Gig Harbor and Key Peninsula Combined Market J
This reflects the combined markets of Gig Harbor and the Key Peninsula. Sales activities for these individual areas are reviewed below.
There were many positive changes last month with May being another strong month in area home sales. Although it posted slightly fewer closed sale than April, May did post a gain of over 42% above May of 2011 - Big WOW! Prices had an overall decline in May but this can be attributed as a bit of a correction to good gains posted in April. 58% of the May sales were closed between $160K and $400K, which is a broader range on the lower side showing that first time buyers and investors are taking advantage of this market. Owner Occupied and Bank Owned home are selling quicker reducing the average ‘Days on Market’ in these two categories. However, a nearly 72% increase in the DOM for short sales increases the overall average slightly. Luckily short sales currently made up only 6.49% of the months sales so the affect here is not too great. Short sales can still take time for lender approval which delays these closings tremendously, if at all.
Active listings showed a modest gain of 23 overall for a total of 635 active listings in the Gig Harbor and Key Peninsula area. Of these 635 active listings, only 16 are bank owned properties. This is positive news because as active bank owned homes are typically priced below the market (due to poor condition or the lender just wants to dump it) this tends to draw down the rest of the market. With fewer active Bank Owned homes our market becomes more stable which in turn can bring higher prices. The active listings also had a 5.49% median price increase, and a 3.06% average price increase to $385,000 and $534,142 respectively. The 12 month Absorption Rate held pretty steady in May with 7.1 months’ worth of active inventory. This has been decreasing in the last few months, trending to a more balanced market.
Looking forward to next month, Pending sales also showed a nice increase to 244 homes from 228. Of these 244, 140 are Owner Occupied, 78 Short Sales and, bringing up the rear, a mere 26 are Bank Owned. This strength in Owner Occupied sales indicates continued strengthening of our market and that June will also be a positive month in sales. All-in-all, May was a good month.
Gig Harbor Market K
Gig Harbor closed home sales of 54 in May resulted in a slight decrease from the April. Now April was a strong month with an increase in sales of over 44% from the prior month so this correction is not too surprising. Even with May’s numbers lower than April; they still show a strong gain over May of 2011’s closed sales of 41, which shows we are entering into a strengthening market.
Sales posted a decrease in days on market (DOM) of 15% to 108 days from the prior month. This equates to just over 3.5 months to sell. This should come as good news for sellers. Month to month prices continue to be on a bit of a roller coaster ride. The median price fell 16.67% to $287,638 with the average price declining by only 4.38% to $352,547. These counter the gains we realized in April. Looking at the current sales Pending, the most active price range falls between $200K and $350K so I would predict that these prices should remain about the same for the coming month.
Of the 174 Pending sales; 111 are owner occupied, 51 Short Sales and 12 are Bank Owned. Current Active listings show 425 Owner Occupied, 37 Short Sales and only 8 Bank Owned. If the absence of competing Bank Owned homes continues, this can bring greater stability to pricing in the area. Listing prices increased from April in both Median and Average price by 3.33% and 2.48% to $465,000 and $620,376 respectively.
Gig Harbor remains the driving force in the area market and May was another strong month in Gig Harbor with good sales quantities but lower sales dollars. The area has gotten much more busy with many listings now receiving multiple offers. Price it well and it will sell!
Key Peninsula Market J
The Key Peninsula posted 23 closed sales in May, resulting in the highest total since October of 2011. Of the 23 closed sales, 10 were owner occupied, 10 Bank Owned and 3 short Sales. This dominance of Bank Owned sales continues to have a negative effect on overall pricing (now where have we heard that before?). There may be hope here as we are seeing signs of a reversal; as we look at the 70 Pending homes on the KP, 29 are Owner Occupied, 27 Short Sales and 14 are Bank Owned. Couple this with the current Active listing inventory of 165 homes, 136 are Owner Occupied, 21 are Short Sales and only 8 Bank Owned. With fewer Bank Owned active listings we should see Owner Occupied home sales regain the majority. This in turn should have a positive effect on the pricing and percentages in the coming months.
Like Gig Harbor, prices fell on the KP countering the gains realized in April. Owner Occupied prices fell by 20% in Median price to $220,000 and 28.18% in average price to $215,285, while Bank Owned Median and Average sales prices both increased (22.97% to $116,825 and 25.92% to $127,845 respectively). Even though Bank Owned prices realized gains, they still made up a nearly 50% of Mays closed sales. As Bank Owned home prices remain the lowest of the three sales types (owner occ/short sales and bank own) this percentage of closed sales continues to have negative effects on overall Median and Average prices and percentages.
Looking towards coming months, 70 homes are currently Pending with 29 Owner Occupied, 14 Bank Owned and 27 Short Sales. This does show us that the KP market is picking up and hopefully we will see an increase of closed sales in the coming month(s).
And in closing . . .
Sales are up, multiple offers are back and it’s getting busy. May posted another strong month in closed sales and the third consecutive month with a drop of Bank Owned active listings. This drop in Bank Owned listings may be the result of recent acts that encourage Banks to work with current owners prior to foreclosure. If lenders do begin to work with homeowners, we would see a rise in the quantity of Short Sales. These are still considered ‘Distressed’ sales but the condition is typically far superior to Bank Owned and prices still run lower than Owner Occupied. These can be great opportunities for buyers, but these also present an additional set of hurdles that will lengthen the sale process.
There are some amazing values in the market right now and interest rates remain unbelievably low. If you know anyone who is considering how they can take advantage of this market please let me know or have them get in contact with me.
