For Clark County residents thinking about buying a home, there’s good news: The market is starting to look up.
Contrary to typical July trends, new sales activity in Southwest Washington increased last month. Pending residential sales reached 702, up 4.2 percent from June, according to the latest real estate report from the Regional Multiple Listing Service.
Summer vacations normally cause new sales activity to decline — a trend that would have made sense last month as many people traveled for the first time since the pandemic began. Instead, the opposite occurred.
“For us to see improvement in new sales activity in July is very, very unusual,” said Mike Lamb, a real estate broker at Windermere Northwest Living in Vancouver. “That suggests to me that it’s a market seeking its new normal.”
The rise in new sales activity is partly related to increases in inventory, which stimulates sales, Lamb said. Southwest Washington had 1.9 months of inventory in July, meaning it would take just under two months to sell all currently available homes if no new homes were to enter the market.
For context, a balanced market typically has between four and six months’ supply of inventory. Though Clark County is still well behind that number, 1.9 months is a notable improvement from the beginning of the year, when inventory hovered around two weeks.
“We’re still at historically low levels of inventory, but it’s so much better than it was,” Lamb said. “I think this market is going to afford buyers much more opportunity.”
Despite increased new sales activity, closings slowed in July. There were 666 new closed residential sales, 14.6 percent lower than June. This is not a surprise, given weaker new sales activity in May and June, Lamb wrote in his August Clark County Market Report.
Median sales prices for residential properties decreased to $529,400 in July, down 0.8 percent from June.
Though Lamb does not expect home prices to drop significantly in the near future, he does foresee the market becoming more sustainable with more realistic prices.
“I think we’re at a place where we’re going to see a kind of move toward a much healthier market,” he said.
Lower mortgage rates also might have contributed to July’s increased activity by easing some pressure off homebuyers, Lamb noted. The average 30-year fixed mortgage rate fell from 5.54 percent to 5.30 percent at the end of July, according to the government-sponsored home mortgage packager Freddie Mac.
Though this is still significantly higher than July 2021’s rate of 2.80 percent, the relative decrease could have encouraged new sales activity in Clark County, Lamb speculated.
“My experience over 42 years of doing real estate is that consumers respond quickly when things are going in their favor,” he said. “As rates have come down, sales activity seems to have come back a little bit.”
Mortgage rates fell further in the first week of August, dipping below 5 percent before rising again to 5.22 percent last week.
