NWMLS: Pending sales hit an all-time high in August

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August market stats were published by the NWMLS on Friday before the holiday weekend. The King County median price of single-family homes rose over 10 percent year-over-year for the first time since May of 2018. Inventory is way down from a year ago, and pending sales climbed to an all-time record high.

Recession? What recession?

Before we get into our detailed monthly stats, here’s a quick look at their press release.

Would-be homebuyers have more buying power, but also more competition for meager inventory
“In order for buyers to be successful in purchasing a home in today’s climate, they have to do some pretty illogical things,” remarked Wilson, the Kitsap regional manager and branch managing broker at John L. Scott Real Estate in Poulsbo. As examples, he listed waiving inspections, paying more than the house is worth, or agreeing to pay the difference in cash between the lower appraised value and the sales price. “These are counterintuitive to what we used to see with a negotiation process,” he lamented.

“The lowest number of homes for sale in more than 20 years combined with the lowest mortgage rates on record are resulting in the perfect storm of frustration for buyers – but they are still out in force,” stated Windermere Chief Economist Matthew Gardner. “The few homes that are on the market are being snapped up quickly, and this excess of demand is causing record-high prices for single family homes in the Puget Sound area.” He also noted rising demand for lower density housing in outer suburbs.

I still find it quite amusing that Matthew Gardner is now the Chief Economist at Windermere.

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):

August 2020 Number MOM YOY Buyers Sellers
Active Listings 2,590 -1.7% -38.2%
Closed Sales 2,783 +0.7% +10.0%
SAAS (?) 1.36 -1.2% +23.2%
Pending Sales 3,537 +3.1% +34.8%
Months of Supply 0.93 -2.3% -43.8%
Median Price* $742,950 +2.1% +10.9%

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

King County SFH Inventory

Inventory fell 1.7 percent from July to August, and was down 38 percent from last year. We’re not currently at an all-time low for the number of homes on the market, but this winter is shaping up to hit a new low unless something changes dramatically.

Here’s the chart of new listings:

King County SFH New Listings

The good news is that new listings were up 35 percent from a year ago, and did not decline nearly as much between July and August as we see in a typical year.

Here’s your closed sales yearly comparison chart:

King County SFH Closed Sales

Closed sales were basically flat between July and August. Last year over the same period closed sales fell 4 percent. Year-over-year closed sales were up 10 percent.

King County SFH Pending Sales

Pending sales rose 3 percent from July to August, and were up 35 percent year-over-year. No month on record going all the way back through 2000 has seen more pending sales than we saw in August. For Seattle-area homebuyers, the recession is apparently non-existent.

Here’s the supply/demand YOY graph. “Demand” in this chart is represented by closed sales, which have had a consistent definition throughout the decade (unlike pending sales from NWMLS).

King County Supply vs Demand % Change YOY

Not a pretty picture for homebuyers, with demand on the rise and supply falling.

Here’s the median home price YOY change graph:

King County SFH YOY Price Change

Year-over-year home price changes jumped up to over 10 percent for the first time in over two years.

And lastly, here is the chart comparing King County SFH prices each month for every year back to 1994 (not adjusted for inflation).

King County SFH Prices

August 2019: $670,000
August 2020: $742,950
July 2007: $481,000 (previous cycle high)

Here’s the article from the Seattle Times: Western Washington home prices hit new record highs

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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.

24 comments:

  1. 1
    The Tim says:

    I updated most of the charts in this post to clean things up. Now the five most recent years are highlighted and any years prior to that are still on the chart, but faded into the background to avoid the whole thing becoming overly cluttered and indecipherable. I hope this helps!

  2. 2
    Erik says:

    This is my favorite post that you do, amazing how clear things are with simple line graphs. Let’s see if prices shoot up for a few more years and tank like a repeat of the last bust. It feels like that could be the case. 2003 until 2007, prices skyrocketed with bush, another conservative president giving breaks to investors. I know a little more this time and I’m hoping to hit the eject button in 2024 as real estate prices hopefully tank to the bottom on the puget sound, and I ride off into the sunset. This time, I’ll treat you right, I promise.

  3. 3
    WTActualF says:

    Does any of this seem out of line with interest rates dropping by 2% and the spring sales season being pushed 2-ish months in the future? If I squint, most of the August/July numbers look inline with April/May of the 2019. The main anomaly is Active Inventory being so low, which could be attributed to now not being an amazing time to move.

