Western Washington Real Estate Market Update

 

The following analysis of the Western Washington real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please reach out anytime!

 

REGIONAL ECONOMIC OVERVIEW

It appears as if the massive COVID-19 induced contraction in employment that Washington State — along with the rest of the nation — experienced this spring is behind us (at least for now). Statewide employment started to drop in March, but April was the real shock: total employment dropped almost 460,000 between March and April, a decline of 13.1%. However, this turned around remarkably quickly, with a solid increase of 52,500 jobs in May. Worthy of note is that, in May alone, Western Washington recovered 43,500 of the 320,000 jobs that were lost in the region the prior month. Although it is certainly too early to categorically state that we are out of the woods, the direction is positive and, assuming we respect the state’s mandates regarding social distancing and mask wearing, I remain hopeful that Washington will not have to re-enter any form of lockdown.

 

HOME SALES

  • There were 17,465 home sales during the second quarter of 2020, representing a drop of 22.2% from the same period in 2019, but 30.6% higher than in the first quarter of this year.
  • The number of homes for sale was 37% lower than a year ago, but was up 32% compared to the first quarter of the year.
  • Given COVID-19’s impacts, it’s not surprising that sales declined across the board. The greatest drops were in Whatcom and King counties. The smallest declines were in Grays Harbor and Cowlitz counties.
  • Pending sales — a good gauge of future closings — rose 35.7% compared to the first quarter of the year, suggesting that third quarter closings will grow as well.

 

 

 

HOME PRICES

  • Home-price growth in Western Washington rose by a relatively modest 3.5% compared to a year ago. The average sale price in the second quarter was $559,194.
  • Compared to the same period a year ago, price growth was strongest in Grays Harbor County, where home prices were up 14.3%. Clallam County also saw a double-digit price increase.
  • It was interesting to note that prices were up a significant 6.6% compared to the first quarter. This suggests that any concern regarding negative impacts to home values as a function of ​    COVID-19 may be overblown.
  • I will be watching for significant price growth in less urbanized areas going forward. If there is, it may be an indication that      COVID-19 is affecting where buyers are choosing to live.

 

 

 

DAYS ON MARKET

  • The average number of days it took to sell a home in the second quarter of this year matched the second quarter of 2019.
  • Across the entire region, it took an average of 40 days to sell a home in the second quarter. I would also note that it took an average of 14 fewer days to sell a home than in the first quarter of this year.
  • Thurston, King, Pierce, and Snohomish counties were the tightest markets in Western Washington, with homes taking an average of only 17 days to sell. All but two counties, Grays Harbor and Cowlitz, saw the length of time it took to sell a home drop compared to the same period a year ago.
  • Market time remains well below the long-term average across the region. This is due to significant increases in demand along with the remarkably low level of inventory available.

 

 

 

CONCLUSIONS

This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors.

What a difference a quarter makes! Given that demand has reappeared remarkably quickly and interest rates remain historically low, it certainly remains a seller’s market and I don’t expect this to change in the foreseeable future.

The overall housing market has exhibited remarkable resilience and housing demand has rebounded faster than most would have expected. I anticipate demand to remain robust, but this will cause affordability issues to remain as long as the new construction housing market remains muted.

 

 

ABOUT MATTHEW GARDNER

As Chief Economist for Windermere Real Estate, Matthew Gardner is responsible for analyzing and interpreting economic data and its impact on the real estate market on both a local and national level. Matthew has over 30 years of professional experience both in the U.S. and U.K.

In addition to his day-to-day responsibilities, Matthew sits on the Washington State Governors Council of Economic Advisors; chairs the Board of Trustees at the Washington Center for Real Estate Research at the University of Washington; and is an Advisory Board Member at the Runstad Center for Real Estate Studies at the University of Washington where he also lectures in real estate economics.


Posted on July 23, 2020 at 10:00 pm
Lynly Callaway | Posted in Market Report | Tagged , , , ,

LOCAL MARKET UPDATE – JULY 2020

While our lives are very different than they were a year ago, the local real estate market has recovered to 2019 levels. Record low interest rates are helping spur demand. Sales were up, home prices increased and multiple offers were common.

