Pending Sales Surge during May; Inventory still less than 2008 levels.

Pending Sales on Whidbey Island increased 45% for single family homes priced under $400,000, increased 33% for homes priced between $400,000 and $799,000, and stayed flat for homes over $799,000 during the month of May. 

 The number of homes available for sale also increased significantly (11%) during May, which was the largest increase during 2009, but was still down from May 2008.  Typically, the number of homes listed for sale increases at the beginning of the year until a peak during August and then declines for the remainder of the year.

Looking at the pending home sales, it is very apparent that the market was driven by first time home buyers as 85% of the pending sales were homes up to $399,000.  Homes priced between $400,000 – $799,000 represented 14% of the pending sales, and the remaining 1% of pending sales took place in the higher end homes priced at $800,000 and above.

Real Estate Market Summary by price segment:  

Entry level homes priced up to $399,000; Balanced market, with between 5.8 – 8.4 months of inventory, firming prices (slight decline in median price, but is “firming”), declining market times.  Affordable homes, $8,000 tax incentive, and low interest rates, has definitely boosted sales.

See Graphs:   509-whidbey-stats-399k

Mid priced homes priced between $400,000 – $799,000; Buyer’s market, showing more signs of activity, but growing inventory, and longer market times, lower list to sale price ratios, and more volatile median prices.  Sales prices are still declining, but the rate of decline is slowing.

See Graphs:   509-whidbey-stats-400k-799k

Higher end homes priced greater than $799,000; Strong buyer’s market, showing very little activity;  Only 2 sales since November 2008.  One pending transaction in May, but based on present rate of sales may have over 5 years of inventory.  Current recession, financing challenges, and weak consumer confidense are having a significant effect on this market segment.  Speculation is that prices may continue to decline for some time in this price range.  Creative financing, such as fractional ownership as well as owner financing, should help to reduce inventory levels. 

See Graphs:   509-whidbey-stats-over-800k