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 Home sales had a quite healthy jump from last year of 23%, however it is still low compared to most years. At the same time, brokers are reporting an uptick in multiple offers

• Buyers have fewer homes to consider compared to a year ago. Inventory levels normally have a bump up from January to February; however we are down 3.8% and 32% from last year. The last time inventory levels were this low was March 2006.
• The supply of single family homes decreased to 4.21 months, a 44.3 percent decrease from last year.
• The median home price dropped again to $308,125 from $315,000 last month and $334,000 from last year.

February 2012:    $308,125

December 2003:  $304,700

Home sales were relatively the same in January from last year. There were 1,095 completed transactions compared to 1,017 in January 2010.  We have 63% more sales than the rock-bottom point we hit in January 2009, and 35% lower than where it was between 2003 and 2007.

Inventory levels are down 28% compared to a year ago and at their lowest since April 2006, which maybe leading to stable home valuations. The supply of single family homes is approximately 4.0 months, which slightly favors sellers.  However, many would-be sellers might be  wary of the market and, as a result, there are fewer homes for sale. At the same time, there are a lot of trapped would-be sellers creating pent-up supply.

KIng County January 2012

The median home price in King County dropped a bit to $315,000 from $320,000 last month. However, foreclosures and short sales will continue to cause downward pressure on prices. Distortions caused by REO (bank- or other lender-owned) and foreclosed properties also contribute to price depressions. When you adjust for these conditions and compare ‘standard resale homes’, the change in home values is much less drastic.

Median Prices for Standard, Bank Owned, and Short Sales

January 2012:       $315,000

April 2004:           $315,000

Peak: July 2007    $481,000

There was a dramatic 8.5% drop in the median price in October. Since then, median home prices have been relatively unchanged at $320,000.

For King County overall, the supply is approximately 3.75 months, down from 4.2 months, which favors sellers.

The median home price of ‘standard resale homes’ was $380,500, Short Sales were $273,500, and Bank Owned $200,000.

Foreclosures and short sales continue to cause downward pressure on prices. Many would-be sellers are still wary of the market and, as a result, there are fewer homes for sale. At the same time, there are a lot of trapped would-be sellers creating pent-up supply. Also, there are some buyers who are eager to strike while the iron is hot, so in some areas, homes are selling before many buyers even have a chance to react.

Not a big surprise that they discovered errors in that process.

Wall Street Journal

There were 1,446 completed transactions during October, which represents an improvement of more than 15 percent from twelve months ago when 1,256 sales closed.  Inventory levels are at their lowest since April/May of 2007 which may led to stable or slight increases in home valuations. It’s encouraging seeing positive trends in sales activity and listing inventory.

There has been about a 5-months supply¹ of homes since May, which is considered to be a balanced (or neutral) market favoring neither buyers nor sellers^..  These numbers are a bit deceiving depending on your situation.  ‘Standard resale homes’ (not bank owned or short sales) are looking at 5 month supply, compared to 10 months for short sellers and 2 months for Bank Owned properties. 

The median price in King County dramatically dropped to $317,000, which is about a 9.4 percent loss from last month and 12 percent less than a year ago when the median selling price was $360,000.  

October 2011: $317,000

April 2004:      $315,000

The median home price of ‘standard resale homes’ was $382,500, Short Sales were $265,000, and Bank Owned $185,000.

Not every home has dropped in value. Much of the decline is due to a combination of factors, including shifting demographics and the influence of  distressed properties, which may be as high as 40 percent in some areas. More  investors and first-time buyers are purchasing in the more affordable price  ranges, which results in a downward shift of median prices. Distortions caused by REO (bank- or other lender-owned) and foreclosed  properties also contribute to price depressions. When you adjust for these conditions and compare ‘standard resale homes’, the change in home values is much less drastic. A more accurate reflection of price declines for the King County area is around 6 percent, citing research by CoreLogic, Wells Fargo Securities and other analysts. 

The ‘temporary’ loan limit for conventional financing dropped back down from $567,500 to $506,000 after being in place for two years. Buyers in need of a mortgage above $506,000 must now qualify for a jumbo loan which is more restrictive and comes at a higher cost than conventional financing.  According to the NWMLS, “nearly one-third of the available inventory is priced above the new, more restrictive dollar limit”.

There is still about a  5-months supply¹ of homes in the King County area, which is considered to be a balanced (or neutral) market favoring neither buyers nor sellers^..  However, this number is a bit deceiving depending on who you are.  Regular home sellers (not bank owned or short sales) are looking at 8.6 months supply of homes. Home sellers trying to short sale their home are looking at almost 16 months supply of homes.  Bank Owned homes have a 3.5 months supply of  homes.

The median price in King County was $305,250, about a 3.1 percent loss from last month and 12.8  percent less than a year ago when the median selling price was $350,000.  The median home price of regular home sellers that sold their homes was $390,000,  Short Sales  were $232,500, and Bank Owned $168,000.

Distressed homes selling at  deep discounts account for much of the drag on prices, Distressed homes –  foreclosures and short sales – accounted for 30 percent of sales in King County  in September.

September Median Price Report

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LISTING DETAILS

The number of homes sold outpaced year-ago totals. There were 2,019  completed transactions during August. This represents an improvement of almost 22  percent from twelve months ago when 1,651  sales closed. It’s a positive sign, but these figures are being compared to last summer’s post-tax incentive doldrums. The federal tax credits were part of the Obama administration’s economic-stimulus package that expired around mid-2010; home sales fell into a lull that persisted well into fall.  Even during the worst year of the dot-com recession in 2002 we had 25% more sales in August than we did this year.

There is still about a 5-months supply¹ of homes in the King County area, which is considered to be a balanced (or neutral) market favoring neither buyers nor sellers^..

The median price in King County was $315,000, about a 1.6 percent gain from last month, and 8.7 percent less than a year ago when the median selling price was $345,000. However, the median price sold in King County has barely changed in eight months.

As we head into the second half of the year, we do so with a year-to-date improvement over 2010 even with the lack of federal tax incentives this year. Current sales activity show signs of a stabilizing market as Buyers return and inventory lessens. This trend extends across all price levels and will slowly produce a steady, positive shift in the market.

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