Issuu on Google+

NWMLS Discover: Resources - Statistics - News Releases Brokers report brisk sales, but rising frustration for home buyers News from NW Multiple Listing Service FOR IMMEDIATE RELEASE: February 5, 2013 Brokers report brisk sales, but rising frustration for home buyers Kirkland, WA, February 5, 2013 – Punxsutawney Phil’s prediction of an early spring is showing up in the latest housing activity report from the Northwest Multiple Listing Service. Its statistics for January showed a 14.4 percent year-over-year increase in pending sales and a 23.6 percent jump in closed sales amid a 31.3 percent decline in inventory. The MLS reported 4,289 closed sales during January, surpassing the year ago total by 820 transactions. Last month’s completed sales of single family homes and condominiums had a median selling price of $239,300. That’s up 11.3 percent from the year-ago figure of $214,990. Supply has dwindled to less than two months in some counties close to job centers, spurring bidding wars. Some buyers are even resorting to writing “love letters” to win over sellers in these competitive situations. Brokers also report an increasing number of buyers have little or no interest in making offers on short sales. “I personally have never seen the ratio between active buyers and available inventory in Seattle’s close-in neighborhoods so out of balance,” remarked Mike Skahen, owner/designated broker at Lake & Co. Real Estate in Seattle. Skahen, a real estate professional since 1976, said multiple offers and bids well over the list price are common. “Even homes that were hard to sell for various reasons are being snapped up so those sellers were wise to list,” he added. Lena Maul, a new member of the Northwest MLS board of directors, and the designated broker/owner at Windermere/North in Lynnwood, agreed now is a good time for sellers to list. “Sellers who are considering a spring or summer listing may want to consider listing now as demand is outweighing supply,” she noted, adding, “This has given well priced sellers the advantage with the benefit of quick sales and multiple offers.”


With multiple offers on the rise, buyers are seeking an edge as they vie for a desirable home. Brokers are reporting an increase in the use of heartfelt letters from would-be owners who want to distinguish themselves and forge an emotional bond with the sellers. Maul recalled a successful letter-writing effort last month by one of her office’s clients. Those buyers, who were using FHA financing, wrote a letter introducing themselves to the seller and explaining why they liked the home so much. After reviewing 13 offers, including one from an all-cash investor, the seller chose the letter-writer’s offer. “Buyers should not forget the human element of appealing to a seller in this multiple offer market,” Maul emphasized, adding, “You just never know who is on the other side of a transaction and what might be important to them. In this case, selling their home to an owner occupant who appreciated special features of their home versus an investor sealed the deal, not cash.” Brokers in the 21 counties served by Northwest MLS added 7,096 new listings to inventory during January. That total was just slightly more than the number of pending sales (7,016) that members reported last month and brought the total number of active listings at month end to 18,008. Only two counties, Mason and Ferry, reported an increase in inventory last month compared to a year ago. The sharpest drops occurred in Snohomish County (down more than 51 percent) and King County (down nearly 48 percent). Both those counties have less than a two-month supply of homes for sale. “Kitsap County is starting its spring market early this year,” reports Northwest MLS director Frank Wilson. It has 3.35 months of supply. Pending sales (mutually accepted offers) rose 23 percent in that market last month compared to a year ago, while closed sales surged nearly 40 percent. Prices in Kitsap jumped 32 percent, second only to Grays Harbor County where year-over-year prices jumped more than 54 percent. “Often we don’t see momentum to really begin building until mid February to the first part of March. This year, I think due to the already low inventory and the continued low interest rates, the market feels like it started mid January” noted Wilson, the managing broker at John L. Scott’s Poulsbo’s branch. Despite imbalance between supply and demand, Wilson said more and more buyers are


opting not to purchase short sale homes because of the uncertainty involved. “It’s not uncommon for a lender to choose at the last minute to foreclose on a property instead of approving a short sale. When this happens it leaves the buyer high and dry with 2-to-4 months of time invested, only to have to start the process all over again,” he stated. That can leave them at a disadvantage considering the current pace of sales. Sixty percent of homes close to job centers are selling within the first 30 days of being listed – twice the average rate, according to figures compiled by John L. Scott Real Estate. J. Lennox Scott, that company’s chairman and CEO, said extremely favorable market conditions have brought a surge of local home buyers into the market. Historically low interest rates and a shortage of inventory are creating an environment for multiple offer situations, he added. Only two counties (Grays Harbor and Kittitas) reported a drop in pending sales last month compared to the same period a year ago, while 16 counties notched double-digit gains. The MLS attributes part of the improvement in sales to last month’s milder weather compared to January 2012 when a major snowstorm walloped the region. Nevertheless, even when compared to several previous years, pending sales were robust. Northwest MLS members reported 5,548 pending sales during January in the four-county region (King, Snohomish, Pierce and Kitsap). That total surpassed the previous high for the month of January, which was logged in 2005 when members reported 5,426 pending sales. Even though buyers are flocking to newly listed homes, sellers must be smart about pricing, emphasized George Moorhead, branch manager at Bentley Properties. “In my area, a home that comes on the market that is well priced for the area, style and condition is usually under contract within a few days,” Moorhead said, but he also noted homes that have been on the market for more than 20 days are subject to price reductions. Moorhead, who is also a member of the Northwest MLS board of directors, said the current market defies basic economics for supply and demand. “Interesting factors include sellers who are still holding back for myriad reasons. Some do not have the confidence or equity to put their home in front of buyers, and that is creating even more pent-up demand.” Skahen, a past chairman of the Northwest MLS board, said it seems like two houses are


