Who bought a home here in 2020? About 35 percent came from outside Thurston County
Whether it was because of affordability, the pandemic or more traditional means such as relocating for a job, out-of-area buyers played a significant role in driving the Thurston County residential housing market last year, according to real estate professionals here.
Ken Anderson, broker and owner of Coldwell Banker Evergreen Olympic Realty in Olympia, estimates that of the 5,060 transactions in 2020, about 1,800, or 35 percent, went to a buyer from outside Thurston County.
Windermere Olympia broker and owner Steve Garrett also pegs the proportion at about a third of buyers. Depending on the time of year, it was sometimes higher than that, said Van Dorm Realty managing broker Steve Pust.
Pust, after examining transactions that featured a buyer with an out-of-area broker, said it rose to 45 percent in the fourth quarter of the year.
On a case-by-case basis, it was sometimes even higher.
Van Dorm real estate broker Anita Carlson, who closed more than 50 transactions last year, said that 60-70 percent of her buyers came from out of the area.
Where did the buyers come from? King County, Pierce County, California and farther afield. And Joint Base Lewis-McChord always produces a steady supply of out-of-area buyers.
The reason for the boom in interest from outside Thurston County? Thurston County’s affordability, compared to other areas in Western Washington. For example, the median price of a single-family home in King County was $725,000 in January, according to Northwest Multiple Listing Service data.
In Thurston, it was $409,000, up nearly 17 percent from the same month a year ago, the data show.
From Seattle to Olympia
Heath Snow and his family moved to the Olympia area last year from West Seattle. He’s a software developer who can work from home, his wife has family ties here, and then the pandemic arrived and the West Seattle Bridge closed.
“All of this kind of happened at once,” he said.
The Snows also were sitting on a proverbial gold mine. A decade ago they paid just $209,000 for a 1,500-square-foot house in foreclosure. Over the years, they made improvements to the house, and by 2020 it was worth $650,000, he said.
First they looked at other homes in West Seattle and encountered prices of $800,000 or higher and highly competitive bidding situations. They would offer to pay $20,000 more than list price, only to be outbid by someone willing to pay almost $200,000 more.
Finally, they sold their house in West Seattle and moved to Thurston County, also paying $650,000. However, instead of a 1,500-square-foot home, their new home is twice as large — 3,200 square feet on a half-acre of property.
Snow did not encounter a multiple-offer situation for his home, but many here have as supply has not kept up with demand.
Here’s an example of the supply problem in this county: About 5,000 homes sold last year, which is an average of 417 sales per month. Total active listings in the county fell to 94 homes last week, Windermere Olympia owner Garrett said, the fewest number of homes for sale in his 40-plus years of real estate.
In other words, that’s potentially 400 buyers for about 100 homes.
“It’s unbelievable,” he said, adding that he recently showed a Snohomish County couple a house in the area that turned into a “block party,” because of the number of prospective buyers in nine separate vehicles who wanted to see the same property.
How we got here
About 15 years ago, the county, like many parts of the country, experienced a boom in housing and home building. Locally, the growth was particularly astounding in Lacey, which in one year issued 1,200 building permits.
Real estate lending, borrowing and investing problems eventually triggered the housing financial crisis and the Great Recession, which slowed the pace of home building. Once the economy improved, home building did not return to its previous pace.
“We have been under-building in this community for over a decade,” said Coldwell Banker’s Anderson.
Demand for housing since then has largely resulted in vertical not horizontal construction.
New apartment projects have been pitched and developed throughout the county, perhaps most noticeably in downtown Olympia.
Meanwhile, demand for single-family homes coupled with few on the market continues to make the county a firmly entrenched sellers market. New, large subdivisions have been pitched in Tumwater and near Lacey, but they are likely years away from producing new homes.
There’s also the question of how much buildable land is left.
During a 2019 conversation about duplex-style housing, Lacey Planning Commission manager Ryan Andrews said the city is nearly built out to the north and south.
“The way we grow (as a city) is really going to change,” he said. “We can’t grow out, we have to grow up.”
Windermere’s Garrett thinks relief for home buyers might come once vaccines are widely distributed and the pandemic abates. He expects the move-up buyers and the sellers wanting to downsize will list their homes for sale then.
“People are going to feel more comfortable,” he said.
Thurston County home sales for January
▪ Single-family residence sales fell 1.4 percent to 282 units last month from 286 units in January 2020.
▪ Single-family median price rose 16.75 percent to $409,975 from $351,167 over the same period.
▪ Single-family pending sales rose 3.6 percent to 375 units from 362 units over the same period.
▪ Condo sales rose to 17 units from 12 units over the same period.
▪ Condo median price rose to $236,500 from $168,500 over the same period.
▪ Condo pending sales fell to 13 units from 16 units over the same period.
Source: Northwest MLS.
This story was originally published February 7, 2021 at 5:45 AM.
