News that hits us where we live.
January 2016 | Puget Sound Area Home Sales, Prices Still Strong
Home prices have "clearly recovered" in the Puget Sound area, and prices are likely to keep rising as a backlog of buyers competes for depleted inventory.
The 2015 year ended on a mostly positive note with pending sales, closed sales and prices all showing year-over-year increases. Listing activity dropped, in part because some sellers hesitate to list their home for fear of not finding a replacement.
Selling prices for single family homes and condominiums surged 8.6 percent from a year ago, rising from $290,000 to $315,000. The price of a single family home (excluding condos) that sold during December jumped nearly 15.5 percent, from $440,000 to $508,000, breaking the pre-recession record of $481,000 that was set in July 2007. Condo prices increased about 7.7 percent from a year ago, raising the median sales price to $279,975.
Despite rising prices, closed sales ended 2015 on a strong note. Brokers reported 7,091 closings during December, outgaining the total of 6,284 for the same month a year ago (an increase of 12.8 percent). For the year, a total of 88,831 closed sales were logged, up from 2014's total of 77,276 for a 14.3 percent gain.
Both long-time homeowners and new homebuyers are feeling the impact of rising prices and interest rates. For buyers, every 1 percentage point increase in interest rates decreases buying power by about 10 percent. The diminished power coupled with rising prices will push buyers who are on the fence to make their move. The same two factors will also motivate long-time homeowners to jump into the market as they look to maximize their profit and find suitable replacement properties.
With the backlog of buyers waiting in the wings, any new inventory that comes on the market will be snapped up immediately. These buyers and their brokers are ready, willing and able to pounce on well-priced, well-located properties. Well-qualified and prepared buyers helped propel last month's 15 percent increase in pending sales compared to a year ago.