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closeWednesday, Nov. 11, 2009
Tax credit helps boost home sales in Washington
By The Associated Press and Herald staff
The number of existing homes sold in Washington increased in the third quarter compared with the previous three months, the Washington Center for Real Estate Research reported Tuesday.
The federal first-time homebuyer tax credit helped boost sales 15.6 percent, according to the center based at Washington State University. Sales also were 2.6 percent higher than a year ago, the center said.
It was the first year-to-year improvement in sales since the fourth quarter of 2005.
In the Tri-Cities, the number of homes sold went up from 810 in the second quarter of this year to 973 in the third quarter, a 20 percent increase, according to the Tri-City Association of Realtors.
"October was our best month for closed sales," said Paul Roy, the association's vice president, saying 379 homes sold that month. He said the strong local economy has helped sustain the area housing market.
Glen Clark, president of the Tri-City Association of Realtors, said a large number of first-time home buyers helped prop up the third quarter home sales.
That also means the inventory of homes costing $200,000 or less is getting thinner, he said.
Slightly more than 1,000 Tri-City homes are listed for sale. They are expected on be on the market for an average of 80 days, down from an average of 113 days over the past 12 months, said Roy, who is also a broker with Coldwell Banker Tomlinson.
The median home price in the Tri-Cities dropped from $172,000 in June to $169,900 in September, but Roy said consumers shouldn't read much into that.
He explained that fewer sales of higher-end homes priced $400,000 and up is distorting the overall picture of housing prices, which generally have been steady. In September 2008, he said, the median home price in the Tri-Cities was $165,000.
In Washington as a whole, the median home price during the July-September period was $260,000, which was 7.6 percent less than a year ago.
"It must be noted that this represents a continued slowing in the rate of decline in prices," said center director Glenn Crellin.
The median price was also held lower because the most active segment of the market was first-time buyers seeking the most affordable homes, he said.
A special study by the center found about half the home sales in the state during the April-June quarter were to buyers claiming the tax credit, Crellin said.
Last week's decision to extend the federal program should help the housing recovery, he said.
Median prices ranged from a high of $515,000 in San Juan County to a low of $125,000 in Adams County.
There were just more than 49,000 homes listed for sale with multiple listing services at the end of September, 14.3 percent fewer than a year ago. This was the smallest September inventory since 2006.
While median prices declined, mortgage interest rates increased during the quarter, leaving affordability basically unchanged.
The housing affordability index statewide stood at 122.8, meaning the median income family had 22.8 percent more income than the minimum required to qualify to purchase a median price home with a 20 percent down payment and a 30-year mortgage.
WCRER has produced home sales statistics in partnership with Washington Realtors since 1994.
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