Thin inventory puts pressure on King County home prices
Buyers paid a median $410,000 in King County, and $295,000 in Snohomish County.
Seattle Times business reporter
The median price of homes sold in King County last month was 17 percent higher than a year ago, driven by a continuing shortage of homes for sale.
But the median is still below the recent peak of $434,000 last July, after a spike in interest rates curbed buyers’ appetites.
Buyers in January paid a median $410,000, down from $419,825 in December, the Northwest Multiple Listing Service reported Wednesday.
The inventory of single-family homes for sale was larger than a year ago. There were 3,132 active listings last month, up slightly from the previous January’s 2,975 but still far below the 5,378 listings in January 2012.
The tight inventory is pushing prices higher, experts said, even as buyers are being more selective in striking deals.
Pending sales, which are mutually accepted offers that haven’t closed, were down 5 percent from a year ago, while closed deals dipped as well. In Snohomish County, closed sales were down even more — 15 percent over the year, despite a 33 percent jump in inventory — in part due to uncertainty over whether Boeing would build the 777X in the Puget Sound region.
In general, many houses that are listed are overpriced because those sellers are incorrectly comparing their homes with others in top condition and top locations, said Deidre Haines, principal managing broker for South Snohomish County at Coldwell Banker Bain.
“Sellers need to pay better attention to what their brokers are telling them about the value of their homes, and not think that Zillow knows,” Haines said, referring to the Seattle-based online real-estate marketplace.
Zillow’s algorithm for estimating a home’s value is a great starting point, she said, but isn’t incorporating all factors.
“You can’t smell it, you don’t know what condition it’s in, you don’t know if it’s been updated, you don’t know if the neighborhood has parked cars in the front yard,” Haines said.
The rise in interest rates has eroded purchasing power, too, forcing many buyers to look at lower price ranges — precisely where the shortage of suitable homes is worst, said Glenn Crellin, associate director for research at the University of Washington’s Runstad Center for Real Estate Studies.
“We still need listings,” Crellin said.
Perhaps the shortage is most acute in the Bellevue School District, which has the region’s second-highest median price after Mercer Island, the MLS reports.
On Wednesday, there were just 10 MLS listings for Bellevue homes built since 2000 and priced at less than $1 million — and only one in northeast Bellevue, where real-estate broker Vera Brodsky was looking for a house for a client.
“There’s basically no newer houses on the market,” said Brodsky, of Berkshire Hathaway HomeServices Northwest Real Estate. “There’s demand for them, but there’s just no supply.”
The listing service said King County had about 2.4 months of inventory, and Snohomish County about 3.7 months. A balanced market is five to seven months, Crellin said.
For well-located homes in good condition, bidding wars remain common, Brodsky said. Three weeks ago, a client interested in a Kirkland house listed at $600,000 lost out to a buyer who offered $50,000 over the list price, she said.
In King County, Southwest King County and the Eastside saw the biggest gains, with the median price rising 20 percent over the year, to $254,500 and $599,500, respectively.
In Seattle, the median price rose to $459,950, up 16 percent over the prior January.
Snohomish County’s median price was $295,000, or 14 percent higher than a year ago. The number of homes for sale there soared by 33 percent to 1,800 listings, even as the volume of deals closed fell by 15 percent from the previous January.
Uncertainty over whether Boeing would build the 777X out of state was a huge factor for buyers, Haines said. The company did decide to build the new jet here.
Starting with Wednesday’s report, the listing service said it was changing how it reported the months of supply, using closed sales instead of pending sales, relative to total active listings. The service said it wanted its supply ratio to be comparable to those calculated by the National Association of Realtors and other groups.
Sanjay Bhatt: 206-464-3103 or email@example.com On Twitter @sbhatt