Inventory Close to 2017 Lows

First time and move up buyers are taking advantage of low mortgage interest rates hovering around 3%. With a lack of inventory, only 829 active listings at the end of the month versus 1410 in 2019, agents are reporting multiple offers on listings and a steady increase in home prices. More inventory is predicted on the horizon as sellers feel more confident listing their homes. Lower inventory levels offer sellers an opportunity to get more exposure and competition for their home.

*Information obtained from the MLS and deemed reliable. Info based on Residential info only, Condos excluded

*April 2020 Housing Numbers. Information obtained from the NWMLS. All info deemed reliable.

Seattle area housing market remains strong through April

Housing activity has remained strong despite what some would have thought was a sure death to the areas high flying housing market. While Covid19 has caused a disruption to life and work, buyers and sellers are active and coming to agreeable terms to complete a purchase and sales. Most parts of real estate are moving through the pipeline without major issue. Lenders are funding loans, inspections and appraisals are taking place, and all parties to a real estate transaction can do their job. With a few new tactics to stay healthy and less in person interaction, buyers and sellers are getting to the closing table on time.  Serious and prepared buyers are taking advantage and patient sellers are being rewarded.

Are we in a repeat of 2008? – Indications say No!

The 2008 financial and housing crisis was just that, a housing crisis. It was caused by home mortgages provided without proper oversight or qualifications, homeowners over leveraging every bit of home value possible, lots of available housing to speculate on, and mortgage investments packaged to investors as “low risk” when they were anything but.

Today’s higher standards for borrowers with larger down payments, solid credit scores, qualified employment, and loan products with more scrutiny is helping prevent a repeat of 2008.  There is also a housing shortage that cannot keep up with demand, especially in the greater Seattle area. The high costs of land, construction materials, labor, and regulation costs limits what builders can and are willing to build. With little new supply to meet demand, and strong financials and increased home equity, current value and desire for houses remains high.

Home Sales – Still going, just a slower pace

Buyers and sellers who planned to sell or purchase a home in the 1^st quarter of the year stayed the course as the call to “shelter in place” began. Some just beginning the process took a step back to re-asses, catch their breath and decide what to do next, and are slowly re-emerging now that the news is not dire. With the days on market dropping by over 1/3, and mortgage applications for new home purchases trending upwards after bottoming out in the first weeks of April, indications are that housing is still in demand and buyers are finding homes they like.

Home Prices – Holding Steady(ish)

Pricing continues to stay and remain positive throughout the city. Historically March to April show a price growth as activity picks up steam, but currently prices appear to be rather stable with no visible over correction in either direction. First quarter (January – March) of the year started out strong with eager buyers and low inventory, increasing overall values. Current listing prices appear to be focused on attracting buyers interest and sellers are able to stick to their listed prices and some receive multiple offers. Values are riding the wave of Q1 home appreciation.

Inventory – More Opportunities

There are 50% less listings than last year, but understandably so. The absorption rate is decreasing, meaning there are more homes on the market than are being purchased as buyers wait for the home that fits their need.  Roughly 6 months of inventory is considered a “balanced” market. Seattle has 2.1 months available, up from 1.8 months in March. Anything less than 6 months is considered a “sellers-market” as it has been for some time.

West Seattle Bridge – A loss for our region and community

As a West Seattle resident, and a real estate agent conducting over 80% of my business in the area, there is no denying the strain a lack of transportation in and out of the area is going to cause.  This is a serious and unfortunate turn of events and I sympathize with those this will seriously affect.  But people love West Seattle for what it offers, not what it does not.

West Seattle has access to beaches, waterfront, parks and a small town vibe like nothing else in the city. Being off the beaten path, with little need to leave “The Island” is one reason West Seattlites enjoy their neighborhood so much. The loss of the bridge might lower interest from some home buyers for a short period of time, but it creates opportunity for those that want to live here and understand the value.

