Tri-Cities home prices rose 11% in 2019 and finished the year with a median price just above $300,000 — the first time we’ve ever ended a year above that milestone.
With the year just about over, we’ve been looking at the three main data points we watch each month to learn what happened and what we can expect next year. Those three data points, which you’ve seen us talk about regularly in our Tri-Cities real estate market data updates every month, are a reflection of supply and demand in our area:
- how many homes are available
- how many homes were sold the previous month
- the price of those sold homes
Let’s take a closer look at the yearly numbers for each of those.
Note: When we track stats each month, we’re only looking at single-family homes, condos, and manufactured homes. And we only track Kennewick, Pasco, Richland, West Richland, Benton City and Burbank. (By comparison, when you see media outlets citing Tri-City Association of Realtors stats, that includes those same six cities, but also Connell, Basin City, Kahlotus, Paterson and other towns.)
Tri-Cities Active Real Estate Listings
One day each month we take a look at how many homes are available for sale on that day. We usually do this on or around the 5th of each month, unless that happens on a weekend. This number is just a one-day snapshot, not the total count of homes available during an entire month. You’ve heard us refer to this number as “inventory” or “actives.”
Active listings had a pretty standard curve over the year. The early-year decline may have been made worse by those awful snowstorms that hit in February. We ended the year with almost the exact same number of actives that we had at the start of the year.
Here’s the crazy thing: For the first 10 years of my real estate career, it was normal to have 1,100-1,300 homes available in any given month. In December 2014, inventory dropped below 1,000 homes and it hasn’t returned to that level since.
Tri-Cities Sold Homes
Our homes sold chart looks kinda similar to the active listings chart above. Again, those winter storms early in the year may have had an impact on activity overall — the industry itself was operating on schedule, but we saw less foot traffic to available homes.
Where things really start to reveal the market is when you put homes sold and active listings on the same graph.
We’ve been in a seller’s market all year, but it really tipped heavily toward sellers in the middle of the year when the number of homes sold grew at a faster pace than inventory. When you have fewer homes available and more homes selling, it’s harder for buyers to find the right home at the right price and sellers are really in control.
As you can see, things improved for buyers over the final few months of the year as inventory was (relatively) high and the number of homes sold each month was either down or static.
Tri-Cities Median Sale Price
The rise in home prices coincided almost perfectly with when we saw the market tilt more heavily toward sellers. Between May and July, prices rose by $22,000.
In my 15+ years as a local Realtor, annual appreciation has tended to run between 1-5% each year, depending on location, style, and condition of the property. In 2010, for example, the market appreciated at 3.2%. But appreciation has been really up and down over the past few years, and the 11% we saw in 2019 isn’t the highest we’ve seen:
- 2018: 4% appreciation
- 2017: 8%
- 2016: 2%
- 2015: 14%
You can see all this for yourself at the Benton-Franklin Trends website, although I should clarify that their numbers include all of Benton and Franklin counties, not just the six cities we watch closely.
To sum it all up, demand for Tri-Cities homes is rising, but the supply of homes available isn’t. And most of the new homes that have been built recently are at or above the median price, making it tough for first-time buyers. 2019 was another good year to be a homeowner/seller in the Tri-Cities and another tough year to be a buyer. But interest rates are still low enough (~4%) to help buyers get more home for their budget.
As always, if you have any questions about the local real estate market, drop us a note at any time! And if you’d like to get monthly updates on new market data and more, check the little box below to sign up for our newsletter.