Northwest MLS brokers agree "there's a lot to be optimistic about"

"There's a lot to be optimistic about," according to one director of the Northwest Multiple Listing Service upon reviewing summary statistics for September's housing activity. The report shows a big jump in pending sales compared to a year ago (up almost 27 percent), continued drops in inventory (down 17.7 percent versus a year ago) and brisk demand for homes at the lower end of the price spectrum.

Distressed properties in the system continue to be a drag on prices – median prices for last month's sales were down about 7.5 percent from a year ago – and brokers continue to voice frustration with slow response time by lenders. (Banks are taking 9.5 weeks to respond to short-sale requests, versus 4.5 weeks a year ago, according to research by Campbell Communications of Washington, D.C.)

Joe Spencer, president and COO of John L. Scott Real Estate, estimates up to 10 percent of pending sales do not close because they're caught in the short sale cycle. Still, he comments, "There is a lot to be optimistic about." He cites interest rates that are now in the high four percents as bordering "on being epic" and the federal tax credit as stimulants to the market.

Northwest MLS brokers reported 7,581 pending sales (offers made and accepted but not yet closed) during September, outgaining the same period a year ago by 1,599 transactions for a 26.7 percent increase. Last month's condominium sales surged, with pending sales up nearly 25 percent from a year ago after languishing in negative year-over-year figures for the first five months of 2009 and only modest gains over the past three months.

"Our market has certainly come a long way since this time last year," said Ron Sparks, managing vice president of Coldwell Banker Bain, who said demand is at its highest level in two years. "For all the challenges that remain, it would be difficult to not appreciate the reemerging market vitality that continues to build even as the summer buying season closes," he added.

Brokers also credit improved affordability, incentives and the looming deadline for the $8,000 tax credit for first-time home buyers as boosting activity. "Because there are so many short sales and bank owned property sales, it was inevitable that prices would fall slightly," explained NWMLS director Dick Beeson, the broker/owner of Windermere Commencement Associates in Tacoma. Beeson described the price drops as "a necessary adjustment given the number of short sales and bank owned property sales in the mix. (A survey by the National Association of REALTORS indicates distressed homes accounted for 31 percent of transactions in August and July.)

On a brighter note, Beeson said activity is brisk for lower priced homes in many areas. "Multiple offers are occurring on a regular basis and many buyers have to make two or three offers on different properties just to secure one," he reports.

Sparks echoed that report, saying, "Describing much of the current market as 'lively' is probably a bit of an understatement," adding, "I've heard agents describe open houses as 'mayhem' and 'chaos." Modestly priced homes in good condition and in popular neighborhoods can certainly draw more than one offer, according to Sparks, who also noted, "This is not to say that all neighborhoods and price points are rebounding at the same pace, but there is an awful lot of economic momentum in our region, including our housing market, that can't be ignored."

Emphasizing recovery comes in stages, Beeson acknowledged some "hard adjustments" are being made in higher priced homes where inventories remain high, but expects that segment to recover.

~ Courtesy of NWMLS