A small number of homeowners who experience a serious burden getting to work, moving kids around the city for school or events, or a busy life outside of West Seattle are considering a move out of the area. But home buyers and residents that work further south (Tukwila, Renton, Kent, etc.) or work from home (expect to see more of this), use public transportation to and from downtown, and families looking to upsize or retirees looking to downsize, will continue to seek out West Seattle and the options available.

The long term repair or replacement options are still being studied, and everyone is waiting to see what is done next to ease the burden felt by residents and businesses.

If you are thinking of buying or selling in the next 12 months, and you have question or want insight to how to prepared for the market ahead, call me today at 425-766-4202.

We will focus on your goals, outline how I work with sellers the greatest ROI in the shortest amount of time on market, and how buyers can save time and money to win in a competitive market. If you think we are a fit, we can discuss your next strategic steps forward. Call me today at 425-766-4202 or via email at aaronc@windermere.com.

All of the content is based on questions I have heard from clients, friends, and other real estate professionals during these unique times we are all in.

Should I buy now or wait?

National Association of Realtors (NAR) sent out a questionnaire on April 5^th & 6^th to over 90,000 homeowners, active buyers and sellers and this is how they responded.

• 57% of home sellers are “Delaying the process a couple of months”, while 59% of buyers say the same thing.
• 10% of sellers say they are “Not selling at all now”, while 13% of buyers have also stopped their home search all together.
• 26% of buyers and 26% of sellers say that they have “Not changed their actions”, they are continuing as planned but they might be relying on virtual communications and tours.

What this means for buyers

• There are less buyers in the mix right now so buyers are not likely to encounter much competition.
• Buyers could negotiate with sellers and get better than asking prices or repairs taken care of. Homes are sitting longer and sellers would not have sold or stayed on the market unless they needed to and were willing to discuss the sale of their home with a potential and serious buyer.
• Even though many sellers are waiting, there are great homes available, maybe even the one you always pictured yourself owning.

I can’t tell you to buy or not. These are in uneasy times, and buyers must tread cautiously and take their time. Sellers are selling and buyers are buying, so there is a way to complete a dream if all the right pieces fit into place.

A Few things to consider

Do you have to move to move?If you have to get out of your current housing situation or you being asked to sign another long term lease?

How long do you plan to live in the home? There are costs to buying a home. Fees for loans, inspections, moving, furnishings. If you believe you will be in the home for less than 4 to 5 years, or you may be moving for job or family, it may be better to wait and ride this one out. If your plan is to be in t he home long term, then keep your options open.

Do you have another house to sell? if you need to fund your move up purchase from the sale of your current home, that could be a difficult situation. Because homes are sitting longer, a seller may not want to remove their home from the market and miss a buyer who can act faster. There are ways to do it, but it could come at a steep cost and a lot of extra work.

Will the value of the house drop right after I buy?

This goes back to what your long term plans are. The only reason “value” drops are because someone will pay you less for it than what it was bought for, so long term buyers will be rewarded. Land is of value, homes are scare, and builders are not building enough new homes to meet demand.  A home is never a bad investment if you are willing and able to ride out the short term ups and downs.

If you think that “value” is buying at the bottom of the market, how will you know where the bottom is? Is it when everyone jumps back into the housing market and buyers are competing with other buyers?

There is intrinsic value of home ownership that you can’t measure. A home is a place to express your own personal tastes, paying yourself and building your own equity, not a landlords. There is enjoyment in entertaining and being close to the ones we care for. There is a value to living our life on our terms that you can’t measure in numbers.

Are there issues today that make buying risky?

There are two things that stick out to me right now, a home mortgage and employment.

Mortgage lender and brokers are trying to find out which way is up. There is less “liquidity” (the companies that buy mortgages and lend the money to fund them) in the mortgage markets so borrowing requirements for buyers are being scrutinized more intensely, even up till the day of the closing on a home. A “pre-approved” buyer is no longer a guarantee of funding for a home purchase, but a lender can tell you what requirements are working the best these days for buyers.

