Tuesday, January 29, 2013
WALLA WALLA — The Walla Walla Valley’s real estate market last year was the best in terms of numbers of homes, lots and land sales since before the 2008 financial crash spurred by mortgage loan defaults, according to local data.
Prices, however, still have a way to go to reach the heights of 2007, figures based on Multiple Listing Service data in a year-end report by Windermere Real Estate show.
The price for a single-family home averaged $202,103 in 2012 — up from $193,829 the previous year but still about 11.7 percent below the 2007 average of 228,843.
The median price — the point at which half of all homes sold for more and half for less — was $176,067 last year, also up from $175,000 the year before but below the five-year high of $199,900 in 2007.
A total of 656 properties — family and rental homes, condos, lots, mobile homes, farms and commercial — were sold in 2012 for a combined $119.1 million. Of those, 496 were single-family homes.
In 2007, a total of 897 properties, 645 of which were homes, were sold for a combined $198.8 million.
“We have turned the corner, it appears,” said Lynne Chamberlain, a Windermere Realtor in Walla Walla and trustee for the Washington Center for Real Estate Research at the University of Washington.
She added that sales in January have already increased 15 percent over December, and the total number of sales in 2012 rose 20 percent over the previous year.
Chamberlain predicted the increase in sales and prices will continue into at least 2015 before leveling out to the area’s historic slower but steady growth in home prices that existed before the real estate surge started in the early part of the past decade, driven in part by a growth in the area’s nationally acclaimed wine industry and tourism.
In a sign of increased building in the Walla Walla Valley, 71 lots and land parcels were sold last year. That’s the highest number since 127 were sold in the pre-crash year 2007 and nearly three times the 26 that were sold in 2009, the worst year over the past five, according to Windermere’s MLS-based data.
“Interest rates will likely stay at historic lows. We believe we will see increased sales and pricing of homes in the affordable mid- range, the loosening of building loans for new construction and a continuation of the short sale and foreclosed properties moving through the system,” she said.
But, she cautioned, “the stars are not yet aligned. There will be obstacles. With gas price fluctuations, natural disasters, war and the fiscal cliff disenchantment, consumer confidence is still down. Let’s hope that the improving market developments can outweigh the negative impacts imposed by policy makers.”
In a further breakdown of Windermere’s data for the Valley’s market in 2012:
- The most homes sold in any price category was 68, in the $125,000-149,999 range. Only one home, the first since 2010, brought a sale price in excess of $1 million.
- The best month to sell a home last year was in September, when 58 were sold, followed by 47 each in November and December and 46 in April.
- The month with the highest inventory of homes for sale was August, with 464 on the market. Active listings for December were 312, the lowest over the year.
The news for the local market echo’s a nationwide revival in existing and new home sales and prices.
Freddie Mac’s U.S. Economic and Housing Market Outlook for January said home sales were up 9 percent over the first 11 months of 2012, according to marketwatch.com. Similar gains are projected for 2013.
The report linked home sales with declining unemployment and low interest rates over the year.
Assuming the uncertainty of the fiscal policy debates during the first quarter fails to derail the economic expansion, the U.S. will likely see about 2 million new jobs created in 2013, gradually nudging the unemployment rate lower, the report stated.
“As we begin 2013, the economy is undoubtedly at a better place now than at this time in 2012,” Frank Nothaft, Freddie Mac vice president and chief economist, was quoted in the 15 report. “And despite the clouds of fiscal uncertainty facing the country, positive jobs reports and the strengthening housing market continue to be the bright spot as we begin the New Year.”
Industry experts caution that the market’s recent strength does not signal a return to the heady days of the housing boom, The Washington Post reported today in a story. Nearly 11 million homeowners are still underwater, owing more than their homes are worth, and prices remain well below their peak in 2006.
The Federal Reserve, however, has begun debating when to withdraw support for the mortgage market, and economists expect interest rates to rise before the end of the year, potentially tempering demand, the newspaper reported. But there is growing consensus not only that the bottom has been reached, but that the housing recovery is real.