do with it as well.

  7. 7

    I feel for buyers in this market. When I compare 2005 to now – it seems the differences are (please correct me if I’m wrong):
    – less inventory
    – more population
    – strong employment future for greater Seattle area
    – less risky mortgages

  8. 8
    sleepless says:

    By whatsmyname @ :

    RE: The Tim @ – Tim, you did manage a great feat of market timing, no doubt. Since you like using history as a guide, you should remember that you significantly benefited in this from the largest recession in 80 years.

    Nothing really changed since the G.Recession, unless, of course, you believe the .gov numbers and we are in rekovereee

  9. 9
    sleepless says:

    By Rhonda Porter @ :

    – strong employment future for greater Seattle area

    if you are in IT, then yes, if not, then no.

  10. 10
    Mo' Data says:

    I bought my home one year before the bottom for $550K. Looking to move to a bigger place.

    While I’ll do ok when I sell just wondering what would make sense Id one is a buyer and seller in this market.

    Fwiw, I’ve been following this blog since 2010, it’s always a bubble and the prices have pretty much gone up since then.

  11. 11
    whatsmyname says:

    By sleepless @ :

    Nothing really changed since the G.Recession, unless, of course, you believe the .gov numbers and we are in rekovereee

    Recession and recovery are relative terms, and specifically comparative with the periods that precede them. An extended period of even very weak improvement in business growth and jobs does not feel very good, but it is a very different animal than a deep and rapid deterioration of the same. To say otherwise is to pretend these words have no meaning.

  12. 12
    Rudolfo says:

    RE: Rhonda Porter @
    Low interest rates could be added to your list.

  13. 13
    Macro Investor says:

    By Tommy Unger @ :

    I don’t like the Seattle market right now from a buyer’s perspective. It’s truly painful.

    My conclusion… if we plan to stay in our home for 10+ years, it’s at least an ok time to buy.

    Why deceive yourself with these rationalizations, wasting everyone’s time with your self doubts? Go ahead and buy, since you are obviously looking for a reason. But realize that you are full of it.

    You don’t need to own to have kids in a “family friendly” place. Millions of people live happy lives without all the work and financial risk involved. Seattle is not so family friendly anyway. Most people move away when they have kids. The schools are better, more play space, etc.

    The life of a homeowner is not so great. All my friends who bought before the peak advised me to NEVER buy. Without the prospect of getting rich off the appreciation, they realized they hated lawn care and being stuck in boring neighborhood.

    The 10 year argument is laughable. In 2005 everyone justified buying into a “painful” market because they were sure it would be break even in 1 year, riches in 10. Now folks are buying even though they estimate 10 years to “do okay”. Will your job last that long? Your spouse’s? Are you okay being stuck in place for much of your adult life?

    Most people are just shopaholics. They will always justify a reason, no matter how far fetched. I don’t mean to be rude to you — you are probably a decent fellow, and I wish you luck. But these kinds of questions are old, and the reasoning is predictably head in sand.

  14. 14
    Erik says:

    RE: The Tim @
    You did good, but Ray Pepper was the big winner. Ray stopped paying his mortgages on all of his rented houses for years while collecting rent on them. Every time he collected another stash of rent money, he’d take it to the auction and buy another house to rent out. I wish I would have thought of that…

    I saw the market crashing just as you had been saying it would for years. I figured you knew best when to buy, so I waited for you to buy and bought shortly after. You even said it wasn’t the exact bottom yet. You called it.

    That said, I don’t think this Seattle market will crash for a longtime. I was wrong last time, so I could easily be wrong again. It seems early to be scared of another crash.

  15. 15
    Mike says:

    By Macro Investor @ :

    Seattle is not so family friendly anyway. Most people move away when they have kids.

    Why do you say that? There are actually a lot of kids in Seattle. The Ballard area has one of the higher birth rates in the metro area outpacing supposedly kid friendly places like Issaquah. Over half of the new parents we run into already own homes in the area.

  16. 16

    RE: Mike @ RE: Mike @
    There’s Hype on Both Sides of this Issue

    They say Seattle is a wonderful place for kids and families. The data on the topic is limited, contradictory and few MSM outlets are willing to tackle it.

    Here’s some articles that do, note, the date of the article is not as relevant as the trends…snippet:

    “…And while these challenges mount, Furchtgott-Roth said, national and local policies continue to make them worse. The author said that younger people do not fully understand the harm that policies that appear to help lower-income workers pose. She said that only 3 percent of Americans earn minimum wage, and half of those people are between ages 16-24.