Buyers can be and usually are protected by certain financial disclosures included in the real estate contract, including the refund of earnest money if a transaction does not close.  However, this will not return costs incurred from home inspections or if you begin the process of moving out of another location.

If there is a possibility that someone could lose their job, this is not the time to buy a home. Employment is never guaranteed, but if you are unsure, just wait.

What can agents do to help buyers?

Real estate agents, home inspectors, moving companies, loan officers, home appraisers are currently allowed to conduct business (don’t ask me, I don’t make the rules), with strict limitations on what we can and should do for clients. Using CDC (Centers for Disease Control) and state guidelines for safe and effective distancing, as well as other creative (electronic and virtual) ways to help complete a transaction without putting you in harm’s way…these services do and are working! There is no one size fits all in this case, so it is better to understand what your needs are so you can tailor an approach that makes you feel safe and secure. I am happy to review what these guidelines are and how they can be structured to help you move forward.

We are all navigating uncharted territory, but one thing I do know, it is never too early to prepare for opportunity if you have wanted or need to buy a home. Don’t be the last one to get started on preparing for when home buying does begin to pick up, plan on being the first.

The Author – Aaron Calvo

I am a full time REALTOR®, skilled contract negotiator and home buyer specialist helping Seattle and surrounding area home buyers navigate real estate transactions. I help buyers identify opportunities, inspect, and negotiate for the best terms possible and do all the heavy lifting so buyers can be at peace with the process of a home purchase. I grew up in Bellevue, WA. and currently live in West Seattle with my wife, children and our dog Max.

All of the content is based on questions I have heard from clients, friends, and other real estate professionals.

Are people still selling and buying homes?

Simply put, yes. But as you can imagine, no-where near regular activity.

The National Association of Realtors (NAR) sent out a questionnaire on April 5^th to over 90,000 homeowners or active buyers and sellers and here are the responses relating to residential real estate.

• 57% of home sellers are “Delaying the process a couple of months”, while 59% of buyers say the same thing.
• 10% of sellers say they are “Not selling at all now”, while 13% of buyers have also stopped their home search all together.
• 26% of buyers and 26% of sellers say that they have “Not changed their actions”, they are continuing as planned but they might be relying on virtual communications and tours.

Sellers on the market today have a good reason for listing their home. Preparing a home for the real estate market takes a lot of effort, time, and resources and sellers did not want that investment to go to waste. Sellers who made plans and commitments to buy another home or move to a new city might be worse off financially if they did not attempt to sell. Rental property or Airbnb owners had bookings evaporate and for some a change in their family dynamics, like a divorce, may have forced the decision the sell.

What can I do if I need to sell now?

Breath and don’t panic! There are buyers out who need or want to buy a home. With less competition some buyers see opportunity to be out there.

Just like at any time you list a home for sale you want to put your homes best foot forward. You only get one chance to make a first impression and now more than ever, it counts. Since many people are home or working from home, it might be a good time to take care of the “honey to do list”, clean, paint and landscape. These are standard selling recommendations no matter what the market is like, and they help to keep the value of the home intact. You can save money by doing some of these things yourself.

Having your home pre-inspected to ensures you know more about your home than buyers do. A pre-inspection can prevent unknown big-ticket repair surprises that could undo a deal from a qualified buyer. If something major is identified, you can choose to fix it now or disclose it to a buyer. It also prevents the need to have lot of people coming and going from the home, like inspectors, especially if there are multiple buyers interested in the home.

When you do get an offer, your agent should always contact the lender to ensure the buyer and the loan company can perform and fund the loan on-time. Mortgage markets and money lenders are working really hard to help new home purchases get to the finish line without issue.

Home Pricing

Sellers are picking less aggressive listing prices and currently appear to be sticking to it. Many sellers would rather wait for better times than sell at what feels like a discount. Sellers that have lowered their asking price may have done so anyways because the home did not offer what buyers were looking for or have an issue buyers did not want to contend with.