  • The number of pending sales, a measure of current demand, was higher in June than for the same period a year ago.
  • The supply of homes on the market remains very low, with just a month of available inventory.  When inventory is this low, quick sales over full price are common. That was the case in June when about 40% of homes sold for more than the asking price.
  • Home prices in King County rose 4% over a year ago. Snohomish County home prices increased 5%.
  • More sellers put their homes on the market. While total inventory remains low, the number of new listings in June was similar to the same time last year.

The monthly statistics below are based on closed sales. Since closing generally takes 30 days, the statistics for June are mostly reflective of sales in May. If you are interested in more information, every Monday Windermere Chief Economist Matthew Gardner provides an update regarding the impact of COVID-19 on the US economy and housing market.


Posted on July 10, 2020 at 6:28 pm
Lynly Callaway | Posted in Market News, Market Report | Tagged , , , ,

SEATTLE’S HOUSING MARKET REMAINS RESILIENT DESPITE COVID-19

The Seattle area housing market in May continued to show resiliency amid the novel coronavirus outbreak, with increases compared to the previous month in new listings and pending sales.

A report from Northwest Multiple Listing Service — which covers 23 counties in the region — showed King County had 3,585 new listings during May, compared with 2,707 new listings that came on the market during April. The total number of active listings in King County also went up slightly month over month, from 3,255 in April to 3,467 in May.

“The market has proved to be very resilient,” Northwest Multiple Listing Service Director Mike Larson said in a news release.

But the number of active listings in May of this year was still about 40% lower than the total active listings in May of last year, according to the report.

The report also found pending sales in King County went up month over month, from 2,246 to 3,358. But the number of pending sales was about 20% lower than it was at the same time last year.

The median home price for closed sales in King County dropped month over month, from $650,000 to $627,000.

“I don’t think anyone should be surprised that home prices in King County took a ‘breather’ in May,” said Matthew Gardner, Windermere Real Estate Chief Economist. “Clearly COVID-19 was the cause for this drop, but I’m confident this is a temporary situation that will be reversed as King County starts to reopen, and fresher inventory comes to market.”

Gardner said he expects prices to go up again in the months ahead.

While the local housing market is still hot, it looks a bit different than in previous years. The number of new listings dropped in the first few months of the shutdown, but homes going under contract (pending sales) are on the road to recovery.

The pandemic caused some sellers to put their sale on pause, compounding the fact that the Seattle housing market was already experiencing low inventory and strong buyer demand.

The drastically low inventory is posing some challenges, making it feel like there just aren’t enough homes. Properties under $1 million are selling quickly, with new listings going pending after just a few days on the market. Bidding wars and multiple offer situations are again becoming commonplace. A balance in the market is unlikely until more sellers decide to list their homes and new construction accelerates to meet demand.

Since the start of the pandemic, real estate agents have been taking advantage of technology, doing virtual tours and using social media to interact with clients. Even as the pandemic put much of life on hold, people have continued needing to sell and buy homes.

While experts have said that uncertainty remains about the long-term impacts the coronavirus pandemic may have on the housing market and the region as a whole, real estate agents are staying positive. The market is strong with improving outlooks week over week.

A version of this article was first published on seattlepi.com by Becky Savransky.


Posted on July 3, 2020 at 8:48 pm
Lynly Callaway | Posted in Local News | Tagged , , , ,

Windermere Insights: How Low Inventory Is Influencing The Market

“While we see more sellers getting ready to list,” observed Pat Grimm, owner of Windermere Capitol Hill, “every week that those homes don’t go on the market, we risk losing buyers to what I’d call a reasonable fatigue.”

Grimm pointed to Seattle’s imbalanced market activity in the first half of June. Pending sales of single family homes were up 21% from the same period last year, despite a 45% reduction in the number of active listings. By mid-month, there remained a paltry 0.8 months’ supply of homes for sale, based on pending sales. Low inventory led Seattle buyers to purchase homes and condos faster and for higher prices than in June 2019.

“Sellers should benefit from this dynamic,” Grimm said, “if they can undertake a move at this stage of the re-opening.”

