Home Supply Remains Low

The local news has caught on to what I’ve been seeing on the front lines of the real estate market this summer. I don’t believe (and experts agree) that the low supply is going away. We just don’t have enough homes/land in and around Seattle. Here is the report from Seattle PI that I am referring to:

Another month, another tale of inventory woes plaguing the Washington real estate market.

9520 1st Ave. N.E., Unit A302. Listed for $374,999. See the full listing here.

According to the latest report from the Northwest Multiple Listing Service, experts are finding many potential home-buyers are expanding their search beyond the major job centers in King County as a result of the crunch on supply in the month of August.

System-wide the 23 counties serviced by the MLS have less than two months of supply — a number that drops to 1.6 months in the four-county Puget Sound region. Year-over-year, that looks like a 13% drop in supply system-wide, and an 18.5% drop in King County.R

Within King County the median sales price has held steady at $760,000 for single-family homes, and areas outside King are becoming a draw for more affordable prices.

“Areas immediately outside the Puget Sound region and along the I-5 corridor continue to see double-digit house price growth,” noted James Young, director of the Washington Center for Real Estate Research at UW. “[It’s] due to first-time homebuyers who struggle to afford housing in King and Snohomish counties as well as from existing homeowners cashing out of Seattle and King County.”

That’s backed up by a recent report from SmartAsset, which ranked the top 10 most affordable places in Washington state, taking into account costs, real estate taxes, homeowners insurance and mortgage rates. The closest one to Seattle is Duvall — ninth on the list. The only other Puget Sound-area locale is tenth, Prairie Ridge.R

“While August is always a slower time for listings and sales, what is really surprising this year is the decrease in new listings taken, while pending sales increased,” observed Mike Grady, president and COO of Coldwell Banker Bain.

Although June and July are usually seen as “peak” for real estate, Grady noted that June and July were relatively lackluster this year, when usually they are active (especially coming off spring).

“The pending sales numbers indicate that buyers are indeed out there and willing to purchase, but there are simply not enough homes,” he added. “Everything that is listed is getting sold and fairly quickly.”

Which means that while the median sale price in King County is holding steady, it’s still not the easiest market to break into.