"We’re having a sale!!!"
In many industries when they slash their prices, they celebrate. In real estate, that isn’t the prevailing sentiment.
Based on the most recently released Northwest Multiple Listing Service data, the database where real estate professionals report listings and sales in the Seattle area, the trends continued last month: decreasing housing inventory, increasing newly reported sales and steady closed sales activity. This trend is consistent throughout most of King County and certainly holds true for most of Renton.
In Renton, from the Fairwood area to the Kennydale area, the number of homes for sale in February 2012 was down 38.9% compared to February 2011. Pending sales, those under contract but not yet closed, was up 12.4% while closed sales were up 15.2% this February compared to last.
So prices should be going up, right? According to my economics class, when supply goes down and demand remains steady or goes up, prices should rise. While last month’s median sales price rose to $260,000 for the first time since September 2011, one month does not make a trend. Remember that 'median' means half the homes sold were more expensive than $260,000 and half were less expensive. February’s median sales price is still 8.8% lower than February 2011’s $285,000. Many attribute this trend to the fact that much of the hyper-activity experienced in the market is in the lower price ranges where investors and first time home buyers are taking advantage of an unprecedented combination of low interest rates for mortgages and prices from a decade ago.
The real estate market is having a sale, but many don’t feel like celebrating. It remains crucial for anyone thinking about making a move to think long-term and seek professional advice when planning for the future.
Nate Thornton has been a residential real estate broker with Windermere in the Renton and Kent area since January 2001. He grew and continues to live in the Fairwood area and is active in the community through the Renton Chamber of Commerce and Communities in Schools of Renton. He welcomes your comments or questions and can be contacted through his website, www.NateRealEstate.com