North Sound Property News

The Mukilteo Beacon sure seems to think so.  Citing the lack of economic downturn in Mukilteo, Pat Ratliff of the Beacon writes,

“Even during the winter “slow months,” many local businesses are reporting either the same or better business than last year. Some businesses have reported a slowdown, but not the large numbers reported on national coverage.

The Mukilteo economy seems to be shielded from the effects of recession more than most cities in the nation.  Boeing and ancillary businesses, as well as other major employers, act as a buffer, helping our economy remain stable.”

That’s certainly true–with workers at Boeing still working mandatory overtime in many cases, our region’s biggest economic engine is continuing to drive growth for local businesses.

 However, the sunny tone of the article also points to Mukilteo’s real estate market as a bright spot, as compared to other parts of the country.  According to the article,

“Real estate draws many of the headlines in the national news’ recession stories, but the Mukilteo real estate market is doing considerably better than most.

While not at the stratospheric pace of recent years, home prices continue to rise here.

“Prices are rising about 4 percent now,” said a local real estate agent.  “Some people are sitting waiting for the bottom to drop, but that isn’t going to happen here.

“If they wait, they’re going to lose the house they want.”

Again, diversity in the economy seems to help insulate the local housing market. “

It’s true that the real estate market in Mukilteo and the Puget Sound region generally, is doing far better than the rest of the country.  However, it’s important not to paint too bright of a picture, because the Mukilteo real estate market does show signs of some problems.   

For instance, while it’s true that average sale price right now is slightly above where it was last year at this time,  it is down pretty significantly from the highs reached last summer, as the Trendgraphix chart below illustrates (click on the thumbnail to see a full-screen version of the chart). 

 And while prices are not falling precipitously, it’s important to keep in mind that inventory is quite high, and time on market is rising.  These trends would tend to indicate that prices are not likely to rise a whole lot this spring and summer. 

 One trend that I think is important to look at when trying to figure out what the market is doing (and what it may do in the future), is the difference between original list price and eventual sale price.  Last year at this time (and for most of the two years prior), original list price was typically between 94-96 percent of sale price.  That number has dropped over the last few months to 88-89% of sale price.  What this means is that the average seller in Mukilteo is having to drop their original asking price 10-15% to find a buyer in today’s market.

Another notable trend is that while average sale and median sale prices have not dropped, the Dollars Per Square Foot numbers have dropped since last year at this time–in fact, they are back to July of 2006 levels.  That means that while Mukilteo buyers may be spending the same amount or more overall on housing, they are now getting more home for the same money.

More home for the same money is,  of course, great news if you are in the market to buy!  Sellers who are finding that they aren’t able to get as much for their home as they might have hoped, should also consider that when they re-enter the market as buyers, they may be able to get quite a bit more for their money than they would have been able to do in a market that was more in favor of sellers.

So, while I agree that the overall economy in Mukilteo is doing well, I think it is important to avoid painting too rosy a picture of our current real estate market.  The truth is that real estate is local–but even locally, we are feeling the effects of a national and global credit crisis.  We are fortunate that the effects are lessened by the overall health of our local economy.

About the Author: Sandy Kaduce is Associate Broker of Gallery Homes Real Estate. She serves buyers and sellers in North King and South Snohomish counties. She is 2009 Board President of the Mukilteo Chamber of Commerce, as well as Vice President of Site Selection for Habitat for Humanity of Snohomish County. For more information, visit Sandy on the web at www.sandykaduce.com! Read more from this author