Where are home prices heading?

The Home Price Expectation Survey checks in with over 100 national real estate experts every quarter, including Windermere Chief Economist Matthew Gardner. Here’s where they think prices will go:

Gardner predicts our local market will fare better than the nation overall.

“As I look to 2019, I believe home prices in King County will increase 7.8% over the current year.”
– Windermere Chief Economist Matthew Gardner

“The local economy will continue to grow and that will drive demand for ownership housing,” according to Gardner. “Supply will slow during the holiday season before we see a new influx of listings in the spring. With more supply, I believe that home price growth will continue to slow, but values will still increase.”

Posted on November 26, 2018 at 3:46 pm
Stephanie Kristen | Category: economy, market trends, real estate, statistics

How Interest Rates Affect Buying Power

Whether you are thinking about buying or selling a home, interest rate trends are an important factor to consider. Mortgage interest rates have been rising and experts, including Windermere Chief Economist Matthew Gardner, predict that they will continue to increase in 2019.

Interest Rates and Buying Power

The chart below shows the impact rising interest rates would have if you planned to purchase a $675,000 home while keeping your principal and interest payments at $3,500 a month.

Every time interest rates increase by a quarter of a percent, your buying power decreases by about 3 percent.

Whether you are thinking about buying or selling a home, interest rate trends are an important factor to consider. Mortgage interest rates have been rising and experts, including Windermere Chief Economist Matthew Gardner, predict that they will continue to increase in 2019.

Interest Rates and Buying Power

The chart below shows the impact rising interest rates would have if you planned to purchase a $675,000 home while keeping your principal and interest payments at $3,500 a month.

Every time interest rates increase by a quarter of a percent, your buying power decreases by about 3 percent.

What this means for buyers:

With prices moderating and interest rates slated to rise again, now is a good time to buy. If you’re betting on prices falling, you need to consider the strong possibility that an increase in interest rates would offset any potential price savings.

What this means for sellers:

Listing your home now means you will attract a larger buyer pool before interest rates rise.

Whether you’re thinking of buying or selling I can provide you market data that will help you make the best decision for your circumstances. Let me know how I can help.

Posted on October 26, 2018 at 5:15 pm
Stephanie Kristen | Category: economy, interest rates, real estate

What’s Really Happening in the Housing Market?

 

Our housing market is finally cooling a bit, from scorching hot to slightly-less-sweltering. While some alarmists are talking bubble or impending crisis, the statistics tell a different story. The market does appear to be shifting, and that’s good news! The steep price increases of the past few years are not sustainable, and also risk pricing buyers out of the market altogether.

Where The Market Is Today

  • Inventory is up, but still far short of demand. Despite a considerable increase in inventory, King County has just six weeks of supply. Four to six months of inventory is what is considered a balanced market, and we’re far short of that.
  • Homes are staying on the market a bit longer. New listings have increased in the past few months, but the increase in inventory is primarily due to homes staying on the market longer. With buyers accustomed to homes being snapped up in days, “longer” is a relative term. Homes in King County are taking an average of 15 days to sell.
  • Prices appear to be moderating. While home prices are up compared to a year ago, the rate of increase is in the single digits rather than the double-digit surges of past months. Prices are down 4 percent from the record high reached this spring.

What This Means For The Housing Market

  • The shift towards slower, consistent appreciation will result in a healthier market.    
  • Buyers have more choices and more time to make an informed decision.
  • It’s still a seller’s market, but sellers need to have realistic expectations about pricing their homes as the market softens.
  • More inventory is still needed to meet demand. 

Whether you’re thinking about buying or selling, it’s important to have the most current information about the market. Please contact us today and we can provide you with information about today’s market and answer any questions you may have.

Posted on October 2, 2018 at 2:54 pm
Stephanie Kristen | Category: economy, market trends, real estate

Seattle / Eastside Market Report – September 2018

The number of homes for sale in August increased dramatically over the same time a year ago. This is the result of a moderate increase in new listings and a much slower pace of sales. Homes are staying on the market longer, giving buyers more choices and more time to make an informed decision.  While home prices are up compared to a year ago, the rate of increase was in the single digits rather than the double-digit surges of past months. It’s still a seller’s market, but sellers need to have realistic expectations about pricing their homes as the market softens.