Online calculators are nice but offer unreliable numbers and give a range of prices for a reason, computers cant price houses.  Real estate agents help you account for upgrades and improvements you have made and how your home compares to others. Today more than ever agents are keeping abreast of the pace of buying activity and obtain valuable housing activity from agents with listed properties to help clients make the right decision for their situation.

Expect buyers to make low offers in hopes of a fire sale, its just a part of the process and requires being resolute on your value and strong negotiating skills to get you the greatest ROI. But if you have left repairs or upgrades for buyers to take care of, and they can find homes without those needs,  buyers will keep looking. If buyers don’t have to compete with others this should be enticement enough to making a reasonable offer.

It is unlikely we will see an immediate return to the same demand for housing before this all started, but we know there is a big need and want. But, if all the home sellers who decided to pull back their listings rush to sell their home the moment we get the “all clear”, there could be a glut of houses to pick from. With more inventory, there are longer days on market and lower prices in the end.

What can agents do to help sellers?

Real estate agents, home inspectors, moving companies, photographers and staging companies are currently allowed to conduct business (don’t ask me, I don’t make the rules) under very strict rules and guidelines. Agents can help sellers using CDC (Centers for Disease Control) and state guidelines for safe and effective distancing, as well as other creative (electronic) ways to conduct business without putting you in harm’s way…and they do work! There is no one size fits all in this case, so it is better to understand what your needs and what an agents limitations are so you can tailor an approach that makes you feel safe and keeps you secure.

We are all navigating uncharted territory, so the best thing you can do it to prepare for opportunity if you must sell. Don’t be the last one to get started on preparing your home when home buying does begin to pick up, plan on being there first.

The Author – Aaron Calvo

I am a full time REALTOR®, skilled contract negotiator and home marketing specialist helping home sellers in Seattle and the surrounding communities sell their home for top dollar in the fewest days on market. Selling and buying real estate is one of the largest financial transactions in our lifetime and I take my fiduciary responsibility to my clients seriously. As a home and rental property owner and former construction contractor, I know what it means to get the greatest return on my investment, and I provide the same level of dedication to my clients. I grew up in Bellevue, WA. and currently live in West Seattle with my wife, children and our dog Max.

Provided annually, this report compares the 5 regions of the Metro Seattle area, highlighting both the year-to-year and quarterly change on important info including; median price, days on market, available inventory  and the change in selling price to the original listed price. The information is designed to highlight trends of our local real estate market and what buyers and sellers may be able to expect going forward.

If you would like to receive this report in PDF format, delivered directly to your email inbox when released, please contact me directly at aaronc@widnermere.com, with the appropriate subject line. There is no cost and no obligation to receive this information.

Click on the image to obtain and review the PDF copy.

Annual Report 2019_Q4-AaronCalvo

If you are thinking about selling or buying a home in the next 12 months, now is the time to start preparing for the market.

You deserve to have the most current and relevant information available so you can make informed and educated decisions and to develop a strategic and effective marketing plan.

Just click the picture of the report below for your very own copy.

If you would like to get these as soon as they are available,  delivered to your email or a hard copy sent to your home, email me at aaronc@windermere.com, with your request. There is no cost or obligation to receive this info.

If you have additional real estate related questions, call me today. 425-766-4202

WS Market Report March

Q3 Report

Selling Your Home: The Impact of Staging

Not all home improvements are created equal. These will reward you the most when it comes time to sell.

Your home is in the perfect location, came at the perfect price, with the perfect lot. (Yay southern exposure!)

But the home itself? Perfect isn’t the adjective you’d use. But you knew that moving in, and now you’re ready to start making it just right.

But where to begin? How about with data? Data is that friend who tells you like it really is.

Because while any home improvement that brings you joy is priceless, not all add as much home equity as you might expect.

