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The Gardner Report – Q2 2020 Western Washington
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 don’t hesitate to contact your Windermere agent.
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.
This post originally appeared on the Windermere.com Blog
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. You can get Matthew’s latest update here.
EASTSIDE
KING COUNTY
SEATTLE
SNOHOMISH COUNTY
VIEW FULL SNOHOMISH COUNTY REPORT
This post originally appeared on GetTheWReport.com
Local Market Update – June 2020
As we move to the next phase of reopening, life feels like it’s slowly inching back towards normal. The same is true in real estate. Statistics on home sales in May provided the first true picture of the effects of COVID-19. Those reports confirmed the incredible strength and stability of the local real estate market.
- 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.
EASTSIDE
KING COUNTY
SEATTLE
SNOHOMISH COUNTY
VIEW FULL SNOHOMISH COUNTY REPORT
This post originally appeared on GetTheWReport.com
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.
EASTSIDE
KING COUNTY
SEATTLE
SNOHOMISH COUNTY
VIEW FULL SNOHOMISH COUNTY REPORT
This post originally appeared on GetTheWReport.com
The Gardner Report – 2019 Q4
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 don’t hesitate to contact me!
ECONOMIC OVERVIEW
Employment in Washington State continues to soften; it is currently at an annual growth rate of 1.7%. I believe that is a temporary slowdown and we will see the pace of employment growth improve as we move further into the new year. It’s clear that businesses are continuing to feel the effects of the trade war with China and this is impacting hiring practices. This is, of course, in addition to the issues that Boeing currently faces regarding the 737 MAX.
In the fourth quarter of 2019 the state unemployment rate was 4.4%, marginally lower than the 4.5% level of a year ago. My most recent economic forecast suggests that statewide job growth in 2020 will rise 2.2%, with a total of 76,300 new jobs created.
HOME SALES
- There were 18,322 home sales registered during the final quarter of 2019, representing an impressive increase of 4.7% from the same period in 2018.
- Readers may remember that listing activity spiked in the summer of 2018 but could not be sustained, with the average number of listings continuing to fall. Year-over-year, the number of homes for sale in Western Washington dropped 31.7%.
- Compared to the fourth quarter of 2018, sales rose in nine counties and dropped in six. The greatest growth was in Whatcom County. San Juan County had significant declines, but this is a very small market which makes it prone to extreme swings.
- Pending home sales — a barometer for future closings — dropped 31% between the third and fourth quarters of 2019, suggesting that we may well see a dip in the number of closed sales in the first quarter of 2020.
HOME PRICES
- Home price growth in Western Washington spiked during fourth quarter, with average prices 8.3% higher than a year ago. The average sale price in Western Washington was $526,564, 0.7% higher than in the third quarter of 2019.
- It’s worth noting that above-average price growth is happening in markets some distance from the primary job centers. I strongly feel this is due to affordability issues, which are forcing buyers farther out.
- Compared to the same period a year ago, price growth was strongest in San Juan County, where home prices were up 41.7%. Six additional counties also saw double-digit price increases.
- Home prices were higher in every county contained in this report. I expect this trend to continue in 2020, but we may see a softening in the pace of growth in some of the more expensive urban areas.
DAYS ON MARKET
- The average number of days it took to sell a home dropped four days compared to the third quarter of 2019.
- For the second quarter in a row, Thurston County was the tightest market in Western Washington, with homes taking an average of 29 days to sell. In nine counties, the length of time it took to sell a home dropped compared to the same period a year ago. Market time rose in four counties and two were unchanged.
- Across the entire region, it took an average of 47 days to sell a home in the fourth quarter. This was up nine days over the third quarter of this year.
- Market time remains below the long-term average across the region, a trend that will likely continue until we see more inventory come to market — possibly as we move through the spring.
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.
The housing market ended the year on a high note, with transactions and prices picking up steam. I believe the uncertainty of 2018 (when we saw significant inventory enter the market) has passed and home buyers are back in the market. Unfortunately, buyers’ desire for more inventory is not being met and I do not see any significant increase in listing activity on the horizon. As such, I have moved the needle more in favor of home sellers.
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.
This post originally appeared on the Windermere.com Blog.
Local Market Update – December 2019
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Favorable interest rates and soaring rents boosted activity in the housing market in November. More buyers competing for less inventory kept home prices strong. With the supply of homes far short of demand, sellers can expect well-priced properties to sell quickly this winter.
