by Dr. Patrick Jones
As the population slowly climbs in Walla Walla, home ownership is staying stable. As seen in Walla Walla Trends Indicator 5.1.7: Share of Housing Stock by Type, single residence units, aka homes, amounted to 69% of all housing units in 2020. This is unchanged over the past five-years and for that matter, since the start of the series in 2000.
Walla Walla is a community based on owner-occupied residences, to nobody’s surprise. Among the larger counties in eastern Washington, only Franklin demonstrated a higher share of owner-occupied homes, at 73% in 2020’s housing mix. Chelan County tied the Walla Walla result.
One-fifth of all Walla Walla’s housing units in 2020 consisted of apartments, remaining unchanged over the past 5- and 20-years. Among all larger eastern Washington counties, this is the highest share, except for Benton, although it ties Yakima.
A relatively high concentration of the housing stock in single dwellings and apartments implies a relatively low share of the third choice, mobile homes. In Walla Walla County, about 11% of all units were mobile homes last year. This is tied for the lowest reading across larger eastern Washington counties with the two counties of the Tri Cities. And, yes, little has changed in the past 20-years in this segment of the housing market.
Over time, the Walla Walla housing mix has increasingly departed from Washington state averages. In all years tracked by this indicator, the county has depended on a higher share of single unit dwellings and, to a lesser degree, mobile homes, to put a roof over its residents. While the housing stock in Washington State is showing a greater dependence on multi-unit dwellings, Walla Walla’s share, as mentioned, remains the same.
The consistent mix of housing stock raises the question: is it the right one? Should Walla Walla be following the state trends, substituting apartments (or condos) for single resident dwellings? Or should it expand its offering of single resident homes? Most residents would likely not want to see an expansion of manufactured homes.
A look at recent prices may give some hint of demand. In the 5-year period from the 4th quarter of 2015 to the 4th quarter of 2020, Indicator 5.1.7: Median Home Resale Value shows the median home resale price of single dwelling homes moved from $178,700 to $372,100. That’s more than a doubling (108%). Over the same period, median resale price for such homes climbed 57% throughout the state. Clearly the single residence market has “tightened” in Walla Wall County more rapidly than statewide.
And apartments? Rents don’t make up an indicator on the Trends site, but annual estimates can be found from the American Community Survey (ACS) of the U.S. Census. Over the period 2015 through 2019, the median rent in the Walla Walla metro area (which includes Columbia County) was estimated to have increased from $825 per month to $858 per month. This makes for a very moderate increase, or 4% over four-years.
Since prices and rents reflect the forces of both supply and demand, it seems to this observer the single resident unit homes are in a much tighter market than rental units. True, the ACS estimates that the rental vacancy rate in the Walla Walla metro has dropped from 4% to 2.9% over the previous four-years, but that pales in comparison to the drop in supply of homes. The source for Indicator 5.1.1, the Washington Center for Real Estate Research at the University of Washington, reported the inventory on-hand in the fourth quarter of last year amounted to 1.1 months of supply. In the 4th quarter of 2015, supply in the county was eight months. Supply has shrunk dramatically.
Even with tepid population growth, the local market is strongly signaling a need for more homes. Are more on the way? Likely some, but not enough. In 2019, the period for which we have the latest data, only 160 single family residence building permits were issued. The 2020 data will undoubtedly show a lower number. Until supply increases, home prices in Walla Walla County will continue to climb steeply.