On the Eastside, the market is undergoing a similar push-pull, according to Joe Deasy, co-owner of Windermere East Inc. “Active listings are being absorbed faster than we can get new For Sale signs up,” he observed. With month-to-date pending sales activity up 21% this June versus last, Deasy noted that the Eastside’s supply of homes is down to only 0.9 months.

Through the first half of June Eastside single family home listings were down 46% from the same period last year, while there were 28% fewer condo listings. “There’s a bottleneck happening, and we could see sales drop unless we bring more homes to market,” Deasy said. “But more listings will lead to more sales,” he added.

One community that has been keenly watching its real estate market dynamics is West Seattle. Hit by the double whammy of the shutdown and the bridge closure, brokers there were wondering how May and June numbers would stack up for this “small town” within the city.

It turns out that West Seattle is experiencing the same demand-supply issue as other local areas. In the first half of June, the supply of single family homes for sale was down 31% from last year. Based on a 9% increase in month-to-date pending sales, the supply of homes stands at just one month.

“Ours is still a seller’s market,” said Larry Johnson, general manager of Windermere’s West Seattle office. “June has seen faster market times and higher selling prices on the units that have gone pending.” The squeeze on West Seattle homes has also led buyers to move on condos, Johnson noted, with month-to-date pending sales up 56% over last year and average sold prices up by 22%.

SOURCE: Windermere Get The Report


Posted on June 30, 2020 at 7:04 pm
Lynly Callaway | Posted in Local News | Tagged , , , ,

A Guide to Mortgage Assistance During COVID-19

Image Source: Shutterstock

 

For some homeowners who have been financially impacted by the COVID-19 pandemic, there is a high level of concern about paying their mortgage. Fortunately, there are options to aid struggling homeowners from governments, financial institutions, and loan providers. The following information is intended to provide clarity on which financial relief options are available to you during this time.

 

What are my mortgage relief options?

Newly placed into law, the Coronavirus Aid, Relief and Economic Security (CARES) Act, provides two protections for homeowners with federally backed mortgages:

 

  1. Your lender or loan servicer may not foreclose on you for 60 days following March 18, 2020. The CARES Act prohibits lenders and/or servicers from beginning a non-judicial foreclosure, or finalizing a foreclosure sale, against you within this time period. While 60 days has passed since this was put into place, it is still important to be aware of in the event that any of these actions were taken against you.
  2. You have a right to request a forbearance for up to 180 days if you experience financial hardship due to the COVID-19 pandemic. You can also apply for a 180-day extension beyond the forbearance period. This does not require submitting additional documentation beyond your claim, nor will you incur additional fees, penalties or interest beyond what has already been scheduled.

 

Forbearance is…

  • With forbearance, mortgage servicers and lenders allow you to pause or reduce your mortgage payments for a period of time while you get back on your feet financially.
  • Different types of loans beget different forbearance options, understanding the differences and which options apply to your loan is key to navigating the forbearance landscape.
  • Once your income is back to a normal level, contact your loan servicer and resume your payments.

 

Forbearance is not…

  • Forbearance is not a means to forgive or erase your payments. Any missed or reduced payments still require payment in the future.

 

Which relief options do I qualify for?

The first step in discovering your mortgage assistance qualifications is to contact your mortgage provider. If you are unsure of how to get in touch with them, look at your mortgage statement for contact information or see what contact options are available online.

After you have successfully made contact, find out if your mortgage is federally backed. To be eligible for assistance under the CARES act, your mortgage must either be backed federally, or by one of the entities in the list below. These links show the agencies’ current advise and related loan information:

 

For non-federally backed loans, contact your lender or servicer to learn more about their forbearance repayment options.

 

Today’s financial landscape can be stressful for homeowners, especially those that are struggling to keep up financially. Fortunately, these entities, institutions, and servicers have provided options to help lessen the burden. Knowing which options apply to you and your household will help you navigate through hardship as your finances recover.


Posted on June 11, 2020 at 8:23 pm
Lynly Callaway | Posted in Market News | Tagged , , , , ,

LOCAL MARKET UPDATE – JUNE 2020

  • The Stay Home order, as expected, continued to impact the number of sales. However, the market is starting to move its way towards more normal activity. Pending sales, a measure of current demand, have risen every week since April.
  • The slight drop in median closed sale price is a result of a proportionately larger number of lower priced homes selling than is normal. It should not be interpreted as a decrease in individual home value.
  • There were significantly fewer homes for sale in May than the same time last year. With less than a month of available inventory, competition among buyers was intense. Bidding wars and all-cash offers were common.

