KIRO Radio's Tom Kelly digs deep into the Puget Sound real estate market
Real Estate
seattlerealestate_hk640.jpg
Existing home sales during the second quarter of 2013 increased 5.4 percent from the first quarter, and 21 percent from a year ago. (MyNorthwest.com Photo/Hannah Kadletz)

UW data shows double-digit price jumps near Seattle

Washington state's housing market continued to advance in the April-June quarter, with four consecutive monthly improvements in home sales activity, according to the Runstad Center for Real Estate Studies at the University of Washington.

The imbalance between limited supply and strong demand resulted in a median price of $251,100 during the quarter, an increase of 6.4 percent compared with a year ago. The Seattle metropolitan area saw especially steep increases in median prices - 14.7 percent in Snohomish County, 13.8 percent in King County and 12.5 percent in Pierce County. Meanwhile, the median price declined in the Olympia and Yakima metropolitan areas.

"The biggest current impediment to the housing market remains a shortage of homes available for sale," said Glenn Crellin, associate director of the center. "Construction activity is improving, but builders cannot improve availability overnight. Lenders need to release properties which have been foreclosed, but are still owned by the lender to allow the market to stabilize and prevent renewed bubble conditions."

Existing home sales during the second quarter of 2013 increased 5.4 percent from the first quarter, and 21 percent from a year ago, reaching a seasonally adjusted annual sale rate of 93,280 homes. That means that if the pace for the quarter continued unchanged for a year, that number of homes would be sold. This represents the highest sales rate in six years.

While quarter-to-quarter home sales increased in only half of Washington's 39 counties at seasonally adjusted annual rates, strong markets in the largest urban areas pulled the statewide tally higher, Crellin said. Declines, he said, were all in smaller communities.

"Stronger sales activity is encouraging some owners to put their homes on the market," said Mark Kitabayashi, president of Washington Realtors, which partners with the center to produce home sales statistics. "But in many markets listings are so scarce, buyers don't have time to see many properties before making an offer. Well-priced, move-in-ready homes sell very quickly, often with multiple offers."

In addition to reduced selection and higher prices, buyers are faced with somewhat higher mortgage interest rates. While an improving job market is resulting in slightly higher incomes, it does not offset the other increases, causing a decline in the affordability of housing compared with three months or a year ago.

Median home prices rose statewide while home affordability dipped a bit. The all-buyer affordability index was 166.6 statewide, which means that a middle-income family could afford a home 66 percent above the median price provided they have a 20 percent down payment and good credit. All 39 counties recorded index values above 100, suggesting that middle-income families statewide could afford a median-price home.

The news was worse for renters seeking to purchase their first home. The statewide measure dipped back below 100, registering a score of 99.5, with 14 counties similarly below 100. Since it is traditionally a challenge to obtain that first home, Crellin said he thinks a first-time buyer index of 80 represents a reasonable opportunity for renters to qualify for a home.

Unfortunately, five counties, including King County - which recorded the lowest index in the state (71.0) - fell below that line.

Tom Kelly, Real Estate Today
Tom Kelly has been a professional journalist for 36 years. He served The Seattle Times for 20 years, many as Real Estate Editor.
Top Stories

  • Don't Flush It
    The city says some Seattleites are doing a crappy job of keeping stuff out of the sewer

  • 'Beaten Down'
    A federal jury hears arguments in a Bellevue police retaliation lawsuit

  • Questioning Competence
    A County Councilmember has changed his tune and is now unsure of Metro Transit's 'candor'
ATTENTION COMMENTERS: We've changed our comments, but want to keep you in the conversation.
Please login below with your Facebook, Twitter, Google+ or Disqus account. Existing MyNorthwest account holders will need to create a new Disqus account or use one of the social logins provided below. Thank you.
comments powered by Disqus
Listen to the show
Hear Real Estate Today on KIRO Radio
Join Tom Kelly every Sunday at 9am on KIRO Radio to talk Puget Sound real estate.

Sign up for breaking news e-mail alerts from MyNorthwest.com
In the community
Do you know an exceptional citizen who has impacted and inspired others?
KIRO Radio and WSECU would like to recognize six oustanding citizens this year. Nominate them to be recognized and to receive a $2,000 charitable grant.