According to a recent report by the National Association of Realtors, existing homes are selling faster than they have since they began tracking them in May of 2011. Across the nation, homes were on the market for an average of 29 days before selling. In Seattle, homes were on the market for an average of only 28 days.
Other cities leading the pack were San Jose with an average of 23 days, San Francisco with 25 days, and Denver with 27 days.
Supply is drastically dwindled by high demand, so many homes for sale are experience multiple offer situations with hungry buyers ready to purchase whatever they can find and afford.
Realtor.com also explained what effect this is having on home prices:
“The lack of homes for sale is also turbocharging price tags. [National existing-home prices are] up nearly 3.5% from March and represent a 6% annual increase.
‘Homes in the lower- and mid-market price range are hard to find in most markets,’ NAR’s Chief Economist Lawrence Yun said in a statement. ‘When one is listed for sale, interest is immediate and multiple offers are nudging the eventual sales prices higher.’”
Read more from Realtor.com.
The local Real Estate market—already the hottest in the country—set yet another price record in April. The number of homes for sale dropped 27 percent compared to a year ago, the lowest amount of inventory ever recorded for a spring month. The historically low supply of homes is making competition among buyers fierce. Sellers are in the enviable position of being able to structure sales agreements to include concessions such as rent-backs and longer closing time so they can take the time to find their next home.
The median price of a single-family home on the Eastside reached an all-time high of $880,000 in April, a 21 percent jump over last April. That represents an increase of $150,000 over a year ago, the largest dollar increase on record. With our strong economy and growing population, brokers are not predicting a slowdown any time soon.
Inventory in King County just keeps getting tighter. There are just 1,900 homes on the market here. That compares to nearly 8,000 in April 2011. As buyers bid up existing homes, prices have escalated sharply. The median price of a single-family home jumped 16 percent from the same time last year to $625,000.
Seattle set a record for home prices for the third straight month. The median price of a single-family home rose 13 percent over the same time last year to $722,250. Like the rest of King County, lack of inventory was the driver. In one of the city’s hottest markets, Ballard, there are just 19 single-family homes on the market.
Home prices in Snohomish County are rising at their fastest pace in four years. The median price of a single-family home soared 17 percent from a year ago to $440,000. While that increase is substantial, prices here are still 30 percent less than in King County.
WalletHub, whose website helps with all things credit and personal financial choices, has recently put together a list of the Best Places to Raise a Family in Washington. The Eastside is strongly represented in the Top 10 and looks to rank pretty high overall!
According to their report, “Washingtonians earn the 12th highest per-capita personal income in the U.S. and experienced the fourth highest growth in income between 2015 and 2016. As a bonus, they don’t have to pay state individual income tax. Those who aspire to work for some of America’s biggest and most admired employers will also be pleased to know that Amazon, Costco, Microsoft and Starbucks are all headquartered here, where strong employment growth is expected for the next two years.”
Sammamish came in at No. 2 followed by Snoqualmie at No. 3. Rounding out the Top 15 were other Eastside cities like Klahanie, Woodinville, Redmond, Newcastle, Issaquah, and Kirkland, respectively.
Read the full list from WalletHub and see where your hometown ranked!
While we finally saw an increase in new listings in March, there was an even greater jump in sales. Lack of supply continued to push prices to new record highs. For the fifth straight month, our region has experienced the sharpest home price increases of any major market in the country. While that may be tough news for buyers, here’s the other reality: rents in the city of Seattle have increased 57 percent in the last six years. Brokers are hoping that more sellers will jump into the market this spring to help meet buyer demand.
After setting a price record in February, the Eastside set yet another record in March. The median price for a single-family home sold in March jumped 18 percent to $870,000. The strong appreciation is reflected in this statistic: For the first three months of 2017, the number of homes sold priced at $1 million or more was up 60 percent compared to the same period a year ago. What was once considered a luxury price tag is now the new normal.
Home prices in King County are growing about twice as fast as the national average. The median price of a single-family home sold in March soared 13 percent over last year to $599,950, an all-time high. Even though new inventory was added, it was snapped up as soon as it came on the market. About 75 percent of homes sold within the first 30 days.
With just two weeks of inventory available, demand in Seattle remains as strong as ever. Packed open houses, multiple offers, and escalation clauses continue to be the norm. The pressure on inventory pushed prices here to yet another all-time high. The median price of a single-family home in the city increased 9 percent over a year ago to $700,000.
Snohomish County set a new price record for the second straight month, with the median price of a single-family home up 10 percent from a year ago to $425,000. Supply is very limited, with just over two weeks of available inventory. Buyers looking for some relief from King County’s hefty housing prices are adding to the competition for a limited supply of homes.
The typical Winter cooldown is over and it seems like a scorching Spring housing market is already underway in the greater Seattle area.
Recent statistics reported by The Seattle Times show “home prices in Seattle have nearly doubled over the last five years,” while the number of homes for sale has hit its lowest point since available records began in 2000.
