More spring in local home sales, but too soon to call it a trend
The number of homes sold in King County last month was down from the tax-credit-driven rush of March 2010, but sales and the median price both rose from February's lows.
Seattle Times business reporter
King County's housing market showed more strength than anticipated in March, observers agree.
Was it a blip, or the start of a trend?
Buyers closed on 1,525 houses last month, according to statistics released Wednesday by the Northwest Multiple Listing Service. As expected, that number was lower than in March 2010.
But the decline — 4.5 percent — was "less than you might have otherwise expected," said Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University.
A year ago, sales were picking up as buyers rushed to beat a midyear deadline to qualify for federal tax credits, part of the Obama administration's economic-stimulus package.
Now those credits are long gone. So the relatively small year-over-year sales decline is "a little bit surprising, considering we don't have that deadline hanging over buyers' heads," said Tim Ellis, editor of the usually bearish Seattlebubble.com real-estate blog.
More single-family homes closed in March than in any month since last June, when sales fueled by the tax credits peaked.
But both Ellis and Crellin said a steeper, 11 percent year-over-year drop in pending sales — offers that were accepted by sellers in March, but haven't yet closed — could bode ill for the market as spring turns into summer.
Fewer pending sales now should mean fewer closed sales later, they said.
Crellin attributed last month's surprisingly strong sales to rising mortgage-interest rates. They have been inching up since November, according to the Federal Housing Finance Agency.
Some buyers who might have been waiting to buy until prices hit bottom probably realized higher interest rates could wipe out any potential savings, Crellin said: "Some of those fence-sitters probably decided they were through sitting."
The median price of single-family homes that sold in King County last month was $345,000 — up from February's post-boom low of $334,000, but still down 6 percent from March 2010.
That's partly because lower-priced bank-owned homes and short sales account for a larger share of total sales — about one-third, according to a Windermere Real Estate analysis.
That's 20 or 25 percent more than a year ago, the company said.
Lower prices and interest rates that remain relatively low are drawing buyers, Ellis said. On his blog, he compared those numbers with King County's median household income and concluded housing hasn't been this affordable since 1998.
"I'm not going to say we're at the bottom," Ellis said, "but it's definitely a good sign for people buying, and for overall market health."
When compared with March 2010, single-family sales actually increased slightly last month in Southwest and Southeast King County, the county's most affordable areas. But those areas, where distressed properties make up a larger share of sales, also saw the steepest price declines.
The median sale price actually rose a fraction on the Eastside, while falling just 1 percent in Seattle.
A lack of inventory is becoming a problem in some areas, brokers said. In Northwest Seattle (Ballard, Green Lake), for instance, 34 percent fewer houses were listed for sale at the end of last month than in March 2010.
"If the property is priced right, it sells," said Anne Marie Kreidler, managing broker at John L. Scott Real Estate's Green Lake office. "We're getting multiple offers in some cases."
Countywide, single-family inventory was down 14 percent in March from the same month last year.
King County condo sales fell 12.6 percent in March from a year earlier, according to the listing service. The median price, $224,500, was 11 percent lower than in March 2010.
In Snohomish County, the median price of single-family homes sold last month was $249,900, down nearly 12 percent from the same month last year. The number of closed sales slipped about 4 percent.
Eric Pryne: 206-464-2231 or firstname.lastname@example.org