selling for every new listing coming on the market. “Buyers keep getting more desperate,” he reported, adding “It will be interesting to see if sellers start jumping in after the weather improves in March,” as is the usual pattern. Skahen also noted buyers who purchased one or two years ago have seen at least a 10to15 percent appreciation in their value. “Amazon hiring is having a huge impact, especially around Ballard, Queen Anne and Capitol Hill,” he commented. Yet another positive indicator of the state’s housing market recovery came from the National Association of Home Builders and its NAHB/First American Improving Markets Index (IMI). Six markets in Washington appeared on the list, the largest number since that gauge was created in September 2011. The IMI is based on six consecutive months of improvement in housing permits, employment and house prices. Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership includes more than 21,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 21 counties in Washington state. Statistical Summary by Counties: Market Activity Summary – January 2013 Single Family Homes + Condos

PENDING SALES

LISTINGS New Listings

Total Active

CLOSED SALES

# Pending Sales

# Closings

Avg. Price

MONTHS SUPPLY

Median Price

King

2,638

3,853

2,777

1,781

$396,949

$315,000

1.39

Snohomish

1,015

1,548

1,154

713

$259,612

$235,950

1.34

Pierce

1,260

2,841

1,258

700

$214,883

$190,000

2.26

Kitsap

354

1,201

359

183

$262,730

$235,000

3.35

Mason

102

584

68

35

$154,086

$138,700

8.59

Skagit

190

626

155

81

$205,934

$179,000

4.04

Grays Hrbor

124

679

60

44

$125,264

$120,300

11.32

Lewis

83

555

54

48

$173,065

$149,975

10.28

118

437

94

54

$140,727

$133,450

4.65

73

415

58

47

$166,680

$139,990

7.16

Thurston

348

1,027

321

189

$224,210

$214,000

3.20

San Juan

19

249

24

10

$417,515

$339,950

10.38

117

581

104

64

$268,010

$232,000

5.59

Cowlitz Grant

Island


Kittitas

40

331

39

25

$260,414

$174,990

8.49

Jefferson

40

327

45

29

$249,265

$224,500

7.27

Okanogan

27

320

20

26

$183,235

$133,450

16.00

Whatcom

288

1,073

239

142

$267,120

$235,000

4.49

Clark

36

168

58

24

$218,739

$189,745

2.90

Pacific

56

314

26

13

$100,800

$100,000

12.08

Ferry

5

74

1

1

$60,000

$60,000

74.00

Clallam

58

314

38

32

$185,092

$170,000

8.26

Others

105

491

64

48

$229,983

$179,200

7.67

7,096

18,008

7,016

4,289

$299,747

$239,300

2.57

MLS TOTAL

4-County Puget Sound Region Pending Sales (SFH + Condo combined) (Totals include King, Snohomish, Pierce & Kitsap counties)

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Jan 3706 4334 4293 4746 4521 5426 5275 4869 3291 3250 4381 4272 4921 5548

Feb 4778 5056 4735 5290 6284 6833 6032 6239 4167 3407 5211 4767 6069

Mar 5903 5722 5569 6889 8073 8801 8174 7192 4520 4262 6821 6049 7386

Apr 5116 5399 5436 6837 7910 8420 7651 6974 4624 5372 7368 5732 7015

May 5490 5631 6131 7148 7888 8610 8411 7311 4526 5498 4058 5963 7295

Jun 5079 5568 5212 7202 8186 8896 8094 6876 4765 5963 4239 5868 6733

Jul 4928 5434 5525 7673 7583 8207 7121 6371 4580 5551 4306 5657 6489

Aug 5432 5544 6215 7135 7464 8784 7692 5580 4584 5764 4520 5944 6341

Sep 4569 4040 5394 6698 6984 7561 6216 4153 4445 5825 4350 5299 5871

Oct 4675 4387 5777 6552 6761 7157 6403 4447 3346 5702 4376 5384 6453

Nov 4126 4155 4966 4904 6228 6188 5292 3896 2841 3829 3938 4814 5188

Dec 3166 3430 4153 4454 5195 4837 4346 2975 2432 3440 3474 4197 4181

Current Statistical Reports __________ Copyright Š 2012 Northwest Multiple Listing Service ALL RIGHTS RESERVED This material may not be copied, published, broadcast, rewritten or redistributed without prior permission.


Feb 2013 NWMLS Update