EASTSIDE
With just over a month of available inventory, demand on Eastside remains very strong. Sales are brisk, with 45% of single-family homes selling in 15 days or less and 20% of homes selling for over list price. The median single-family home price in November rose 2% from a year ago to $900,000 and was unchanged from October.
KING COUNTY
With more buyers vying for fewer homes, King County remains a solid seller’s market. While inventory traditionally shrinks in the winter, this November saw the number of new listings at historic lows. Demand was strong, with the number of closed sales up 12% over the same time last year. The median home price ticked up 3% over the prior year to $661,000 and was unchanged from October. The strong market sent prices higher in the more affordable price ranges, with some areas in South King County seeing double-digit increases.
SEATTLE
Activity in Seattle was very strong in November. The number of closed sales was up 29% over the same time last year. With just over one month of homes available for sale, the city is starved for inventory. Seattle homes prices have ebbed and flowed slightly from month to month for much of this year. The median price of a single-family home sold in November was off 3% from a year ago to $735,000.
SNOHOMISH COUNTY
With an increasing number of buyers driving to affordability, the Snohomish County housing market remains robust. Inventory is very tight and continues to fall. The county finished November with just over one month of supply. The median price of a single-family home rose 5% over a year ago to $495,000. That figure is unchanged from October.
VIEW FULL SNOHOMISH COUNTY REPORT
This post originally appeared on GetTheWReport.com
Local Market Update – November 2019
A steady influx of buyers continued to strain already tight inventory throughout the area in October. Home sales were up, as were prices in much of the region. With our thriving economy and highly desirable quality of life drawing ever more people here, the supply of homes isn’t close to meeting demand. Homeowners thinking about putting their property on the market can expect strong buyer interest.
EASTSIDE
As the Eastside continues to rack up “best places” awards, it’s no surprise that the area is booming. Development is on the rise, fueled primarily by the tech sector. The appeal of the Eastside has kept home prices here the highest of any segment of King County. The median single-family home price in October was stable as compared to the same time last year, rising 1% to $900,000.
KING COUNTY
King County’s 1.74 months of available inventory is far below the national average of four months. Despite the slim selection, demand in October was strong. The number of closed sales was up 5% and the number of pending sales (offers accepted but not yet closed) was up 11%. The median price of a single-family home was down 2% over a year ago to $660,000. However, some areas around the more reasonably-priced south end of the county saw double-digit price increases.
SEATTLE
Seattle home prices took their largest year-over-year jump in 12 months. The median price of a single-family home sold in October was up 3% from a year ago to $775,000, a $25,000 increase from September of this year. Seattle was recently named the third fastest-growing city in America. Real estate investment is surging. A growing population and booming economy continue to keep demand for housing –and home prices—strong.
SNOHOMISH COUNTY
Both the number of home sales and home prices were on the rise in Snohomish County in October. Overall homes sales increased 7%, and the median price of a single-family home rose 5% over a year ago to $495,000. Supply remains very low, with just six weeks of available inventory.
VIEW FULL SNOHOMISH COUNTY REPORT
This post originally appeared on GetTheWReport.com
The Impact of Staging Your Home
For more than 20 years, the benefits of staging a home have been well documented. Numerous studies show that staging helps sell a home faster and for a higher price. According to the National Association of REALTORS®, 88 percent of home buyers start their search online, forming impressions within three seconds of viewing a listing. When a home is well staged, it photographs well and makes the kind of the first impression that encourages buyers to take the next step.
Studies also indicate that buyers decide if they’re interested within the first 30 seconds of entering a home. Not only does home staging help to remove potential red flags that can turn buyers off, but it also helps them begin to imagine living there. Homes that are professionally staged look more “move-in ready” and that makes them far more appealing to potential buyers.
According to the Village Voice, staged homes sell in one-third less time than non-staged homes. Staged homes can also command higher prices than non-staged homes. Data compiled by the U.S. Department of Housing and Urban Development indicate that staged homes sell for approximately 17 percent more than non-staged homes.
A measurable difference in time and money
In a study conducted by the Real Estate Staging Association in 2007, a group of vacant homes that had remained unsold for an average of 131 days were taken off the market, staged, and relisted. The newly staged properties sold, on average, in just 42 days, – which is approximately 68 percent less time on the market.
