Puget Sound Homebuyers and Sellers: What to Expect in the Near Term, and How to Prepare.
Many people trying to buy a home in today’s Puget Sound market are saying, “Am I living in 2006-2007 again?” Sellers are in the driver’s seat, but only when they price and condition their home correctly for the market. Buyers are living an equally frustrating existence. Along with their agents, they’re up at the crack of dawn scouring new listings, price reductions and back-on-market properties, but being the second, third or tenth offer for the seller to review in a few days is common. To avoid these scenarios and deal with them when they arise, both buyers and sellers should find a good Realtor to help navigate the ever-changing market.
Sellers’ issues are evidenced by expired listings: 1,200 Single Family Homes (SFH) for sale in King County over the past six months expired and did not sell. Approximately 25% of those properties came back on the market and sold at a lower price. In Pierce County during the same time frame, nearly a 1,000 listings expired, with similar percentages eventually being sold at a lower price. The lesson is, it’s hard to under price a home in this market, but it’s still easy to over price one. Knowledgable, experienced Realtors know the vagaries of a hot or a cold market. The accuracy of the Realtor’s information and the guidance he or she provides are irreplaceable if done well.
Sellers are just starting to figure this out. Many experienced the hard winter of 2008-2012. Until now, they haven’t had an opportunity to recapture a large portion of the equity they lost in the recession. In King County, we are a whiskers width away from the median sale price reaching its former highest level. Median sale price of a Single Family Home (SFH) was $458,000 in 2007 and $442,000 today (-3.5%). In Pierce County the distance between the highest median sale price in 2007 ($284,000), and today’s median sale price ($235,000) is still quite a far (-17%). Likewise, Snohomish has gone from a height of $370,000 in 2007 to $334,000 today (-9.7%). But the direction is unmistakable: buyers have to pay more for the same house they didn’t buy last year.
Later in the year, when interest rates edge up as a result of the Federal Reserve’s policy change reducing/eliminating buying mortgage-backed securities, we may see a curb on the percentage of increase in today’s home pricing, running between 5-15% a year. But with near-full employment levels and historic low interest rates, it looks like spring and summer will be hot in the housing market. Finding a buyer is just the beginning; the closing of the sale is the work found below the surface waiting to be discovered.
Buyers also achieve the most success in today’s market with the help of a smart Realtor. While someone else may put an offer on a home before you, the differentiator between the two may not always be the price. Qualified Realtors know how to position their buyers to take advantage of the market and handle the ice-berg sale: one where the problems that arise are below the surface and appear when least wanted or expected. This sale happens at least 50% of the time, and the issues surrounding it can only be solved by the steady hand of a Realtor. Finding the right agent to help you is as important as finding the right home. Why do you think some offers are accepted over others? Your Realtor has strategies to help you buy the home you want, and want the home you buy.
Because of their skills, our RE/MAX Brokers always deal from a win-win position and always have the latest, most accurate information. We’re experts in creating a smooth fun process by filling in the valleys, leveling the hills and making straight paths to walk on for buyers and sellers.