Spokane led the nation in real estate wars

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Spokane resident Kelly Saunders found her dream home in two months, but it wasn’t easy.

Saunders sold her previous home in February and started looking for a new property.

She faced eight trade wars and lost four bids to buy homes for cash, some of which sold thousands of dollars above the asking price.

Saunders – with some persistence – found a home north of the Garland area.

“I decided that I just liked this house and said, ‘Let’s do whatever we have in this house,” she said.

She wrote a letter to the seller describing why she liked the house and ended up paying $ 70,000 in excess of the $ 300,000 asking price, overtaking another buyer to offer cash.

“I had a small down payment, but there was a lot of cash behind it,” she said.

“I immediately received $ 370,000. I am one of the lucky few who managed to win the money offer. “

Saunders is one of several buyers in the region competing with numerous home offerings, and market dynamics have only accelerated due to low interest rates and the pandemic.

Remote workers and buyers from elsewhere fled the major metropolitan areas to more accessible cities such as Spokane, fueling bitter bidding wars.

Spokane’s real estate market had the highest percentage of military rates in May of 50 urban areas across the country, according to an analysis by Redfin released last month.

The high-tech real estate brokerage found that 86.7% of offers written by its agents in Spokane faced competition in May, followed by Raleigh, North Carolina at 84.5% and Tucson, Arizona, at 84.5%. 81.8%.

Nationwide, 70.4% of housing offers written by Redfin agents faced competition in May, well up 52.7% from the same month in 2020.

Spokane also had the highest bidding war rate in the country in April, according to Redfin, with 83.3% of bids facing competition.

“This is a very competitive market now. He was competitive for a while. But around March it hit a new level, ”said Brynn Rea, a Redfin agent based in Spokane. “It’s really hard to compete for buyers, especially first-time buyers. Unfortunately, many of them have been pushed out of the market.

“Now we see a lot of money and a lot of investors. There is a lot of demand here, and rental prices are so high and interest rates are so low, it’s just the perfect storm for this crazy market. “

On average, homes in the Spokane area receive three to eight offers. But there are houses that have received over 20 offers from buyers.

Homes under $ 400,000 are most in demand, Rhee said.

“There are many buyers with $ 300,000 in income who are desperate to get an offer,” she said.

Although Spokane’s housing market was bustling before the pandemic, sellers were open to negotiating price cuts.

Buyers are now abandoning contingencies and checks to stay competitive with buyers from elsewhere, some of whom have sold their million-dollar properties in major cities and are using the capital to pay cash for a house in Spokane, Rea said.

According to the Spokane Association of Realtors, Spokane County’s average closing price was a record $ 380,000 in June, up 28.8% from $ 295,000 in June 2020.

About 750 private homes and condominiums of less than 1 acre were sold in June, up 5.2% from 713 homes in June 2020.

In June, the county had an inventory of 284 houses, which corresponds to a 12-day stock. This means that it will take 12 days to sell all the homes on the market. In June 2020, inventory was carried out in 728 houses.

Despite a spike in the war of filings across the country, Redfin reported signs that the market could cool off and competition is starting to level off after peaking.

“After months of rising prices and low inventories, some home hunters are fading into the background – either because their prices are overpriced or because they burned out,” said Daryl Fairweather, chief executive officer economist Redfin. “Americans are spending more of their money on things like travel and eating out, now that the restrictions on the pandemic are being lifted.”

Observers say this may not be the case in Spokane as demand continues to outstrip supply.

Eric Johnson, president of the Spokane Association of Realtors, said he expects the market to continue to offer plentiful supply unless interest rates rise or the labor market changes.

Spokane is experiencing population growth of about 1-2% per year. Population growth in the area, combined with a lack of affordable homes, is driving the demand for additional housing, he said.

At the same time, the Growth Management Act and building codes are obstacles to building more homes.

Rea agrees that the local housing market needs more new construction, but builders are struggling with changes in building codes, rising lumber prices and labor shortages.

“New construction will help to level the market significantly, but it will take time,” she said.

Despite these problems, Rea expects the market to remain brisk throughout the year.

“We will still have a strong summer and fall until interest rates go up the roof,” Rea said. “There will be a seller’s market here for a while.”

Shoppers can gain a foothold in the market this summer by buying homes when people are on the lake or on vacation, she said.

“This is a great time to jump in there and hopefully not find yourself in such a competitive situation,” she said. “When everyone is at the lake, this is the best time to watch.”

Johnson advises buyers to keep trying and be patientespecially if they want to take advantage of low interest rates

“We are going to continue to supply the market and help this process as much as we can,” he said.

Saunders said that while she faced some frustrating moments when looking for a home, she advised buyers to remain optimistic.

“Hang there. Go on,” she said. “This house is going to happen.”

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