The study was repeated in 2011, in a more challenging market, and the numbers were even more dramatic. Vacant homes that were previously on the market for an average of 156 days as unstaged properties, when listed again as staged properties, sold after an average of 42 days—an average of 73 percent less time on the market.
Small investments, big potential returns
Staging is a powerful advantage when selling your home, but that’s not the only reason to do it. Staging uncovers problems that need to be addressed, repairs that need to be made, and upgrades that should be undertaken. For a relatively small investment of time and money, you can reap big returns. Staged properties are more inviting, and that inspires the kind of peace-of-mind that gets buyers to sign on the dotted line. In the age of social media, a well-staged home is a home that stands out, gets shared, and sticks in people’s minds.
What’s more, the investment in staging can bring a higher price. According to the National Association of REALTORS, the average staging investment is between one percent and three percent of the home’s asking price, and typically generates a return of eight to ten percent.
In short, less time on the market and higher selling prices make the small cost of staging your home a wise investment.
Interested in learning more? Contact your real estate agent for information about the value of staging and referrals for professional home stagers.
This post originally appeared on the Windermere.com Blog
Local Market Update – October 2019
While fall usually brings a decrease in sales activity, the opposite was true in September. The number of listings on the market dropped by double digits and home sales rose. With interest rates near historic lows and employment levels at historic highs, the housing market is expected to stay strong throughout the fall and winter.
EASTSIDE
Long the most affluent area of King County, the Eastside continues to record the highest home prices in the region. The median price of a single-family home on the Eastside was $928,500 in September, an increase of 4% from a year ago and a decrease of less than 1% from August. The Eastside construction boom continues, indicating that developers remain confident in the strength of the local economy.
KING COUNTY
The number of homes on the market in King County fell by almost 20% in September when compared to a year ago. However, last fall saw an increase in inventory that was unusual for the time of year. The median price of a single-family home was $660,000, down just 1% from the same time last year. Cities in King County, outside of Seattle, all saw price increases. Sales were up 7% indicating no shortage of buyers.
SEATTLE
Prices remained relatively stable, with the median price of a single-family home in September dipping 3% over a year ago to $750,000. As tech companies continue to recruit top talent to the area, Seattle’s population keeps booming and demand for housing remains high. While home sales traditionally dip in the fall, the city saw sales increase by 12% in September as compared to last year. Rising rents may push more buyers into the market.
SNOHOMISH COUNTY
Buyers continue to be drawn to Snohomish County thanks to a strong economy and housing costs that are considerably more affordable than King County. That influx of buyers is also driving up prices. The median price of a single-family home in September was $492,500, up from $484,995 the same time last year. At $167,500 less than the median price in King County, it’s a relative bargain.
VIEW FULL SNOHOMISH COUNTY REPORT
This post originally appeared on GetTheWReport.com
You’ve Moved into Your New Home. Now What?
Congratulations on your new home! You made it through the arduous process that is buying a new home. Now it’s time to take on the task of moving in.
You did your research about the neighborhood and you feel like you know the home like the back of your hand. However, there are some things to do as you move in to protect your newest investment, and yourself, from the unknown variables in and around your home.
Change the locks garage door codes
Previous owners might have changed the locks, but they may not know who all has a key or a code to open your garage, especially neighbors who they trusted to watch their place while they were away. Changing the codes and locks on all the doors ensures that you have complete control over entry to your home
Check or Install Fire and Carbon Monoxide Detectors
If the home already has fire and carbon monoxide devices, make sure they are in working order by testing each one with the tester button. Keep a note of when to replace them as well.
If they don’t have them, install a device in each sleeping room, as well as common areas like the living room or kitchen. Hallways are a great place to cover multiple rooms with one detector as well.
Install a security system
Enjoy total peace of mind with a new security system. Meet with a consultant on the best ways to protect your home for a system that works best for you and your lifestyle.
There are also app-connected systems that you can set up yourself that notify you of movement on the cameras or doors and windows opening.
Meet the neighbors
Build a sense of community and get to know the lay of the land by knocking on neighbors’ doors to get to know them. Bring a small gift as a “thank you” for dealing with the moving trucks. This is a great initial step for figuring out who you can trust to watch things while you’re away should you need a helping hand in the near future.
These are just a few ideas on what you should do as soon as you move in. What are some things you do, or suggest to friends and clients on move-in day?
Do you have questions on buying or selling your home? Reach out for more information, Sandy Nicholls (425) 444-4966
This post originally appeared on the Windermere.com Blog
