Below is a link to a good article in yesterday's Olympian about the local housing market. Among other things, it provides some view to the future supply of new construction homes coming on the market.
Residential building permits are down across the country, and that is a good thing. The supply of homes on the market is already over 7 months (4-6 months supply indicates a balanced market).
Builders are clearly responding to the oversupply by moderating the pace of new construction. While we have a ways to go yet, this is helping to bring our market out of the doldrums and back to more sustainable times.
http://www.theolympian.com/southsound/story/954635.html
Monday, August 31, 2009
Thursday, August 27, 2009
Coldwell Banker Ranked Highest in Seller Satisfaction
J.D. Power and Associates recently released results from its 2009 Home Seller Survey. Coldwell Banker was ranked highest among national real estate companies in satisfaction among home sellers.
The survey examines four factors among in the home-selling process: (1) agent, (2) marketing, (3) office, and (4) package of additional services. The results of the survey showed that Coldwell Banker performs “particularly well in all four categories.”
The survey examines four factors among in the home-selling process: (1) agent, (2) marketing, (3) office, and (4) package of additional services. The results of the survey showed that Coldwell Banker performs “particularly well in all four categories.”
Wednesday, August 26, 2009
Sales of New Homes on the Rise
Last week we shared the news of the nationwide jump in sales of existing homes. This week the report on July new home sales was announced. Sales in that category are up 9.6% to an annual pace of 433,000.
This is the highest rate of sales since last September, and it is the largest percentage increase since early 2005, which was the peak of the nation’s housing boom.
The standing inventory of new homes fell to a 16-year low. That reflects both the increase in sales and the fact that builders have put the breaks on new starts.
At the current rate of sales, there is now a 7.5 month supply of new homes. This is down sharply from the beginning of the year when more than 12 month supply of homes sat on the market. A balance market is one that has between four and six month supply.
Locally, pace of new home sales is lagging behind the national trend. We are seeing a slight uptick in activity with July sales 4.4% up from a year ago. Most subdivisions are averaging a couple of sales each month, which reflects a more normal pace of sales for our market.
There is certainly a lot less new construction coming on the market. As of July 31, 2009, there were 416 new construction listings in Thurston County, down 28% from the 581 listings in July 2008.
Like the rest of the market, price is really dictating the pace of sales. Those new homes that are priced well compared to the competition, both new and existing homes, are selling well. Also, homes in the more affordable space under $300,000 continue to outperform the homes priced above that level.
The average list price of a Thurston County new construction listing is now $302,493, down $63,862 from the same time last year.
Statistics compiled by Coldwell Banker Evergreen Olympic Realty, Inc. from the NWMLS database. Statistics not compiled or published by NWMLS.
This is the highest rate of sales since last September, and it is the largest percentage increase since early 2005, which was the peak of the nation’s housing boom.
The standing inventory of new homes fell to a 16-year low. That reflects both the increase in sales and the fact that builders have put the breaks on new starts.
At the current rate of sales, there is now a 7.5 month supply of new homes. This is down sharply from the beginning of the year when more than 12 month supply of homes sat on the market. A balance market is one that has between four and six month supply.
Locally, pace of new home sales is lagging behind the national trend. We are seeing a slight uptick in activity with July sales 4.4% up from a year ago. Most subdivisions are averaging a couple of sales each month, which reflects a more normal pace of sales for our market.
There is certainly a lot less new construction coming on the market. As of July 31, 2009, there were 416 new construction listings in Thurston County, down 28% from the 581 listings in July 2008.
Like the rest of the market, price is really dictating the pace of sales. Those new homes that are priced well compared to the competition, both new and existing homes, are selling well. Also, homes in the more affordable space under $300,000 continue to outperform the homes priced above that level.
The average list price of a Thurston County new construction listing is now $302,493, down $63,862 from the same time last year.
Statistics compiled by Coldwell Banker Evergreen Olympic Realty, Inc. from the NWMLS database. Statistics not compiled or published by NWMLS.
Friday, August 21, 2009
Existing Home Sales Surge
The National Association of Realtors reports that in July sales of existing U.S. homes increased 7.2% over the June 2009 pace of sales. We are now at a seasonally adjusted rate of 5.24 million units.
It is the fourth month in a row that sales have increased, marking the first time since June 2004 that we’ve had such a string of positive gains.
Year over year sales are also up. In July 2008, we had a 4.99 million unit pace of sales. We have to look all the way back to November 2004 to find the last time we had a year over year gain in nation-wide sales.
The sales gains were not evenly shared around the country. Some areas are seeing bigger gains than others. The Northeast jumped 13.4%, the Midwest is up 10.4%, the South rose 7.1%, and the West is down 1.7%. All areas were ahead of July 2008 levels.
