Housing Inventory Improves, but high prices, interest rates are constraining activity

Despite strong gains in inventory levels, Northwest Multiple Listing Service reported year-over-year (YoY) drops in both pending sales and closed sales during June for the 26 counties in its monthly report. The area-wide median sales prices rose 4% from twelve months ago.

King County’s pending sales were essentially flat (down 0.54%) from a year ago, while Kittitas County experienced a sharp increase (up 41.3%). Closed sales dropped about 7.2% YoY in King County but jumped 56.5% in Kittitas County. The median sales price rose 5.4% in King County from the year-ago figure of $830,000 to $875,000 but was unchanged in Kittitas County ($529,995 versus $529,997).

For the 26 counties overall, the median price for June’s closed sales was $650,000, which marked a 4% increase from June 2023 when the figure was $625,000. For single family homes (excluding condos) the median selling price was $674,995; for condos it was $499,000.

In its report, Northwest MLS noted, “With the 30-year fixed mortgage rate currently at 6.86% (as of late June 2024), the purchasing power of prospective buyers remains constrained relative to a few years ago.”

The MLS also suggested higher levels of for-sale inventory should help stabilize prices over the summer months.

Area-wide, the supply of residential properties (including single family homes and condominiums) increased 35.7% during June compared with the same month a year ago. Twenty-two of the 26 counties served by NWMLS reported double-digit gains.

At month end, there were 14,393 active listings in the NWMLS database, up from the year-ago total of 10,607 for a healthy 35.7% gain.

There was 2.17 months of supply system-wide at the end of June, improving on May’s figure of 1.92 months, but still well below the 4-to-6 months of inventory industry-watchers use as an indicator of a balanced market.

King County had 1.94 months of supply as of the end of June versus 1.55 months at the end of May. In Kittitas County, there was 3.61 months of supply at month-end, shrinking from May’s figure of 5.09 months.

The year-over-year dip in closed sales transactions reversed YoY increases reported for April 2024 (up 9.5%) and May 2024 (up 6%). Closings in King County surged 16.4% in April and 16.7% in May, while in Kittitas County the YoY volume of completed transactions declined in both April (-3.9% and May (-5.8%).

The Pacific Northwest housing market is moving slowly toward normalization, observed CoreLogic Chief Economist Selma Hepp. “While increased inventory of homes on the market this spring offered potential home buyers more options, elevated mortgage rates put affordability at the forefront of housing market concerns,” she added.

Northwest MLS reported the total number of property showings scheduled through its software decreased about 9.1% when comparing May (when there were 128,924 showings) to June (119,775 showings).

Key boxes at listed properties were accessed 163,536 times last month, about the same as May when brokers accessed them 163,414 times.