Carole's Blog

Gig Harbor home sales show steady progress!

Are we better off than we were five and six years ago? No, but we’re climbing out steadily. Here’s the evidence:

• Sales were up 27%  this last quarter compared to 2011
• Sales were down 19% this year compared to 5 years ago
• Inventory is down 13% from August 2011 and very close to 6 years ago
• Homes are taking 21% less days to sell than a year ago
• Pending sales are up 7% this quarter compared to last quarter
• Pending sales are up 10% for last 12 months compared to previous year
• Sale prices are running 94% of original list price
• Supply & demand—only 5.7 months’ supply—verging on a seller’s market
• Median sales price down 13% year over year
• Median sales price down just 4.7% this quarter over last quarter
• Median sales price down 32% this quarter from 6 years ago

Nearly all the signs are positive and have been for several months–enough to be a trend. We’ve slowed the decline in prices and the inventory is quite tight. These statistics are for Gig Harbor and Fox Island.

Evidenced locally, our Gig Harbor Soundview Windermere office had the best summer months for sales that we’ve had in five or six years. And new listings are only coming in at half the numbers of sales the brokers are making. Homes priced to be “in the market” rather than just “on the market” are selling quickly at all price ranges, often with competing offers. This is a nice “window of opportunity” for sellers who have been waiting to sell.

Waterfront is having its best year since 2007. It fairly exploded in last August and early September. September generally is about the third best month for sales.

With only 5.7 months’ supply of homes on the market we are clearly no longer in a buyers’ market. And we are sliding beneath the 6 month “normal” market into the range of a seller’s market. We’ve had as much as 32 months’ supply and it was even 9 months in July.

Aside from supply and demand, the ratio homes are selling for compared to their original list prices is up to 94%. We haven’t been this high since 2007 and we hit 76% in 2010 and 84% in 2011. These last two figures should be lessons to the buyers in the marketplace. The “killing” the buyers were able to make in the past few years is rapidly disappearing.

Our distressed home sales have dropped dramatically with only 10% of the market bank-owned or a short sale listing.

So…high sales volume, low inventory, fewer days on market, homes selling for closer to list price…Can a solid nudge in prices be far behind?

Carole Holmaas is a Broker at Windermere Real Estate in Gig Harbor, licensed since 1967 along with her husband John. She specializes in waterfront, view and golf course homes. She may be reached at 253.549.6611 or Carole@ISellGigHarbor.com

Gig Harbor home sales—something for everyone

• Local inventory ↓ 17% from 2011 –7.2 mo supply
• King/Sno/Pierce inventory    ↓ 42.65% from 2011
• Median price ↓ 1% Y-T-D –rate of decline slides
• Waterfront prices↑ 6% Y-T-D
• Nationally, price increase ↑3.5% not to 2016
• Local sellers’ market through $350,000 prices
• Local balanced market through $700,000 prices
• Washington REO inventory less than 2%

Gig Harbor home sales are trending with overall national figures. Sales–the first part of any housing recovery have come back with vigor. Prices–the second piece of the recovery is lagging. Both Gig Harbor and Key Peninsula have experienced as many positive as negative months this year–again typical nationally.

Prices are declining at a shallower rate than in past months. Both peninsulas are currently at second half 2004 prices for Gig Harbor home sales —improved  from 2003 prices  we experienced most of last year but still down 1% for the first half of the year.

The good news is that distressed Gig Harbor home sales have dropped 10% from the beginning of the year—another national trend. Short sales outnumber REO properties nearly 2-1. And currently distressed homes make up just 10% of the inventory.

Washington is fortunate to have a non-judicial foreclosure process which has cleared the backlog faster than in states where the courts make the determination. This leaves less shadow inventory in the wings as well. In fact Washington has less than a 2% foreclosure rate—one of the lowest in the country. Lenders are working more aggressively with homeowners on modifications and short sales.

An increase in Gig Harbor home prices depends on supply and demand. The supply side is down to seven-month inventory but prices haven’t spiked yet—largely because anticipation of surfacing foreclosed properties. We will know shortly if we need to factor in more than the current 2% into the market pricing equation for Gig Harbor home sales. Inventory in the tri-counties has dropped 42% from last year—the fifth largest drop in the nation.

So this summer is an excellent window for sellers—inventory is low and interest rates have never been lower. Home supply is down nearly 20% from a year ago and over 40% from the peak. It is truly a sellers’ market under $350,000 and a nicely balanced market up to $700,000.

There is a tremendous pent-up demand for sellers who want to move for employment, be closer to family or scale down in size. And there appears to be little reason to wait for price increases because the national prediction is it will take until 2016 for house prices to reclaim the 3.5% increase in value considered the pre-bubble “normal”.  Maybe a bit more down this year, up 1.3% in 2013 and 2.6% in 2014, is what the June Home Price Expectation Survey says.

Friday respected magazine The Economist, reported “America’s houses are now among the world’s most undervalued: 19% below fair value, according to our house-price index.” Another good reason to buy.

As I said at the beginning…there is something in Gig Harbor home sales news for everyone.