We regularly post Market Reports to show the home sales activity in different towns in Clark County. We tend to report more frequently on the areas where we concentrate our efforts - East County - Camas, Hockinson, and Washougal. We use a pictograph to show Active, Pending, and Recent Sales, including Average Price, SQFT, and $/SQFT:
At the end of the chart, we note the "Annual Increase in Sales Price" - which is derived from the RMLS "AVG Price % Change" numbers for that month.
The RMLS defines this indicator as the average sales price for the last 12 months compared to the same average 12 months prior. The RMLS monthly report includes the percent change for all of Clark County, as well as specific RMLS areas.
The Numbers Show a Decrease in % Price Change
We started to notice an interesting change in this indicator several months ago, so we decided to plot it. Since around 2011, the AVG Price % Change for most areas kept going up year after year. That continued until 12 months ago. Now the numbers show a different trend - leveling off, or even heading down slightly.
What does this mean? The rate at which prices were going up is now cooling. Average price increases in most areas are still positive, just not as high as previous years. Here are the trends in our areas of focus:
Simultaneously, inventory, although historically low, has been creeping up as more homes and new construction come on line:
This Trend is Regional and National
Charting our neighboring Portland market shows the same trajectory down in AVG Price % Change. A more comprehensive indicator - the S&P CoreLogic Case-Shiller Home Price Index confirms that, for the Portland metro market (which includes Clark County), there is a year-over-year decrease in the rate of home price increases. This is true for most major markets in the U.S., including the larger Seattle metro area to the north.
So, are we entering a cooling off period in the area? In addition to a lower percent price change, closings in the county are down from 6 months ago. This could, of course, be due to some of the Fed's interest rate hikes last year. The promise of no new rate increases in the coming months might boost overall sales again, but increasing inventory could still put pressure on prices.
The message for Sellers is, when listing your property be very realistic about your pricing. Inventory is still low, but qualified buyers are clearly expecting lower prices than last year. Likewise, buyers should be aware of pricing opportunities as inventory increases.
For now, it appears to be a slight (and needed) pricing correction in the market. Due to the low inventory, we are still in a Sellers market. Buyers who find a home they love, need to act quickly and realistically with offers.
We don't expect wild drops in pricing, but the trend appears to be downward for now. It will be interesting to see how this plays out as we continue to track and report on price changes in the coming months.