County home sales still booming

The national housing boom was officially pronounced dead on Monday. Thank goodness Snohomish County didn’t get the news.

On a day when pundits were declaring the five-year housing boom officially over, the Northwest Multiple Listing Service reported that home sales in the county increased by more than 18 percent during February.

And that increase – based on sales of a year ago – came despite a continuing skid in the number of homes available for sale and a strong increase in the prices of homes that are on the market.

In Snohomish County, listings were down about 4 percent from a year ago. The combined median price of homes and condominiums was at $304,950, a more than 22 percent increase from February 2005.

That was in contrast to the national scene, where home sales have declined for four of the last seven months and the backlog of unsold new homes has hit a new record.

Explanations for the recent national cooling-off vary. Many people bought homes during the past five years and are staying put. Some analysts blame a decline in consumer confidence. And interest rates have been rising, especially for adjustable mortgages that allowed people to buy more expensive homes than they could have afforded with a 30-year loan.

“We started to see the strain in July and August, and by the fourth quarter the market definitely had slowed,” said Layne Marceau, president of the Northern California region for Shea Homes, one of the nation’s largest private builders.

Rising prices and interest rates pushed more buyers out of the market. When prices finally did cool, sellers couldn’t command a high enough price on their old house to buy the new one, said Marceau, who believes the slowdown is temporary.

The median price of an existing single-family home has declined since peaking at $219,700 in July to $210,500 in January, according to the National Association of Realtors.

Median means half the homes sold for more and half sold for less.

In Snohomish County, the median for single-family homes alone hit $324,950, a nearly 20 percent increase from a year ago. That means county residents are paying 54 percent more for their houses than the average American.

Why are they still buying here?

Improving spring weather, increasing population and job growth are three reasons. Relatively low mortgage rates are a fourth.

Dick Fulton, a listing service director who is a Coldwell Banker Bain broker in Seattle, said February started slowly and ended with a bang.

“The locomotive is finally up to full speed,” Fultan said, adding, “We’re back.”

The continuing sales in the Northwest follow traditional economic patterns.

While being one of the last areas of the country to improve after an economic slowdown, the Northwest is often one of the last to slow down. Both Microsoft and the Boeing Co. have been expanding, and so have other local companies.

Snohomish County has the further boost of much lower home prices than King County, which is the strongest economically throughout the state. People who find jobs in King County can commute to work from a home in Snohomish County for a lot less money. The combined median home price in King County last month was $344,950, $40,000 more than in Snohomish County.

The Associated Press contributed to this story.