Home sales on King County's Eastside lead December activity
The median price of a house sold in King County last month was $380,000, down 5.8 percent from December 2008 — the last month the median topped $400,000.
By Eric Pryne
Seattle Times business reporter



Houses are selling way ahead of 2008's dreary pace all over King County.
And nowhere have sales increased more lately than on the Eastside, the county's most expensive area.
Consider these December numbers, released Tuesday by the Northwest Multiple Listing Service:
• Countywide, closed sales of single-family homes rose a healthy 57 percent from December 2008. On the Eastside, the bump was even bigger: 78 percent.
• Pending sales — accepted offers that haven't yet closed — rose 55 percent countywide, 81 percent on the Eastside.
• Closed sales more than doubled year over year in five of the 29 areas into which the listing service divides King County. Three were on the Eastside: Kirkland, Redmond and West Bellevue/Medina.
The Eastside's surge actually began in the fall, after a summer in which sales there stayed relatively flat compared with 2008 while sales began climbing in more affordable South King County and Seattle.
So what's happening east of Lake Washington? Real-estate professionals offer an assortment of possible explanations: increasingly flexible — or desperate — sellers. The continuing impact of federal tax credits. The improving stock market. Not to mention favorable interest rates.
'Sky not falling'
"Our buyers are realizing the sky is not falling," said Peter Hickey, owner-broker of Windermere Real Estate's Kirkland office.
While King County house sales in December exceeded the previous year's number for the seventh straight month, prices continued to drift. The median price of a single-family home that sold in December was $380,000, down 5.8 percent from December 2008 when it last topped $400,000.
During 2009 the monthly median fluctuated between $363,850 and $395,000, with no clear trend up or down. Median means half the homes sold for more, half sold for less.
But prices did rise year-over-year in December in a few scattered neighborhoods: Woodinville, Shoreline, Southeast Seattle, parts of Renton.
Across the Sound, in Kitsap County, the median price increased 8 percent.
In Snohomish County, the median house price fell nearly 10 percent year over year in December, to $287,000. But buyers also closed on nearly twice as many houses.
Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University, said he was "pleasantly surprised" by the December sales volumes throughout Western Washington.
He had anticipated a bigger drop from November, when many first-time buyers rushed to close to meet a deadline — later extended — to qualify for an $8,000 federal tax credit. In King County, the month-to-month decline was just 7 percent.
As for the strong sales on the Eastside, Crellin speculated they may be fueled in part by sellers with mounting financial troubles who now are willing to accept lower prices than a few months ago.
"I suspect there is some bargain-hunting going on in those neighborhoods," Crellin said of Kirkland and Redmond.
Hickey, the Windermere broker, said some high-end new homes on the Eastside that have languished on the market for up to two years now are receiving multiple offers.
Price cuts helped, he acknowledged: "We have motivated sellers who have come to grips with the fact that their houses are not worth 2006 prices anymore."
Sales may be increasing faster on the Eastside now than in South King County, the county's most affordable area, because buyers are willing to pay more to be closer to work, Hickey said.
Gerhard Ade, an agent in Coldwell Banker Bain's Kirkland office, said the Eastside continues to attract newcomers to the region who come to work for Boeing, Microsoft and Amazon.com.
The Eastside also may be attracting "trickle-up" buyers who have sold their houses elsewhere in the region to first-time buyers and are looking to relocate, he said.
But Mona Spencer, broker at John L. Scott's Redmond office, said first-time buyers remained a big part of the Eastside market in December, despite the extension of the federal tax credit to June 30. Most of the sales that her office closed last month were for less than $500,000 — starter homes on the Eastside, she said.
"I had two mutually accepted deals on Christmas Day, both to first-time buyers," Spencer said. "I'm seeing more activity. Our sales are up."
Buyers of more expensive homes have the most to gain by taking advantage of the lowest mortgage rates in the last 50 years. In December, the national average mortgage rate on 30-year fixed loans for less than $417,000 was below 5 percent, according to bankrate.com. Rates for loans for larger amounts hovered between 6 and 8 percent.