Tighter inventory of houses for sale and stricter lending rules created new obstacles for prospective homebuyers in Clark County in January, according to local analyses of a report issued Saturday.
Just 338 home sales closed last month, according to RMLS, a Portland-based listing service. The total was a slight, 2.7 percent increase from January 2013, but down nearly 30 percent from December’s 475 closed sales. The decrease, said one local broker, reflects a limited number of desirable listings in the local market at a time when more folks are getting ready to take the homebuying plunge. Housing demand remains strong, said Gene Thompson, a real estate broker and owner of Equity Northwest Properties in Vancouver. But the move-up buyers he works with aren’t interested in fixer-uppers. They also want to see more houses for sale in east Vancouver and Camas.
“There’s demand for good quality starter and move-up houses,” Thompson said. “The quality just isn’t there.”
Inventory levels in January were at a 6.4-month supply of houses listed for sale, indicating it would take that long to exhaust the inventory if no new listings were added, RMLS reported. The supply increased from 6.2 months’ worth of listings in January 2013. January’s 6.4-month inventory increased from 4.5 months’ worth of listings in December.
But buyers quickly rushed in to absorb the new listings in January with their home purchases, said Terry Wollam, a Realtor with Re/Max Equity Group.
The RMLS reported 675 new properties listed in January and 505 pending sales.
“The pending sales increase negated the uptick in inventory,” Wollam said,
Thompson said he is hearing complaints from potential buyers who are discouraged by the cost of private mortgage insurance, or PMI, required by lenders when buyers put less than 20 percent down on a home. It’s a requirement with popular Federal Housing Administration financing, he said.
“It’s about $250 a month,” Thompson said. “It has put a damper on the market, no doubt about it,” Thompson said.
Yet he expects to see improving home values and rising home sales through 2014 as move-up buyers rush to take advantage of mortgage interest rates that are still considered a bargain at about 4.5 percent.
The median sales price of a home — half sold for more, half for less — in Clark County was $220,100 in January. It increased nearly 5 percent from a median of $210,000 in January 2013.
Thompson said he sees a lot of empty nesters looking for houses that are just a bit larger and better appointed than the homes where their families were raised.
Negotiating a sale for these clients depends on the mortgage interest rates holding steady, he said.
“This interest rate makes it more affordable for them to buy a 2,500 (square) foot home than their 1,800 (square) foot home,” Thompson said. “People will only hold back for so long and they’ll say, ‘We’ve got to get a house,’ especially when rates are at 4.5 percent.”