We’ve made it through the shortest month of the year so let’s examine how we did in real estate.
Gig Harbor and Key Peninsula Combined Market K
This reflects the combined markets of Gig Harbor and the Key Peninsula. Sales activities for these individual areas are reviewed below.
The shortest month of the year, even with the added 29th day, February unit sales rebounded posting 55 closed sales and nearly a 45% increase over our sluggish January, and surpassing Feb 2011 by one, yes one, sale. Here, upward is good, even if it is only in low single digits. Average Price held to a .92% decline over Jan but posted nearly a 10% drop over last year. The Median price dropped by 10.37% from Jan, countering the 12.81% increase Jan posted, as a market correction that I had predicted last month. A bright spot here is that Bank Owned home sales posted some nice gains in Jan and Feb. We all realize that the less expensive, foreclosure homes drag down the market price. But if this increase becomes a trend then we could expect to see prices start to climb in other types as well. This would also hinge on the amount of inventory or the absorption rate, as less inventory tends to drive prices upward. The inventory of Active listings increased to 582 in February increasing the absorption rate to 8.8 from the 8.6 of Jan. The absorption rate has been declining in the last few months. As we head into spring anticipating the typical seasonal sales increase, we should see further shrinking in the absorption rate
Now, let’s take a look at pending sales which is a great indicator of the coming month’s sales numbers. Currently there are 177 homes under contract as 32 Pending Inspection, 92 Pending and 36 Pending Short Sale in the combined Gig Harbor Key Peninsula area. This equates to an increase of 15.7%, or 24 units, over last month. With nearly 50% of these pending sales priced between $200 and $400K this remains the strongest market price area. Keep in mind that these are ‘Pending’ sales and that not all of these will close in February, or at all. This is only an indicator of what the sales numbers may be in the months ahead.
Gig Harbor Market K
Gig Harbor home sales had a rebound after a dismal showing in January. Total units sold jumped from Jan. by over 90% to 42 total units sold, and up over 16% from Feb of 2011. Sales posted a decrease in days on market (DOM) of 30% to 124 days from the prior month. The Median price had a decline of 6.87% to $303,750, the Average Price posted an increase of 4.17% to $372,716, but both were down over last year. Bank owned homes sold reached its highest number since September of last year with twelve units sold. This increase in units could be a factor in the rise in Median and Average prices.
Of the 177 homes pending in the combined Gig Harbor/Key Peninsula markets, 134 of these are in Gig Harbor with 18 Pending Inspection, 73 Pending and 30 Pending Short Sale. Of the 134 pending homes in the Gig Harbor market, 61% are price between $200 and $400K which remains the strongest market price range in the area.
Gig Harbor Active listings increased by just over 6% to 421. Listing prices had a very modest increase in both Median and Average price by 0.48% and 1.00% to $410,950 and $592,444 respectively. When we look at how this increase in inventory affects the absorption rate, it nearly offset the increase in unit sales which resulted in an increased twelve month absorption rate from 8.4 to 8.8 months. A very slight increase that will most likely head the other direction next month when the current increased pending sales actually close.
Key Peninsula Market L
Key Peninsula closed sales dropped to the lowest level since May of last year, posting only 13 closed sales and an 18.75% drop as compared to last month. Prices also were down significantly from last month in both Total Median and Average values ($103,000., -52.48% and $166,585., -41.48% respectively) as well as in all sales type catigories. Compared to February of 2011 the picture is not any better with again a significant value drop in most sale types. This drop in value can partially be attributed to the light sales month. A factor of just thirteen sales does not provide a true market value as a single home sale can affect these greatly and easily. Of these 13 closed sales, 7 were bank owned or short sales. Another month where distressed properties outnumber Owner Occupied home sales.
Active listings had a decline of just over 6.4% to 161 listings. With these we also posted a slight increase in the median and average listing prices of 1.09% ($234,950) and 2.31% ($283,182) respectively. With this reduction in listing inventory, the twelve month absorption rate was reduced from the 9.1 months of January to 8.7 months of inventory in February. This is still considered relatively high, and with the distressed sales continuing in the majority, it remains a buyers’ market on the KP.
Looking towards coming months, 43 homes are pending (a 19% increase) with 14 Pending Inspection, 19 Pending and 6 Pending Short Sale. With this increase in the amount of Pending sales we should see a corresponding increase in the total numbers sold in March totals. Of these pending sales nearly 50% fall between $140,000 and $300,000. If these sales do close there should be a corresponding increase in Median and Average prices as well.
Recap
February’s increase in sales brought us a slight rebound from the lackluster January in Gig Harbor but not on KP where total sales fell to a nine month low and distressed inventory still commands the market. Closed sales posted declines in value in most categories from last month as well as from last year. A glimmer of optimism as Pending sales have increased indicating more buyers are submitting acceptable offers and proceeding to close.
There are some amazing values in the market right now and interest rates are unbelievably low. If you know anyone who may be able to take advantage of this market please let me know or have them get in contact with me.
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