House prices tumble in June

By Rolf Boone | The Olympian • Published July 10, 2008

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Thurston County home prices slid more than 9 percent from June 2007 to June 2008, the Northwest Multiple Listing Service reported, the steepest year-over-year drop this year and the largest decline South Sound real-estate experts could remember.

Broker Doug Burger, who has spent nearly 30 years in real estate, said there have been times when South Sound median prices remained flat, but they didn't fall.

"The is the first time I've actually seen (prices) drop, especially to this degree," he said. "To take this kind of turn is surprising for everybody."

The combined median price for a single-family residence and condo last month was $247,000, down 9.2 percent from the $272,000 reported in June 2007, Northwest MLS data show. Other key data in the year-over-year June period:

• Home sales fell 23 percent to 322 units from 419

• Inventory fell last month to 2,171 units, down 8.5 percent from 2,372 units

• Single-family median prices fell 7.5 percent to $254,950 from $275,567

• Condo median prices fell 8.7 percent to $184,950 from $202,475

After a period in which home sellers were unwilling to lower prices, they are starting to change their minds, Burger said.

"They do that very reluctantly, but reality is hitting them," he said.

Abbey Realty broker Jeff Crandell said the sales market for homes priced above $300,000 is slow, but it's better for homes priced between $200,000 and $300,000.

These days, the South Sound home buyer is in control, Crandell said.

Buyers are more discriminating, they are not afraid to ask for discounts or incentives, and they are not buying the first house they see, he said.

"Turnabout is fair play," Crandell said. "Sellers had it their way for years, and now we're seeing the results. The pendulum is swinging in the other direction."

But Jerry Wilkins, Northwest MLS area services manager, said the year-over-year June price drop is an anomaly. He pointed out, for example, that year-to-date single-family median prices have fallen only 2 percent.

"I don't find that an area of concern," he said about the moderate price decline.

Although prices fell sharply in June, so did inventory levels, dropping more than 8 percent in the year-over-year period. A better balance between the supply and demand for homes will help the market, Burger said.

"That's the trend it needs to go," he said. "If inventory keeps rising, it is going to make it (the housing market) worse. We need to get it down to 1,300, 1,400 houses" from its current level of 2,171 units.

Rolf Boone is a business reporter for The Olympian. He can be reached at 360-754-5403 or rboone@theolympian.com.