Homebuyers Resuming Search Amid Improving Inventory, Attractive Terms
KIRKLAND, Washington (February 2019) – Homebuyers around Washington state are making their way back to the market, hoping to take advantage of improving inventory, attractive interest rates, and more approachable sellers, according to officials with Northwest Multiple Listing Service.
Northwest MLS statistics for January show year-over-year improvement in the volume of new listings and total inventory, along with moderating selling prices. Although fewer pending sales (mutually accepted offers) were reported than a year ago (down about 3.3 percent), January was the smallest year-over-year decline since May 2018 when the drop was about 2.7 percent.
Commenting on the MLS statistics summarizing last month’s activity, broker Gary O’Leyar said January’s post-holiday real estate activity doesn’t normally pick up until later in the month, but this year the uptick began early. “January started as a bit of a surprise. Open house activity was very robust, and we saw multiple offers in numerous instances again,” reported O’Leyar, the owner of Berkshire Hathaway HomeServices Signature Properties in Seattle.
Brokers tallied 7,564 pending sales during January, a decline from a year-ago when they recorded 7,820 transactions.
Seven counties had increases in pending sales of single family homes and condos compared with 12 months ago, including King (up nearly 7.5 percent) and Snohomish (up 3.8 percent).
James Young, director of the Washington Center for Real Estate Research at the University of Washington, commented on pending sales. The mixed results, including “healthy growth” in King and Snohomish counties, “corresponds well to upward movement in mortgage applications late in December, a leading indicator for the month to follow,” he noted, adding, “One should expect to see increased sales activity in the coming months throughout the region if mortgage applications continue to stabilize or increase.”
J. Lennox Scott, chairman and CEO of John L. Scott Real Estate, said buyers “came out of the woodwork” after the holidays, eager to take advantage of better housing conditions. “Areas close to the job centers are seeing improved affordability from spring 2018,” he said, attributing it to lower interest rates, strong job growth, and adjusted pricing.
Scott said buyers are also attracted by expanded inventory resulting from the addition of new listings and a higher number of unsold inventory, although he noted “inventory levels are still considered a shortage.”
Prospective buyers who sat out the second half of 2018 or were pushed to the sidelines during last year’s heated market are finding better buying conditions, agreed Robb Wasser, branch manager at Windermere Real Estate/East. “Interest rates are near a nine month low and buyers have a stronger platform for negotiating, which have helped drive a 9 percent increase in pending sales of single family homes in King County,” Wasser stated.
MLS members added 7,090 new listings of single family homes and condos during January, up from the year-ago figure of 6,805 and nearly doubling December’s total of 3,631. At month end there were 11,687 active listings in the database, up more than 45 percent from the year-ago total of 8,037. Listing inventory more than doubled in both King and Snohomish counties.
Sixteen counties, including all four in the Puget Sound region, reported more inventory than a year ago. Even with sizable gains, supply is still tight at 2.4 months system-wide. (In general, four to six months typically indicates a balanced market.)
“The rise in inventory is largely due to investors who are selling because they believe the market has peaked and they want to unload their properties before interest rates rise too far,” said OB Jacobi, president of Windermere Real Estate.
“New listing inventory in King County is bringing more homebuyers to the market. We are enjoying increased open house traffic, including during the Super Bowl weekend,” remarked Dean Rebhuhn, owner of Village Homes and Properties in Woodinville. He also commented on the early arrival of the spring market, crediting jobs and immigration as factors. “Properly priced homes are selling!” he exclaimed.
Mike Grady, president and COO of Coldwell Banker Bain, expects activity to pick up heading into spring, as is customary. “I have absolutely no concerns about 2019 being a strong year, with prices rising 4-to-6 percent and units up 10-to-12 percent. There is no reason for sellers not to move on with their lives and list their homes,” he remarked.
Northwest MLS figures show an area-wide price gain of just over 5 percent on January’s 4,865 closed sales of single family homes and condos. Only six of the 23 counties in the report had year-over-year price drops. Among them was King County where prices slipped about one percentage point, from $571,250 to $565,000.
Prices on single family homes (excluding condos) rose 5.4 percent from the same month a year ago. In the four-county Puget Sound region, prices increased in Kitsap, Pierce and Snohomish counties, but decreased about 2.9 percent in King County, dropping from $628,388 to $610,000. Prices for single family homes in Kitsap County, where there is only about 1.7 months of supply, surged nearly 14.7 percent when compared to a year ago.
