The national housing market had some bad news at the end of 2012 and some good news however for 2013. The Commerce Department reported that home sales fell 7.3% in December 2012 from November 2012. But housing analysts who looked past the headlines see a lot of reasons for optimism in some more positive long-range trends for 2013 and 2014.“The market is 52% as strong as it was prior to the 2008 crash,” according to a housing index created by online real estate marketplace Trulia. For it’s monthly Housing Barometer, Trulia crunches three indicators: U S Census construction data, National Realtors Association existing home sales, and the delinquency and foreclosure t=rates from mortgage-data firm Lender Processing Services. And while 52% is a bad score on an exam, 52% is the highest score the real estate market has seen since the real estate boom.Economics Professor Mark Perry of the University of Michigan-Flint said: “There are almost no housing indicators showing weakness. Construction starts hit a 54-month high in December 2012, reaching 954,000 on an annualized rate, a 37% jump over last year. U S existing sales rose more than 9% to 4.65 million in 2012, their highest annual level in 5 years. And the combined delinquency and foreclosure rate is at its lowest level in 4 years, according to LPS.”Chief economist, David Crowe, for the National Association of Home Builders (NAHB) says: “People are also remodeling their homes with renewed vigor, suggesting homeowners believe that house prices will continue to raise.” Earlier in the week the NAHB said it’s Remodeling Market Index reached 55 in the final quarter of 2012, the highest reading since 2004. Any reading over 50 shows that remodeling is growing.Seattle’s Real Estate Market is right in line with the national trends and in some area well ahead of the trends. Inventory is very low on both sides of the lake. Looking at Seattle’s (core Seattle neighborhoods), numbers right now, today, there are a total of 773 homes and condos that are currently active, 944 homes and condos are Pending, and 496 that closed in the last 30 days. On the Eastside as of today there are 1141 Active Listings, 1469 Pendings, and 613 properties that have closed in the last 30 days.That’s a very strong market in Seattle and the Eastside. Although the total numbers of sales are still about 15% below where there were in 2007, we are in a very strong sellers market right now. Springtime historically is when we see most sellers putting their homes on the market however and over the next few months we should see a little more inventory but most likely not at the level that will balance out the market. Lenders are still pretty stingy with who they give loans to but the number of qualified buyers increased by about 15% from 2011 to 2012, and buyers are gaining more confidence that the real estate market in Seattle has stabilized and prices have started to increase. Prices in the greater Seattle Real Estate Market increased by about 5% in 2012, but most of that increased was felt in the second half of the year. We could see another 10% increase in home prices by the end of 2013.
David Bell's Real Estate Blog
Stay tuned to David's blog for updates on the Seattle Real Estate market, as well as other information from David's experience as a Seattle Realtor.
David regularly appears on the Brashenomics Radio Show Wednesdays at 3pm on 1150 KKNW and occasionally on other radio shows around the region. Click here to view his previous radio appearances.
As a native in Seattle, and selling real estate for over 22 years, I feel being a neighborhood expert is one of my strengths as an agent. In this video I shot as part of a promotion with KOMO News for the Magnolia neighborhood, I outline my approach to real estate and also why I feel it's important for real estate agents to be honest and forthcoming with their clients. The core philosopy of my business is to give my clients the best service possible, that's why I've named my business "Seattle's Best Real Estate."
I'd like to help you with your next real estate transaction. Please contact me with any questions you may have.
In this installation of Brashenomics, I compare the local Seattle real estate market in 2011 and 2012 to provide a birds-eye view of what the housing market looks like, and point out some key factors that the local media seem to miss.
I’m asked all the time what is the best month to sell your home in the Seattle real estate market? Right now my answer is “in the month you need to sell it.” The Seattle and Bellevue real estate markets right now are facing an inventory shortage. We have been and are currently in the first sellers market we have seen since early 2007. “Good” homes that are priced “correctly” are selling quickly and that has been the case now for several months. Homes that are challenged and/or over priced are not selling however. Back in 2005 or 2006 even the challenged and over priced homes would sell eventually, but that is not the case today. I define a challenged home as one on a busy street, homes that need a lot of work or were of poor construction, homes that have very unusual floor plans, or homes that are in poor locations.
