Thurston median home price reaches new high, but for how long as gas prices, rates rise?
The median price of a Thurston County home rose to just under $500,000 in February, adding Thurston to a select few Western Washington counties with a median price that high, according to Northwest Multiple Listing Service data released this week.
Although the median price continues to rise, sales were unchanged from February 2021 at 287 units, and new listings in February outpaced the number of listings from the same month last year, raising the possibility the market is shifting in favor of the buyer from the seller.
Years of low inventory in the county have favored the seller. Higher inventory strikes a better balance between buyer and seller, experts say.
The housing market also might be contending with two new realities: higher gas prices and higher mortgage rates as the world reacts to news about the Russian invasion of Ukraine. AAA fuel data show that the Olympia area set a new high on Tuesday for regular unleaded gas with an average price of $4.60, up from $3.26 a year ago.
Depending on how long higher gas prices last, it could affect housing demand as buyers become more concerned about their commute and home location.
Mortgage interest rates also recently spiked then fell again.
The average interest rate on a 30-year mortgage rose to a nearly three-year high of 3.92 percent last month, then dipped to 3.76 percent in early March, according to Northwest MLS. By historical standards, rates are still incredibly low, but for the recent buyer there has been a clear shift higher. A year ago the average rate on a 30-year mortgage was 2.81 percent.
“Something on everyone’s minds is how the invasion of Ukraine might affect the housing market here at home,” said Matthew Gardner, Windermere Real Estate chief economist, in a statement. “While these events have helped push mortgage rates lower, it doesn’t mean they are on their way back to the historic lows of a year ago. In fact, that’s almost guaranteed not to happen.”
The Mortgage Bankers Association expects mortgage rates to rise above 4 percent by the end of the year. How do higher rates affect the purchaser? Northwest MLS provided this example: the average borrower with a 20 percent down payment would pay about $100 more a month on a new mortgage than one a year ago.
Danielle Hale, chief economist for Realtor.com, expects the market to continue to favor sellers, but the pace of home price increases may slow from double-digit to single-digit percentages this year.
February data for Thurston County
▪ Single-family home sales were unchanged at 287 units in February 2021 and February 2022.
▪ Single-family median home price rose 18.47 percent to $499,950 from $422,000 a year ago.
▪ Single-family pending sales rose 16 percent to 405 units from 349 units over the same period.
▪ Condo sales fell to three units from 12 over the same period.
▪ Condo median price rose to $375,000 from $216,950 over the same period.
▪ Condo pending sales were unchanged at 11 units over the same period.
Source: Northwest MLS.
This story was originally published March 9, 2022 at 5:45 AM.