Home prices in King County jumped up 6.7 percent last month from the month before giving us the biggest one-month jump since early 2015 according to The Seattle Times. The biggest increase, the report continues, hit the suburbs. This sharp increase comes after a few months of slower price growth that is typical of winter months.
Does this symbolize an early start to the Spring market? When you combine these high prices with low inventory, an abysmal 1,400 homes available across King County last month, it would seem so.
Our inventory has become so low that fewer people are even wanting to sell their homes. KOMO News reports that our housing market is now facing “seller gridlock” because owners are not selling since they do not have any good options available for buying or upgrading their homes. KOMO also explains homes are being purchased faster than new listings can even hit the market.
According to the same article, not many expect the typical Springtime increase in inventory to meet the demand our area is currently facing and could be facing for some time.
Key advice many are sharing is to get started in the Spring market sooner rather than later. Right now is the perfect time for sellers to get the most out of their home and take advantage of current market conditions.
Home prices are growing faster in our region than anywhere else in the country. After a brief slowdown last month, home prices in February jumped to new record highs. The reason? The lowest number of homes for sale on record. The surge in prices came well ahead of the normal seasonal spring uptick, adding even greater urgency among buyers competing for already severely limited inventory. It remains to be seen if the predicted hike in interest rates will help moderate the market. For now, sellers are calling the shots.
The Eastside, always the most expensive area in King County, set a new price record in February. The median price for homes sold in February soared 12 percent to $832,000. That’s nearly $100,000 more than the same time last year. With less than one month of available inventory, this seller’s market is expected to continue for quite some time.
A recent trend of slowing price growth reversed itself in February. The number of homes for sale in King County was at its lowest point since 2000, when records first started being tracked. That is down 25 percent from a year ago. The deep shortage of inventory resulted in a sharp increase in prices. The median price of a single-family home was up 9 percent over last year to $560,000.
The median price of a single-family home in the city increased 5 percent over a year ago to $675,000, another all-time high. Prices here have nearly doubled over the last five years. While areas of King County outside of Seattle are more affordable, prices there are growing even faster. The median price of homes in North, Southwest and Southeast King County all increased by double-digits in February.
After a softening of price increases over the past few months, Snohomish County saw record high prices in February. The median price of a single-family home jumped 15 percent as compared to a year ago to $412,500. With less than one month of supply in the county, brokers expect prices to remain strong.
The local real estate market remains very hot with extremely low inventory and prices that are rising faster than anywhere else in the country. However, that rate of price growth appears to be cooling from last year, dropping to its slowest pace in three years. Predictions of more interest rate hikes may further limit price increases. Those considering to sell their home may want to take advantage now of this perfect storm of record-low inventory and record-high prices.
Those looking to buy a home on the Eastside continue to face rising prices and strong competition for limited inventory. With less than a month’s supply of homes, properties here are getting snapped up as soon as they come on the market, and often sell for well over asking price. The median price for homes sold in January climbed 14 percent compared to a year ago to $793,000.
Buyers scrambling to beat increasing interest rates have depleted an already record-low supply of homes. Fewer than 1,600 single-family homes were on the market in King County in January, beating December’s all-time low. The median price of a single family home was up 7 percent over last year to $525,000, but that is the cheapest home prices have been in 11 months. Time will tell whether that price moderation is an anomaly or the continuation of a trend.
After months of robust increases, Seattle home prices slowed down in January. The median price of a single-family home in the city inched up 3 percent over a year ago to $635,000. Some areas of the city even saw small price drops. That should spell good news for buyers, yet razor thin inventory continues to make it a solid seller’s market.
After months of double-digit price increases, Snohomish County may be starting to experience the same market softening as King County. The median price of a single-family home in Snohomish County rose 8 percent as compared to a year ago to $410,000. Tight inventory continues to be a problem. There are 40 percent fewer homes on the market here than the same time last year.
Washington State finished the year on a high with jobs continuing to be added across the market. Additionally, we are seeing decent growth in the area’s smaller markets, which have not benefitted from the same robust growth as the larger metropolitan markets.
Unemployment rates throughout the region continue to drop and the levels in the central Puget Sound region suggest that we are at full employment. In the coming year, I anticipate that we will see substantial income growth as companies look to recruit new talent and keep existing employees happy.
HOME SALES ACTIVITY
- There were 19,745 home sales during the fourth quarter of 2016—up by a very impressive 13.4% from the same period in 2015, but 18.7% below the total number of sales seen in the third quarter of the year. (This is a function of seasonality and no cause for concern.)
- Sales in Clallam County grew at the fastest rate over the past 12 months, with home sales up by 47%. There were also impressive sales increases in Grays Harbor and Thurston Counties. Jefferson County had a fairly modest decrease in sales.
- The number of available listings continues to remain well below historic averages. The total number of homes for sale in the fourth quarter was down by 13.7% compared to the same period a year ago.
- The key takeaway from this data is that 2017 will continue to be a seller’s market. We should see some improvement in listing activity, but it is highly likely that demand will exceed supply for another year.
- Demand continued to exceed supply in the final three months of 2016 and this caused home prices to continue to rise. In the fourth quarter, average prices rose by 7.1% but were 0.4% higher than the third quarter of the year. The region’s average sales price is now $414,110.
