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Tuesday, May 8, 2007 - Page updated at 02:02 AM

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Buying a home here: You'll pay even more

Seattle Times business reporter

Bucking the national trend, the price of King County houses has risen for the fourth month in a row, reaching a median $465,000 in April, according to statistics released Monday by the Northwest Multiple Listing Service.

At the same time, single-family home sales are slowing throughout much of the four-county Central Puget Sound region.

The majority of single-family homes sold within Seattle last month went for more than the asking price, an analysis by Windermere Real Estate shows.

That trend in Seattle was strongest for two-bedroom houses. Less expensive because of their small size, they're in high demand as "starter homes." They brought an average 100.43 percent of their asking price, Windermere found.

Three-bedroom houses — the largest percentage of sales — on average sold for 100.25 percent of asking.

Only five-bedroom houses in Seattle, which as a group are larger and more expensive, sold for less: 97.6 percent of the original asking price.

Buoyed by a strong local economy that's been growing at twice the national rate, some 64 percent of all Seattle houses sold within 30 days, Windermere reported.

In other parts of the country, where the economy is more sluggish and foreclosures have started to push down prices, average selling times are 90 days or more.

"If it's a good, clean property and priced right," it will sell quickly, said Jerry Martin, broker and owner of RE/MAX Northwest Realtors-Kirkland. He noted that homes priced below $500,000 sold the fastest, sometimes receiving multiple offers.

Martin estimates that on the Eastside, one in 10 single-family-house transactions is generating multiple bids. Last spring about 80 percent did, he said. Multiple offers on condos in his area are less frequent.


"Overall, people have been getting worn out paying what in their opinion is an inflated price," Martin said.

Plus there are significantly more properties to choose from compared with a year ago.

In King County, the number of houses available increased 38 percent in April. The number of condos for sale rose 74 percent as more new buildings and conversions came on the market.

That strong uptick helps explain why pending sales for houses and condos combined fell 5.4 percent last month compared with a year earlier. Pending sales reflect the relationship between the number of available properties and the number of accepted transactions.

Foreclosures may have added to the inventory total but remain a small factor locally.

In March, the last month for which statistics are available, one in every 1,846 King County homeowners was in some stage of foreclosure, compared with one in every 775 nationally, according to RealtyTrak, a California foreclosure-information provider.

However, many foreclosures are not finalized as owners and lenders, who have started introducing new mortgage products with more variable terms, find ways to escape this fate.

April's local sales activity is an improvement from earlier in the year, said Dick Fulton, managing broker of Coldwell Banker Bain's Lake Union and Magnolia offices.

"Because of the awful weather we had, there were a substantial number of days where commerce couldn't happen," he noted. "The 2007 market kind of found its stride for the first time in April. The activity feels like we're at a faster pace than last year in the Seattle and Bellevue market."

That's likely not repeated nationally, according to a preliminary report on April home sales released last week by the National Association of Realtors.

The trade association anticipated that final April numbers will show sales nationwide to be the lowest since March 2003. Tighter mortgage-lending standards along with a decline in subprime lending are among the causes, according to David Lereah, the group's chief economist.

At present, loan rates aren't seen as a factor. In Seattle last week, the average for a 30-year, fixed-rate mortgage stood at 6.27 percent. That's up slightly from prior weeks but down about a half of a percentage point compared with a year ago.

Within the four-county, Central Puget Sound region, houses in Snohomish County have appreciated the most, year over year, the MLS found. The county's proximity to King County job centers, plus its relative affordability compared with King, are two reasons for its strong appreciation.

However, its price rise has not been as steady as King County's.

Over the past four months, median single-family house prices have fluctuated in Snohomish County, settling at $375,000 in April. That figure reflects a 13.7 percent year-over-year increase. Median means half sell for more, half for less.

House prices in the same time period are up 10.9 percent in King County, 6.9 percent in Kitsap County and 4.4 percent in Pierce County.

King County's median condominium price last month was $295,000, up 19 percent compared with the previous April. Snohomish County's median condo price was $242,500, up 21.3 percent.

Spring traditionally is the strongest season. Whether April will be the strongest month remains to be seen.

Already, asking prices are cooling, according to the MLS.

King County's median listing price of $525,000 is just 5 percent higher than a year ago. That's likely a result of more properties for sale, thus more competition for buyers.

Sellers "have to be very aware of pricing their homes properly relative to their competition in their price range," Fulton said, adding that "the ones selling are the ones priced competitively."

Elizabeth Rhodes:

Copyright © 2007 The Seattle Times Company



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