Washington Housing Market Cools Somewhat, WSU Report Shows

PULLMAN, Wash. — Seasonal increases in housing markets were evident in the second quarter of 2000, but when compared to home sales activity a year ago, Washington’s housing market slipped by 3.5 percent to 33,920 resale home transactions between April and June, reported the Washington Center for Real Estate Research at Washington State University.

The statistics, produced in cooperation with the Washington Association of Realtors, reflect a strong overall market as the median sales price increased 5.5 percent compared to last year, reaching $178,000. “Taken together, these data indicate we have moved from an overheated market in western Washington’s metropolitan areas, to one which is merely very strong,” said Glenn Crellin, WCRER director.

“Most of the state’s population centers reported modest year-to-year declines in home sales, while median prices rose in each community,” said Phil Souza, a Bellevue real estate broker and 2000 WAR president.

Statewide measures overshadow wide variations among local communities. While the state’s sales rate was lower than last year, six counties recorded activity at least 10 percent above a year ago. Rural central Washington and parts of the Olympic Peninsula were especially improved. Meanwhile, the number of sales declined by at least 10 percent in six counties, including King. At least some of the weakness in King County must be attributed to the sharp decline in the value of Microsoft shares, which began the quarter trading for around $105 and ended the period about 40 percent lower, Crellin said.

Local median sales prices also ranged widely, from $255,000 in King County to a low of $70,000 in Pacific County. While most areas had higher prices, the prevailing median was actually below a year ago in 11 counties, primarily in eastern Washington.

“Statewide, housing affordability declined for the sixth consecutive quarter, as higher prices and mortgage rates offset increasing incomes,” reported Crellin. The typical family in Washington could still afford the median price home, but an index of 107.3 means their ability to purchase a typical home is quite limited. Jefferson County again reported the worst affordability conditions, while Walla Walla County was credited with the most affordable ownership housing. For households hoping to purchase their first home in Washington, the first-time buyer index stood at 63.8, indicating that it is increasingly difficult to become a home owner.

“Statistics indicate the typical renter who desires to become a homeowner in Washington will have to find a home less expensive than the typical starter home in their area, or find a way to increase their downpayment, regardless of what part of the state they are in,” said Crellin.

WCRER and WAR have been producing these statistics since early 1994, with quarterly releases designed to coincide with wire releases of existing home sales by state and median home prices by metropolitan area from national association officials.