The following analysis of the Eastern Washington real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere agent.
Washington State continues to be one of the fastest growing states in the nation and there is little to suggest that there will be any marked slowdown in the foreseeable future. Over the past year, the state has added 105,900 new jobs, representing an annual growth rate of 3.2%. This remains well above the national rate of 1.65%. Private sector employment gains continue to be robust, increasing at an annual rate of 3.7%. The strongest growth sectors were Construction (+7.4%), Information (+6.2%), and Professional & Business Services (+6.1%). The state’s unemployment rate was 4.5%, down from 4.8% a year ago.
The Eastern Washington region added just 426 jobs over the past 12 months, representing an annual growth rate of 0.1%. The low growth rate is due to a marked decline in manufacturing which could be a function of ongoing trade and tariff issues. It will be interesting to see if this continues for the remainder of the year. Despite low employment growth, the unemployment rate for the counties covered by this report dropped to 4.7% from 5.1% a year ago.
HOME SALES ACTIVITY
Home sales throughout Eastern Washington continue to grow, but housing inventory is showing gains, as well. This increase in the number of homes for sale has caused sales to cool somewhat as buyers now have more choices and time to make them. Total sales rose by 1.6% over the same quarter in 2017 to 4,167 units.
Sales rose fastest in Whitman County, which increased 5.7% from a year ago. Walla Walla county saw a significant drop in sales but, because it is a relatively small market, it’s prone to significant swings.
Year-over-year, home sales rose in four counties, one county saw a drop, and Grant County saw exactly the same number of sales as a year ago.
The number of homes for sale was down 21.8% from the third quarter of 2017, but total listings were up by 13% when compared to the second quarter of this year.
Year-over-year, the average home price in Eastern Washington rose 9.8% to $271,401. Price growth has been moderating and prices were essentially the same as in the second quarter.
Low inventory throughout the region has been a significant hurdle to would-be home buyers. I believe that we will see more homes come onto the market this fall and the trend will likely continue once we move into next spring.
All the counties in this report saw prices rise compared to the third quarter of 2017. Franklin County took over the number one spot with an annual price increase of 16.3%.
The takeaway here is that home–price growth has started to cool a little and I expect that to continue as inventory levels rise.
DAYS ON MARKET
The average time it took to sell a home in Eastern Washington last quarter was 46 days.
The average amount of time it took to sell a home in Eastern Washington dropped by 21 days compared to the third quarter of 2017.
Every county other than Benton (+3 days) saw the time it took to sell a home either remain static or drop compared to the same quarter in 2017.
It took eight fewer days to sell a home in the third quarter than it did in the second quarter of this year.
This speedometer reflects the state of the regions real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors.
The number of homes for sale has picked up a little in recent months, but housing markets throughout Eastern Washington are still very tight. The overall trend remains in favor of home sellers;therefore, I am leaving the needle in the same place as last quarter.
Matthew Gardner is the Chief Economist for Windermere Real Estate, specializing in residential market analysis, commercial/industrial market analysis, financial analysis, and land use and regional economics. He is the former Principal of Gardner Economics and has more than 30 years of professional experience both in the U.S. and U.K.