December 1, 2015
Washington state home prices up, sales down in third quarter of 2015
In the third quarter of 2015, home sale prices increased but sales themselves were fewer in Washington state.
The statewide median sales price for a single family home stood at $291,900 according to the Runstad Center for Real Estate Studies in the University of Washington’s College of Built Environments. This is represents only a slight increase of 0.01 percent from the second quarter or $2,600 and a 0.9 percent increase over the third quarter of 2014.
The seasonally adjusted annual rate of existing home sales rose 7.8 percent from the second to the third quarter of 2015, and increased 5.7 percent from the same quarter last year. In all, 101,950 homes were sold on a seasonally adjusted basis for the quarter, meaning that if the quarter’s pace continued unchanged for a year, that number of homes would be sold. And though most economic statistics are reported with seasonally adjusted annual rates, these are not forecasts of future activity.
The state’s most populated counties — King, Pierce and Snohomish — each saw a decrease and in median price and volume of sales. Looking at other counties with at least 1,000 sales (for statistical significance), there were some winners: Clark County prices were up 8.5 percent, Kitsap 2 percent, Skagit 11.4 percent and Thurston 4.3 percent.
Median prices were lower than 2014 in 18 of the state’s 39 counties, with prevailing prices in Adams County at 16.1 percent below last year. Given the state’s market diversity, median house prices are highly variable, ranging from $75,500 in Lincoln County to $491,000 in King County.
Housing affordability for all buyers statewide continued to fall in the third quarter of 2015. That index — where 100 means a middle-income family can just qualify for a median-priced home, given a 20 percent down payment and a 30-year fixed mortgage rate at prevailing rates — was slightly lower at 143 from 144.2 the previous quarter.
The least affordable county continues to be San Juan, with an all-buyer housing affordability index of 84.6; the most affordable was Lincoln County, registering a value of 401. For first-time buyers, Benton County was again the most affordable and King County the least affordable.
Affordability is by far the largest concern in the state’s housing market, particularly in urban counties. However, Pierce and Snohomish counties, bounding King County to the north and south, indicate an affordability index of 156 and 128 respectively.
Statewide, the first-time buyer index also showed a small but continuing erosion of affordability, ending the quarter at 78.8 down from 80.4. The first-time buyer index assumes a less expensive home, lower down payment and lower income. This means that a household earning 70 percent of the median household income — as may be true of first-time buyers — had only 78.8 percent of the income required to purchase a typical starter home statewide.
Permitting activity, which represents both multifamily and single family buildings, has fallen dramatically from 9,000 new units a year ago to 5,424 in this period, which is a 38.9 percent decrease. King County is most striking with a 71.7 percent decrease, which raises questions about buildable land supply and may reignite price appreciation in the future.
The Runstad Center produces home sales statistics in partnership with Washington Realtors. Each quarterly release coincides with information from the National Association of Realtors regarding median home prices by metropolitan area.
Sales, median home prices and affordability data for all Washington counties are available at the Runstad Center’s website.
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For more information, contact Runstad Center Director Peter Orser at 206-795-7008 or porser@uw.edu.
Tag(s): College of Built Environments • Peter Orser • Runstad Department of Real Estate