There is one simple reason for the surge in activity – price. Regular followers of our blog will know that we routinely discuss price and how it is the solution to getting housing going again.
For a long time prices have been well above current levels of supply and demand. When that happens, buyers simply do not purchase. Now that prices are coming back to match the supply-demand picture buyers are back.
The national median sales price for existing homes is down 15.1% in from the same period a year ago. Prices are down 32% from the peak in 2006.
The lower prices have made the home price to income ratio the best it has been in years. This means homes are affordable again. And affordability is the key to stability and sustainability in housing.
The emergence of the subprime, adjustable-rate or interest-only loan products earlier this decade created a false sense of affordability. The return to predominately fixed-rate lending coupled with lower home prices is creating a more sustainable base of homeowners who will now know they can truly afford their homes over the long-haul.
Even with the brisker pace of sales, there are still enough houses for sale to keep us squarely in a buyer’s market. The inventory of unsold homes in the U.S. stands at a 9.4 month supply. However, supply has dropped by two months in just a year.
Locally, our supply is just below 7.4 months. A balanced market has a four to six month supply of homes for sale, and we are definitely trending back toward that kind of market.
For the latest on July 2009 sales in our local market, read our August 6, 2009 blog post.
Click image to enlarge.
Statistics compiled by Coldwell Banker Evergreen Olympic Realty, Inc. from the NWMLS database. Statistics not compiled or published by NWMLS.
It is the fourth month in a row that sales have increased, marking the first time since June 2004 that we’ve had such a string of positive gains.
Year over year sales are also up. In July 2008, we had a 4.99 million unit pace of sales. We have to look all the way back to November 2004 to find the last time we had a year over year gain in nation-wide sales.
The sales gains were not evenly shared around the country. Some areas are seeing bigger gains than others. The Northeast jumped 13.4%, the Midwest is up 10.4%, the South rose 7.1%, and the West is down 1.7%. All areas were ahead of July 2008 levels.
There is one simple reason for the surge in activity – price. Regular followers of our blog will know that we routinely discuss price and how it is the solution to getting housing going again.
For a long time prices have been well above current levels of supply and demand. When that happens, buyers simply do not purchase. Now that prices are coming back to match the supply-demand picture buyers are back.
The national median sales price for existing homes is down 15.1% in from the same period a year ago. Prices are down 32% from the peak in 2006.
The lower prices have made the home price to income ratio the best it has been in years. This means homes are affordable again. And affordability is the key to stability and sustainability in housing.
The emergence of the subprime, adjustable-rate or interest-only loan products earlier this decade created a false sense of affordability. The return to predominately fixed-rate lending coupled with lower home prices is creating a more sustainable base of homeowners who will now know they can truly afford their homes over the long-haul.
Even with the brisker pace of sales, there are still enough houses for sale to keep us squarely in a buyer’s market. The inventory of unsold homes in the U.S. stands at a 9.4 month supply. However, supply has dropped by two months in just a year.
Locally, our supply is just below 7.4 months. A balanced market has a four to six month supply of homes for sale, and we are definitely trending back toward that kind of market.
For the latest on July 2009 sales in our local market, read our August 6, 2009 blog post.
Click image to enlarge.
Statistics compiled by Coldwell Banker Evergreen Olympic Realty, Inc. from the NWMLS database. Statistics not compiled or published by NWMLS.
Thursday, August 20, 2009
Men vs. Women
Are we that Different in Home-buying Process?
Coldwell Banker just completed an interesting survey of 1,000 individuals to learn how men and women differ in the home-buying process. One result – women are a bit more decisive than men.
According to the report “when asked how long it took before they knew their home was ‘right’ for them, almost 70 percent of women had made up their mind the day they walked into the house, vs. 62 percent of men. Conversely, significantly more men needed two or more visits: (32 percent of men vs. 23 percent of women).”
View the entire Press Release and Video at: http://coldwellbanker.com/servlet/News?action=viewNewsItem&contentId=14521585
Coldwell Banker just completed an interesting survey of 1,000 individuals to learn how men and women differ in the home-buying process. One result – women are a bit more decisive than men.
According to the report “when asked how long it took before they knew their home was ‘right’ for them, almost 70 percent of women had made up their mind the day they walked into the house, vs. 62 percent of men. Conversely, significantly more men needed two or more visits: (32 percent of men vs. 23 percent of women).”
View the entire Press Release and Video at: http://coldwellbanker.com/servlet/News?action=viewNewsItem&contentId=14521585
Mortgage Rates Drop Again
Mortgage rates dropped again this week to 5.12% on a 30 year fixed-rate mortgage, according to Freddie Mac’s weekly Primary Mortgage Market Survey. This latest drop brings rates to their lowest levels since May, which rates were still in the high 4’s. At this time last year rates were nearly a point and a half higher at 6.52%.