“The minor decline in King County home prices in January doesn’t mean the housing market is tanking; it’s primarily because of the significant increase in the number of homes for sale,” suggested Jacobi. “We may see prices take minor dips periodically in the coming year, but for the most part they are expected to continue rising, just at a far more modest rate than in recent years,” he added.
“Median prices on closed sales continue to remain stable in January with continued strong upward growth in outlying counties,” stated Young. “Pierce, Kitsap, and Thurston counties outpaced King and Snohomish counties in price growth, consistent with the past few months. This trend indicates that many first-time buyers and middle-income families are continuing to look to the outer regions of the area for value. Strong price growth in Lewis and Whatcom counties also support this general trend of outward migration along the I-5 corridor,” he added.
Mike Larson, president/designated broker at ALLEN Realtors in Lakewood (Pierce County) concurred, describing the slowdown in activity during the second half of 2018 as a “much-needed correction.” Sellers in King and Snohomish counties “got caught up in the craziness so many buyers turned to Pierce County for their affordability solution,” something he expects will continue this year.
Condo prices rose slightly, about 1.6 percent, as inventory more than doubled from a year ago. The median price for the 645 condos that closed last month area-wide was $325,000. In King County, where more than half the sales occurred, the median price was $383,500, up slightly from the year-ago figure of $380,000.
Several brokers expressed optimism for a busy spring.
“Buyers are signaling a more aggressive spring market with an uptick in search activity and high application rates with mortgage companies,” said George Moorhead, designated broker at Bentley Properties. He also noted would-be owners are commenting on having more options to consider and “are feeling the real estate market is less volatile.” He also reported sellers are similarly encouraged by having more options, “and not having to race around with the fear of making a housing mistake.”
“We’ve clearly been in a transitioning market, but given the ongoing demand for real estate in the Greater Seattle area, we may have adjusted to a ‘new market reality’ wherein inventory is up and prices have re-aligned, but there is still strong demand for housing. I would expect to see a robust regional real estate market going forward into spring,” stated O’Leyar.
The director of the Washington Center for Real Estate Research was more guarded in his expectations. “Increasing inventory and moderate price growth in urban counties (and growth in outer regions of the Puget Sound) point to several problems relating to how potential homebuyers see things moving forward,” said James Young. He referenced figures from the National Association of Homebuilders National Trends Report indicating a shrinking pool of buyers.
“The picture for first-time buyer affordability in the longer term for the region is not bright for potential homeowners unless changes in the housing supply framework throughout the area are addressed soon.”
Larson also expressed concerns around affordability, “particularly for entry-level buyers as well as move-down buyers who also want to sell. The middle rungs on the housing ladder are slowly disappearing,” he remarked. Options like condos could help fill that void, he suggested, but believes they won’t be built “until the state legislature reforms the condo liability laws.”
Affordability is a “crucial issue” for 72 percent of millennial renters, according to a survey by Apartment List.
Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.
Source, Northwest Multiple Listing Service
Moving to an island can be challenging. To live on many islands in the Pacific Northwest you have to account for ferry schedules, as well as being far away from major shopping centers. Even things you don’t normally think about, like having a few different options for gas stations, or being able to quickly drive to the nearest recycling center, may be out of reach. For some people, island living is worth the drawbacks. Sure, you may not be able to visit the mall, but you get to settle down in a literal vacation destination.
When you live on Camano Island, you don’t have to choose.
We like to say that Camano Island is the “easy drive-on Island” where there are no finicky ferry schedules, and no waiting in a crowded parking lot for hours at a time. Take a few minutes out of your day to cross a few hundred yards of bridge, and you’re on Camano Island! The island is close to several major urban centers: twenty minutes from Marysville or Burlington via I5, and only forty-five minutes from Bellingham or Shoreline.
Another great thing about living on Camano Island is getting away from rush-hour traffic. Typically, once you go north of Marysville, traffic eases up. When you want to go shopping in Burlington, for example, you don’t need to worry about planning your whole day around the trip! Hop across the bridge, cruise through Stanwood, and head north on I5 for an easy twenty-minute drive.
Living on an island doesn’t have to mean giving up access to the rest of the world! On Camano Island, we like to think we have the best of both worlds: island paradise, with abundant convenience.
There are many reasons to move to Camano Island: the relaxed island atmosphere, friendly neighbors, and beautiful scenery right in your backyard. If you’ve dreamed of living on an island, you should definitely consider Camano Island.
