Slow unprepared buyers losing out….

According to the lastest stats from the NWMLS, things sure are on the rebound! 

FOR IMMEDIATE RELEASE: October 4, 2012

Housing market rebound continues,
with “slow, unprepared buyers” settling for “2nd choice” homes

KIRKLAND, WA, October 4, 2012 – Home sales around western Washington continue to outpace activity of a year ago while inventory remains thin, according to new figures from Northwest Multiple Listing Service. Brokers say that combination is resulting in disappointment for buyers who are slow to accept the reality of a recovering housing market.

Commenting on September data from Northwest Multiple Listing Service that shows upticks in sales and prices, broker Frank Wilson said buyers who make unrealistic offers and requests are “back on the street looking at their second choice home.” Meanwhile, some sellers with well-priced, well-prepared homes are receiving multiple offers according to Wilson, a member of the Northwest MLS board of directors and the managing broker of John L. Scott Real Estate in Poulsbo.

Northwest MLS figures for September show the pace of sales slowed from the past six months, but still outgained activity of a year ago. Members reported 5,535 closed sales, which compares to the year ago total of 4,988 for an increase of nearly 11 percent. Thirteen of the 21 counties served by the MLS reported double-digit gains in the number of completed transactions.

Through three quarters of 2012, closed sales are up 14.6 percent from a year ago (48,022 versus 41,906).

Prices on last month’s closed sales rose 9.2 percent from twelve months ago. The area-wide median price on single family homes and condominiums that sold last month was $255,500.

Prices on single family homes (excluding condominiums) increased more than 12 percent, rising from $240,000 to $269,000. The most expensive homes sold in San Juan County, which reported a median sales price of $380,000, and in King County, where the median selling price was $375,000.

Brokers added 7,300 new listings to inventory last month, the fewest number since January. With those additions, there were 25,476 active listings in the MLS system at the end of September. That total is down 27.7 percent from the year-ago selection that encompassed 35,254 listings.

The sharpest drop in active listings occurred in Snohomish County, which has about half the inventory of a year ago (2,187 currently versus 4,308 active listings at end of September 2011). Northwest MLS figures show year-over-year prices there jumped 14.6 percent.

The imbalance between supply and demand is “wreaking havoc” with some buyers and sellers, said Northwest MLS director George Moorhead, branch manager at Bentley Properties in Bothell. Some sellers are lamenting “missed opportunities,” but he believes positive momentum will continue with the combination of below-normal inventory, record-low interest rates and changing views on home ownership. “We are seeing clients’ views change from a home being a short-term investment vehicle to being a place where we raise and teach our families,” Moorhead remarked.

MLS members tallied nearly 600 more pending sales last month than a year ago. Brokers reported 7,494 mutually accepted offers for an increase of 8.7 percent from the year-ago total of 6,897 pending transactions. Sales results were mixed across the MLS market area, with 12 counties reporting increases, eight reporting declines and one unchanged.

The rapid pace of sales in some areas coupled with dwindling inventory means below-average months of supply in some counties. Area-wide there is about 3.4 months of supply, with five-to-six months considered to be average. King, Pierce and Snohomish counties all report levels below three months.

All cash buyers are returning to the entire market, observed MLS director Darin Stenvers. “Cash offers are being made across the price spectrum, including the million dollars-plus ranges,” he added.

Stenvers, the office managing broker at John L. Scott, Inc., in Bellingham, said the ingredients are in place for “a perfect buying season,” citing rapid absorption of inventory and well-priced homes as two factors. How long such conditions will last is “the $64,000 question,” he stated, noting pent-up demand in some areas has buyers feeling the pressure to move quickly to get their offers accepted.

New home construction will continue making a rebound, Stenvers believes. He said builders are moving cautiously in most markets, being careful to build only the sizes and quality of homes that are likely to sell before completion, and not starting too many foundations at one time.

Despite brisk activity, Stenvers noted foreclosures and owners who are delinquent on mortgage payments remain a concern. The number of owners nationwide who are 90 days or more late in making payments is again on the rise, a situation that will continue to affect foreclosure rates, he explained.

“The lack of foreclosed homes not coming on the market has successfully stabilized prices but also created a lack of homes for buyers to buy,” Stenvers stated.

Buyers are also weighing the pros and cons of renting or buying. “The rent versus buy conundrum is still the biggest obstacle facing buyers today,” Stenvers reported.

Referring to new reports on recent and planned rent increases and low availability of good rentals in some areas, Stenvers said home ownership is “a better investment in many areas even if buyers are thinking of holding the home for a relativity short time frame.” It is hard for someone to move into an apartment after having the freedom of a larger home, so displaced home owners are looking to rent homes first, he reported, adding, “This alone is driving investors back into the housing market,” he stated.

