The following analysis of the eastern Washington real estate market is provided by Matthew Gardner, chief economist at Windermere Real Estate. We hope this information can help you make more informed real estate decisions. For more information about the housing market in your area, please contact your Windermere real estate agent.
Regional economic overview
The Eastern Washington job market lost more than 47,000 jobs during the pandemic period, but the region has now recovered all of these jobs and added nearly 11,000 new jobs. Every county except Whitman is showing employment levels above their pre-pandemic peak. Of particular note is Spokane County, which met my forecast in Q2 Gardner report and has now seen a full runway recovery. Unsurprisingly, job growth has caused the unemployment rate to fall further, with only 4.6% of the region’s workforce now out of a job. This is lower than the pandemic peak of 14.9%.
Eastern Washington Home Sales
❱ Home sales across Eastern Washington were down 2.2% compared to the same quarter in 2020. This is not very informative as the country experienced a massive housing market rebound following the COVID-19 outbreak. More conveniently, sales are up 13.5% compared to the second quarter of this year.
❱ Listing activity increased by more than 64% compared to the second quarter of this year, enabling sales to grow. That said, available inventory is still down 13.7% from last summer.
❱ Year-over-year sales increased in three provinces, but declined in the other four. Compared to the second quarter, sales increased in all counties except Whitman, with significant increases in Lincoln County, where transactions were up more than 48%.
❱ Pending residential sales, which are an indicator of future closures, were 3.1% higher than in the previous quarter. This suggests that fourth quarter closes will be positive.
eastern washington home prices
❱ On a year-over-year basis, the median home price in Eastern Washington was up a very significant 23.7% to $425,630 and was 3.8% higher than in the second quarter of this year.
❱ Demand remains strong, as evidenced by the increasing number of pending sales, and the increase in the number of homes for sale has not held the market down.
❱ Prices rose in every county except the small market in Lincoln County. In all other areas there were double-digit increases.
❱ Mortgage rates remain highly competitive, which has kept prices rising. But as I said in the previous Gardner report, affordability concerns are starting to mount. Both Spokane and Walla Walla counties are now technically unaffordable to middle-income buyers, and every county in this report — with the exception of Lincoln County — is considered unaffordable to new buyers.
Days at the market
❱ The average time to sell for a home in Eastern Washington in Q3 2021 was 14 days.
❱ During the quarter, it took 17 days less to sell a home in Eastern Washington than it did a year ago.
❱ In all markets, the market was down in days compared to Q3 2020, with significant declines in Lincoln County (-29 days), Whitman County (-26 days) and Grant County (-22 days).
❱ It took six days less to sell a home in the third quarter than it did in the second quarter of this year.
This speedometer displays the state of the real estate market in the region using housing stock, price increases, home sales, interest rates and larger economic factors.
With a full return of the jobs lost to COVID-19 and very favorable mortgage rates, home buyers are on their way. This, combined with more choice in the region, caused home sales and prices to rise.
As it stands, the only thing that favors buyers is that there are more homes for sale. But given the direction of ongoing sales, prices and shorter days in the market, the region still favors home sellers. As such — and even in light of affordability issues starting to appear in select markets — I’ve chosen to move the needle a little more in favor of home sellers.
About Matthew Gardner
As chief economist for Windermere Real Estate, Matthew Gardner is responsible for analyzing and interpreting economic data and its impact on the real estate market at both the local and national levels. Matthew has over 30 years of professional experience in both the US and UK
In addition to his day-to-day responsibilities, Matthew sits on the Washington State Governors Council of Economic Advisors; chairs the Board of Trustees of the Washington Center for Real Estate Research at the University of Washington; and serves on the Advisory Board at the Runstad Center for Real Estate Studies at the University of Washington, where he also teaches real estate economics.