— from Sandi Friel —
In a very welcome development for our Orcas Island real estate market, 89 properties sold between January 1 and June 30. This is a significant 46% increase over the same period in 2013. Properties are also selling quicker, with the median time on market down 30% to 183 days. In more good news for sellers, offers are coming in closer to their list price and the median home sold for 96% of the asking price. Before throwing a ticker tape parade, though, let’s dive into the data to see what these numbers really mean.
What’s Selling?
The biggest increase was in sales of vacant land, where numbers nearly doubled and made 25% of total sales. Buyers are still seeking out lower-priced parcels, primarily inland, with a few view parcels and one waterfront also selling. Twenty of the 22 sales were below $200k, with a median selling price of $120k.
Just looking at existing home sales, there was a more modest yet still very positive 29% increase over 2013, with 63 sales. The lion’s share of market movers was in the $200k-$400k range, with a new Eastsound condo development contributing to sales numbers in the lower price range. However, higher priced homes sold well too, which raised the overall median home price to $357,000 – up nearly $75k over the 2013 figure.
Price Check
Distressed homes accounted for 19% of the homes sold on Orcas. That’s a slight increase over 2013. Although there was only one short sale, banks still hold an inventory of foreclosures and as they unload these properties it will continue to keep price pressure on homes.
I continue to look for trends in the Sales Priced to Assessed Value Ratio (SAVR). In 2013, the median sale price of an Orcas home was 96% of its new assessed value. This year it’s up to 106%. That could indicate a bump in value, but the SAVR varies so wildly, I don’t think it’s a reliable indicator…yet. For instance, one bank-owned home sold this year for 54% of its assessed value, and an off-grid property featuring unconventional building methods sold for 148% of its assessed value. Similarly, land sales ranged from 59% to 171% of their assessed value. There are so many minute factors that contribute to a buyer’s valuation of a property, and thus their offers, that the assessed value cannot be relied upon to determine true market value.
Who’s Buying?
Nearly half – 49% — of purchasers were local islanders, up from 44% in 2013. This figure includes move-up buyers, investors, and recent newcomers to the island who are moving from their existing rental. With the recent gains in the mainland markets and Seattle’s population boom, we should start seeing more out-of-state buyers as well as Emerald City folks looking for second homes.
Inventory Woes
There are homes for sale on Orcas, but unfortunately most of them are not in the segment of the market seeing the highest demand. The best-selling category is homes in the $200-$400k range, and many of the prime properties in this niche have been snatched up. Buyers, if this is your target price range and a desirable home hits the market, be prepared to jump on it. Have a bank pre-approval letter, proof of funds and an aggressive offer ready. Sellers, if you took your home off the market in the last few years, now might be a good time to list. Consult your real estate broker for pricing advice. Even though the market has improved, proper pricing is the key to selling your home in a reasonable time period versus letting it age on the market.
This data was compiled using information provided courtesy of NWMLS. You may follow Sandi Friel at OrcasReport.com.
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