Eastside

>>>Click image to view full report.

The median price of a single-family home on the Eastside was up nearly 10 percent from the same time last year to $935,000. Home prices have declined each month from the all-time high of $977,759 set in June. Inventory increased 73 percent over last August. With supply soaring and home prices moderating, sellers need to work with their broker to price their home to meet the current market conditions. A year ago 47 percent of the homes on the Eastside sold for over list price. This August that number was down to 29 percent.

King County

>>>Click image to view full report.

King County experienced yet another flood of inventory with the number of homes for sale jumping 65 percent over the previous year. Despite the growth, the county has just 1.9 months of inventory and remains a seller-oriented market. The market has slowed but it remains fast-paced, with 62 percent of the properties here selling in fewer than 15 days.  While home prices were up 3 percent from a year ago, the median price of $669,000 represented the third straight month of declines from the record-high of $726,275 reached in May.

Seattle

>>>Click image to view full report.

After leading the nation in home price growth for nearly two years, Seattle is finally cooling off.  The median home price in August was $760,000, up just 4 percent from last year and down from the record $830,000 reached in May.  Inventory soared in August, but the city still has just two months of supply, far short of the four to six months that is considered balanced.  Bidding wars are becoming less common and price drops more common. Sellers must adjust their expectations to what appears to be a long waited moderating of the market.

Snohomish County

>>>Click image to view full report.

Mirroring the market slowdown in King County, Snohomish County also experienced a cooling off in August. The median price of a single-family home was $492,000, up 8 percent from a year ago but down from the record high of $511,000 two months prior. Inventory increased nearly 30 percent, but at just 1.6 months of supply the market remains very tight and sales are brisk. Sixty percent of homes here sold within 15 days.

Posted on September 12, 2018 at 10:39 am
Stephanie Kristen | Category: economy, market trends, statistics

Seattle / Eastside Market Report – June 2018

Last month brought some long-awaited, positive news for buyers with May posting the most new listings in over a decade. Despite the uptick in inventory, most homes are selling in less than a month. Prices haven’t been impacted either, with the majority of the region continuing to experience double-digit home price increases.

Eastside

>>>Click image to view full report.

The median home price on the Eastside hit an all-time high of $960, 000 in May; a 10 percent gain over the same time last year. While there were a third more homes for sale in May than a year ago, the area still had only about a month of available inventory. Three to six months is considered a balanced market. Redmond, a city with a population of 64,000, currently has only 51 single-family homes on the market.

King County

>>>Click image to view full report.

First the good news: Those looking to buy a home in King County in May had almost 1,000 more homes to choose from compared to the previous month. The bad news: That boost in inventory did little to moderate home prices. The median price for a single-family home jumped 15 percent to $726,275, up slightly from the record high set in April.

Seattle

>>>Click image to view full report.

A strong economy and desirable lifestyle have kept Seattle a leading destination for job-seekers. The ever-increasing demand for housing has sapped supply and sent prices soaring. For 19 months Seattle has led the nation in rising home prices. May saw the city set yet another record, with the median home price jumping 14 percent to $830,000.

Snohomish County

>>>Click image to view full report.

Soaring prices in King County combined with rising interest rates make Snohomish County an affordable alternative for those willing to extend their commute time. The typical home cost $500,000 in May, an increase of 11 percent over the previous year, and down very slightly from last month.

This post originally appeared on the WindermereEastside.com Blog.

Posted on June 12, 2018 at 9:38 am
Stephanie Kristen | Category: economy, real estate, statistics

Home Prices Hit New Records: Take Advantage Of Your Equity

The Great Recession took its toll on housing prices, with home values declining throughout the country.  Since then, prices have rebounded. While many areas of the U.S. are not back to pre-crash levels, home values in Washington State have increased significantly.
Homeowners here have the second highest appreciation rate in the country.
 The economists at CoreLogic recently released a special report entitled Evaluating the Housing Market Since the Great Recession. In the five-year period from 2012 to 2017, home prices in Washington have appreciated 57 percent. The national average was 37.4 percent.
The map below was created to show the 5-year appreciation from December 2012 to December 2017 by state.