The National Association of REALTORS®’ 2015 Remodeling Impact Report and 2016 Remodeling Impact Report: Outdoor Features (full disclosure: NAR is a sponsor of HouseLogic.) have tons of data on how much improvements cost — and how much of those costs you can recoup.

Here are the best seven home remodeling projects with equity-building might:

#1 Upgraded Landscaping

This one might be a bit of a surprise. (Maybe you expected a major kitchen reno to top the list.)

But if your yard is one of your home’s imperfect parts, a little color and a touch of hardscaping can make a huge difference to your curb appeal, which is a great immediate equity-booster.

What does a basic landscaping upgrade include?

• Flowering shrubs
• A 15-foot-tall deciduous tree
• A flagstone walkway
• Two 6-by-2 stone planters
• Fresh mulch

The cost: $4,750

The return: 105% at $5,000

Related: 5 Awesomely Easy Landscaping Projects

#2 New Roof

If you find yourself sprinting for the buckets when it starts to sprinkle, getting a new roof should be your No. 1 to-do. Measuring rainfall from the indoors isn’t cool.

The cost: $7,600

The return: 105% at $8,000

Considering it’s what’s between you and the elements, it’s a no-brainer.

Not sure if you need a new roof? Signs you might include:

• Shingles are missing, curling up, or covered in moss.
• Gritty bits from the asphalt shingles are coming out the downspout.
• The sun’s shining through your attic.
• You notice stains on ceilings and walls.
• Your energy bill is sky high.

#3 Hardwood Floors

You flip on the TV to see that your fave home reno-ing duo is it at again, flipping a ranch that’s stuck in the ‘80s.

They make it to the living room, pull back the dingy carpet to reveal hardwood floors in great condition. They’re psyched — and for good reason.

Hardwood floors are a timeless classic. Refinishing is a no-brainer. Neither will you regret adding new hardwood floors if you have none.

The cost to refinish: $2,500

The return: 100% at $2,500

The cost to buy new: $5,500

The return: 91% at $5,000

Related: Should You Refinish Hardwood Floors Yourself?

#4 Patio or Deck

If your home is your castle, your yard is your kingdom. After giving your yard a much-needed overhaul, you need a place to watch over you handiwork. How about that deck or patio you’ve been dreaming of?

The cost of a patio: $6,400

The return: 102% at $6525

The cost of a deck: $9,450

The return: 106% at $10,000

#5 Insulation

Insulation is tucked out of sight, so it’s often out of mind — that is, until you’re forced to wear your parka indoors because it’s sooo darn cold.

The cost: $2,100

The return: 95% at $2,000 plus the added savings on heating and cooling costs

#6 New Garage Door

No surprise that a garage door replacement project made it onto this #winning list — a new garage door provides a big boost for your home’s curb appeal at a relatively modest cost.

The cost: $2,300 (for a two-door)

The return: 87% at $2,000

There are options galore, too. A host of factory-finish colors, wood-look embossed steel, and glass window insets are just some of the possibilities that’ll give your doors bankable personality.

#7 Vinyl Siding

In any color! And never paint again.

Those are two of the three benefits of vinyl siding. The third, of course, is your home’s value.

But if long-time homeowners look at you funny when you mention vinyl siding, just tell them that today’s vinyl is way better than what they remember because of fade-resistant finishes and transferable lifetime warranties.

The cost: $12,000

The return: 83% at $10,000

Want fiber-cement siding instead? It also shows a strong payback of 79%. Although it’s the pricier option — you’ll spend $19,100 — it has one thing vinyl still lacks — the perception of quality.

And quality matters. In a survey from the National Association of Home Builders (NAHB), “quality” was the one of the most important traits that home buyers focused on when house hunting.

Related: 

• Costs and ROI of the Most Common Home Remodeling Projects (including kitchens and baths)
• Time-Sucking Home Remodeling Mistakes You’ll Wish You Could Avoid