The monthly statistics below are based on closed sales. Since closing generally takes 30 days, the statistics for May are mostly reflective of sales in April. If you are interested in more information, every Monday Windermere Chief Economist Matthew Gardner provides an update regarding the impact of COVID-19 on the US economy and housing market. You can get Matthew’s latest update here.  As we adapt to new phases of reopening, know that the safety of everyone remains our top priority.


Posted on June 11, 2020 at 8:16 pm
Lynly Callaway | Posted in Market Report | Tagged , , , , ,

Questions to Ask During Your Virtual Home Tour

Image Source: Canva

 

Thanks to COVID-19, the new reality is that many open houses and home tours are being conducted virtually. For prospective home buyers, this new territory brings an added element to prepare for in the home buying process. Some of the questions that should be asked in a virtual home tour parallel those of in-person tours, but others are unique to today’s virtual world.

 

Could you zoom in?

  • Sometimes it can be difficult to get a true glimpse at what you want to see in a room. Asking the agent to zoom in on specific features is commonplace in virtual home tours, and they understand this is part of the viewer experience. Don’t hesitate to ask multiple times. Getting a better look at everything you want to see will help you feel like you’ve gotten the most out of your virtual tour.

 

How many square feet are in this room?

  • Virtual tours can slightly distort space, making it tough to gauge the size. The room-to-room square footage is information the agent is sure to have handy. Since you can’t be there in person, it will help you piece together the virtual visuals with the sense of physical space that we’re all accustomed to feeling in the places we live.

 

What color is that?

  • In the smartphone era, and computer era at large, we have come to understand that digital representations of color are not always true to the eye. Ask the agent to confirm specific colors so you can plan accordingly. Have a color swatch on hand or look the colors up online as you go through the tour.

 

When were the appliances last updated?

  • The importance of this question rings true in past, present, and future. Knowing the state of the home’s appliances, and the likelihood and timing of when they will need replacement, is vital information for both assessing the move-in readiness of the home and understanding what costs might lie ahead.

 

Has the seller provided an inspection?

  • This is another example of a critical question, whether your home tour is virtual or physical. If the seller has already done an inspection, ask the agent to lead you to any areas of concern based on the inspector’s findings. If there is anything that has not yet been addressed by the seller, have your agent ask what their plan is for making the necessary repairs/updates.

 

When is the offer review date?

  • Understanding the seller’s timeline for reviewing and accepting offers will help guide your decision-making process and allow you to strategize based on the timeline.

 

Whether your home tour is physical or virtual, getting the information you need to make an informed decision remains paramount. Although there is no substitute for physically being in the home you are looking to buy, keeping these questions in mind will position you well as you progress through the home buying journey.


Posted on May 27, 2020 at 11:11 pm
Lynly Callaway | Posted in Buyer | Tagged , , , , ,

Neighbors in Need Raises $690,000 for Food Banks

The COVID-19 pandemic has affected populations across the globe, but those who struggle with poverty and count on food programs to meet their basic day-to-day needs are in an especially uncertain place. While coping with increased demand and a bottlenecked pipeline of food supply, food banks are desperate for funds to continue to serve their communities. Because of this, Windermere decided to challenge its offices to raise $250,000, every dollar of which would be matched by the Windermere Foundation and donated to food banks in the areas where Windermere operates. We titled it the “Neighbors in Need” fundraising campaign.

Neighbors in Need kicked off on April 21, with the goal of raising $250,000 by May 5. As word continued to spread, online donations and contributions from both our agents and the public began to increase. Neighbors in Need was given a boost by Seattle Seahawks starting safety Quandre Diggs in a heartfelt message encouraging support. Over the final 24 hours, leading up to the May 5 deadline, support poured in from across the Windermere family as the final figure exceeded the initial goal of $500,000, landing at a total of $690,000.

