There's good news and bad news in real estate

 
 

 

It didn't sound good when the Northwest Multiple Listing Service reported today that housing prices in King and Snohomish counties plunged by 16.5 percent in October from a year ago. The average price in King County fell to $370,000 while the average in Snohomish fell to $243,000.

Average prices were depressed in part by the high proportion of the sales (38 percent) that involved "distressed" properties. Bankers or other parties selling distressed properties typically accept lower than sellers would accept under nomal market conditions.

But there was also some bright news in the report. The number of houses on the market also plunged, dropping to 12,694, from 18,590 the year before. And the number of deals under contract rose to 3,995, from 3,162 the year before.

Inventories have to come down before housing prices start to firm again. What is still unclear is the level of "shadow" inventories, housing that could flood the market if credit conditions continue to deteriorate.

Rental Market May Finally Be Cooling Down in Greater Seattle. Still Hot in Tacoma.

Rental Market May Finally Be Cooling Down in Greater Seattle. Still Hot in Tacoma.

With new units on the market and occupancy down, rents are growing more slowly.
 
 
Rent growth is accelerating in Tacoma while slowing in Seattle

In a sign of what could be the beginning of the end for the hot rental market, average rents are no longer growing at a torrid pace. While average monthly rents increased by 5.6 percent to $1,777 in the Seattle/Bellevue/Everett area in September from the year before, average rents actually declined slightly from the previous month.

“Seattle is still among the top-performing metros in the nation, but deliveries of new units accelerated in the third quarter and the pace is expected to quicken through the second quarter of 2017,” says Jay Denton, senior vice president of analytics for Axiometrics, a market research firm. Denton says the new supply is weakening the ability of landlords to boost rents as much as they have in the past. That's good news for tenants, but landlords may not be as excited.

By contrast, rents in Tacoma continue to soar. Check out the story we published on Tacoma's hot market earlier this year. The average rate of growth for rent in the Tacoma metropolitanTacoma increased for the 11th straight month in September, climbing to $1,266, up 9.6 percent from the year before and far outpacing Seattle. Occupancy is also higher in Tacoma — at 96.7 percent in September compared to 95.4 percent in the Seattle area. 

Rents in both Seattle and Tacoma increased faster than the nation, where they grew by just 2.6 percent to $1,290 in September from the year before.

 

Seattle-Bellevue-Everett                                     Sept 2016                  Aug 2016                  Sept 2015

Average Rent

$1,777

$1,799

$1,683

Annual Effective Rent Growth

5.6%

6.6%

8.0%

Occupancy

95.4%

95.5%

95.3%

Tacoma-Lakewood

Average Rent

$1,266

$1,256

$1,155

Annual Effective Rent Growth

9.6%

9.3%

8.5%

Occupancy

96.7%

96.4%

96.0%

National

Average Rent

$1,290

$1,293

$1,258

Annual Effective Rent Growth

2.6%

2.9%

5.2%

Occupancy

95.1%

95.2%

95.3%