    It’s a topic that the Seattle area knows well.

    “A minimum wage of $15 an hour means that no teen in Seattle is going to be able to get an entry-level job,” Furchtgott-Roth said. “The $7.25 minimum wage already keeps out a lot of people. The African American teen unemployment rate is about 30 percent, teen unemployment rates is about 19 percent. So already people are being priced out of the market; $15 an hour is going to price a lot more people out of the market, too.”…”

    http://mynorthwest.com/194/2758285/Poor-policies-are-harming-young-people-entering-the-workforce

    snippet:

    “…Districts take a budget hit with drop in student numbers…”

    http://heraldnet.com/article/20081020/NEWS01/710209874

    snippet:

    “…The Best Place to Raise Your Kids in Washington state is…Pullman. Ready for the next jab? The runner-up is West Richland….”

    http://thesunbreak.com/2010/12/15/best-place-to-raise-kids-in-washington-hint-not-seattle/

  17. 17
    Wazzuner says:

    RE: herrbrahms @

    That’s a misconception, you have to get below 80% of the purchase price not 80% of value, although you might be able to get it removed if the current market value drops the LTV below 80%.

  18. 18
    GoHawks says:

    Why is everyone so certain that this is a bubble? Inventory in King County would need to rise 400% just to get to neutral territory.

  19. 19
    Erik says:

    RE: GoHawks @
    Prices bounced off the bottom and people on this site freaked out. We are not in a bubble. I am surprised Tim is pushing that idea.

  20. 20
    Anonymous Coward says:

    RE: The Tim @ – But the hypothetical 2005 buyer has also had 10 years of amortization on top of the 15% change in pricing. So even with 0% down and a 30 year fixed, your hypothetical 2005 buyer has about a 30% equity position in their current home. Which means after sales costs, they’d have enough left over to put 10% down on a place 1.5x the sale price of their current home.

  21. 21
    ongsomwang says:

    By Mike @ :

    By Macro Investor @ :

    Seattle is not so family friendly anyway. Most people move away when they have kids.

    Why do you say that? There are actually a lot of kids in Seattle. The Ballard area has one of the higher birth rates in the metro area outpacing supposedly kid friendly places like Issaquah. Over half of the new parents we run into already own homes in the area.

    As a millinieal and new father. Nooooo Seattle is not a great place to raise kids, and I consider myself fairly liberal minded in some ways. If you are rich with no student debt, sure live there..

    For the vast majority of normal young adults with young children Seattle is not a great place to live anymore, simply because it is not affordable.

    Even if you are making a good salary between 75K-150K it is still not reasonable. Feels like you are treading water in this city. Especially once you factor in things like child care, paying debt, rent, etc…

    I am a professional making a pretty good wage, but I am forced to rent some tiny apartment in West Seattle for 2.5 K plus a month. If I ever want to own anything that looks half way decent I need to move to a place far out in the suburbs. How is paying 600K for a house reasonable for any young adult these days?

  22. 22
    ronp says:

    RE: ongsomwang @ – Yes, Seattle is expensive for families, but if you can rely on transit and live somewhere walkable (near Woodland Park or other good outdoor spaces), it is doable. I see a lot of cargo bikes with kids in them nowadays too. Vast majority of Seattle schools are very good to excellent.

    Obviously this only works reasonable well if you work in downtown/ U district or another Seattle neighborhood. Nothing wrong with living farther out, especially if you can find something near decent bus or light rail service, or near an employment center.

    I think Tim should not ever make a “good time to buy/not good time to buy” judgement. Collateralized debt obligations messed up the market once in 75 years. Bad regulations/regulators caused a lot of suffering. But even within that market people bought houses at the peak that have been fixed up slightly (add a bath to a one bath house, etc) that have not lost value. Or are located in an area essentially untouched by the downturn (hello north Seattle).

  23. 23
    Anonymous Coward says:

    RE: ongsomwang @ – Because with 20% down you can get a $550K house for the same $2500/mo you’re spending for the tiny apartment.

