The nation as a whole was depressed over the lackluster figures released recently by the National Association of Realtors, following a string of encouraging data that had pointed to stabilization in the housing sector.

After four straight months of gains, existing-home sales moved backward in August, falling 3 percent from July. The drop in home sales disappointed economists, who had been expecting the report to show an increase in sales of about 2 percent.

However, locally, pending sales around Western Washington during August jumped nearly 21 percent from a year ago and inventory dropped more than 18 percent, according to new figures from Northwest Multiple Listing Service. Those indicators, along with signs of stabilizing prices, set the stage for brisk activity in the next few months as first-time buyers try to take advantage of the Nov. 30 deadline for tax credits.

Brokers reported 7,539 pending sales (offers made and accepted but not yet closed) for August, up 20.7 percent from a year ago. That volume outgained July's total by 260 transactions. In the four-county Puget Sound region, pending sales of single family homes and condominiums (combined) surged 25.7 percent from a year ago.

Within King County, pending sales activity improved 25.1 percent from a year ago, and was especially robust in the North King County area (up 38.7 percent) and on the Eastside (up nearly 36 percent). Excluding condos, two sub-areas of King County notched gains of more than 40 percent for pending sales of single family homes – Southeast King County (up 40.4 percent) and the Eastside (up 42.5 percent).

Current house-hunters have fewer listings to consider than a year ago: 41,528 active listings at the end of August compared to 50,772 for same month a year ago, a decline of 18.2 percent. Prices on current offerings, which include single family homes and condominiums, range from $13,000 to $32 million.

Nationwide, according to some economists the decline is a logical correction after several months of strength in existing-home sales.

"The setback reported is not terribly surprising given the large (+7.2 percent) increase reported for July and the strong advance in such sales that has [occurred] over the past half year," economists at Goldman Sachs said in a report.

Still, only five of 74 forecasters correctly predicted the drop. For their part, economists at Nomura Economic Research—which did forecast a slide—said the drop appears "inconsequential."

"Since 1973, sales have risen for five or more consecutive months just 13 times," they said in a report. "As with most other economic indicators home sales move in fits and starts and this decline does not alter our judgment that sales have turned the corner towards growth though the pattern is likely to be uneven. Indeed, even after the small drop in August, single family home sales are up 10.6 percent from the January low, the best growth over any seven-month stretch since June 2004."

Although the nationwide sales figures for August are disappointing, its important to remember that all the pieces of the housing market recovery are still in place and moving forward: low home prices, low mortgage rates, a first time homebuyer tax credit, and a drop in inventory. These are all contributing stabilization factors for the housing market

Locally, summing up last month's activity, a healthy, balanced market is in everyone's best interest, and the August report tells us we're definitely getting closer.

James Tibbetts is an associate broker at West Seattle Windermere and can be reached at 206-932-2550.

Full disclosure: James Tibbetts is an advertiser with the West Seattle Herald.