  4. 4
    Tony says:

    The easier to read charts are a big improvement!

  5. 5
    SeaH says:

    But first the county and state and nation need to lift the mortgage / rent eviction ban . Let’s see what’s happens . I’m guessing 2021 low interest rate will persist. RE: Erik @ 2

  6. 6
  7. 7
    Erik says:

    RE: SeaH @ 5
    When the eviction moratorium is lifted, the people that get kicked out of Seattle move to crappy areas and bring prices down there. When the foreclosure moratorium is lifted, I would guess that the banks spread out sales of pent up foreclosures over months, so there is little affect on the market prices. Demand is still high for houses in Seattle.

    Fed said low interest will continue for the next few years, so that I agree with.

  8. 8
    Blurtman says:

    RE: Erik @ 7 – High home prices act as a wealth and income screening mechanism. And now that Trump has scuttled Obama’s “fair housing” rule, the local Sammamish militia can stand down and liquidate their stockpile of incendiaries.

  9. 9
  10. 10

    Good Comments All

    Nothing selling since May at at all in my SE King County HOA group of 140 units with 5% for sale signs out there…looks like a new apartment bldg going up west of my HOA. Fragments of new construction all over the Kent area, looks like a lot of new businesses going up next to a lot of empty Killer Flu Lease space in Covington. The new Kent homes are all about $700K each and all are too big IMO, the $140K new modular home lacks a lot, crawl space and car port with landscaping…another $140K to dump into it. The prices are very high out in Kent for new stock.

    https://www.realtor.com/realestateandhomes-search/Kent_WA/shw-nc

    Grab Your mugs of coffee and start your internet [my COMCAST Internet, TV and phone were out all day yesterday]. How about your’s?

    “… Destructive fires rage across state as smoke stifles Seattle area
    The sizzling forecast is adding to fire worries today after fierce winds and hot weather sparked dozens of blazes in Washington state. Far more acres burned in a single day than in all of last year. Hundreds of families fled their homes, and thousands of others lost power. In Pierce County, one resident is describing his hurried escape from a “firestorm,” while the situation across the mountains is captured in a striking image that shows a railroad trestle going up in flames before it collapsed. Seattle-area air quality advisories are expected to extend into this afternoon. If you go outside, here’s how to do it safely. (Photo: Mike Siegel / The Seattle Times)…”

    SWE’s Take: The State is on blazing fire now…and the 92 degrees highs today and tomorrow just dry it all worse…There’s some brown haze out there today too..

    “…Seattle officials are growing confident that repairs can squeeze at least 15 more years of use out of the cracked West Seattle Bridge. As traffic from the emergency closure worsens, the city is revealing possible scenarios for repair. Above, bicyclists on the Spokane Street swing bridge often look up at platforms where workers are grinding, wrapping and drilling the main bridge. (Photo: Steve Ringman / The Seattle Times)..”

    SWE’s Take: Squeeze about 15 years out of the cracked bridge sums it up. Then it collapses anytime before then?

    “…Let’s try this again: Today is Federal Way’s first day of school after power outages canceled classes yesterday. It’s in the last batch of Washington districts to return to class. Follow today’s news updates. Meanwhile, the Khan Academy’s founder and online-learning expert is explaining why he thinks students should do less and turn off the camera…”

    SWE’s Take: Why did the power go off yesterday? Why did my Kent COMCAST Services shut down yesterday with a TBD get-well? The Tooth Fairy knows.

    “…There’s a new problem with Boeing’s 787 Dreamliner. The company disclosed a manufacturing flaw that affects nearly 900 planes, and also revealed more 737 MAX cancellations…”

    SWE’s Take: Ever since we outsourced the 737/787 manufacturing out of this country its quality has become bleak. Time to start a brand new airplane program Boeing and this time engineer and manufacture it mostly in America please. The DOD national security could use this American made A/C platform now.

