Higher interest rates and tight inventory putting squeeze on Pierce County home sales
The latest home-sales reports shows different price ranges facing different realities in terms of speed of sale.
Overall, Pierce County’s median closed home sale price for existing single-family homes in April was $525,000, down from nearly $580,000 at the same period in 2022, according to the Northwest Multiple Listing Service’s monthly report.
The April median closed sale price for homes in the county was still higher than in January 2023 when it was at $517,442.
The number of pending and closed sales in the county for existing condos and single-family homes combined were down from a year ago — more than 27 percent for pending sales and more than 37 percent for closed sales.
Inventory was tight, with just over a month’s supply available.
The median closed sale price for existing condominiums in Pierce County was up from 2022, with April’s coming in at $396,475 compared with $374,000 at the same time last year and $353,500 in January.
In separate reports, John L. Scott Real Estate noted “strong sales activity” up to $3 million in Pierce County, with a return to “multiple offers and the start of premium pricing.”
However, speed was relevant to price, the real estate agency’s report showed..
Countywide, among homes listed in March, between 73 percent to 80 percent of those priced $750,000 and below were pending sale within the first 30 days on the market, according to the report. For those priced $1 million or more, the percentage of those pending in the first 30 days dropped to around 37 percent.
According to NWMLS, “Freddie Mac data show the 30-year fixed rate mortgage rate near the end of April was 6.43%. That compares to the year-ago rate of 5.1% and a rate of 2.98%” on April 29, 2021.
This week, the Federal Reserve raised its key interest rate by a quarter point, its 10th-straight increase in its attempt to curb inflation.
The impact of higher interest rates may be more acute for first-time buyers, “because they don’t have the money from the sale of a home to offset a lower loan amount with a higher down payment,” said Kevin Graham, a writer for Rocket Companies and Rocket Mortgage, in Thursday’s release.
This story was originally published May 5, 2023 at 5:00 AM.