 Take advantage of your increased home equity.

If you’re thinking about selling your home, now is an excellent time to take advantage of your sharp increase in equity. Today’s market very strongly favors sellers, so you can expect to get the best possible price for your property. It’s also not uncommon today for the buyer to accommodate your needs as you look for another home.
Posted on April 24, 2018 at 7:13 pm
Stephanie Kristen | Category: economy, listings, market trends

Seattle / Eastside Market Report – April 2018

Despite the typical seasonal surge in new listings, supply in our area continued to fall far short of demand in March. With just two weeks of available inventory in every market, competition for homes is intense. The result was another month of double-digit price increases as compared to a year ago. The region has now led the country in home price increases for 17 months in a row. The prediction for the spring market: HOT with no signs of cooling.

Eastside

>>>Click image to view full report.

The median price of a single-family home was up 6 percent over last March to $926,000, down slightly from the record-setting price last month. Sales were brisk at every price, including the luxury market. Sales of homes priced at $2 million or more were up 23 percent in the first quarter of 2018 as compared to the previous year.

King County

>>>Click image to view full report.

A booming economy combined with insufficient inventory propelled prices to an all-time high in March. The median price of a single-family home in King County jumped 15 percent to $689,950. Multiple offers remain the norm. Buyers here need to plan on moving very quickly and working with their agent on strategies to navigate bidding wars.

Seattle

>>>Click image to view full report.

The median home price in Seattle set a new record of $819,500 in March, up a whopping 17 percent from a year ago. Homes are selling within days of being listed. Only 19 single-family homes are currently on the market in Ballard and just 24 in Queen Anne. South Seattle, traditionally the most affordable part of the city, has seen the greatest increase in prices.  Home values in these neighborhoods have nearly tripled since the recession ended, while home values in the rest of the city have doubled.

Snohomish County

>>>Click image to view full report.

Once a less competitive market than King County, Snohomish County now has the lower amount of inventory of the two. The median price of a single-family home grew 12 percent over a year ago to $475,000. Prices here remain significantly lower than in King County and many buyers priced out of that market are trading a longer commute time for the opportunity of ownership.

Posted on April 9, 2018 at 11:58 am
Stephanie Kristen | Category: bellevue, economy, market trends, seattle, statistics

How Tax Reform Affects Homeownership

New tax legislation was signed into law at the end of 2017, and it included some significant changes for homeowners. These changes took effect in 2018 and do not influence your 2017 taxes.  Here’s a brief overview of this year’s tax changes and how they may affect you.

 The amount of mortgage interest you can deduct has decreased.

Under the old law, taxpayers could deduct the interest they paid on a mortgage of up to $1 million. The new law reduces the mortgage interest deduction from $1 million to $750,000.

These changes do not affect mortgages taken out before December 15, 2017.

The home equity loan deduction has been eliminated.

The prior law allowed homeowners to deduct the interest on a home equity loan if the value of the loan was $100,000 or less. The new law eliminates the deduction for interest on home equity loans.

The property tax deduction is capped at $10,000.  

Previously taxpayers could deduct all the state, local and foreign real estate taxes they paid with no cap on the amount. The new law limits the deduction for all state and local taxes – including income, sales, real estate, and personal property taxes – to $10,000.

The casualty loss deduction has been repealed.

Homeowners previously could deduct unreimbursed casualty, disaster and theft losses on their property. That deduction has been repealed, with an exception for losses on property located in a federally declared disaster area.

…AND AN IMPORTANT VICTORY

The capital gains exclusion remains unchanged.

Homeowners can continue to exclude up to $500,000 for joint filers or $250,000 for single filers for capital gains when selling their primary residence as long as they have lived in the home for two of the past five years. An earlier proposal would have increased that requirement to five out of the last eight years and phase out the exclusion for high-income households, but it was struck down.

