Properly priced homes selling well in Gig Harbor

Real estate agents say mortgage crisis hasn’t affected area

George Le Masurier

of the Gateway

While the Gig Harbor-area real estate market seems slow compared to the boom of previous years, agents and brokers insist the sky is not falling.

In fact, the local market is quite normal, they say, and relatively unaffected by the mortgage lending crisis that is crippling other parts of the United States.

“Buyer confidence is returning,” said Alison Ybarra, broker and branch manager of the John L. Scott office in Gig Harbor.

She said buyers are taking note of a wide choice of housing inventory, low mortgage rates and new, secure financing options — a combination they haven’t had in a long time.

As property values soared in the double digits, and sometimes higher than 20 percent, in the past few years, people began to think that frenzy would continue.

But agents knew better.

“It was insane. We knew it had to get real at some time,” Ybarra said.

And yet, the Gig Harbor area remains an aberration, even in Pierce County.

While local March sales dropped by 44 percent compared to last year, the median price increased 8 percent from $373,750 to $402,500.

That may be an indication of recent increased activity for higher-priced properties, as the median price had declined by 18 percent in the first three months of 2008 compared to the same period last year.

But Ybarra said the homes that are selling move in an average of 144 days — four to five months — and bring 96 percent of the listing price.

That shows properly priced homes do sell quickly, she said.

Some agents are saying they now refuse to take listings when sellers have an unreasonable price expectation.

Tova Uddenberg of Re/Max Partners said agents are becoming encouraged with a new energy in the air that she said is also being felt by title/escrow and mortgage companies.

“However, it is a normal market now, and that only seems slow because of the last few years,” she said.

Jeff Carr of NorthWest Mortgage Services said the serious contraction in the industry resulted in his worst fourth quarter in two decades. But he sees it picking up.

The foreclosure incidence here is small, and typically real estate activity rises to 40 percent of the year’s business during June, July and August.

“I’ve got 17 loans in the house right now,” he said. “That’s good for a business of our size.”

Carr believes that, as mortgage rates get into the low 5 percent range, buyers won’t be able to resist jumping back into the market.

“People seem to be waiting for property values to find the bottom,” he said.

But if buyers think sitting out will get them a better deal, Ybarra warned that prices will continue to increase. She said there’s no guarantee that rates will stay low.

In one unusual twist to a confusing market, Ybarra said people are starting to look at Gig Harbor as affordable.

“Agents from outside the area never used to include Gig Harbor listings in their MLS searches for buyers, because we were always considered too expensive,” she said. “That perspective is changing because of the (Narrows) bridge.”

She said affordable housing has always been here and points to several pages of listings in the $200,000 to $300,000 range, even some properties less than $200,000.

Gig Harbor may have been seen as the Mercer Island of the South Sound, but the more average income population that provides a community support system has always existed. And she sees it increasing with the boom in commercial growth.

Market by the numbers

There are months of inventory in the Gig Harbor-area market.

On homes in all price ranges:

March 2008 — 15 months

March 2007 — 6.9 months

January 2007 — 17.5 months

There is currently 11.2 months of inventory for homes priced less than $600,000 and 27.8 months of stock for those priced higher.

Number of homes for sale in all price ranges:

March 2008 — 59 sold, 66 pending

March 2007 — 105 sold, 116 pending

January 2007 — 39 sold, 86 pending

Almost all of the sales are houses less than $600,000. They account for 47 sales and 56 pending sales last month, compared with two sales and 10 pending for more expensive houses.

Selling price compared to listing price on homes in all price ranges:

March 2008 — 96 percent after 144 days on the market

March 2007 — 97 percent after 110 days on the market

January 2007 — 96 percent after 98 days on the market

In March, homes priced $600,000 or more sold at 95 percent of listing price after 190 days on the market, while less expensive properties sold sooner — at an average of 132 days — and for 97 percent of the asking price.

Source: trendgraphix.com

Reach Publisher George Le Masurier at 253-853-9248 or by e-mail at george.lemasurier@gateline.com.