  24. 24
    JustJoan says:

    So refreshing to hear Tim say, “It’s pretty much a terrible time to buy…” If I hear another agent tout what a great time to buy it is, I think I’ll be sick…

    JustJoan

  25. 25
    ongsomwang says:

    By Anonymous Coward @ :

    RE: ongsomwang @ – Because with 20% down you can get a $550K house for the same $2500/mo you’re spending for the tiny apartment.

    I hope you are being sarcastic. Saving 20% for a home that costs half million dollars is no small feat for the average 24-36 year old adult with even a decent income.

    Perhaps it is doable if you save for years, delay marriage, delay kids, and have no student debt.

  26. 26
    greg says:

    By softwarengineer @ :

    RE: Mike @ RE: Mike @
    There’s Hype on Both Sides of this Issue

    They say Seattle is a wonderful place for kids and families. The data on the topic is limited, contradictory and few MSM outlets are willing to tackle it.

    Here’s some articles that do, note, the date of the article is not as relevant as the trends…snippet:

    “…And while these challenges mount, Furchtgott-Roth said, national and local policies continue to make them worse. The author said that younger people do not fully understand the harm that policies that appear to help lower-income workers pose. She said that only 3 percent of Americans earn minimum wage, and half of those people are between ages 16-24.

    It’s a topic that the Seattle area knows well.

    “A minimum wage of $15 an hour means that no teen in Seattle is going to be able to get an entry-level job,” Furchtgott-Roth said. “The $7.25 minimum wage already keeps out a lot of people. The African American teen unemployment rate is about 30 percent, teen unemployment rates is about 19 percent. So already people are being priced out of the market; $15 an hour is going to price a lot more people out of the market, too.”…”

    http://mynorthwest.com/194/2758285/Poor-policies-are-harming-young-people-entering-the-workforce

    snippet:

    “…Districts take a budget hit with drop in student numbers…”

    http://heraldnet.com/article/20081020/NEWS01/710209874

    snippet:

    “…The Best Place to Raise Your Kids in Washington state is…Pullman. Ready for the next jab? The runner-up is West Richland….”

    http://thesunbreak.com/2010/12/15/best-place-to-raise-kids-in-washington-hint-not-seattle/

    these are not facts, they are opinions expressed by a right wing think tank that claims it is not right wing. These are the very people who brought us such gems as “zero tolerance” and flooded our prisons ….

    They even state that their agenda is one of personal responsibility , which we all know is code for everyman for himself and god for us all. They are not are brothers, but they appear to want to be our keepers….

  27. 27

    RE: Macro Investor @

    You Got That Right On Moving Out Because of the Poor Public Schools in King County

    We keep throwing more and more money at them; but have forgotten the basics of teaching math and science; but we have English to the foreigners. This sanctuary city is off the Richtor Scale on twice the staff size, the same amount of students as the Baby Boomers some 40-50 years ago; yet decrepit math and science with a unthinkably low graduation rate and no money for study halls. They add in GEDs; so lord only knows what it really is….20%?

    If you can drive ’em there; get your kids to a community college ASAP to take math and science; or its “game over”. What B.S degreed teachers for math and science?

  28. 28

    RE: greg @

    Hey You Progressive

    I didn’t call you a liberal, that’s what I am. Read my public school report based on my experience in Seattle. Its the blog above.

  29. 29
    Macro Investor says:

    By greg @ :

    these are not facts, they are opinions expressed by a right wing think tank that claims it is not right wing.

    That’s a very good point.

    It is very hard to get an unbiased opinion on real estate. I would guess most of the comments here are from agents and flippers. They want you to believe it makes sense to pay $600k for a shabby wooden box on a tiny lot. They know that sounds absurd, so they suggest you just hold on to it for 10 years and everything will work itself out.

    Can you think of any reasons why someone would need to move in under 10 years? Job losses, new manager who makes life miserable, office moves, or a finding better job that’s far away. Bad neighbors, or even criminals moving into the immediate area.

    What about saving for the kid’s education, or retirement? Folks in the real estate business don’t want you to think of that. You should just work until you die to pay a mortgage. Then once there is equity, you should sell and spend it on a bigger one — paying even more fees to everyone in the food chain.

    I don’t always agree with Tim, but at least he’s writing what he REALLY thinks.

  30. 30
    herrbrahms says:

    RE: I’m just here so I won’t get fined @

    Actually, I wasn’t talking about FHA mortgage insurance but conventional PMI. You are correct that FHA loans now laughably assess mortgage insurance for the life of the loan. Better hope that rates don’t go up when you try to refi out of that albatross! Additionally, things are so harsh out there locally for people who have the temerity to only bring 20% down instead of coming in all cash, that an FHA buyer might as well wave a white flag now.