Neighbors in Need exemplifies Windermere’s deep commitment to supporting our local communities, which traces back to 1989 when the Windermere Foundation first started. Since then, we’ve proudly raised more than $41 million for low-income and homeless families throughout the Western U.S.

On behalf of the Windermere Foundation to all those who joined the effort: Thank you. We could not have made this large of an impact without your help. We are humbled to be able to do our part to help those who need it most during these uncertain times.


Posted on May 13, 2020 at 6:03 pm
Lynly Callaway | Posted in Local News, Windermere Community | Tagged , , , ,

LOCAL MARKET UPDATE – MAY 2020

We hope you are weathering the new normal as best as you can. With everyone spending more time than ever at home, real estate has taken on a whole new importance. For those who are interested, here is a brief update on how COVID-19 continues to affect our local market:

  • Business was better than expected under the Stay Home order. COVID-19 did reduce real estate sales in April as compared to a year ago, however the number of sales rose steadily each week of the month. Sales growth continued in early May and we expect sales to increase slowly week by week.
  • The number of new listings dropped, suggesting that would-be sellers are waiting until the shelter-in-place order is over to put their home on the market. With local technology companies continuing to hire, buyers will continue to face competition for limited inventory in the coming months.
  • Home prices remain stable, with the median price of homes sold in April up slightly from a year ago. Sellers appear to be pricing homes realistically and buyers are not finding deep discounts.

The monthly statistics below are based on closed sales. Since closing generally takes 30 days, the statistics for April are mostly reflective of sales in March. Next month’s data will offer a more telling trend of the effect of the virus on the local housing market.

If you are interested in more information, every Monday Windermere Chief Economist Matthew Gardner provides an update regarding the impact of COVID-19 on the US economy and housing market. You can get Matthew’s latest update here.

As our current situation evolves, know that the safety of everyone remains our top priority.


Posted on May 13, 2020 at 5:53 pm
Lynly Callaway | Posted in Market News, Market Report | Tagged , , , , , ,

Saving to Buy A Home During COVID-19

Image Source: Canva

The COVID-19 pandemic is changing the way people plan for their future. For those saving to buy a home, the landscape may seem daunting. However, this new world of social distancing and stay at home orders is an opportunity to rethink your spending and saving plans. Keeping the following suggestions for your budget and finances in mind can help make your dream of buying a home a reality.

Rethink your budget:

If there have been changes to your income amid COVID-19, adapting your budget is a logical and necessary step. If your income has gone unchanged, certain tweaks to your budget can yield significant savings. Knowing the leisure portion of your normal expenditure has been removed for the time being is a great starting point for reassessing your spending.

  • Begin with your income and assets
  • Determine your household’s new baseline and arrange your new budget accordingly
  • Divide your budget expenses out into Fixed and Variable
  • Adjust for changes in essential costs—Housing, Utilities, Insurance, Food
  • Put into savings what normally would have been your leisure spending money

As the stay-at-home lifestyle continues, take a look at your unnecessary costs for such things as memberships, subscriptions, and online shopping. Reach out to the subscription organizations and see if they are offering any options to delay your membership until a later date.

  • Categorize all active memberships as Cancel, Adjust, or Keep
  • For live entertainment, research how far out the venues have postponed shows
  • Adjust your online shopping needs for your current lifestyle
  • Reassess the must-haves of your new stay-at-home daily life

Review your finances:

If you’re planning on buying a home in the near future, you are likely already on your financial planning journey. With added uncertainty around COVID-19’s effective timeline, the more information you can gather, the better. In these unprecedented times, flexible solutions are being provided to customers. Exploring what options your banks and issuers are offering will keep you informed and prepared while keeping your finances in order.

Contact your credit card issuer to see if they are offering any of the following options to customers:

  • Payment deferral or forbearance
  • Flexible fee policies
  • Lowering your monthly payment or interest rate temporarily
  • Forgiveness or relief from late fees

Following the steps outlined above can go a long way towards helping you save for a home. As your finances are impacted by the COVID-19 pandemic, take time to adjust accordingly. Continuing to gather information and developing a strategy will help you steer your eventual home purchase in the right direction through these uncertain times.


Posted on April 23, 2020 at 9:59 pm
Lynly Callaway | Posted in Local News | Tagged , , , , ,