Housing Activity Shows Seasonal Slowdown, Stable Prices

KIRKLAND, Wash. (Dec. 6, 2007) –A "typical holiday market," "the start of an optimum buy zone," "a good time to beat the spring rush," and a "wonderful time to be a home buyer" are among reactions by directors of Northwest Multiple Listing Service upon viewing the activity summary for November.

The latest recap report issued by Northwest MLS shows little price fluctuation from a year ago, ample inventory (about 31 percent more listings than a year ago, but 6.3 percent fewer than the previous month), the expected seasonal slowdown of sales activity, along with reports of "busy agents" who are working with motivated buyers and sellers.

For its 19-county market area, MLS members reported 5,194 pending sales of single family homes and condos (combined) last month, down from 7,022 for the same month a year ago, a drop of 26 percent.

An analysis of the falloff in activity in the four-county Puget Sound region from October to November shows this year's decline, at 12.4 percent, is the third lowest of the past eight years. Since 2000, pending sales from October to November have dropped from a low of 5.3 percent (in 2001) to a high of 25 percent in 2003.

Prices on completed sales of single family homes and condos dipped slightly -- 1.35 percent area-wide -- from a year ago. For November's closed sales, the median price was $315,000, which compares to the year-ago figure of $319,300.

For the four-county Puget Sound region (King, Kitsap, Pierce and Snohomish counties), the median selling price for last month's closed sales of single family homes and condominiums was $340,000, down about 1.2 percent from the same month a year ago when the price was $344,000. For single family homes only (excluding condos), the median price for the four-county area rose about 1 percent, from $363,500 to $367,352. For condos, the median price increased more than 3.9 percent, from $255,000 to $265,000.

In King County, the median price declined 2.9 percent for the "blended" property types (single family homes and condominiums); the price declined from $397,500 to $385,990. The price for single family homes only (excluding condos) was unchanged at $435,000. The median selling price for condos that sold in King County last month was $284,450, an increase of 4.2 percent from twelve months ago when the median price was $272,950. One factor contributing to the price dip is the growing popularity of condos, which tend to have lower prices. A year ago, condos accounted for 25.3 percent of closed sales in King County; last month, condos made up 30.3 percent of sales countywide.

NWMLS director Kathy Estey, managing broker at John L. Scott's downtown Bellevue office also attributes the price dip to the broader selection. "From my perspective we are seeing a great deal more activity in the lower price ranges because there is more inventory in those ranges now," she remarked, explaining an increased volume of sales at the lower end of the spectrum means the median price (half sell for more, half for less) will adjust downward.

"Most homes have not lost value – and good properties are still attracting more than one buyer," Estey stated, while noting premium pricing is rarely in effect. Last week, her office had four different multiple offer situations for homes priced under $700,000. She also reports two different multiple offer situations in the past few weeks for homes priced over a million dollars. Pent up demand is starting to show signs of moving buyers from the sidelines into the market, she noted. "Our agents are busy," she reports, adding, "It is a good time to beat the spring rush."

Selection is plentiful, with 44,399 active listings offered for sale at the end of November. That's up about 31 percent from a year ago when there were 33,817 active listings. The inventory includes 8,805 new listings that were added during the month.

"Welcome back to normal," commented MLS director Ken Bacon, the broker at Windermere's Redmond office. He characterized the market as "a typical holiday market," and while different that the past few years, it's similar to markets in the prior decade with appreciation of about 3 percent per year, a great job environment and buyers driven by a need and desire for homeownership. Bacon expects buyer interest to build after the holidays, with single digit appreciation likely to continue. "What a wonderful time to be a homebuyer," he exclaimed.

J. Lennox Scott, chairman and CEO of John L. Scott Real Estate, described conditions as "the start of the optimum buy zone."

"We're slowly beginning to rebound from the effects of the turbulent mortgage market," Scott said, adding, "Interest rates are back down to pre-mortgage meltdown levels, prices are holding steady, and there is ample inventory for buyers."

MLS director Dick Beeson, broker/owner of Windermere Real Estate/Commencement Associates, reports less volatility in the market. "The market seems to have leveled out," he commented, with buyers resuming their search as interest rates continue to fall and inventory starts to shrink.

"Some sellers have finally reduced their price or come on the market at the right price" to facilitate a quicker sale" according to Beeson. "Correct pricing gets the most money in the quickest time," he emphasized. Open house traffic has been "up and down" and there are still many non-committal buyers undergoing prolonged searches as they seek a perfect blend of neighborhood, price and amenities, Beeson noted. He anticipates a "great first quarter," with lower inventory and lower rates brewing up a slight rebound in spring and summer.

Although traffic is down, Steve Little, an associate broker at Windermere Real Estate/Northwest, reports having a noticeably higher percentage of serious buyers at his open houses. "The 'just lookings' and 'maybe in the future' or 'looking for remodeling ideas' visitors have decreased, according to Little. Buyers don't seem to have the sense of urgency they had a few months ago, he remarked, adding, "Wait until spring when they will think, 'I should have bought when the market was not as hot.' "

Northwest Multiple Listing Service, owned by its member brokers, is the largest full-service MLS in the Northwest. Its membership includes approximately 31,000 brokers and agents. The organization, based in Kirkland, currently serves 19 counties, mostly in western Washington, plus Grant, Kittitas and Okanogan counties in the central part of the state.

NWMLS News Release: November 2007 Activity Dec. 6, 2007