In down market, agents say lower-end houses moving

King County single-family homes sold last month for a median price of $375,000, the lowest since May 2005, according to a report released Wednesday by the Northwest Multiple Listing Service.

The number of closed sales in February dropped 42 percent from the same month in 2008 — which in turn was down 27 percent from February 2007.

So, against such a dismal statistical backdrop, how do you explain what happened late last month when Windermere agent Dorothy Franklin listed an 82-year-old, five-bedroom house in Green Lake, just four doors from busy Aurora Avenue North?

By the end of the first — and only — open house, Franklin had four offers in hand, all from first-time buyers. The bid the sellers accepted exceeded the asking price of $389,950 by $5,000.

It was a flash from the not-so-distant past. "It shocked me, let me tell you," Franklin said.

Big-picture statistics don't tell the complete story of what's happening in the local real-estate market now, agents and brokers say.

Attendance is up at open houses, they report. Some first-time buyers are starting to commit, perhaps motivated by lower prices and the new $8,000 tax credit in the federal stimulus package.

Houses that show well and are priced right — especially at the lower end — are starting to move, agents say. And, for the first time in more than a year, some properties are attracting multiple offers.

Kathy Estey, managing broker at the John L. Scott downtown Bellevue office, said her office has been involved in 11 single-family-home transactions recently, from West Seattle to Bothell, that drew competing bids. All but one were priced at $390,000 or less. Almost all the bidders were first-time buyers.

"If a house is well-priced and in good condition, it'll sell," Estey said. "People were sitting around and waiting. Now there's so much pent-up demand."

So far, however, evidence of any turnaround is mostly anecdotal.

Falling prices

The broker-owned multiple listing service reported the median single-family home price in February dropped 12.8 percent in King County and 12.1 percent in Snohomish County from the median in February 2008.

Pending sales — offers that have been accepted, but haven't closed — dropped more than 20 percent in both counties year over year.

Condo sales numbers also tumbled. But, again, industry professionals say first-time buyers are snapping up some lower-priced units quickly. And the median sale price for Snohomish County condos rose 4 percent, to $254,990, last month from February 2008.

Business partners Zach Vall-Spinosa and Charlie Anderson spent nearly a year remodeling a century-old apartment building in Seattle's Madison Valley and converting it to condos. They put the 12 units on the market in November, asking between $160,000 and $290,000.

The last one sold last month, Vall-Spinosa said, and all went for the full asking price.

"We sold three the first weekend. These things were just flying out the door," he said. "I think there's been some pent-up demand for quality product in that price range."

Investors bought two units, Vall-Spinosa said, but the rest went to first-time buyers — mostly young, single and carless — who had been looking for four to 12 months.

Lower-priced homes may not be selling as well as they did a year ago, but they are faring better than higher-priced inventory, Windermere spokeswoman Sonja Riveland said.

She crunched the latest listing-service numbers for King County and found that, while sales of houses and condos priced at more than $300,000 plummeted 53 percent year over year, sales of homes priced at less than that threshold dropped only 16 percent.

Sellers increasingly are willing to list homes at lower prices that reflect market realities, Riveland added.

Franklin, the agent selling the Green Lake house, said it moved quickly because it was in top condition and priced realistically. She said she told her client she could list it at less than $400,000 to start, or begin at $415,000 and drop it two weeks later if it didn't move.

The client opted to start lower in hopes of a quicker sale. The strategy evidently worked.

The whole experience has left Franklin more upbeat about the real-estate market's future. "I think it's going to start waking up," she said. "I really do."

But it remains a different market than it was two years ago. Back then, Franklin said, she would have listed the Green Lake house at more than $500,000.

Eric Pryne: 206-464-2231 or epryne@seattletimes.com