We understand that not everyone is excited about moving to an island. There are often drawbacks to living in a beautiful place far away from the business of everyday life. This is why Camano Island is so special. We have beaches, state parks, a golf course, and a winery. Your neighbors go boating in the summers and fresh crab is an island staple. While other islands can boast similar things, we can proudly say that we’re also twenty minutes away from the urban centers of Smokey Point, Mount Vernon, and Burlington. If you’re ready to go out after a long, sleepy day on the beach, look no further than the bustling I5 corridor directly accessible via highway 532. The Seattle gridlock often ends in Marysville, so feel free to head out for a day of shopping at any time! Plan your day around you, not around rush-hour.
If you don’t feel like driving for twenty minutes to pick up a few groceries, that’s ok! Camano Island and Stanwood have several options for home necessities, including QFC, Mod Pizza, Starbucks, Rite Aid Pharmacy and more!
Looking for a place to grab a drink with a friend? Check out either of our two craft breweries or any one of our three artisanal coffee shops. If hiking and adventuring is more your style, look no further than Cama Beach State Park, or Camano Island State Park; located less than twenty minutes from anywhere on the island.
There’s also no need to worry about finding a gas station, either. In Stanwood and on Camano Island, take your pick of the six (competing!) fueling locations available.
Camano Island gives you the opportunity to experience life on vacation while still enjoying the convenience of living near a major urban center. Take a walk on the beach in the morning, then take a five-minute drive to Stanwood to do your afternoon shopping. Living “away from it all” doesn’t mean having to give up your access to civilization! Own a home on the beach and get your Starbucks fix every morning. Watch beautiful sunrises, and visit local boutiques and department stores.
When you live on Camano Island, we believe you can have it all.
Economist Matthew Gardner motioned his outstretched hand horizontally through the air. “Balance,” he said. “That’s what we’re trending back to.”
Gardner was addressing some 250 people during an economic forum Friday, Jan. 26, at the Camano Center.
After nearly 20 years of volatility in the housing market — the early 2000s boom, the Great Recession and the ensuing recovery — the economy should return to that of one resembling the 1990s with slow and steady growth, he said.
After huge leaps in home prices during the past few years in the Stanwood-Camano area, price increases should slow to about 5 percent this year, Gardner projects.
“It’s not bad — a move back to balance — it’s just that most people don’t remember what a balanced market looks like,” said Gardner, chief economist at Windermere Real Estate in Seattle. “Many people have only known volatility.”
Prices for homes increased about 10 percent in Stanwood, rising from an average median price of $389,995 in 2017 to $430,000 in 2018, according to Northwest Multiple Listing Service data. On Camano Island, the cost of a home rose 3.7 percent, increasing from $394,975 to $410,000.
The biggest change last year was the drop in the number of homes for sale in spring, which drove up prices because what few homes were for sale didn’t stay long on the market. Local housing inventory spent the rest of the year steadily rebounding from some of its lowest points ever in spring.
Further complicating inventory levels is a smattering of interesting trends: People choosing to live in their homes longer; constraints for homebuilders, such as a shortage of workers and costly regulations; people increasingly opting not to pull up roots and move for a new job; and people working longer instead of retiring.
Meanwhile, millennials are starting to search for homes, which is keeping demand high.
“Millennials are doing everything we did, just about five years later in life than we did,” Gardner said.
One of that generation’s largest impediments to buying a home has been the lack of wage increases in the past few years — a trend Gardner sees as reversing this year.
“Companies are having a really hard time finding workers,” he said. “To get them, you’ve got to pay them. And I think that will kick in this year.”
However, Gardner warned that the U.S. economy also is prime for a recession.
“Quite frankly, we’re due … we’re in the second longest economic expansion in U.S. history,” he said. “But it will look nothing like the Great Recession.”
He predicted a recession similar to that of 1991 where the economy posted a few quarters of negative economic growth.
Several factors could cause the recession — a trade war, the Federal Reserve raising rates too quickly, over-leveraged companies. With the U.S.’s gross domestic product growth slowing, it may take just one economic event to send growth below zero.
“There’s always an outside shock that causes a recession,” Gardner said. “But this one will not be caused by housing.”
During the Great Recession’s housing crisis, home values decreased — the only time that happened during a modern recession.
“Overall, we’re positioned well here,” he said. “I don’t see anyone here more exposed than elsewhere.”
Warmer months are ahead, so now is the time to plan for spring cleaning and maintenance. A clean home offers a fresh start for the year, and a checklist of tasks guides your efforts towards efficiency. For many homeowners, spring cleaning can be a personal challenge. It can also be one accomplished with the help of the rest of the family or other residents. In some occasions, however, professional assistance may be advised, or even necessary. Regardless, regular home maintenance not only increases your home’s value, but it can also make your home more comfortable and enjoyable.