    “… Downsizing an aging parent from a three-level home to a two-bedroom apartment means saying goodbye to phases of life, not just valued possessions. A professional organizer learned careful ways to ease the process…”

    SWE’s Take: Boo Hoo…all the GIGANTIC $700K new Kent area homes with stairs are a perfect place to retire [limping around doing stair climbing and house cleaning the monstrosity all day], $700/mo winter heating bills and $600/mo property taxes with similar stiff HOA fees are all just chump change and aging parents can afford it. Not. These new house babies never rot. Living in a small retirement Seattle area Condo is like a slap in the face?

    Good News: That 92 degree high in Kent today from Yahoo is contradicted by the Seattle Times as 87 degree today in Seattle. I noticed yesterday’s 83 degrees at 6PM was like 73 degrees at 8 pm…it sure cools off fast now. Time will tell…

  11. 11

    Get Those Deplorable Young Adults Out Of Your Seattle area basements or huge $700K money pits now…slip into a normal sized retirement home without family/friends tenants sucking you dry, buy small retirement homes with privacy instead..

    Got this in my email today…are there any Bubbleheads out there that like living in group “gypsie type” Seattle area homes/apartments today?

    “…There’s no place like home with mom and dad. Well, at least that appears to be the reality for a lot of young adults. According to Pew Research, 2020 has set a new and rather dubious record for the nation, as 52% of young adults (18 to 29 years old) are living with at least one parent. This number surpasses the old record set in the year 1940, when 48% of young adults were living with their parents.

    The obvious connection between 1940 and 2020 is the status of the economy. 1940 was the tail end of the decade-long Great Depression, while this year’s COVID pandemic caused the shutdown of vast swaths of the economy, which continues to impact the jobs market.

    Fortunately, the August unemployment rate dropped to 8.4% from a high of almost 15% this past April, showing that the number of Americans getting back to work is growing rapidly — in fact, far more rapidly than the last “recovery.” As Labor Secretary Eugene Scalia pointed out, “Under the last administration during the so-called ‘great recession,’ our last economic downturn, it took 34 months — nearly three years — to get unemployment down under 8.5%. The president, the country — we have done it in four months. So, it’s a very strong trend.”

    The good news is this latest unpleasant record for young adults is likely to be short-lived. However, other contributing factors, such as the problem of college students acquiring massive student loan debt, cannot be remedied as rapidly. Even so, the solution to that issue likewise has a lot to do with ensuring a growing and thriving economy. Government intervention, especially in the form of the Democrats’ college debt-forgiveness scheme, will only serve to exacerbate the problem, as it would insulate young adults from taking responsibility for their own decisions, not to mention piling onto the national debt.

    Of course, here’s hoping that the brief stop-off at Mom’s Marriott is just that — brief…”

    The student debt is like $2.5T and its like throwing a heavy “9 speed transmission in a newer Dodge Charger past 2014″….slows its investment speed way down…too much weight/debt.

  12. 12
    Erik says:

    RE: Blurtman @ 8
    Samammish residents can get off their high horses and fight in the trenches with the rest of us.

  13. 13
    David says:

    By Blurtman @ 8:

    RE: Erik @ 7 – High home prices act as a wealth and income screening mechanism. And now that Trump has scuttled Obama’s “fair housing” rule, the local Sammamish militia can stand down and liquidate their stockpile of incendiaries.

    I used to visit housing projects in Atlanta. They had iPhones, big screen LCD TVs, some had nice cars and electric bikes.

    Trash on the street – would they bend over and pick it up to throw it away? Maintain their environments? – OH F#@k No!!

    Why should trash be forced into nice hoods to bring their unique form of crap-culture to people more talented?

  14. 14
    Justsomedude12 says:

    https://www.king5.com/article/news/nation-world/amazon-seeks-to-hire-33000-people/507-2070f8b8-f4d2-4c18-a51d-9926a8638395

    “Amazon said the jobs will be centered around Amazon’s offices across the country, including Denver, New York, Phoenix and its hometown of Seattle. The new hires will work from home at first, but the company said it does want employees to return to the office eventually.”

    And these are corporate and tech positions (Avg $150K/year), not warehouse workers.

    Seattle isn’t getting all of the jobs, but this definitely doesn’t support the exodus from Seattle theory.

  15. 15
    TJ_98370 says:

    RE: Justsomedude12 @ 14

    “….Seattle isn’t getting all of the jobs, but this definitely doesn’t support the exodus from Seattle theory….”

