Seattle Market Update
2018 in review – The year started strong for real estate. High demand from well-qualified buyers, low interest rates, a strong economy and low inventory kept driving prices up the first half of the year. The second half of the year, sales slowed as higher mortgage rates and unsustainable price increases squeezed would-be buyers out of the market. At the same time, inventory improved offering more options to buyers, however, inventory for affordable homes didn’t really improve all that much. Homes started to take much longer to sell over the summer, not for a lack of interested buyers but more for a lack of housing affordability. Once the rates declined again toward the end of the year, sales started to rebound slightly showing that homebuyers are very sensitive to mortgage rate changes.
2019 “crystal ball” – We’ll have to see. 30-yr-Mortgage Rates are projected to increase to 5.0% in Q2, 5.2% in Q3 and 5.3% in Q4 but we don’t know what they will actually be. The biggest problem in our area is a lack of inventory, particularly affordable inventory. Seattle is facing some real growing pains. The sudden injection of tech wealth over the last 5+ years has exacerbated inequalities pushing people and businesses out of the city. Unless solutions are found for some of these issues, housing appreciation may be modest.
Comparing Seattle trend to National Trend
Looking at the information from October 2017 – October 2018. You can see that the increase in rates eased appreciation in most other parts of the country but unlike in Seattle didn’t push prices downward.
This graph published in the Seattle Times Business section visually conveys this interesting point.
Did you know?
Did you know that the shutdown of the IRS & other Government Agencies is causing headaches for homebuyers and lenders? There is a delay in financing or refinancing mortgages because lenders cannot obtain income validation for form W-2 and personal tax return income. Some people will have to wait to get their mortgage refinanced or move into their new home.
1431 NW Richmond Beach Rd #1, Shoreline, WA – 2 bdr/1.5bth – $234,950 – Under Contract.
The townhouse is located at the Brookside West Condos, a well-managed 16-unit townhouse community with many long-term residents. Spacious master bedroom is connected to the 5-piece master bath. The second bedroom is loft-style. Open floor concept on main level with access to large, level and fenced in yard. Home needs some TLC.
We’d love to hear from you
Any questions, comments, or feedback? Contact us any time.
Happy New Year,
Krisanne and Kerstin