In the face of back-to-back market crashes in the first half of March, buyers nevertheless responded favorably to seasonally higher inventories of homes for sale. In King, Pierce, and Snohomish Counties, this caused the number of residential transactions in that month to increase by 1.6 percent year over year. This last flurry of activity before the COVID-19 response from Governor Jay Inslee’s office was enough to keep prices escalating, and the median residential price for the three counties rose by 9.8 percent from a year ago. The CoreLogic Case-Shiller Home Price Index results published by S&P Dow Jones on May 26 showed an index increase of 6.9 percent for the metropolitan region. What we at RSIR observed in April still holds: “we find in these results confidence that after [the months-long] run-up in prices, building upon the advances of the preceding five years, no city in the country entered this crisis better prepared for a rough patch than Seattle.”
Seattle’s last West Coast competitor on the index, San Diego, fell behind in January (at 5.2 percent); and the Puget Sound region’s rate of year-over-year growth nearly doubled that of San Francisco (3.5 percent), whose home prices were the slowest-growing among these gateways. Residential prices at Portland and Los Angeles rose 4.9 percent and 4.4 percent, respectively.
Craig J. Lazzara, Managing Director and Global Head of Index Investment Strategy at S&P Dow Jones Indices, observed in the S&P Dow Jones press release, “March’s data witnessed the first impact of the COVID-19 pandemic on the S&P CoreLogic Case-Shiller Indices.” Yet “housing prices continue to be remarkably stable. The National Composite Index rose by 4.4 percent in March 2020, with comparable growth in the 10- and 20-City Composites (up 3.4 percent and 3.9 percent, respectively). In all three cases, March’s year-over-year gains were ahead of February’s, continuing a trend of gently accelerating home prices that began last autumn.”
Locally however, March was the last month in the year to date that the three-county region would see higher residential selling volumes, both monthly and year over year. Both the number of residential homes sold and the dollar volume of sales declined sharply in April: down by 28.0 percent and 26.3 percent, respectively. The April selling volume was the lowest for that month since 2014. May promises to be lower still, at 51.0 percent of sales a year ago three days from the end of the month (May 28)—the fewest residential sales for that month since May 2009, and the sharpest monthly percentage decrease ever recorded by the Northwest Multiple Listings Service.
The Governor’s stay-at-home order has contributed to the historically slow sales, forcing the parties, their brokers, bankers, escrow agents, and inspectors to find alternative means of transacting business that have protracted the normally swift cycle of closing a deal. Consequently, the low sales figures have been attended by growing backlogs of pending sales that are still being shepherded toward closing.
“Clearly the coronavirus pandemic and stay-home orders suspended many buyers and sellers from being more active,” said Dean Jones, President and CEO of RSIR. “However, pending sales activity in May spiked by 53 percent over the prior month and is accelerating faster than new listings, so we view the market as becoming more competitive, which will put upward pressure on prices.”
In April, we raised the alarm on unemployment due to the COVID-19 response. A month later, initial claims in the state are lower for the first time in four weeks. Yet the numbers remain dire, with 15.4 percent unemployed statewide, and county unemployment rates of 20.2 percent and 19.1 percent in Snohomish and Skagit Counties, respectively. Lingering joblessness and business closures will affect large numbers of households who would have qualified for home loans just three or four months ago. Yet as we reported before, “these conditions are not exclusive to Seattle or King County. Across the country, state and local governments have responded in broadly similar ways to COVID-19, and our region is not uniquely burdened by those restrictions. Seattle home prices may therefore be expected to continue to outperform those of competing cities both regionally and nationwide.”
For more details on the March 2020 Case-Shiller Index results, download the S&P Dow Jones Case-Shiller summary report. Our 2019/2020 Market Report is available for ordering now; and look for our upcoming 2019/2020 Waterfront Report, due in June. For details on the market implications of our reports for homes in your neighborhood, contact a local R
 Published by S&P Dow Jones, the Case Shiller Index surveys resales of residential homes in the Seattle metropolitan statistical area comprising King, Snohomish, and Pierce Counties (“Seattle MSA”). The index notably does not account for condominium sales.
 William Hillis, “Home Prices In Seattle Were Well-Positioned For The Economic Effects Of COVID-19,” RSIR blog, 4 May 2020.
 “Annual Home Price Gains Increased to 4.4% in March According To S&P CoreLogic Case-Shiller Index,” S&P Dow Jones, New York, 26 May 2020.