Carole's Blog

 Gig Harbor waterfront posts healthy price uptick

Gig Harbor waterfront 2014’s sales nearly equaled 2013’s record-breaking year. But the real news is the 18% increase in median sales price for Gig Harbor waterfront. Half of all sales were more than $600,000 and half less. Gig Harbor waterfront sales prices peaked at $900,000 in 2007–now at 2005 levels.

But the sales pattern for Gig Harbor waterfront was atypical—the market slowing precipitously 4th quarter 2013, continuing through the entire 1st half of 2014. By July Gig Harbor waterfront sales were markedly down–both price & number.

Not surprisingly, all 23 $1m plus sales occurred in Gig Harbor & Fox Island. But what was noticeable was the buying intensity 4^th quarter in the upper end. Only 6 Gig Harbor waterfront  offers were accepted in the entire 1st half, 7 in the 3^rd quarter & 9 in the 4^th, mirroring consumer confidence. 10 of those 23 sales closed in November & December alone. $655,000 was the high sales price for Key Peninsula.

What a difference a year made in the over $1m tier for Gig Harbor waterfront. 2013’s record sales volume produced the smallest percentage (10%) of sales over $1m & the lowest median sales price ($490,000) since 2004. But 2014’s nearly equal numbers showed a healthy uptick of 17% high-end sales with 18% increase ($600,000) in median sales price.

The current slim inventory of Gig Harbor waterfront—coupled with historically low interest rates & easier financing should keep prices rising in 2015.  Median list price of the 38 homes in Gig Harbor/Fox Island is a shy $1m & in Key Peninsula $435,000 for the 18 homes listed. On the other hand, if an abundance of “pent-up sellers” list, it could hold down prices. I calculate a minimum of 250 Gig Harbor waterfront owners are ready to move—if market conditions (prices) permit.

Gig Harbor waterfront homes $1m plus sold on average for 150% of assessed value in 2014. Average frontage was 102 feet, considerably down from 170 feet the year before. Only 5 had more than 125 feet. 50% had docks or dock permits & 85% were low to medium-low…nothing unusual here. Homes $750,000-1,000,000 sold on average for 120% of assessed value.

Distressed Gig Harbor waterfront  home sales are becoming nearly a non-issue—just 2% of the sales last year were short-sales and 5% were bank-owned, down 9% & 13% 3 years ago.

Carole is a Broker at Windermere/Gig Harbor, specializing in Gig Harbor waterfront and view properties. She may be reached at 253.549.6611 or Carole@ISellGigHarbor.com

Gig Harbor home prices and sales pause in October

Pending sales volume during October was level with 2012 sales as well as September’s.  The higher tiers have seen fewer contracts and closed sales in the past two months.

The consensus is the federal shutdown during the first two weeks of October, the unknown of the Affordable Health Care law and below-normal inventory has shaken consumer confidence.

Consumer confidence “deteriorated considerably” in October as a result of the shutdown and debt ceiling squabbles, according to The Conference Board. A recent Gallup poll found some improvement in Americans’ economic confidence, but reported it is still well below mid-September, before the shutdown

MLS figures summarizing October’s activity show year-over-year drop in inventory (down 10% in Gig Harbor and 20% in Key Peninsula), nearly 20% increase in the volume of closed sales, and healthy increases in selling prices (up 9.4% in Gig Harbor and 5.9% in Key Peninsula).

Gig Harbor’s median price of $350,000 is 9.4% higher than a year ago – 12.9% lower than September – essentially the same as first half 2005 prices. First half November Gig Harbor home prices are also lower.

• As of Nov 17, $285,000 is the median Gig Harbor home price for closed sales
• Gig Harbor home prices are running at 1^st half 2005 prices
• Key Peninsula’s median price of $216,000 is 5.9% higher than last year & the same as September
• As of Nov 17, $183,000 is the median for closed sales this month
• Prices are running at 2^nd half 2005 prices
• Nationally house prices are expected to increase 4.3% in 2014 and settle around 3.4% after that
• October homes closed at 99% of then current list price. November is seeing a slight tick down from that and slightly longer market time
• Inventory is down 10% for Gig harbor and nearly 20% for Key Peninsula

We are seeing this in the Gig Harbor home market now with a neutral supply of homes at a bit more than six months…a far cry from the 3.5 month supply of the second quarter.

The shortage of homes for sale earlier in the year created an imbalance of supply to demand which resulted in double digit year-over-year price increases nationally. According to a recent Wall Street Journal article, the inventory of homes for sale is now beginning to reach more normal levels. The article reported:

“Housing inventories increased in August and stood just 2.5% below their levels of a year ago, offering the latest sign that more sellers are testing the market after swift home-price gains over the past year.

Nationally, there were 1.98 million homes listed for sale in August, according to a report released Thursday by Realtor.com. That was up by more than 24% from the low point in February and up 1% from July. Inventories have increased for six straight months.”

What about Home Prices?

This doesn’t mean prices will collapse. The inventory levels are still depressed, just improving. As the article mentions:

“While the overall level of homes for sale remains relatively depressed, the report suggests that inventory may have hit a bottom earlier this year after an extended two-year decline.”

However, as we mentioned last week, properly pricing your home in this market can be tricky. You should depend on the advice of your real estate agent.

I see this happening in our Gig Harbor home market. It will be interesting as the economy picks up to see if this trend continues and owners remain in their homes rather than "trading up". Do you think we will all live in our homes longer than before the recession?

Americans are increasingly willing to spend on home renovations, according to a survey that says they are taking on more projects and plan to use more expensive materials throughout the process. Remodeling app Planese outlined in a news release the results of an online survey done with remodelormove.com, in which homeowners were asked roughly 70 questions about their plans to remodel their home or move to a new one. All 5,000 respondents were interested in making some sort of change.



The results indicate Americans are willing to spend 30 percent of their home's value to remodel, up from 25 percent in 2007 and 28 percent in 2010, though home prices were significantly higher in 2007 and lower in 2010 than they are now. People plan to spend an average of about $102,000 to renovate. How homeowners said they'd use that money offers more insight into the consumer mindset.



Based on the survey results, those looking to remodel increasingly plan to hire professionals for the work and use more expensive materials for the renovation. And as far as what they're remodeling, homeowners surveyed in 2013 are undertaking more expensive projects by favoring kitchen updates over bathrooms.

http://bit.ly/18kDA1j