Click image to enlarge.
Click image to enlarge.
Great Community Event this Weekend
Sand in the City, one of our community’s greatest public events, happens this weekend at the Port Plaza next to Farmer’s Market in Downtown Olympia.
Hosted by the Hands On Children’s Museum, the event showcases some outstanding sand sculptures built by local businesses and organizations. The three-day event starts with sand sculpting tomorrow (8/20) and continues with family activities all day Saturday and Sunday.
The event is free to the public, but donations are welcomed to help support children’s programming. Come out and enjoy the fun and support this great children’s organization.
Below are photos of our company’s previous sand sculpture entries.
Three Little Pigs (Golden Shovel Winner 2003)
Click image to enlarge.
Winnie the Pooh (Silver Medal Winner 2004)
Click image to enlarge.
Hosted by the Hands On Children’s Museum, the event showcases some outstanding sand sculptures built by local businesses and organizations. The three-day event starts with sand sculpting tomorrow (8/20) and continues with family activities all day Saturday and Sunday.
The event is free to the public, but donations are welcomed to help support children’s programming. Come out and enjoy the fun and support this great children’s organization.
Below are photos of our company’s previous sand sculpture entries.
Three Little Pigs (Golden Shovel Winner 2003)
Click image to enlarge.
Winnie the Pooh (Silver Medal Winner 2004)
Click image to enlarge.
Wednesday, August 19, 2009
Foreclosures Filings Dropping Dramatically
Foreclosure filings in Thurston County have dropped significantly over the past several weeks, averaging just over 13 filings per week since July 25th. This is the lowest rate we’ve seen since last year. Prior to this drop off, filings, known as Notice of Trustee’s Sales, had averaged nearly 40 per week since early this year.
Click image to enlarge.
This dramatic drop in rate may not last long. The biggest set of adjustable rate subprime mortgages originated in our market happened from summer of 2005 through 2006. The majority of those loans came with low rates fixed for 3 years. The last wave of those loans will reset at much higher rates over the next few months.
For interesting related story on the national foreclosure picture visit: http://www.cnbc.com/id/32449645/site/14081545
Statistics compiled by Coldwell Banker Evergreen Olympic Realty, Inc. from the NWMLS database. Statistics not compiled or published by NWMLS.
Click image to enlarge.
This dramatic drop in rate may not last long. The biggest set of adjustable rate subprime mortgages originated in our market happened from summer of 2005 through 2006. The majority of those loans came with low rates fixed for 3 years. The last wave of those loans will reset at much higher rates over the next few months.
For interesting related story on the national foreclosure picture visit: http://www.cnbc.com/id/32449645/site/14081545
Statistics compiled by Coldwell Banker Evergreen Olympic Realty, Inc. from the NWMLS database. Statistics not compiled or published by NWMLS.
Tuesday, August 18, 2009
More Sellers Needing Price Reductions
More home sellers across the U.S. are reducing the prices of their properties according to a recent study by Trulia.com. Nearly 24.4% of all sellers as of August 1, 2009 made at least one price reduction since coming on the market. That number was up from the June report, which showed 23.6% of sellers made price reductions.
The study shows that the average price reduction was 10% from the top list price, which equates to a $40,173 price reduction.
Locally, we are seeing that the majority of sellers had to take on one or more price reductions before getting the home sold. In our study of Thurston County home sales for July 2009, we found that 58.9% of sellers needed a price reduction before selling. The average percent price reduction was 20.1%, or $63,298.
Click image to enlarge.
The fact that a greater percentage of local sellers needed price reductions might be explained by the fact that our market’s correction started about 18-24 months after most of the rest of the nation. Sellers outside the northwest have had longer to come to terms with the market changes and the need to reduce prices to match the level of demand.
As high as our local numbers are they are actually improving quite a bit. In January and February, nearly 71% of sellers had to reduce their price before finding a buyer.
Remarkably, even at the peak of our market in the summer of 2006, 41% of sellers needed price reductions before selling, which shows that even in the most active seller’s market we’ve ever seen it was still possible to overprice a home.
Statistics compiled by Coldwell Banker Evergreen Olympic Realty, Inc. from the NWMLS database. Statistics not compiled or published by NWMLS.
The study shows that the average price reduction was 10% from the top list price, which equates to a $40,173 price reduction.
Locally, we are seeing that the majority of sellers had to take on one or more price reductions before getting the home sold. In our study of Thurston County home sales for July 2009, we found that 58.9% of sellers needed a price reduction before selling. The average percent price reduction was 20.1%, or $63,298.
Click image to enlarge.
