Saturday, April 10, 2010
King County house prices post year-over-year rise for first time in 2 years
The bar couldn't have been lower. Still, an increase is an increase.
House prices in King County rose in March for the first time in more than two years, according to one closely watched measure.
The median price of single-family homes that sold last month was $367,250, up 0.9 percent from March 2009, the Northwest Multiple Listing Service said Monday.
While tiny, the year-over-year countywide increase was the first since January 2008.
The median price in March 2009 - $363,850 - was the lowest in years. And last month's number, while slightly higher, was the lowest since then.
Area home prices have shown signs of stabilizing for several months: The median price in Seattle rose year-over-year in January, then on the Eastside in February.
Sales are up, too: Buyers closed on 1,596 houses in King County in March, 65 percent more than in the same month last year.
House sales were up 73 percent in Snohomish County. King County condo sales rose 47 percent.
While it is a less reliable measure, the listing service reported more pending sales of houses in King County last month than in any month since May 2007.
All this has brokers and other observers of the real-estate scene talking about a resurgence in the local market and wondering how long it might last.
"Are we at the end of this [downturn]? I wish I knew," said Doug Davis, broker at Hallmark Realty in Kirkland.
He and others said some March buyers were motivated partly by record-low interest rates â€” and concern those rates could start climbing soon.
Others bought at least in part because of federal tax credits scheduled to expire soon: To qualify, buyers must have homes under contract by the end of this month.
The March statistics are "very encouraging," said Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University.
But the market's future beyond the next few months hinges on several factors, he said, including job growth and the Federal Reserve's success in keeping interest rates low, as it has vowed, in the face of increasing pressure from buyers of government debt.
Crellin said the year-over-year increase in the median King County house price in March probably was due in part to a federal tax credit for repeat buyers that Congress approved late last year. It has brought some buyers into the market, he said, and they are "taking advantage of bargains they're finding in higher-priced properties."
But Omeed Salashoor, manager of MetLife Home Loans' Lake Union office, said he has seen little evidence the credit for repeat buyers is motivating many sales. An older tax credit for first-time buyers still seems to be having more impact, he said.
Loan applications at his branch rose 40 percent between February and March, Salashoor said.
The year-over-year jump in closed house sales in King County in March was the 10th consecutive monthly increase, and the 65 percent rise was second only to November's bump.
Sales were particularly strong on the Eastside, where closings were up 108 percent.
Davis, the Kirkland broker, said his office has a lot of walk-in traffic, and that it has increased significantly.
"I think there's been a lot of people waiting," he said. "Now, in 2010, they're actually saying, 'That's a pretty good buy.' "
Tim Ellis, who edits the real-estate blog Seattlebubble.com, said in an e-mail that he expects Seattle-area sales to continue to rise through May, then plateau and maybe drop in the summer and autumn after the tax credits expire.
Nationally, there also were indications the housing market is coming back from the winter doldrums.
The number of buyers who agreed to purchase previously occupied homes rose sharply in February, far exceeding expectations, a report said Monday.
The National Association of Realtors said its seasonally adjusted index of sales agreements rose 8.2 percent from January to a February reading of 97.6. January's reading was revised slightly downward to 90.2.
The report "may signal the early stages of a second surge of home sales this spring," said Lawrence Yun, the trade group's chief economist.
Meanwhile, the federal government launched a new effort Monday to speed up the time-consuming, often-frustrating process that homeowners face when they want to sell â€” but owe more on their home than it's worth.
The Obama administration will give $3,000 for moving expenses to homeowners who complete such a sale known as a short sale or agree to turn over the deed to the lender. It's designed for homeowners who are in financial trouble but don't qualify for the administration's $75 billion mortgage-modification program.
Owners still will lose their homes, but a short sale or deed in lieu of foreclosure doesn't hurt a borrower's credit score for as long a time as a foreclosure does.
For lenders, a home usually fetches more money in a short sale than a foreclosure. And the bank avoids expensive legal bills, cleanup fees and maintenance costs that follow a foreclosure.
By Eric Pryne - Published 4/6/10
Seattle Times business reporter
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