May 2008 NWMLS Housing Report
(NWMLS Press Release)
KIRKLAND, Wash. (June 5, 2008) – “If you’re a buyer, this is the time to take advantage of unique market conditions.” That’s the message one industry leader offered in reviewing the latest report from Northwest Multiple Listing Service summarizing housing activity for the month of May.
NWMLS figures show inventory remains plentiful (up nearly 22 percent from the same month a year ago, and up about 5.4 percent from April), with thirteen of the nineteen counties in its service area reporting double-digit increases from twelve months ago. At month end, the selection included 43,546 single family homes and 8,271 condominiums – with one of every five of those listings classified as newly built.
“There are such great opportunities for buyers right now to position themselves for the future,” remarked J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “Interest rates are historically low, there’s a healthy inventory of homes to choose from, and the new, higher conforming loan limits have increased housing affordability,” he noted, adding, “If you’re a buyer, this is the time to take advantage of these unique market conditions.”
Prices area-wide are showing moderate fluctuation. While median selling prices in most counties served by NWMLS are down from a year ago, many areas are showing stability and even increases. In 30 “sub-areas” the MLS tracks within King County, for example, 21 areas reported higher prices in May compared to April.
NWMLS director Diedre Haines, the broker at Coldwell Banker Bain’s Lynnwood office, said that office had twice as many multiple offer transactions in May compared to April (rising from six to 12). Last month, agents in that office wrote the highest volume of transactions since August, she reported. “I’ve stopped reading the papers,” she remarked, adding, “We’re seeing good increases in activity.”
Pending sales are down from a year ago, but nearly kept pace with April’s volume (down about 2 percent). NWMLS members reported 6,085 pending sales area-wide during May. That compares to 9,743 pending transactions of a year ago and 6,208 for April.
Pending sales of single family homes declined about 3.8 percent from April, while the volume of pending sales of condominiums rose nearly 8 percent from April to May.
“We still haven’t had summer hit us yet as the weather remains cool, wet and cloudy. I expect both temperatures and the market to heat up as summer approaches,” commented Dick Beeson, broker/owner at Windermere/Commencement Associates in Tacoma. “Open house traffic is picking up and buyers are coming off the sidelines to make buying decisions. Buyers are realizing that interest rates may creep up and they would be in a worse position if rates went up 1 percent than if prices fell 5 percent, he stated.
NWMLS director Mike Skahen believes the price drop has “already happened.” “It’s a great time to negotiate with sellers,” he suggests. Skahen, the broker at Lake & Co. Real Estate, Inc., reports a noticeable pickup in activity in the close-in Seattle markets where sellers are pricing competitively.
“We didn’t have a spring selling season this year,” he observed. When the press gets less negative, Skahen believes “It’s going to push buyers off the fence and they’ll regret having waited.”
Northwest Multiple Listing Service, owned by its member brokers, is the largest full-service MLS in the Northwest. Its membership includes approximately 31,000 brokers and agents. The organization, based in Kirkland, currently serves 19 counties, mostly in western Washington, plus Grant, Kittitas and Okanogan counties in the central part of the state.
Regarding this comment: “NWMLS director Mike Skahen believes the price drop has “already happened.” “It’s a great time to negotiate with sellers,” he suggests.”
Mr. Skahen is either intentionally misinforming the public or has zero clue about macro-economics. The price drop is Las Vegas and LA for example, has mostly happened. Our drops probably won’t be as steep, but they will continue. Boeing just announced probable layoffs in 2009. What the announcement didn’t tell you was that thousands of Boeing on-sight contractors are likely released in early 2009. Microsoft is slowing hiring to a crawl. My MS team recently hired two full time employees, but both are permanently place in the Vancouver BC facility. Wamu is losing thousands of high paying positions. Expedia just laid off hundreds of skilled workers. Deflation is already occurring. The single piece of good news for consumers is cheaper gas. Unfortunately, the oil price is a reflection of its shrinking demand in a constricting economy.
Based on all the factors I just listed, how does anyone ascertain that “the price drop has “already happened.”” Anybody who buys today will have a home worth less tomorrow. Given every single forecast I have heard, this trend will continue for 6 months minimum. If homebuyers want bargaining power, just wait a few quarters when layoffs start to force people back into apartments. Economics 101.
Awaiting moderation? Nevermind, this will never make it in. I didn’t cheerlead and state how everything is wonderful in the market and how the time to buy is NOW NOW NOW.
Two minutes between posts at 1 am in the morning doesn’t provide much opportunity to moderate.
At any rate, this NWMLS post/press release was dated May ‘08 so it’s definitely dated. No doubt, though, hard times in the real estate market will continue for the foreseeable future.