Check Your Attic
Once summer arrives, it can be too hot in many regions to comfortably perform an inspection. Use late winter and early spring to ensure the following: there’s ample insulation (10 to 14 inches), there are no signs of mice or rats (droppings, strong odor, nests), there are no bugs (flying, crawling, or otherwise), and there are no signs of roof leaks (water stains, etc.).
Schedule HVAC Maintenance
Annual tune-ups on your heating/cooling equipment will reduce your energy bill and help ensure you can maintain a comfortable indoor temperature.
Fix the Window Screens
It won’t be long before you’ll want to throw open the windows for fresh air, or relief on a warm afternoon. Take time now to ensure your window screens are ready for the challenge. Many traditional neighborhood hardware stores still offer re-screening services. Contractors also specialize in this service and are available for house calls.
Clean the Ceiling Fans
During the warm weather and the cold, ceiling fans can help moderate the temperature and better distribute the air. But your fans will be far more efficient if you give them a good cleaning a couple times each year. For fans mounted up to 10 feet in the air, you can use a ladder to access the tops of the fan blades. For those mounted on vaulted ceilings, use a long-handled duster.
Apply Weather Stripping
Many homeowners think of weather stripping as a cold-weather commodity, but it’s just as important during summer. To keep the cool air in and the hot air out, use any of the many filler materials available to seal gaps around windows, doors, exhaust fans, and any other point where you can see light peeking through.
Look for Damaged Roof Shingles
Use binoculars (with your feet safely planted on the ground) to scan for roof shingles that are curling, broken, or missing. If anything seems compromised, have a roofing company perform an inspection and provide a bid. If you or any members of your family are enterprising drone users, a camera-affixed drone can also be a useful aid in this reconnaissance effort.
Wash the Exterior
An easy way to extend the life of your exterior paint – and make your house look better than ever – is to give the siding a good washing. Use mostly water (to avoid harming any plants) and a stiff pole brush.
Search Out Rotten Wood
While you’re washing the exterior, keep an eye out for areas where there may be rot. Use a screwdriver to gently but firmly press on any siding or trim where you see black mold, missing paint, or exposed gray wood. If the area you’re probing feels mushy or bone-dry, contact a contractor to assess and stabilize the situation.
Clean the Gutters
All it takes is a handful of leaves to clog a gutter downspout and cause overflow and flooding. Hire a professional to give the gutters a thorough cleaning and you’ll avoid the very real dangers of working from a ladder. If you live in an area with lots of trees, consider getting quotes for some of the leaf-less gutter systems.
Prepare Your Lawn to Grow
The winter sets impediments for your lawn, and it takes preparation to help it shine. Rake away any dead grass and aerate the whole lawn to allow nutrients to access the roots. Reseed bare spots and apply a spring fertilizer to ensure your lawn has the fuel it needs to grow strong and beautiful.
Every holiday gift list has at least one person who is tough to shop for. Wavering between a risky guess at clothing that might not fit and just throwing in the towel and buying a gift card can be frustrating. But there’s one thing you can be sure of: everyone on your list probably loves to have their home looking stylish. If you’re hoping to score a big win with the pickiest of people of on your list, here are some of our favorite holiday gift ideas for the home.
Candles are a time-honored “safe” gift that usually deliver a positive response and are useful in any home. Take that one step further by gifting a stylish lantern to hold those candles. This gift is typically small, simple, and cost-effective, meaning that it’s pretty much the perfect gift idea for even the trickiest of people.
Maps and globes instill a home with a sense of adventure, and never have there been more décor options for those struck with a bit of wanderlust. One option is an interactive scratch-off map that allows tracking of travel. If wall space is limited, consider a cork globe with push pins that can be used to mark travel destinations.
Everyone has a guilty sugary pleasure of some sort, so why not encourage those desserts to be showcased with pride? A dessert display isn’t necessarily something you’d buy for yourself, but it’s a gift that is almost guaranteed to please. Glass is classic, but marble or wood-based displays can blend easily into just about any kitchen design while adding a little extra touch of style.
Keep It Simple, Keep It Smart
If all else fails, you can be assured that everyone on your list this holiday season loves music, podcasts, audiobooks, or some other audio form of media. Thanks to the increasing prevalence and affordability of smart speakers, giving a versatile, high-tech gift has never been easier. For under $30 you can now choose between several options, including the Amazon Echo Dot and Google Home Mini.