New data further boosts outlook for homebuyers in metro Seattle area

Report by: Marc Stiles, Puget Sound Business Journal

With 52 percent more single-family houses on the market in the metro Puget Sound region, prices continued to climb more moderately last month compared to October 2017.

The median sales price increased just 6.5 percent in King County to nearly $671,000. Prices went up nearly 20 percent in January and the rate of escalation has been trending downward since.

Kitsap and Pierce counties saw similar percentage gains in October to around $343,975 and $335,000, respectively, according to the Northwest Multiple Listing Service's monthly report out Tuesday. Snohomish County registered the largest annual gain, 7.6 percent, to $473,247.

The public remains loath to buy with the total number of closed and pending sales down 15 percent year over year, though Bothell-based Bentley Properties owner and Designated Broker George Moorhead said he has noticed a significant uptick in buyer activity over the past three weeks. Closed and pending sales were up 4.3 percent month-over-month.

Buyer activity is typically up in the fall when buyers want to move into their new homes before the holidays, though less extreme price escalation and fewer competitors are adding to sales activity, Moorhead said.

Compared to September, median sale prices were up slightly in King County but down 2.4 to 5 percent in the other three counties.

Sellers are coming to terms with the changing market, said John Deely, principal managing broker at Coldwell Banker Bain in Seattle. Jittery about falling prices, some sellers remain flexible on pricing even after reducing asking prices as buyers capitalize on sellers' desire to beat the competition.

Inventory is up but still below what is considered a balanced market, which is when there is a five to six month supply of homes for sale. Inventory stands at 2.4 months in King, up from 0.9 in March. Snohomish County has a nearly 2.3 months' supply, while Pierce's is 1.8 months and Kitsap's had 1.9 months.

Mortgage interest rates continue to rise, reaching a decade-high mark this quarter. Even so, Moorhead said buyers have expressed little concerns, though they do wonder if the value of their potential investment in a house will rise much over the next three to five years.

Moorhead said homebuilders are ramping up incentives, such as mortgage rate buy-downs, custom upgrades and also are paying closing costs.

The condo market last month saw year-over-year median sales price gains of 5.8 percent to $400,000 in King, 6.8 percent to $331,000 in Snohomish County and 21 percent in Pierce to $260,000. Kitsap condo median sale prices fell by nearly a third to $238,475, though that was based on just 18 sales.