Home sales shoot up in November from year ago thanks to federal tax credit

The deadline that wasn't helped push King County home sales up in November.

Buyers closed on 1,574 houses last month, a whopping 81 percent increase from November 2008, according to statistics released today by the broker-owned Northwest Multiple Listing Service.

In Snohomish County the increase was even more dramatic: 120 percent.

Most of last month's closings were for offers accepted in September or October, when first-time buyers thought they faced a Nov. 30 deadline to claim an $8,000 federal tax credit.

In early November, Congress extended the deadline and expanded the credit to June 2010.

November 2008 was a dismal month for home sales, which also helps explain the big year-over-year surge. Consumer confidence plummeted last fall as the global credit crisis erupted, the stock market plunged, and such corporate giants as Washington Mutual and Lehman Brothers collapsed.

But last month's house sales in King County also were up 3 percent from November 2007's total.

The median price of a house that sold in King County in November was $370,000, down 6.3 percent from the same month in 2008. The median condo price was $252,600, down 7.9 percent.

While up significantly year-over-year, the number of houses sold in King County last month was the smallest since May. Real estate activity generally subsides as winter approaches.

The number of pending King County house sales in November — offers that were accepted, but haven't yet closed — dropped 31 percent from October's total, perhaps another reflection of the impact of the first-time buyer tax credit.

But pending sales were up 36 percent from November 2008.

Observers differed on what the future holds.

"This winter will not be 'business as usual' for the housing market," Lennox Scott, chairman and CEO of John L. Scott Real Estate, said in a prepared statement. "Thanks to historically low interest rates, adjusted home prices, and the passage of the extended/expanded tax credit, we are getting a running start on the New Year."

But Tim Ellis, editor of the bearish Seattle Bubble real-estate blog, expects a slowdown.

"I suspect that a large part of this spike [resulting from the tax credit] will end up having been borrowed from sales that would have otherwise taken place in the already normally slow December through February [period]," he wrote.

"Don't be surprised if we see a massive drop-off of sales next month."

In Snohomish County, pending house sales were up 47 percent in November from a year ago, but down 30 percent from October. The median price of a house that closed in the county in November was $283,129, down 11.6 percent from November 2008.

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