Find out more about 2018 tax reform.

How does tax reform affect your plans for buying or selling a home?

The changes in real estate related taxes may change your strategy.  I’d be happy to go over your options and answer any questions you may have.

Posted on March 19, 2018 at 12:26 pm
Stephanie Kristen | Category: economy, real estate

Seattle / Eastside Market Report – March 2018

The local real estate market set new home price records in many parts of the region in February. Prices here have grown faster than anywhere else in the country for the last 16 months in a row. Demand remains high and inventory very low. Brokers are hoping the normal seasonal increase in listings this spring will help give buyers some relief.

Eastside

>>>Click image to view full report.

With home prices soaring on the Eastside, it’s not a matter of whether the median price will exceed a million dollar, but when. February brought the market very close to that milestone. The median price of a single-family home increased 14 percent to a record $950,000 on the Eastside, surpassing the previous peak recorded in December.

King County

>>>Click image to view full report.

The red-hot job market in King County continues to outpace nearly every area in the nation. Well-paid workers looking to buy close to city centers have fueled a growing competition for a shrinking number of homes. That demand boosted the median price of a single-family home up 16 percent over a year ago to $649,950.

Seattle

>>>Click image to view full report.

The median price of a single-family home in Seattle hit a new high of $777,000 in February, $20,000 more than the previous record set in January and up 14 percent from the same time last year. Despite the sharp increase in prices, multiple offers have become the norm for most properties. It remains to be seen if recent interest rate hikes will have a moderating effect on home values.

Snohomish County

>>>Click image to view full report.

After several months of moderating growth, Snohomish County set a new record for home prices in February. The median price of a single-family homes jumped 18 percent to an all-time high of $485,000. Inventory is down from a year ago, with less than a month’s supply of homes available for sale.

If you are considering buying a home in today’s market, here are three things to consider:

  1. Make sure you can afford the payments.
  2. Choose a location that will appeal to you long-term.
  3. Be committed to living there for a minimum of five to seven years.
Posted on March 15, 2018 at 9:46 am
Stephanie Kristen | Category: bellevue, economy, market trends, seattle, statistics

Seattle / Eastside Market Report – February 2018

With competition for homes growing and inventory shrinking, the real estate market in January was as hot as ever.  Home prices were up by double digits as buyers chased severely limited inventory. The number of homes for sale hit a record low for the month of January, which should strongly favor sellers as we move into the prime spring selling season.  The average home seller in our area now makes a 64 percent profit, the fourth-highest rate of any region in the country, according to ATTOM Data Solutions.

Eastside

>Click image to view full report.

Home prices on the Eastside continue to climb. The median price of a single-family home was up 18 percent over last January to $938,000 —­ virtually unchanged from the record high set a month ago. West Bellevue, King County’s most expensive area,  saw the median home price surge to a record high of $2.72 million. With less than a month of available inventory, prices aren’t expected to cool any time soon.

King County

>Click image to view full report.

Single-family home prices in King County soared 20 percent over a year ago to $628,388, with double-digit increases recorded in every area of the county.  Lack of inventory continues to fuel the market.  There were 21 percent fewer homes for sale here as compared to a year ago, with inventory hitting a record low for the month of January. The region has now been the hottest housing market in the country for 15 months in a row.

Seattle

>Click image to view full report.

An ongoing shortage of inventory combined with an economy that continues to add jobs has kept the Seattle housing market very competitive and increasingly expensive. Seattle’s median price hit a new record in January jumping 19 percent to $757,000.  Despite the increase in prices, brokers are reporting open house traffic that can number in the hundreds of interested buyers.

Snohomish County

>Click image to view full report.

Home price increases in Snohomish County were more moderate than those in King County. The median price of a single-family home grew 10 percent over a year ago to $450,000. That number is down from the high of last year, and reflects a more common seasonal slowdown.

Posted on February 8, 2018 at 8:18 am
Stephanie Kristen | Category: economy, interest rates, market trends, statistics