King County home sales rebound in 2011, but prices still falling
Last year was the best year for home sales in King County since 2007. Prices, however, have softened.
Seattle Times business reporter
Homebuyers purchased nearly 2,000 more houses and condos in King County last year than in 2010.
For 24 million fewer dollars.
That's among the statistical nuggets in a year-end report the Northwest Multiple Listing Service released Monday. It reinforces what researchers have been saying about the Seattle real-estate market for months.
Sales volumes are climbing while prices — or at least the median price of houses that sell — continue to fall.
That's not really surprising, said blogger Tim Ellis of Seattlebubble.com; it only makes sense that lower prices would attract more buyers.
"The lower you see prices go, the more sales you're going to see," he said.
The number of houses and condos sold in King County in 2011 was up more than 9 percent from 2010, according to the listing service. Last year was the best year for sales since 2007.
But those buyers spent a total of $8.91 billion on those homes, down from $8.94 billion the previous year.
The median price of houses sold last year, $340,000, was down $35,000 from 2010. Condos saw a $40,000 drop, from $244,000 to $204,000.
"This report, my research, [the] Case-Shiller [home-price index], the Federal Housing Finance Agency — we're all saying that prices have softened," said Glenn Crellin, associate director for research at the University of Washington's Runstad Center for Real Estate Studies.
Why? A new analysis of the listing service's data by Washington Property Solutions, a short-sale negotiating firm, names the same culprit that researchers have been pointing to for months: foreclosed homes.
Banks are reselling more of them. In King County, the number of bank-repossessed houses sold last year was up 73 percent from 2010, according to the firm.
Those transactions accounted for 43 percent of all sales in Southwest King County and 35 percent of all sales in Southeast King County — areas that, not coincidentally, accounted for most of the countywide bump in sales volumes.
And those homes are selling for significantly less than other houses. In King County, the median price of bank-owned houses that sold last year was $202,000, according to the analysis.
"As the pipeline of bank-owned properties floods the market, it further erodes home values, causing more homeowners to go underwater and enter into short-sale territory," Richard Eastern, Washington Property Solutions' chief executive, said in a statement.
But home values are holding up better — perhaps even increasing — in neighborhoods with relatively few distressed-property sales, Crellin said.
The Eastside, for instance, had 10 percent more single-family home sales in 2011, according to the listing service, while the median sale price slipped just 4 percent. Microsoft hiring may be driving that submarket, Ellis said.
Home sales within Seattle actually declined 1 percent last year, with the median price falling 7 percent.
The number of $1 million-plus houses sold in King County last year, 735, was down 11 percent from 2010. Banks owned 37 of those houses, according to Washington Property Solutions.
But the number of $500,000-plus condo sales was up 16 percent, with the Eastside accounting for all the increase.
An analysis of county records indicates more than one-third of the Eastside's high-priced condo sales were in one project — Bellevue Towers, in downtown Bellevue. That project slashed prices a year ago after the developer turned the two high-rise buildings back to the lender to avoid foreclosure.
More tidbits from the listing service's year-end report:
• The most expensive residential property sold in the Seattle area last year was a 2-acre lot at the tip of Hunts Point — the house was razed in 2006. It went for $14.75 million.
• The least expensive home sold last year? A $12,500 property in Everett.
• The median price of three-bedroom houses built in King County in 2010 and 2011 that sold last year was 15 percent higher than that of older homes. In Snohomish County, the new-home premium was 32 percent.
• Fewer people were selling real estate in King County in 2011 — 10,715, down from 11,503 in 2010.
Eric Pryne: 206-464-2231 or firstname.lastname@example.org