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August ranks as 2011's best month for both pending and closed sales in Washington state!

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KIRKLAND, Wash. (Sept. 6, 2011) – August now ranks as this year’s best month for both pending and closed sales around Washington state , according to the latest report from Northwest Multiple Listing Service. Last month’s volume of pending sales was the highest number of mutually accepted offers since April 2010 when the homebuyer tax incentive expired.

Northwest MLS brokers reported 7,632 pending sales during August, a gain of more than 26 percent from the same month a year ago when they notched 6,037 pending sales. Last month’s total for the 21 counties in the MLS service area surpassed July by 450 transactions.

Thirteen counties had double-digit gains from a year ago, led by Snohomish County where pending sales jumped more than 46 percent.

"For the first time in a long time, I can say with confidence that things feel better," said Northwest MLS director OB Jacobi, president of Windermere Real Estate. "We shouldn’t get too distracted by the large increase in pending sales," he cautioned, noting, "It’s a positive sign, but these figures are being compared to last summer’s post-tax incentive doldrums. With that being said, we’re excited about the positive momentum in the market."

"Interestingly enough," Jacobi remarked, "We’re seeing the most activity in the $600,000 to $800,000 price ranges in King County, but low inventory continues to be an issue across the board." He also noted the company’s mortgage reps are reporting a 50 percent increase in non-refinance loan applications, which he believes "is a positive indicator of things to come."

Closed sales during August climbed more than 35 percent from the same month a year ago, rising from 4,211 sales to 5,704. Through eight months, this year’s completed transactions have outgained last year by 592 sales (36,918 versus 36,326, for an increase of more than 1.6 percent).

Northwest MLS members added 9,128 new listings to inventory last month, the fewest since February. With those additions, the selection at month end included 36,907 active listings, with about 86 percent of the inventory being single family homes.

Inventory has dropped more than 16 percent compared to a year ago (36,907 active listings at end of August versus 44,186 for same month a year ago).

"With a low level of home inventory for sale and historically low interest rates, we are seeing a healthy volume of sales activity causing multiple offers," observed J. Lennox Scott, chairman and CEO of John L. Scott Real Estate.

(NWMLS news release: August activity) Sept. 6, 2011 (NWMLS news release: August activity) Sept. 6, 2011

Multiple offers are occurring below the one million dollar mark close to job centers in Seattle and Bellevue, and below the mid-price point elsewhere, according to Scott, who advised would-be buyers and sellers to get "buyer ready."

To get "buyer ready," Scott said potential purchasers "should get pre-approved for a home loan, understand the inventory level in your selected market area and price range, and sign up to receive daily email notifications of just-listed properties." Sellers should take similar steps, he suggested: "If you have a home to sell, start investigating the process."

Selling prices are still below year-ago levels. Area-wide, the median price for last month’s completed sales was $236,000, about 12.4 percent less than twelve months ago. Year-to-date through August, prices for sales of single family homes and condominiums (combined) are down about 9.4 percent.

In King County, last month’s median selling price was $315,000, down nearly 9.9 percent from a year ago. A year-to-date price comparison shows a decline of just under 8.4 percent.

Five counties show slight year-to-date price changes: Kitsap (-2.1%); Grant (-1.85%); San Juan (+2.6%); Okanogan (unchanged); and Whatcom (-0.65%).

Commenting on the latest numbers, NWMLS director Frank Wilson emphasized, "A real estate market is about activity and momentum." He also noted historic affordability, with the cost of a home better matching income levels and extremely low interest rates contributing to favorable conditions. "We continue to live in a real estate market of extreme affordability, affordability levels that have not been seen in decades," he stated.

Wilson, the branch managing broker at John L. Scott Real Estate in Poulsbo, noted Kitsap County is seeing slightly more new listings come on the market than a year ago, but total inventory is down about 6.6 percent.

"From a marketing prospective there is nothing better than motivated sellers who are willing to stage their home for sale and price it to be competitive in today’s market," Wilson stated. "This market is now about serious buyers and serious sellers -- people who have a plan and goals in mind," he observed, adding, "Our pending sales are up more than 15 percent which shows the activity of a healthy market." He also noted a more balanced market, based on months supply (currently about 5.8 months supply compared to the year-ago figure of 7.1 months). However, he acknowledged, home prices continue to settle as they have dropped about 12 percent in Kitsap County compared to a year ago.

The National Association of Realtors® attributes much of the price drops around the country to sales of distressed homes, which are usually sold at deep discounts. NAR’s analysis shows 29 percent of sales nationwide are classified as distressed.

NAR officials also fault banks for "unnecessarily restrictive practices." Such practices are restraining the housing recovery by denying loans to many creditworthy potential buyers, according to NAR. "Those declined buyers represent the difference between an uneven recovery, and a much more robust housing market that could stimulate the economy and create jobs," the association declared.

Commenting on the Realtors’ most recent statistics, NAR Chief Economist Lawrence Yun described sales activity as underperforming. "The underlying factors for improving sales are developing, such as rising rents, record high affordability conditions and investors buying real estate as a future inflation hedge. It is now a question of lending standards and consumers having the necessary confidence to enter the market."

 

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 22,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 21 counties in Washington state.

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