The second quarter results, which complete the first half of the year, in San Juan County and on San Juan Island reflected the market change. Per the NWMLS, the dollar volume in San Juan County was $205,893,608 with a total of 205 transactions. The numbers reflect a 22.5% decrease in dollar volume and a 39% decrease in the number of transactions as compared to the same period in 2021.For San Juan Island the transaction volume was $90,737,383 with a total of 93 transactions. This was a 19% decrease in volume and a 42% decrease in number of transactions.
My chart is correct, we had the same number of transactions close YTD 2020 as in YTD 2022. I double checked it as I thought it odd. Further, it is clear that 2021 was the anomaly year. We have corrected to what was considered a good year, but less volume and number of transactions than 2021.
Year-over-year, our median and average prices for home and land show a good increase and the inventory has been on an increasing trend since March 2022. However, the number of pending transactions for both the County and San Juan Island have been on a downward trend since April 2022. Sellers only had to negotiate off their list price during the last 12 months an average of 1.10% for homes and 2% for land.
Our sellers are listing now because they recognize that in the near future, our market will be much more balanced and not favor them to the level they enjoyed in 2021 and YTD 2022. Some of the new listings are still having multiple offers and escalating prices if they are priced properly from the start. Some sellers that price too optimistically are not getting the attention. We are not having any difficulty with low appraisals at this point; however, the appraisers may be changing their approach somewhat to match the balancing market.
Buyers still need to be aggressive to compete on newly listed properties and cash is the most favorable source of funding along with short inspection and feasibility periods. Sellers are considering offers with financing or a pending sale if they only have one offer to review.
The segment of our market with the most impact from increasing interest rates and inflation are those homes listed under $600,000. The buyer pool is very small as many of the buyers for this price range require financing and may have been priced out with the last round of aggressive increases in mortgage interest rates. Many of these buyers are essential workers or provide essential services to our community, so it is unfortunate that home ownership is so difficult.
The inventory in this segment of our market has not increased as much so the selection is also very low.
The land sales have increased due to lack of existing home inventory even though it is still more cost effective to buy existing and remodel than it is to build new custom construction. The most active segment for land sales has been the lower end priced parcels. In the price range under $400,000, some of these parcels offer acreage and /or small water views.
Year to date, the most active segment of our market are those homes that sold in the $1M-$2M range. This price range offers the most inventory and selection as well. This is typically the range that is purchased by newcomers to the island versus long term islanders.
The ability to relocate to the islands has been and will continue to be popular because one’s ability to work from their home with good internet connection. And why not, who would not want to live here? We all came from somewhere else and moved here for all the same reasons. When one reviews the Pros and Cons of living in the islands, other than the periodic glitch with the ferry system, it is pretty darn perfect.
Merri Ann Simonson
Coldwell Banker San Juan Islands Inc.