MLS director Wilson said while the story of a few years ago has flipped, the path to ownership remains constant. “We used to say the seller who priced and staged their home the best would get buyers. Today we’re saying buyers who are most realistic with their offers and pre-approved with a lender, and who are the most aggressive might get the house they want.”

“This is what a normal market looks like — buyers and sellers negotiating fairly with each other and each feeling they may have left a little on the table,” Wilson remarked. One of the benefits of a “normal” market is that it is not all about sale price, he explained, noting closing costs, type of loan, closing date, possession date and work orders are all things that balance out a normal transaction.

Setting up buyers for success remains the paramount goal, according to Wilson. A buyer’s path for success includes pre-approval with a lender, sufficient funds to pay their own closing costs, and the patience to wait through the closing process, especially if they are buying a short sale or bank owned home, he explained.

George Moorhead, another MLS director, echoed that advice, saying “Smart recovery is what everyone should be considering as we heal from the neglected financial actions of the past.”

Current buyers are cautiously optimistic, Moorhead reported. Clients in general are united in debt reduction, building up savings and reserves, spending more wisely than they ever have, and have an optimistic outlook of the economy as a whole.

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership includes more than 21,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 21 counties in Washington state.

Statistical Summary by Counties: Market Activity Summary – September 2012

 

Single
Family
Homes
+ Condos

LISTINGS

PENDING
SALES

CLOSED SALES

New
Listings
Total
Active
# Pending
Sales
#
Closings
Avg.
Price
Median
Price

King

3,009

6,312

3,072

2,312

$424,085

$335,000

Snohomish

987

2,187

1,206

880

$284,833

$261,658

Pierce

1,128

3,731

1,247

773

$231,335

$200,500

Kitsap

379

1,552

346

238

$282,866

$240,250

Mason

102

791

75

68

$202,012

$180,000

Skagit

156

904

146

121

$267,587

$230,000

Grays Harbor

100

858

93

59

$142,108

$130,000

Lewis

107

717

64

68

$159,612

$155,000

Cowlitz

137

526

102

78

$141,492

$127,450

Grant

70

571

52

57

$147,326

$137,000

Thurston

323

1,283

317

289

$223,461

$211,000

San Juan

18

408

35

29

$736,017

$375,000

Island

114

848

132

90

$311,867

$270,900

Kittitas

67

506

55

38

$259,489

$196,500

Jefferson

47

515

52

39

$239,002

$225,500

Okanogan

35

438

18

22

$206,500

$192,150

Whatcom

272

1,529

271

216

$277,558

$239,944

Clark

45

229

37

30

$194,755

$175,450

Pacific

34

414

34

23

$138,635

$119,000

Ferry

8

82

1

0

0

$0

Clallam

49

422

39

37

$223,025

$220,000

Others

113

653

100

68

$219,385

$214,750

MLS TOTAL

7,300

25,476

7,494

5,535

$323,747

$255,500

4-County Puget Sound Region Pending Sales (SFH + Condo combined)
(Totals include King, Snohomish, Pierce & Kitsap counties)

 

 

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

2000

3706

4778

5903

5116

5490

5079

4928

5432

4569

4675

4126

3166

2001

4334

5056

5722

5399

5631

5568

5434

5544

4040

4387

4155

3430

2002

4293

4735

5569

5436

6131

5212

5525

6215

5394

5777

4966

4153

2003

4746

5290

6889

6837

7148

7202

7673

7135

6698

6552

4904

4454

2004

4521

6284

8073

7910

7888

8186

7583

7464

6984

6761

6228

5195

2005

5426

6833

8801

8420

8610

8896

8207

8784

7561

7157

6188

4837

2006

5275

6032

8174

7651

8411

8094

7121

7692

6216

6403

5292

4346

2007

4869

6239

7192

6974

7311

6876

6371

5580

4153

4447

3896

2975

2008

3291

4167

4520

4624

4526

4765

4580

4584

4445

3346

2841

2432

2009

3250

3407

4262

5372

5498

5963

5551

5764

5825

5702

3829

3440

2010

4381

5211

6821

7368

4058

4239

4306

4520

4350

4376

3938

3474

2011

4272

4767

6049

5732

5963

5868

5657

5944

5299

5384

4814

4197

2012

4921

6069

7386

7015 7295 6733 6489 6341 5871      

 

Posted on October 11, 2012 at 10:19 am
Bruce Fulton | Category: Uncategorized

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