Home Prices Continue to Slide, Sales Even Out and Interest Rates Put On the Breaks

Current Price Trends
October market statistics just released by NWMLS show a developing trend in small decreases for median prices in Pierce County. The price index dropped from $284,364 to $283,431, the second such decline in the past two months. Buyers waiting for a general price collapse are likely to remain frustrated. Sellers, however, don’t have the luxury of overpricing their homes. Only homes with the best perceived value are selling.

This index is calculated by averaging the median sales price for the last six months. This reduces the impact of seasonal effects on the overall trend.

Market Activity
Listing inventory remains at record levels but continues to drop with seasonal influences. After reaching a high of 7863 in August, there were 7407 home listings at the end of October. Sales recovered slightly from the previous month low to 791 pending recordings. The dual effect was to lower the total market inventory absorption time from 11 months to just over 9.

Financial Market Trends
Interest rates continue to remain stable at 6.125% even though the Federal Reserve continued its rate reduction policies. Costs associated with loans over $417,000 (Jumbo Loans) have begun to drop which will help upper-end buyers. There is also pressure to raise conforming loan limits which will increase mortgage affordability and create a positive impact.