The fact that a greater percentage of local sellers needed price reductions might be explained by the fact that our market’s correction started about 18-24 months after most of the rest of the nation. Sellers outside the northwest have had longer to come to terms with the market changes and the need to reduce prices to match the level of demand.
As high as our local numbers are they are actually improving quite a bit. In January and February, nearly 71% of sellers had to reduce their price before finding a buyer.
Remarkably, even at the peak of our market in the summer of 2006, 41% of sellers needed price reductions before selling, which shows that even in the most active seller’s market we’ve ever seen it was still possible to overprice a home.
Statistics compiled by Coldwell Banker Evergreen Olympic Realty, Inc. from the NWMLS database. Statistics not compiled or published by NWMLS.
Thursday, August 6, 2009
Thurston County Pending Sales Rise Again Closed Sales Fall a Bit
The Thurston County housing market continues to show mixed signals, but the most important number, pending home sales, is trending in the right direction.
The number of closed home sales in July 2009 was down 6% from a year ago, logging 282 sales versus 301 in July of 2008. After June sales posted only the third year-over-year increase in two and a half years, it is disappointing to see fewer sales in July.
However, a more important indicator of the market’s future performance is pending home sales. Pending sales are contracts that are accepted by a seller but have not yet closed. They represent the most current activity and show how active buyers are in the market. Thurston County pending sales increased 14.7% in July, jumping from 339 in July 2008 to 389 this year.
We are now seeing a trend emerge as monthly pending sales continue to best last year’s numbers. This is a good sign that buyers are active in this market. They are jumping back in as prices have become more affordable, helped by low interest rates and tax incentives for first-time buyers.
The difference in the performance of closed and pending sales is primarily due to the fact that many sales are simply taking longer to close. Short sales, where the net proceeds to the seller will not cover the outstanding debt on the property, are taking 60 to 90 days to close as the buyer and seller must wait for the bank to approve the sale.
Another factor in the difference is that many of the pending short sales never become closed sales because either the bank does not approve the sale or the buyer loses patience waiting for bank approval. Short sales account for at least 10% of our area’s pending sales activity.
The biggest influence in our market’s overall performance, however, continues to be price. To the extent a home is priced well it is selling. Year to date, our area’s average sales price is $264,851, which is down slightly more than 8% from a year ago and 12% off the peak a couple of years ago.
Depending upon location, condition, and amenities, some homes are requiring far more than an 8% reduction, while others are fairing better than the average. Because each house is unique, each has its own pricing story.
As we have reported in the past, that drop is simply bringing us back to our market’s historic trend line for price appreciation. While our market is not out of the woods yet, its path to recovery has been much less severe than some of the hardest hit places in the country.
Statistics compiled by Coldwell Banker Evergreen Olympic Realty, Inc. from the NWMLS database. Statistics not compiled or published by NWMLS.
The number of closed home sales in July 2009 was down 6% from a year ago, logging 282 sales versus 301 in July of 2008. After June sales posted only the third year-over-year increase in two and a half years, it is disappointing to see fewer sales in July.
However, a more important indicator of the market’s future performance is pending home sales. Pending sales are contracts that are accepted by a seller but have not yet closed. They represent the most current activity and show how active buyers are in the market. Thurston County pending sales increased 14.7% in July, jumping from 339 in July 2008 to 389 this year.
We are now seeing a trend emerge as monthly pending sales continue to best last year’s numbers. This is a good sign that buyers are active in this market. They are jumping back in as prices have become more affordable, helped by low interest rates and tax incentives for first-time buyers.
The difference in the performance of closed and pending sales is primarily due to the fact that many sales are simply taking longer to close. Short sales, where the net proceeds to the seller will not cover the outstanding debt on the property, are taking 60 to 90 days to close as the buyer and seller must wait for the bank to approve the sale.
Another factor in the difference is that many of the pending short sales never become closed sales because either the bank does not approve the sale or the buyer loses patience waiting for bank approval. Short sales account for at least 10% of our area’s pending sales activity.
The biggest influence in our market’s overall performance, however, continues to be price. To the extent a home is priced well it is selling. Year to date, our area’s average sales price is $264,851, which is down slightly more than 8% from a year ago and 12% off the peak a couple of years ago.
Depending upon location, condition, and amenities, some homes are requiring far more than an 8% reduction, while others are fairing better than the average. Because each house is unique, each has its own pricing story.
As we have reported in the past, that drop is simply bringing us back to our market’s historic trend line for price appreciation. While our market is not out of the woods yet, its path to recovery has been much less severe than some of the hardest hit places in the country.
Statistics compiled by Coldwell Banker Evergreen Olympic Realty, Inc. from the NWMLS database. Statistics not compiled or published by NWMLS.
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