Summary
- Limited supply continues to be the story throughout the Puget Sound Region, with 13 of the 23 counties in the NWMLS report having less than one month of supply at month-end.
- Prices on last month’s 8,875 closed sales were up nearly 14% from a year ago, rising from $434,900 to $495,000, with 17 of the 23 counties in the report having double-digit price gains compared to a year ago.
- Low interest rates are helping buyers to stay active despite price increases. Various projections place interest rates for 2021 relatively stable at current rates; between 3.3% and 2.8%.
- Buyers need to be ready to compete… it’s a real thing. Be pre-approved, conduct a pre-inspection, and waive all non-essential contingencies (based on buyers’ ability to support potential risk).
- To get top dollar, sellers still need to prepare their home for sale, presented in its best condition, and ensure it is marketed correctly. Let us know if you’d like our professional guidance.
Details
Northwest MLS brokers say real estate activity across Washington remains strong
The Northwest MLS report summarizing November activity shows strong year-over-year (YOY) increases in closed sales (up about 23%) and prices (up 13.8%). Pending sales (mutually accepted offers) rose 7.9% from a year ago, and the year’s saga of depleted inventory continued last month with the number of total listings down nearly 43%.
Although inventory is limited, a check of the supply by price range shows about 25% of the listings across the 23 counties served by Northwest MLS are priced under $400,000, and a similar number (24.4%) are priced from $400,000 to $600,000. At the high end of the spectrum, about 21% of homes and condominiums in the database have asking prices of $1 million and higher.
“With listings down 42.8%, record low interest rates, and demand very high in outer suburban areas, it seems like the perfect price storm has hit,” suggested James Young, director of the Washington Center for Real Estate Research at the University of Washington.
While overall inventory is down, a comparison of counties shows a wide range of deficits, according to NWMLS data. Perhaps surprisingly, King County’s supply declined “only” about 18% from a year ago, while five counties (Clallam, Clark, Island, Mason, and Snohomish) reported drops of at least 63%. A closer look at the MLS report for all counties shows the shortages are most acute for single family homes (off 50.6% area-wide), while the condo supply improved (up 7.1%).
Thirteen of the 23 counties in the MLS report had less than one month of supply at month end. Overall, there was about three weeks (0.73) of inventory at the end of November, well below the four-to-six months many analysts use as a gauge of a balanced market. Inventory kept King County’s residential supply (single family homes) at 0.67 months and condo supply at 1.88 months by the end of November.
A check of Northwest MLS statistics shows condo listings system-wide are up more than 7% from a year ago. Closed sales jumped nearly 34% overall and condo prices increased more than 11%.
The MLS map areas encompassing Seattle have about 61% more condo listings than a year ago; the Eastside selection is up 36%. Year-over-year condo prices in Seattle rose about 8.7% while on the Eastside prices on condos that sold in November surged nearly 32%. In South King County, condo prices jumped 24% on shrinking inventory (down nearly 33%).
One indicator of brisk activity is the ratio of pending sales to new listings. November’s 8,584 pending sales outgained the month’s new listings, which totaled 6,425 area-wide, continuing a pattern reported during much of the year. New listings surpassed pending sales during only two months (March and April) this year, resulting in the depleted supply of active listings.
Brokers reported 6,505 total active listings at the end of November, down from the year-ago total of 11,366. Supply was at the lowest level since February
Industry watchers say the in-migration of people from larger, more expensive locales is driven not only by low interest rates, but also by workers freed by the pandemic to work from home long-term, and by a desire for more living space by those who are working remotely, supervising their children’s schooling, or accommodating adult children and aging parents who may have been displaced because of the virus.
Organizers of a forum for the Pacific NorthWest Economic Region (PNWER) said the rise of virtual platforms like Zoom has prompted knowledge workers to flock to new frontiers known as “Zoom towns” – scenic destinations where they can live more cheaply and “achieve a work/life balance which many never dreamed of achieving.” Speakers identified several “Zoom towns” including two areas in Washington, the San Juan Islands and the Methow Valley.
Year-to-date closed sales in San Juan County are up more than 48% compared to the same period last year. In Okanogan County, where the Methow Valley is located, sales are up more than 17%.
Prices on last month’s 8,875 closed sales were up nearly 14% from a year ago, rising from $434,900 to $495,000. Seventeen of the 23 counties in the report had double-digit price gains compared to a year ago.
Kitsap County is among the areas experiencing double-digit activity in pending sales, closed sales, and prices.
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*Information and statistics compiled and reported by the Northwest Multiple Listing Service.
