The current real estate market is not for the faint of heart

0
162

[ad_1]

Trade wars, cash trades, 20 or more bids for one home – that would be the real estate market here and in many places across the country.

It has been a wild ride for a year, according to local real estate agents.

Last spring, the start of the traditional home buying season coincided with the COVID-19 pandemic and vacation home orders. It didn’t look promising for the real estate market.

A few months later, the situation changed dramatically.

Residents of apartments and condominiums, as well as city dwellers, especially those who could work from home, sought to vacate cramped premises and buy a house. They were satisfied with historically low interest rates: the average 30-year fixed rate mortgage fell below 3%.

Only one problem: there were more potential home buyers than vacant homes.

“Demand has significantly outstripped supply, and so, of course, prices jumped 10-18% in the first six months of this year,” said Randy Sakali, an agent for Windermere Real Estate in Everett.

As a result, multiple sentences have become the norm.

George Caudill, a longtime agent for Pacific Properties in Linwood, received 43 offers for one property and 26 for another. Previously, he looked through them one by one. “To appreciate that many sentences,“ I asked someone to build me an Excel spreadsheet, ”Caudill said.

Real estate agents Randy Sakali and Carol Fallin are listed in Mukilteo.  (Kevin Clark / The Herald)

Real estate agents Randy Szakali and Carol Fallin are listed in Mukilteo. (Kevin Clark / The Herald)

Home prices and listing began to rise.

In Snohomish County, the median single-family home sales price in June was $ 716,000, up 32% from a year ago. This means that the home, which sold for $ 716,000 in June, was sold a year ago for $ 541,875, according to the Northwest Multi-Listing Service.

According to the National Association of Realtors, the jump is in line with the national average sales price, which is up 23% from last June. The numbers in King County lagged behind, but not by much. The median sale price of a home in King County in June was $ 860,000, up 19% from a year ago.

Steeper?

Some recent signs point to a cooling market. First, US new home sales have declined in recent months.

On the other hand, the National Association of Realtors reported that sales of existing homes rose slightly – 1.4% in June after a downward trend for several months.

The local real estate market took a breather from roughly Father’s Day, June 20, to mid-July, Caudill said. “It was Sonville for a while.”

According to Sakali, the summer lull is to be expected – people celebrate the holidays or take a long-awaited vacation. Sales are likely to rise in the fall, she said, especially as mortgage rates continue to hover around 3%.

The main bathroom in the ad in Mukilteo.  (Kevin Clark / The Herald)

The main bathroom in the ad in Mukilteo. (Kevin Clark / The Herald)

On the supply side, there is a glimmer of hope – according to the Northwest Multiple Listing Service, the number of offers in the Puget Sound area has grown by 14% in recent months.

“Homebuyers will be delighted to hear that offers in King, Pierce and Snohomish counties increased between May and June, giving them more homes to choose from and possibly easing the pressure a little,” said Matthew Gardner, chief economist at Windermere Real. Estate, the listing service said.

Sakali and Caudill say there may be several reasons for the rise in stocks.

Many homeowners are just now completing their spring project listings to get them in order and prepare them for sale, Sakali said.

Pacific Properties’ Caudill says several clients delayed listing their homes for sale until more people were vaccinated. “They just didn’t feel comfortable showing the house until the numbers went up,” Caudill said.

Sakali usually advises sellers to stay with friends or to book a hotel room to avoid the hassle of multiple screenings.

“In this market, there is usually a short hotel stay,” she said.

“Real estate at the right price will continue to sell quickly,” often the contract ends in a week or less, Sakali said.

Dining room and living room in an ad in Mukilteo.  (Kevin Clark / The Herald)

Dining room and living room in an ad in Mukilteo. (Kevin Clark / The Herald)

J. Lennox Scott, chairman and chief executive officer of John L. Scott Real Estate, agrees: “Many homes are signing contracts within days due to high demand from buyers,” he said.

However, inventory growth may be short-lived, John Dealey, executive vice president of operations at Coldwell Banker Bain, told NWMLS.

“We are continuing on a trajectory that will keep the Puget Sound region at the top of the national lists of one of the most popular housing markets,” said Dealey. “Inventories in large districts range from two to three weeks.”

