Realtor.com listed their top 10 "Turnaround Towns" for the 3rd quarter of 2012, and the Seattle real estate market was listed as the fifth-best market. West coast cities dominated the list, with eight of the top ten cities in California and Washington.
The list was based on changes in some of the most important trend categories for real estate: pricing, inventory, and time on the market. The unemployment rate was also factored into the rankings, giving some credit to the likelihood that strong employment will further bolster the housing market.
Seattle had one of the lowest unemployment rates on the list, at 8.0 percent. With a 12.92 percent gain in year-over-year home prices, the appreciation was significant for Seattle's ranking. Inventory and Age of Inventory (time on the market) were even strong factors for the city, however.
Seattle's inventory of homes available for sale dropped 45.57 percent compared to the same time last year, nearly slashing prospective home buyers' options by half. The time a home sits on the market before selling also dropped over 40 percent, making the Seattle real estate market a much tighter, faster-moving market than it was just a year ago. The increased competition in Seattle has pushed its ranking through the 3 quarters of 2012 from #25, to #6, and now to #5 in the country.
From the article:
5. Seattle-Bellevue-Everett, WA is showing significant improvements in all three of its key housing indicators. Home prices are continuing to increase, rising almost 13% in the third quarter over last year. Seattle has also seen a large reduction in both its median age of inventory (-45.57%) and inventory (-40.62%). Seattle’s September foreclosure rate of 1 in every 1,149 housing units is also well below the national rate.
Seattle's particularly-low foreclosure rate is significant, in that many markets have real concerns about a second wave of foreclosure inventory shutting down their home price appreciation. While that's always a potential in any market, it's severely limited in the Seattle market by the relative lack of distressed properties.
Data Source: NWMLS - The Northwest Multiple Listing Service did not compile or publish this information.