Pierce County home prices tumble 14.5 percent

Strong sales among low-end homes help pull median down

KELLY KEARSLEY; The News Tribune
Last updated: May 6th, 2009 08:37 AM (PDT)

That’s one of the largest year-over-year drops the county’s seen since the real estate market started its downward march almost two years ago.

The median home price in March was $228,375. The median home price in April 2008 was $263,051.

Local real estate agents attribute the price decline to a number of factors.

Foreclosures and short sales – homes being sold for less than is owed on the loan – are taking their toll on the market.

And many of the homes that are selling are in the lower prices ranges – often $200,000 or less – as first-time home buyers take advantage of low interest rates and tax credits, said Theresa Bastian, operating partner with Keller Williams Realty Tacoma.

“We’re still seeing home buyers almost always offering less than the asking price,” she said.

Homes in Pierce County were spending an average of 131 days on the market, according to Al Morken, a local real estate analyst. That’s a 16 percent increase from last year at this time.

Steve Ketz knows first hand that it’s a tough time to sell. He’s had his Northeast Tacoma home plus two adjoining lots on the market since September.

He’s received two offers on the house, now listed at $249,000. The most recent offer fell through after the buyer’s financing was declined. Ketz turned down a previous offer made last fall.

“I might look at it again today,” he said. “Six months ago I thought it was too low, but the market has not improved -- in fact I think it has declined.”

There are a few bright spots: The area’s active listings dipped by 26 percent to 1,556 homes and condos currently for sale. Much of the decrease was due to a slowing of new listings.

A shrinking inventory can help push home prices back up and the supply begins to better match the demand.

Pending sales – homes where offers had been made, but the sales had not closed – were also up 18.9 percent. The number of closed sales for the month was down compared to April 2008.

The uptick in pending sales reflects increased buyer activity, though some of that growth might be attributed to a number of buyers who are simply waiting for short sales to come through, Bastian said.

Rhonda Lien, 56, recalled helping her son buy a home in the Puget Sound area about four years ago when homes often had multiple offers and buyers found themselves paying above the asking price.

Lien’s looking for a home again, this for herself and her husband, who are moving back to the Tacoma-area from Wisconsin.

“That was crazy,” she said. “This feels more rational.”

Kelly Kearsley: 253-597-8573 Kelly.kearsley@thenewstribune Blogs.thenewstribune.com/business

Originally published: May 5th, 2009 04:55 PM (PDT)