    I’m glad that you were able to get a place up here in Shoreline 1.5 yrs ago. You came in 1.5 years after we bought in Shoreline in May 2012. The whole thing worked out well for us….my Seattle apartment building was sold by two retiring brothers to a Property Management Corporation, (TM) which promptly jacked my rent 25% with every indication that they were going to continue pushing it to the sky. My fiancee and I gave notice and bought in Shoreline on FHA 3.5% down. We had been caught relatively flatfooted by the situation, so we threw money at our mortgage the first couple of years, and the combination of overpayments and appreciation put us in a good place to refi into a 20 year conventional this past Feb.

    I should send a gift basket to that soulless landlord who economically evicted me. It turned out to be just the push I needed to get a house only a few months past the bottom.

  31. 31
    herrbrahms says:

    RE: Wazzuner @ RE: Wazzuner @

    If you have a conventional mortgage with PMI, and you’re confident enough that you passed a 20% equity stake that you’re willing to pay for an appraisal to prove it, then you won’t be paying PMI any longer. Either your current lender will remove it, or if they don’t, you will refi straight out of that old loan at current rates. The only question is whether you have to pay a new loan origination fee to escape the penalty.

  32. 32
    Jonness says:

    By Erik @ 19:

    RE: GoHawks @
    Prices bounced off the bottom and people on this site freaked out. We are not in a bubble. I am surprised Tim is pushing that idea.

    Despite my posting the question a few months ago, “Is this a second bubble?” I don’t see it as a second bubble just yet. I say this in part because the mom-and-pop investors are not in the game, and new construction has yet to stage a come-back in most markets. That said, if an event were to occur that caused the foreign investors to rush for the exits, then we’d be in trouble. At the moment, I don’t see that as likely.

    IMO, current prices don’t represent a second top. I’ve seen some waterfront homes nearby selling for frothy prices. But I don’t believe rural raw land prices have moved up enough to warrant looking for a top.

    Tim’s chart shows Kitsap County up 8%. That’s a nice change of pace, but it’s not a bubble. It’s a sign that the Seattle craziness is starting to reach the outskirts. It could cool off at any time, but I don’t see prices as being so high as to cause an exodus.

  33. 33
    Jonness says:

    By ronp @ 22:

    I think Tim should not ever make a “good time to buy/not good time to buy” judgement.

    I’ve seen a similar argument more times than I can count. It reached a frenzy in Seattle in 2007 just before the peak of the market and subsequent collapse.

    In those days, Tim waited it out, timed the market, and bought at the bottom while recommending to thousands of others that they do the same. Those with a similar philosophy to yours ended up on food stamps while driving millions of unsuspecting families into unprecedented and irreparable financial crisis.

    It’s not as if your philosophy is without risk. Market timing is a crucial element of buying a house. To simply recommend that others ignore it has proven to perhaps to be the most dangerous purchasing-strategy to come along in the entire history of house buying.

  34. 34
    Tommy Unger says:

    RE: Macro Investor @ 13 – I think I need to defend myself here, although you may not see my comments.

    No self doubts, just concerns that many of you on the blog also have. I’m not “looking for a reason” to buy. That would indeed be more indicative of a gamble though.

    I like the city of Seattle, as does my family, so we are buying where we want to live.
    I first bought before the peak, and in hindsight, I would have done the exact same thing. Most importantly, I bought a place that I lived in happily for 12 years, and still own today. I like being a homeowner.

    I’m okay with being “stuck for much of my adult life” because we have kids. It’s really as easy as that. I don’t need or want to break even in 1 year and I don’t expect, or even hope for riches in 10. I don’t think I’m smart enough or flexible enough to time another market price trough. I just want to live a chunk of my (early-?)middle years in a home and place where I’m happy.

    One last thought. You say, “these kinds of questions are old”. Implying that there’s some long history of housing boom/bust price cycles with answers to our current situation. This is where we really disagree. The boom/bust from ~2000 to 2007 was unprecedented in history. It is likely an indication that things have changed. Maybe we are now in a more volatile world. But to think that you can somehow leverage the history of housing prices in the US over the last 100 years or so to determine that now is a bad time to buy? I know I can’t.

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