In his latest video update, Windermere Chief Economist Matthew Gardener provides a recap of the events that led to the foreclosure crisis a decade ago, and detailed evidence as to why he does NOT believe we are headed for a housing bubble.
Our key takeaways included the following:
- Housing inventory remains tight (see the chart below for Pierce County)
- Buyers are well qualified for the homes they are purchasing
- Millenials (a bigger demographic than Boomers) are reaching peak household formation
- There is no end in sight to the migration into the South Sound from more expensive metros
- There isn’t enough new construction in the pipeline and construction costs have risen sharply this year
We’ve included some data below that is specific to Pierce County and we believe shows why our market is feeling added pressure.
In April of 2021 our median sales price was $425,000 -- up from $205,000 in April of 2011. Keep in mind that King County’s median price leapt from $335,000 to $685,000 during this same period of time.
Last month we had 1.1 months of supply (homes) versus 11.3 months in April of 2011. That shift (in conjunction with record low interest rates) has put a tremendous amount of pressure on our sales prices.
However Gardener does predict that price gains will start to slow as prices move ahead of household incomes. We are seeing some evidence of this on the ground, but also witnessing substantial bidding wars and cash offers for unique and/or well prepared homes.
Click through to get all the details in Matthew’s analysis over on Windermere’s blog.