Over the 23 years I’ve been in the Seattle Real Estate business I have tracked the Seattle Real Estate market statistically. Often times studying the numbers tells an experienced agent things that are contrary to what most people actually think is, or has been, happening in the Seattle Real Estate market. Staying current with sales numbers year after year gives me vital information I need for my clients that are both buying and selling.
For example when the bubble burst in Seattle at the end of 2007 most people thought that 2008 was the worst year we have had for sales in Seattle in our recent times. Well they were partially correct because total sales in 2008 were way below sales levels in 2007. Then people thought that prices kept falling every year until 2011 and again they were partially correct. Depending on where the property was however, which neighborhood it was in and the style and condition of the property had a substantial impact on the price as well. The closer in to the Seattle city center you were, the less the price dropped and the sooner prices stabilized. The farther out you were the more the prices fell and they kept falling for a longer period.
Some Seattle neighborhoods survived the bad years for the real estate market
So “close-in” areas like Queen Anne, Magnolia, Capitol Hill, Ravenna, Bryant, Green Lake, Wallingford, and Ballard saw prices fall between 25% to 30% from 2008 through 2009. Then prices stabilized for the most part by the spring of 2010, while areas further away from downtown dropped more in price over a longer period of time. For the most part, the close-in Seattle neighborhoods have been stable from early 2010 until the spring of 2012. One interesting trend to note is that total sales have declined each year starting in 2008. 2011 was worst year we have had for the total number of homes sold, although prices were relatively stable.
In these close-in areas, MLS #390, 700, 705 and 710 there were a total of 4663 single-family homes that closed in 2007. In 2011 the total was 3434 or 36% less than in 2007.
For the close-in neighborhoods, MLS #’s 390 (Capitol Hill), 700 (Queen Anne/Magnolia), 705 (Ballard/Green Lake), and 710 (Northeast Seattle), the total number of single-family homes sold increased by about 15% from 2011 to 2012. 3,434 homes were sold in 2011 compared to 4,056 homes sold in 2012. Remember that 2011 was a very low year for total sales. In 2012 the total number of sold homes increased, yet it was still about 15% fewer homes sold than in 2007. Although we are still rebuilding the region’s inventory, there are some indicators that point to the real estate market in Seattle looking more good than bad.
Two Seattle neighborhoods with a good market in 2012
Let’s take a closer look at MLS area 700 (Queen Anne/Magnolia) and 705 (Ballard/Green Lake). For MLS Area 705, Ballard/Green Lake, the average List Price for 2011 was $442,546 and the average sold price was $432,256. The average List price for 2012 was $459,387 with the average Sold price being $458,467. That represents about a 5.7% increase in average price from 2011 to 2012.
For MLS Area 700, Queen Anne/Magnolia, the average List price for 2011 was $655,497 with the average Sold price of $628,570. Then the average List price for 2012 was $668,132 with the average Sold being $652,164 for a 3.6% increase over 2011.
The Seattle Real Estate Market is GOOD
The Seattle economy is one of the best economies in the country. The state jobless rate has fallen to 7.6% and the national rate is 7.8% while Seattle jobless rate has fallen to 6.5%. OK I feel a prediction coming here: If the National economy continues to improve or at worst stays the same the bottom of Seattle Real Estate Market was at the end of 2010 and is on its way up. If the national economy falters then I think the worse case for Seattle Real Estate is that it remains flat. Either way this is a great time to buy for first time homebuyers and a great time to buy for the move up buyer. And if you bought your home prior to 2005 this is not a bad time to sell especially if you want to move up.
In summary, the Seattle real estate market is VERY good and getting better. This is perhaps the best time to buy real estate in Seattle that we may see our lifetime! That being said, you still have to be smart about what you buy and how much you pay.