Homebuyers around Washington state are making their way back to the market, hoping to take advantage of improving inventory, attractive interest rates, and more approachable sellers.
Northwest MLS statistics for January show year-over-year improvement in the volume of new listings and total inventory, along with moderating selling prices. Although fewer pending sales (mutually accepted offers) were reported than a year ago (down about 3.3 percent), January was the smallest year-over-year decline since May 2018 when the drop was about 2.7 percent.
Commenting on the MLS statistics summarizing last month’s activity, broker Gary O’Leyar said January’s post-holiday real estate activity doesn’t normally pick up until later in the month, but this year the uptick began early.
Seven counties had increases in pending sales of single-family homes and condos compared with 12 months ago.
J. Lennox Scott, chairman and CEO of John L. Scott Real Estate, said buyers “came out of the woodwork” after the holidays, eager to take advantage of better housing conditions. “Areas close to the job centers are seeing improved affordability from spring 2018,” he said, attributing it to lower interest rates, strong job growth, and adjusted pricing.
Scott said buyers are also attracted by expanded inventory resulting from the addition of new listings and a higher number of unsold inventory, although he noted: “inventory levels are still considered a shortage.”
MLS members added 7,090 new listings of single family homes and condos during January, up from, the year-ago figure of 6,805 and nearly doubling December’s total of 3,631. At month’s end there were 11,687 active listings in the database, up more than 45 percent from the year-ago total of 8,037.
Sixteen counties reported more inventory than a year ago. Even with sizable gains, supply is still tight at 2.4 months system-wide. (In general, four to six months typically indicates a balanced market.)
Mike Grady, president and COO of Coldwell Banker Bain, expects activity to pick up heading into spring, as is customary. “I have absolutely no concerns about 2019 being a strong year, with prices rising 4 to 6 percent and units up 10 to 12 percent. There is no reason for sellers not to move on with their lives and list their homes,” he remarked.
Northwest MLS figures show an area-wide price gain of just over 5 percent on January’s 4,865 closed sales of single-family homes and condos. Only six of the 23 counties in the report had year-over-year price drops.
But not everyone is completely optimistic.
Mike Larson, president/designated broker at ALLEN Realtors in Lakewood (Pierce County) expressed concerns around affordability, “particularly for entry-level buyers as well as move-down buyers who also want to sell. The middle rungs on the housing ladder are slowly disappearing,” he remarked. Options like condos could help fill that void, he suggested, but believes they won’t be built “until the state legislature reforms the condo liability laws.”
Editor’s note: NW REporter is a joint monthly real estate newsletter from two Northwest Washington non-profits: Northwest Multiple Listing Service (NWMLS) and Seattle King-County REALTORS.