SPOKANE – Washington’s housing market remains a pricey bright spot, but that means renters are seeing fewer opportunities to become homeowners, a study finds.
There were 26,720 homes sold statewide during the first three months of 2007, a 9.2 percent drop from the same quarter in 2006, according to statistics released last week by the Washington Center for Real Estate Research at Washington State University in Pullman.
But the median price of $300,800 in Washington was 7.4 percent higher than a year ago. That compares with a 1.8 percent decline in the national median price for a single-family home during the first quarter. The median is a typical market price where half the homes sold for more and half the homes sold for less.
“Home prices only tell part of the story,” CRER Director Glenn Crellin said in a statement. “The real question regarding housing’s future strength is where households can afford the homes.”
Nationally, the trend is toward less expensive homes, sending prices down.
Dennis Rose, 2007 President of Washington Realtors, said Washington’s economy is helping keep home prices high.
“Strong job growth, coupled with a commitment to quality-of-life issues, is helping Washington avoid much of the pain of declining home prices observed in other areas,” Rose said.
The Housing Affordability Index uses median home prices, mortgage interest rates and family incomes to measure the ability of a middle-income family to afford mortgage payments on a typical home.
In Washington, the affordability index climbed for the second consecutive quarter, mostly because the mortgage interest rate declined slightly during the first quarter, the WSU center said.
The state’s affordability index was 88.9, meaning the typical family needs about 11 percent more income than the national average to be able to afford the median price home.
The WSU real estate center found that housing is considered affordable in 24 of the 36 counties where data was available. But in a dozen counties, there was a pronounced affordability problem.
A healthy housing market needs to provide opportunities for renters to become homeowners, Crellin said.
The center’s statewide first-time-buyer affordability index has a value of 52, meaning the would-be home buyer has only about half of the income required to qualify for a mortgage on the typical starter home.
The problem is even more pronounced in individual markets, such as King County, where the index stood at 39.7 during the first quarter. The first-time-buyer index was also below 50 in Snohomish, Jefferson, San Juan and Whatcom counties.
The quarterly survey found significant variations in home sales and prices across the state.
Home sales increased in 20 counties, declined in 15, and were unchanged in four compared with last quarter. Year-to-date comparisons show five increases, three stable, and 31 declines in sales figures.
Median prices ranged from a high of $475,000 in San Juan County to a low of $96,700 in Adams County. In Snohomish County the median price for single-family homes in April was $375,000, according to the Northwest Multiple Listing Service.