SEATTLE HOUSING MARKET UPDATE
September was another great for month for sellers in Seattle.
The median price of a Seattle home was back up to $500,000 after showing lots of fluctuation over the past 2 months:
- July 2014 median price $525,000
- August 2014 median price $475,000
- September 2014 median price $500,000
I think the July 2014 of $525,000 and the August 2014 of $475,000 are BOTH anomalies/outliers and that the $500,000 in September is a true reading.
The September 2014 median sales price of $500,000 is the 2nd ALL TIME HIGHEST MEDIAN SALES PRICE EVER RECORDED. The record is July 2014 with the median price of $525,000.
SO WHAT HAPPENED TO SEATTLE REAL ESTATE IN SEPTEMBER?
In September there were 1,193 ACTIVE listings in the Seattle real estate market.
In September 746 homes went PENDING.
Which means that 1 out of every 1.6 homes on the market went pending in September.
This 1.6 ratio implies a 1.6 month supply of inventory.
The 1.6 ratio is a strong SELLER’S MARKET INDICATOR.
Any ratio under 3.0 is a seller’s market indicator.
Any ratio between 3.0 and 6.0 is a neutral market indicator.
Any ratio over 6.0 is a buyer’s market indicator.
The story remains LACK OF INVENTORY.
The 1,193 ACTIVE listings is 44% under our 10 year average for September inventory.
The September ten year moving average for inventory is 2,115 ACTIVE listings.
Also if we compare September 2014 to September 2013 we will note that even though inventory was low in September 2013 (1,351) it was even lower in September 2014 (1,193). Inventory is down 12% vs 2013.
And if we compare DEMAND. In September 2013 695 homes went PENDING and in September 2014 746 homes went PENDING. So DEMAND was 7% higher in 2014.
Also please note that September was the 8th month in a row that the AVERAGE list price vs SALES price was 100% or more.
In the month of September the list price vs sales price was 100%.
WHAT TO EXPECT IN OCTOBER?
Historically INVENTORY peaks in the Seattle market in September and starts to come down in October. So you can expect inventory to decrease from the current level of 1,193. So there will be LESS TO CHOOSE FROM FOR BUYERS.
And because buyers will have less to choose from therefore I expect sales to slow from the 746 PENDING that we saw in September and expect the number of pendings in October to be somewhere in the 600’s.
The past 3 months have had INVENTORY/PENDING ratios of 1.5 to 1.6 (a strong seller’s market) therefore I expect October to be the same since no leading indicator/parameter has really changed much over the past few months.
- Inventory remains historically low
- The Seattle economy is very strong with unemployment of approximately 4%
- Interest rates remain outstanding with fixed 30 year mortgages hovering around 4%
So expect October to be another great month for sellers with a inventory/pendings ratio of 1.5 to 1.6
Please see the graphs and charts below
If you have any questions or if Steve Laevastu can be of any assistance please contact me