Housing sales fall, prices start to drop as Thurston County’s market shifts
Sales of single-family homes fell by 25 percent in Thurston County, median home prices are no longer rising, and inventory is more than double what it was a year ago, according to the latest data from Northwest Multiple Listing Service.
Inventory of homes on the market in the county is now enough to last more than a month. Still, a housing market that doesn’t favor either the buyer or seller is thought to have inventory in the range of 4-6 months.
On a month-to-month basis, prices have fallen, the data show. The median price of a Thurston County home in June was $525,000, in July it was $505,000 and for August it came in at $493,514, although that was still nearly $30,000 higher than August 2021, the data show.
Some of these changes have brought relief to buyers who were competing to buy a home a year ago. But now they are facing two major headwinds: higher mortgage interest rates and inflation, which rose by 8.3 percent in the year-over-year period ending in August, according to federal labor data.
The average 30-year fixed-rate mortgage is now 5.89 percent, according to Freddie Mac, a government-sponsored enterprise that provides capital to mortgage lenders and tracks interest rates.
“Mortgage rates rose again as markets continue to manage the prospect of more aggressive monetary policy due to elevated inflation,” Freddie Mac officials said in a recent survey.
What does it all mean? A slower housing market, but one that isn’t cataclysmically slower.
“Last month’s housing numbers certainly are eye-opening,” said Windermere Chief Economist Matthew Gardner in a statement. “However, I believe they are simply indicating the market is trending back to the more normalized conditions that we were seeing before the pandemic.”
Although sales have slowed, some elements of the housing market remain busy, including home remodelers, some of whom will take part in the Olympia Master Builders Tour of Homes this weekend, Sept. 17-18.
Daniel Doyle of Doyle Construction, a business he started in 2019, has had steady work and is just putting the finishing touches on a $500,000 remodel of a 3,000-square-foot home that overlooks Budd Inlet off Cooper Point Road Northwest in Olympia.
The home, which will be featured on the tour, started out needing some carpentry work, but “blossomed into something bigger,” Doyle said. It has been rewired, replumbed, there’s a second story over the garage and the entryway was opened up, he said.
“We breathed some life into the house,” he said.
One reason remodelers are busy is because of the labor shortage created by the pandemic, Doyle said, adding that skilled tradespeople are in high demand.
Still, he does expect the economy to slow. It’s not going to be a housing-driven slowdown like the Great Recession, but higher interest rates will have an effect on those wanting to tap the equity in their home to fund remodeling work, he said.
Doyle said his customers can be divided evenly between those who pay cash and those who get a bank loan.
The scattered site Tour of Homes, which is 10 a.m. to 4 p.m. Saturday and Sunday, will feature eight homes: seven remodels and one custom-built home, said Olympia Master Builders Executive Officer Angela White.
In previous years, some homes on the tour were for sale, but the Master Builders encountered a similar problem that buyers have recently faced: a lack of inventory, she said.
To find a guide for the tour, go to the Olympia Master Builders website, or visit a Olympia Federal Savings branch, Capital Healing and Cooling, or Olympia Overhead Doors, White said.
Thurston County housing numbers
▪ Single-family home sales fell 25.4 percent to 460 units in August 2022 from 617 units in August 2021.
▪ Single-family home median price rose 6.13 percent to $493,514 from $465,000 a year ago.
▪ Single-family home pending sales fell 27.3 percent to 527 units from 725 units over the same period.
▪ Condo sales fell to eight units in August 2022 from 18 units in August 2021.
▪ Condo median price rose to $346,500 from $312,500 over the same period.
▪ Condo pending sales fell to 17 units from 25 units over the same period.
Source: Northwest MLS
This story was originally published September 15, 2022 at 5:00 AM.
