PORT ANGELES — “There’s no mystery, the market is out of whack,” said real estate agent Dave Ramey with Coldwell Banker Uptown Realty in Port Angeles.
“I’ve been a Realtor for 45 years, and I’ve seen a lot of strange markets and this is probably the strangest yet.”
Ramey’s sentiment is shared in markets across Clallam County, and much of the nation, as median home prices climbed during COVID-19 with low supply and high demand.
He and two other Clallam agents — Michael McAleer, managing broker for Team McAleer at RE/MAX Prime in Sequim, and Don Grafstrom with Forks’ Professional Realty — spoke on the housing spike during the Clallam County Economic Development Council’s “Coffee with Colleen” program on Aug. 11.
“I have not talked to a single Realtor who thinks this market is good for anybody, including Realtors,” Ramey said. “It’s challenging.
“We have a lot of disappointment with clients who have to write five or six or seven offers, and to get something accepted means writing five times as much.”
Port Angeles
Looking at the Port Angeles real estate market from Joyce to McDonald Creek, Ramey said that the problem is multi-faceted, including low interest rates and homes being used for vacation rentals instead of long-term residences.
“Until some things change, we’re going to be stuck here for awhile … (until) interest rates start climbing and (maybe) prices will start to level off, or like in 2007, start to go down,” he said.
Ramey said last week not much has changed since his Aug. 11 report where he noted that Port Angeles’ average home sale price from Jan. 1 to mid-August was $391,900 with a median of about $360,000.
“The year-to-date price is up 12.4 percent for the average from last year, and the median is up 18 percent,” he said.
Of the 135 homes on the market in mid-August, Ramey said 48 were active and 87 pending, with an average of 18 days on the market and median of five days.
“Supply is being sucked up pretty fast,” he said.
Port Angeles’ previous high sales point was in 2007, Ramey said, before dropping through 2012. At this time in 2011, there were 335 active listings and only 26 home sales, he said.
“I do know from experience, all markets correct one way or the other,” Ramey said.
Sequim
McAleer, referring to his agency’s quarterly reports of Sequim’s market (started in 2004 by his sister Colleen McAleer, now the EDC’s executive director) during the Zoom meeting, said the second quarter saw median home sale prices go from $470,000 in May to $550,000 in June.
But following up last week, McAleer said in a phone interview the median price is down to $465,000 from July 1 to Aug. 30 with a caveat during that span: the price per square foot has gone up $10 to about $275, and sales are on par with last quarter – 191 in quarter two and 135 so far in quarter three.
As of Monday, Aug. 30, Sequim’s median asking price was $575,000, and the average asking price was $661,000, he said.
“Supply is the issue,” McAleer said.
“Obviously there is a greater demand with these new professionals added to the mix.”
In previous reports and in the Zoom meeting, McAleer said that anecdotally it appears Sequim is seeing interest from younger professionals from Seattle the last 18 months — more so than retirees from Californian in recent years — looking to escape the city life.
With 156 homes on the market in Sequim, McAleer said only 75 are active, with the rest pending or under contract and on the market for 12 days (median).
He said hiring crunches across the Olympic Peninsula are partly due to not having enough places for people to live, as rentals and entry level housing prices are too expensive.
To offset that, McAleer said City of Sequim’s fees are cost prohibitive for multi-family housing/apartments, and that the city needs to add more apartment buildings — similar to the Elk Creek Apartments — to meet the workforce demand.
“Most of the workers are making $15 to $20 an hour and the median home price is (now $575,000),” he said at the meeting.
“We need a lot better than that. We need apartment buildings, multi-family homes, or else we’re going to turn into a Santa Barbara where only the wealthy live there.”
Forks, West End
With inventory so low across the county, Grafstrom said he estimates there were four times as many agents as homes available at one point.
“I’ve been doing this 29 years, and I’ve never seen that many Realtors come from the eastern side of Lake Crescent,” he said.
Grafstrom says the Forks/West End area covers east of Neah Bay toward Sappho and south toward the Quinault Reservation, with 153 sales closed by the end of July.
He estimated the median prices had gone up about 20 percent this year (about $126,000 to $160,000) with the median number of days on the market going from 74 to 33 in a year.
“Realtors out here tend to sell a wide variety of properties,” Grafstrom said. “The majority of brokers deal in raw land and even commercial properties.”
While the area is large, he said, “just a couple of sales are going to make a huge impact on the market.”
In a phone interview, he said the Forks area has seen a rekindled interest in the “Twilight” series which is driving tourism 15-plus years later.
“There’s such a demand for vacation rentals, it’s kind of nice because it’s created some opportunity for people to have a little income they couldn’t bring in from their normal job especially during COVID,” he said at the meeting.
He added that short-term rentals are changing the market there with nothing in zoning preventing that, but it’s deterring potential doctors, teachers, law enforcement officers and more from relocating.
“People don’t feel this market is healthy,” he said. “What happens when inflation starts to take hold?
“We’re going to see people in the same line of work with no increase in salary. They can’t afford the house of someone who had the same job for the same salary.”
Foreclosures
As of mid-August, 434 Clallam County homes awaited foreclosure, according to Patti Morris, a real estate broker through JACE Real Estate in Port Angeles.
Morris shared the number at the Aug. 11 “Coffee with Colleen” Zoom meeting.
“I would say once foreclosures do start to go, we will see homes coming on the market,” Morris said. “All federal agencies want them to be 30-day quick closures.”
Details on the types of homes, which city and the homeowners all vary, she said in a phone interview.
Homes range from manufactured homes to single-family homes to larger, more expensive homes, she said.
“From my experiences, it’s a whole variety of people living in the homes, and often it’s reverse mortgage homes where one of the heirs of the owner or squatters are in the homes, and it’s not necessarily someone who is in trouble with their mortgage,” Morris said.
She’s been tracking the foreclosures since the federal moratorium on evictions went into place March 2020.
“The homes may be occupied, but I don’t think it’s going to be a mass dump of homes on the market,” she said.
Washington state’s eviction moratorium is set to end Sept. 30, and the Supreme Court ruled on Aug. 26 to overturn the Biden Administration and the Center for Disease Control and Prevention’s moratorium on evictions.
However, Morris said she’s unsure just how soon these homes could go on the market.
“The eviction process could take a few months,” she said.
She said homes facing foreclosure not through U.S. Departments of Housing and Urban Development (HUD) and Veterans Affairs (VA) would go through banks and other real estate agents and/or auction houses.
As for helping Clallam’s low housing inventory, she said it could help, but “it just depends on how quickly they are foreclosed on.”
EDC executive director Colleen McAleer asked if homeowners of foreclosed properties could connect with potential buyers, but Morris said the foreclosure process had already begun on these homes and were stopped by the federal and state moratoriums.
For options for veterans to avoid foreclosures, call 877-827-3702, and for those with loans through the Federal Housing Administration (FHA) through HUD, call 800-225-5342.
To hear the entire video and more on housing, visit clallam.org or search youtube.com for “Clallam EDC.”
