Here’s to a happy and healthy New Year!
May all your dreams and wishes be realized.
Stay Tuned in 2015 for:
- 2014 Seattle market update (January)
- Fabulous Seattle homes for sale
- Monthly videos created by me
- And much more
And to Start the Year Out Right, here are my predictions for the 2015 Real Estate Market:
Each year I review what has happened during the year, research what the experts say for next year, and share my thoughts on what will happen in the market in 2015.
Median Sold Prices – Home prices will continue to increase nationally by single digit numbers, between 5-6% whereas Washington State home prices will increase around 7%. Urban metro areas (such as Seattle) in high demand by millennials will see an increase probably in the double digits. Home prices in October 2014 were up by 6.4% year-over-year, after climbing 10.6% in 2013. There are still areas of very high demand and low inventory which will continue to push prices upward. However, many homeowners surveyed suggest they will sell their homes next year, increasing potential inventory and putting downward pressure on prices.
Inventory – It is a good thing that more homeowners are expected to sell their homes next year as I predict that more buyers will be entering the market for a home. Improved job markets and lower unemployment rates, along with stabilizing home prices and fewer bidding wars, will bring more buyers into the market. Buyers who left the market in 2014 due to disappointment over lost offers will return. Increased inventory and slower market time gives buyers the time they need to get financing and look at more homes. The bottom line is inventory will increase due to more sellers in the market, but I expect that buyers will be purchasing that inventory, so there won’t be big fluctuations either way.
Interest Rates & Mortgage Availability – The improving economy is a sure sign that interest rates will increase in 2015. The new rates will balance job growth and higher inflation rates. The Federal Reserve indicated it will increase the federal funds rate in 2015 (the federal fund rate has a significant effect on mortgage rates). I expect the 30 year fixed rate mortgage rate will reach 5% by the end of 2015. Government officials have also indicated that mortgage credit should become more available in the foreseeable future, which will allow more buyers to qualify for a mortgage and will allow some people to qualify for a lower-rate mortgage. The FHA is raising its loan limits for King, Snohomish and Pierce counties to adjust for rising median home prices; the loan limit in 2015 for a single-family home is $517,500, up 2.3% from $506,000 this year. Additionally, the FHA is bringing back loans with only a 3% downpayment.
Foreclosures – The foreclosure crisis is near its end. 2014 saw foreclosures down 30%. We will see a further decline in 2015 with a return to low levels.
These are just a few of the things I predict 2015 will bring us. For further information, please don’t hesitate to give me a call at (206) 790-0081 or emailJamie@JamieFlaxman.com. I would be happy to share what my 2015 predictions mean for your real estate holdings.
Although the holiday period is usually slow for home sales, November activity this year was up 13.6% from November of last year, for the city of Seattle. For the 21 counties that encompass the Northwest Multiple Listing, activity was up 3% over last year. And for the four Puget Sound region counties (King, Kitsap, Pierce and Snohomish) the total of 5,220 pending sales marked the highest level for November since 2006
Lack of supply continues to be the norm for the Puget Sound area, with inventory stagnant in Seattle at 1.4 months). And that number goes much lower for high demand neighborhoods such as Phinney Ridge (less than 1 week), Wedgewood (3 weeks), Magnolia (1.1 weeks), and Capitol Hill (3 weeks).
The average sales price in Seattle was up 14.6% over last year and 2.4% from October.
And interest rates remain below 4% – there is no better time to buy.
If you’d like a report for your neighborhood, please give me a call or email.
I have been so busy over the past week that I barely have time to write this post. Any question about how hot the market is? Here’s a story for you. Yesterday I submitted an offer on behalf of a client for a wonderful Phinney/Greenwood home. There were 9 offers including ours, and I believe all but one conducted pre-inspections. As one of the other brokers submitting an offer said, it was going to be a “blood bath.” Many of the offers had escalation clauses – and boy did it escalate. I can’t disclose how high it went until after the transaction closes, but my buyer did not have the highest – we came in 3rd. The offer that had the highest dollar amount had weak financing and wasn’t willing to do anything to change the financing situation; the next offer was only a few thousand more than ours but also had weak financing. MY CLIENT GOT THE HOUSE because she had strong financing (30% down and the lender talked with the listing agent) and my buyer was willing to come up a few thousand dollars more.
The bottom line. Financing is as important as price. And who the lender is may make a difference. My client’s lender was willing to go above and beyond to advocate for the client. On-line lenders and big banks often won’t do this. With them, you’re just one of hundreds of mortgages – personal relationships make a difference.
The bottom line. The market is still hot. A colleague had 11 offers on another listing. Inventory is low demand is still high.
Contact me at email@example.com or 206-790-0081 to discuss putting your home on the market or buying a home.
The Puget Sound housing market picked up in May with greater inventory, but demand is still very high. Most new listings are receiving multiple offers with many significantly escalating above list price.
The chart above shows activity in the city of Seattle for single family homes and condos combined. The number of homes for sale increased 14.3% over April, but the level was slightly below that of a year ago. The number of sales closing was up 4.4% over April but down 12% from a year ago.
While less homes are selling, prices are up over last year. Combined single family homes and condos in Seattle are up 4.4% over a year ago. On average homes sold at 100% of list price.
Inventory remains extremely low, at 1.4 months worth in May. That is, if no homes came on the market, the current inventory would be gone in about 6 weeks. In May last year that inventory was at 1.2 months.
However, when you look at specific neighborhoods, the numbers can be dramatically different. For example, Wallingford, a high demand neighborhood. Prices on sold homes and condos were up 8.2% from a year ago, with an average sales price of $620,000. Homes in Wallingford average a sales price of 105% of listing price. And inventory in Wallingford was at 0.7 months in May, approximately 3 weeks worth.
For further information, please give me a call or email. I’m happy to provide you with a market update for your neighborhood or city.