Inventory Way Up, So Says the Media
Well, not quite. When compared to a year ago, yes, King County’s active listings (single family homes & condos) are up 44.3% from the prior year…but that’s been the case for most of the year.
In actuality, when compared to September, the inventory level fell 2% in October to 14,240 listings in King County. Seattle’s overall inventory inched up slightly by 2.6% to 4,197 listings.
Pending sales in the county increased 7.4% and in Seattle by 9.8% from September to October. Compared to a year ago, pending sales are down 28.5% in the county and 20.5% in Seattle. Pending sales reflect properties that went under contract but have not yet closed. In other words, more buyers made home purchases in October compared to September, though fewer overall compared to the same period last year. The median price in county and city fell to $387,500 and $396,250, respectively.
The inventory absorption rate decreased to 6.0 months in the county and 5.3 months in Seattle. What this means is that if no new listings come on the market, it will take 6 months to sell the current inventory in the county and 5.3 months to sell the inventory in Seattle. A lower absorption rate indicates a seller’s market while higher rates reflect a buyer’s market. A year ago, Seattle’s absorption rate was 2.7 months and the county’s was 2.9 months. Currently, inventory levels in the county and city reflect a normal market environment.
For condo specific market information, please visit the Seattle Condo Blog’s Seattle Condo Sales Performance - October.
Source: NWMLS (single family homes & condos)
The media, embittered by their loss of real estate developer revenue thanks to Google and Craigslist outpricing them, have turned on real estate. Quite frankly, their sour grapes will not derail economic reality.
Year-over-year comparisons are the only kind that make any sense when looking at inventory and sales. Inventory always decreases from September to October. Every. Single. Year. And it will continue to decrease through December. This tells us nothing about the relative strength or weakness of the market. YOY on the other hand does.
Tim - Agree. This post was a reaction to a news anchor who last night proclaimed that inventory skyrocketed in October. My point was, it’s been up 40-50% all year and actually decreased in October, so basically status quo. The anchor gave the impression that October’s inventory took a big jump…it didn’t.