- In most parts of the region, home prices are well above historic highs and continue to trend upward.
- When compared to the fourth quarter of 2015, price growth was most pronounced in Kittitas County. In total, there were eight counties where annual price growth exceeded 10%. We saw a drop in sales prices in the notoriously volatile San Juan County.
- The aggressive home price growth that we’ve experienced in recent years should start to taper in 2017, but prices will continue to increase at rates that are higher than historic averages.
DAYS ON MARKET
- The average number of days it took to sell a home in the fourth quarter dropped by 15 days when compared to the fourth quarter of 2015.
- King County was the only area where it took less than a month to sell a home, but all markets saw decent improvement in the time it took to sell a home when compared to a year ago.
- In the final quarter of the year, it took an average of 64 days to sell a home. This is down from the 78 days it took in the third quarter of 2015, but up from the 52 days it took in the third quarter of 2016. (This is due to seasonality and not a cause for concern.)
- We may experience a modest increase in the time it takes to sell a home in 2017, but only if there is a rapid increase in listings, which is certainly not a given.
This speedometer reflects the state of the region’s housing market using housing inventory, price gains, sales velocities, interest rates, and larger economic factors. For the fourth quarter of 2016, I actually moved the needle a little more in favor of buyers, but this is purely a function of the increase in interest rates that was seen after the election. Higher borrowing costs mean that buyers can afford less, which could ultimately put some modest downward pressure on home prices in 2017. That said, the region will still strongly favor sellers in the coming year.
This blog by Matthew Gardner originally appeared on the Windermere.com blog.
Windermere’s Chief Economist Matthew Gardner is back again to talk about what the 2017 housing market means for first time buyers and millennials. Here are some of his thoughts…
I believe that the big story for the coming year will be first-time home buyers. Since they don’t need to sell before purchasing, their reemergence into the market ensures that sales will continue to increase, even while inventory is limited. Thirty-one percent of buyers currently in the real estate market are first-time buyers, but it would be more ideal if that figure was closer to 40 percent.
Why don’t we have enough first-time buyers in the market? With Baby Boomers working and living longer, we aren’t making much room for Millennials to start their careers. Plus, the major debt that the younger generation owes on student loans ($1.3 trillion today) hugely impacts the housing market. But the bigger issue is lack of down payments. Before the recession, many Millennials could look to their parents for help with down payments; however, these days that is not as much the case.
I would also contend that the notion of Millennials being a “renter generation” is nonsense. In a National Association of Realtors survey, 75 percent of them said that buying a home would be the most astute financial decision they’d ever make; however, 80 percent said they don’t think they could qualify for a mortgage. I do believe that Millennials will eventually buy, but they’re delaying their purchasing decisions by about three years when compared to previous generations, which is about the same amount of time they’re waiting to start families as well.
Mortgage rates have risen rapidly since the election, and unfortunately, I do not see a turnaround in this trend. That said, they will remain cheap when compared to historic averages. Expect to see the yield on 30-year mortgages rise to around 4.7% by the end of 2017. For those who have grown accustomed to interest rates being at historic lows, this might seem high, but it’s all relative.
If I were to gaze all the way into 2018, my crystal ball takes me to the dreaded “R” word. Like taxes and death, recessions are another one of those unwanted realities that inevitably comes to visit every so often. Irrespective of who was voted into the White House, my view remains the same: prepare to see a business cycle recession by the end of 2018, but, rest assured, it will not be driven by real estate, nor will it resemble the Great Recession in any way.
A record low number of houses for sale in December indicates that 2017 will continue to be a very competitive market for buyers. The good news: those who decide to take the plunge and list their home can count on getting a premium price for their property. Brokers reported that about three-fourths of the homes sold in December involved bidding wars.
Strong demand driven by a booming tech economy and great schools continue to strain the already low inventory on the Eastside. It’s not unusual for a well-priced new listing to receive dozens of offers and to sell for well over asking price. With supply failing to meet demand, the median price for homes sold in December soared 19 percent to a new record high of $803,500.
King County had only about 1,600 single-family homes on the market in December, an all-time low. With the healthy regional economy, demand remains very strong. Prices, however, appear to be moderating somewhat. The median price for a single-family home sold in December was $550,000, up 8 percent over a year ago, but unchanged from October and November. A traditional uptick in inventory this spring may help keep price increases more modest this year compared to the double-digit increases seen in 2015.
According to the Case-Shiller home price index, home prices are rising faster in the Seattle metro area than in any other major region in the country. One issue is space. The city’s existing density means that virtually no new single-family homes are being built in Seattle. As new residents flood in, more people are competing for the already tight inventory. As a result, home prices are up. The median cost of a single-family home rose 6 percent from a year ago to $635,000.
While home prices in Snohomish County are well below those of King County, the gap is closing as prices here are increasing at a faster pace than neighboring counties. The median price of a single-family home in Snohomish County rose 12 percent as compared to a year ago to $400,000. Like King County, inventory is very slim, indicating a market heavily favoring sellers.