    – Yup –

    Amazon adds more office space to Bellevue, now as many new jobs as HQ2

    https://www.seattleweekly.com/business/amazon-adds-more-office-space-to-bellevue-now-as-many-new-jobs-as-hq2/

  16. 16
    DeadMouz says:

    Team Blind post 9/8/20:
    Employees Permanently Leaving Seattle
    Amazon UYwe53
    540 Comments

    Significant chunk of my team members are permanently leaving Seattle and still collecting Seattle pay checks. My boss working from Hawaii and org VP embraced WFH saying ‘at best’ we will be a hybrid org. Other team members permanently moved to cheaper states. Over 90% of amazon employees want WFH in some form according to surveys. WFH is the future and it is here to stay. I ain’t ever going back to the office and they can’t make me. I bet in the future there will be a salary normalization cross USA and Canada and this will be a very good thing for all devs! https://www.teamblind.com/post/Employees-Permanently-Leaving-Seattle-murDpGut

  17. 17
    Bumble says:

    These charts are the good stuff, thanks Tim. I missed them!

    Imho, covid motivates people to leave the confinement of apartments and condos in search of more space. Add cheap money, and that creates strong buying pressure for SFHs, especially in suburban and rural areas. I thought that mass unemployment might put downward pressure on home price growth, but maybe not when there is a moratorium on foreclosures; and who needs foreclosure anyway when your home is up double digits YOY?

    A global pandemic and heightened interference in the RE market (more than usual) are creating nutty outcomes. Lets see what the election and cold and flu season brings. Winter is coming.

  18. 18

    Grab Your Iced Ciino Cool Down and Read the brief:

    “… Washington fires claim 1-year-old’s life and at least 121 homes
    Fire conditions are dangerous today as spreading blazes threaten Washingtonians on both sides of the Cascades. The state has seen its first reported death of the fire season: A 1-year-old boy from Renton was killed and his parents were burned while fleeing a blaze in Okanogan County. Here’s the status of the major fires that are burning. As today’s temperatures head toward records and air quality remains unhealthful, stay posted with our live updates. (Photo: Ellen M. Banner / The Seattle Times)..”

    SWE’s Take: Keep your house windows shut and its 90 degrees in your Seattle house without Central Air [most are]…you can die that way too…what to do, what to do, when the air becomes unbreathable? Here’s what PEMCO suggests today:

    “With Northwest air-quality readings ranging from Good to Unhealthy depending on wind direction, you’ll want to take steps now to minimize the impact of wildfire smoke on your family:

    Monitor changing risk with updated maps. Check out these air quality maps for Washington and Oregon. Limit exposure when air quality in your area dips to “Unhealthy for Sensitive Groups.”
    Keep doors and windows closed, and use a towel to block gaps under doors. Close fireplace dampers, too. If you use the fan on your furnace to stay cool or have an air conditioner, set it on recirculate so you’re not drawing dirty air into your home. Consider buying a HEPA air cleaner, particularly for your bedroom. In your car, use recirculated rather than fresh air.
    Limit exposure indoors and out. Postpone yard chores, exercise and outdoor play for the kids. Avoid vacuuming the carpet, which can send settled particles floating back into the air. If you have a medical appointment scheduled, find out if it’s possible to substitute an online visit, instead. That will save you from having to get out in the smoky air, perhaps aggravating your condition.
    Use N95 masks if possible. Thanks to their tight-fitting design and multiple layers, they block more smoke particles than the face coverings you’re probably using for everyday errands. However, they’re hard to find, so if they’re not already in your supply cabinet, continue using the masks you have now.
    Check your car’s air filter. If you’ve been driving in smoky conditions, your air filter can become clogged, leading to a breakdown. If you pull out your air filter and can’t see sunlight through it, it’s time for a change. Don’t wait until your normally scheduled service…”

    Good News: The first Killer Flu reaction occurred in January 2019 [there was only 15 confirmed cases in America then] by banning all air travel from China where it originated. This caused a total uproar that it was another COMPLETE over-reaction by Presidential EO….I guess they did or didn’t want earlier reaction to Killer Flu then? The Tooth Fairy knows…I hate politics. IMO, this kind of indecipherable nonsense is best kept in Woodward’s Fairy Tale Book, labeled FICTION.