The normal real estate market may offer a five-month supply of homes for sale. If there are 50 houses on the market and 10 houses are sold every month, this is a five-month supply.

Availability

The National Association of Realtors said nationwide first-time buyers accounted for 31% of home sales in June, up from 35% a year earlier.

Affordability, especially for first-time home buyers, is an ongoing challenge for real estate agents, lenders, and government officials, especially in communities struggling with building density or land use issues.

In Snohomish, King and Pierce counties, less than a quarter of single-family homes had a list price below $ 400,000 in June, which is considered an acceptable price range. By comparison, about a third of homes in the three counties were worth $ 800,000 or more.

Real estate agents Carol Fallin and Randy Sakali listed in Mukilteo.  (Kevin Clark / The Herald)

Real estate agents Carol Fallin and Randy Szakali are listed in Mukilteo. (Kevin Clark / The Herald)

Given the shortage of homes, it’s no surprise that prices are going up. But some homebuyers are raising rates.

Some local buyers have downsized and sold larger homes, and have the means to make a sizeable down payment or cash-in-order, Sakali said.

The region’s technology sector is also a factor. It continues to attract new residents to the area, some of whom have sold homes in more expensive markets and are willing to offer tens or even hundreds of thousands of dollars above the home’s list price.

Last year, Greater Seattle ranked third in the United States for the number of high-tech job postings, ahead of San Francisco, according to Indeed, an online job board. These jobs usually include a solid salary. Seattle’s tech wages are among the highest in the country, averaging $ 109,628 per year. According to Indeed, only Silicon Valley, where the average is $ 123,826, offered more.

“I had a young couple in their 30s from California who are robotics experts,” Caudill said. “Each of them brought home $ 15,000 a month without paying a car. They wanted a shelter for their money. ”

As Dealey of Coldwell Banker said, “Given the direction of tech companies like Amazon and Microsoft, rent out large office space and hire thousands of employees in our region, bringing in people from more expensive markets like Silicon Valley with more money to spend. , we don’t. ” I don’t see much change in this scenario for buyers in the short term. ”

Previously, one of the first questions a home buyer could ask was how are things in schools? They are now more likely to ask about internet speed or whether there is enough space for a home office, Caudill said. It has also seen a surge in the number of home buyers looking for mom and dad places.

“I have had several clients who said they bring their parents to live with them,” Caudill said. “Instead of putting them in a nursing home, they say, ‘Let’s have them with us,’” Caudill said. For these clients, he said, the checklist includes a master bedroom on the ground floor with at least three-quarters bathroom for their parents.

This recent listing by Randy Szakali was sold in Mukilteo for $ 1.2 million.  (Kevin Clark / The Herald)

This recent listing by Randy Szakali was sold in Mukilteo for $ 1.2 million. (Kevin Clark / The Herald)

Buyers are still asking about the school district, but now they are also evaluating the backyard.

“They want the kids to be able to play where they can follow them instead of sending them around the corner to the park,” Caudill said. Because of this, smaller or less modern homes with large backyards can be more expensive than newer or even larger homes on a smaller lot because of this, Caudill said.

What should a buyer do?

Carol Fallin, an agent for Windermere Real Estate in Everett that partnered with Szakaly, offers the following tips for home buyers:

Above all, “treat finding a new home like a job,” Fallin said. Before proceeding with the inspection of houses, obtain a preliminary agreement with the lender. Be prepared to lash out if you are browsing the property you want.

If you haven’t bought a home in 10 years or more, keep in mind that many homes are rented out in a matter of days. Thinking about whether to make an offer for a week or more is unrealistic in this market.

While you can buy a home with a 3.5% discount, an offer is more likely to receive serious attention if it includes a 10% or 20% discount.

If this is your first time buying a home or are on a tight budget, consider choosing a property that needs renovation or remodeling.

Become familiar with the area before looking for a home. If you are walking, assess the situation on the sidewalk. If you have children, look out for nearby parks. Are you a pet lover? Before making an offer, ask about the homeowner’s association’s pet policy.

“You can change the house, remove the walls and paint the interior, but you cannot change the location,” Fallin said.

Janice Podsada; jpodsada@heraldnet.com; 425-339-3097; Twitter: JanicePods

Gallery




[ad_2]

Source link