  19. 19
    ruxpert says:

    Remote work trend could create 2M new buyers: Zillow
    A study by the Seattle-based company found that approximately 2 million renters could afford monthly payments on a typical starter home in the US, but not in their current metro
    by Patrick Kearns | Staff Writer
    September 08, 2020
    https://www.inman.com/2020/09/08/remote-work-trend-could-create-2-million-new-buyers-zillow/

  20. 20

    RE: Justsomedude12 @ 14
    Where’s Your Link that Amazon Pays $150K for most new hires?

    The Tooth Fairy Tale Book? New employment emphasizes hiring of like $12/hr ware house workers up to $29/hr, mainly like $17/hr….most of the workers sent to smaller Bellevue offices already worked in Seattle anyway, they were transferred. The new hire wage range is mostly like $17/hr. Ya gotta a better Amazon wage link than SWE? I didn’t think ya did. I bet your guesses are better than my links…LOL

    https://www.higherincomejobs.com/apply?z=YnA9eiZjaWQ9MTE1MTE4OTMzNzk1ODg0NSZtc2Nsa2lkPWYwNTU0NDAwMWZmMzFiYmE0YTY0MWI1YTRhZjY1NzAwJnBhdGhfcmFua2luZ19pZD00MzImcXRoZW1lPUFtYXpvbiZyZXF1ZXN0X2lkPTVmNWE1NjJiYTZlYjImczE9MTE1MTE4OTMzNzk1ODg0NSZ0aW1lPTE1OTk3NTU4Mjk0MDYmdHNpZD1jMWQ1MjU1ZjkyNjM0MmE1YTI1NzU1Y2E3ZDJhODg4Mg

    Again, where’s your link????

  21. 21
    Justsomedude12 says:

    RE: softwarengineer @ 20 – The link is in my post. And I didn’t write “Amazon Pays $150K for most new hires”. Please re-read what I wrote.

  22. 22
    Juststoppedby says:

    By Blurtman @ 8:

    RE: Erik @ 7 – High home prices act as a wealth and income screening mechanism. And now that Trump has scuttled Obama’s “fair housing” rule, the local Sammamish militia can stand down and liquidate their stockpile of incendiaries.

    Maybe you know something about this that I don’t…

    I feel like Seattle prices have gone up so much, that people would be more likely to cash in and sell their house and wait for the bank to foreclose on it.

    I feel like Seattle prices have gone up so much, that people would be more likely to cash in and sell their house and wait for the bank to foreclose on it.

    It will be interesting to see how everything breaks down. Also, kind of curious to see if any buyouts/early retirement cause people to cash out here and move down south somewhere else.

    Interesting times.

  23. 23
    Juststoppedby says:

    By Erik @ 7:

    RE: SeaH @ 5
    When the eviction moratorium is lifted, the people that get kicked out of Seattle move to crappy areas and bring prices down there. When the foreclosure moratorium is lifted, I would guess that the banks spread out sales of pent up foreclosures over months, so there is little affect on the market prices. Demand is still high for houses in Seattle.

    Fed said low interest will continue for the next few years, so that I agree with.

    Oops, responded to the wrong post last time. Let’s try this again:

    Maybe you know something about this that I don’t…

    I feel like Seattle prices have gone up so much that many people would be more likely to cash in and sell their house rather than wait for the bank to foreclose on it.

    It will be interesting to see how everything breaks down. Also, kind of curious to see if any buyouts/early retirement cause people to cash out here and move down south somewhere else.

    Interesting times.

  24. 24
    Erik says:

    RE: Juststoppedby @ 23
    Above, I was discussing supply and demand.

    I don’t think supply will rise in the near future in Seattle. We are in a eviction and foreclosure moratorium right now, so a lot of supply cannot hit the market. We are frozen by the fed. When those moratoriums are lifted, I still don’t see an increase in supply. See my reasoning above.

    On the demand side, rates will remain low, keeping demand high because more people can afford to buy.

    I don’t have any secret knowledge or anything. If supply stays low and demand stays high, which I think it will, I don’t see prices going down. A lot of people I respect, like ardell, say prices are going down next year. That may very well be the case, I’m just having trouble seeing it in Seattle at this point.

    Don’t make a decision based on what I’m saying. I’m confused on what the future holds. My logic is telling me one thing and the people in the know are saying something different.

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