Brooks & Heinze Seattle Real Estate Team – February 2019 Newsletter

February 8, 2019

 

Seattle Market Update

There is a clear lack of consumer confidence evident in the real estate market. January is always a little slow but we saw slower activity in the market than usual last month.

Seattle Area home prices are still dropping but for most Seattleites that still means homes are out of reach. The median income of homebuyers in the Seattle metro area has reached $114,000 or about 40% higher than the region’s actual median household income of $82,000.

The 30-year fixed mortgage averaged 4.46 percent for the week ending Jan. 31, up from 4.45 percent the previous week. A year ago, mortgage rates stood at 4.22 percent.

There is hope that the softening of house price appreciation along with increasing inventory of homes on the market, as well as historically low mortgage rates will give a boost to the spring homebuying season. However, signs of a slowdown in the global economy and lack of affordability for locals might dampen these hopes.

Seattle Rental Market

Seattle has added lots of new, modern and expensive apartment buildings to address the influx of newcomers to the Emerald City. Perhaps too many units were added. Currently, 1 in 10 units across the city are sitting empty. Landlords have responded by lowering rents slightly and offering more perks to get tenants in the door. For more detailed information click here. Unfortunately, affordable apartments are still hard to find.

The rental market is cooling the most in the priciest parts of the region. On the Eastside, rents dipped 2.5 percent, in the last quarter, while rents remained virtually unchanged in South King County and Snohomish County. Rents dropped at least 3 percent in the past quarter in Belltown, South Lake Union, Fremont/Wallingford, Kirkland, Redmond, Sammamish/Issaquah and Edmonds.

Did you know?

A recent report by AARP found that 90 percent of retirees want to stay in their homes as they age. Aging in place — rather than packing up and moving to a specialized retirement community — is the newest housing trend for older Americans.

We’d love to hear from you

Any questions, comments, or feedback? Contact us any time.

Thank you,

Kerstin

 

Brooks & Heinze Team
at Skyline Properties, Inc.
Kerstin Brooks: 206.276.5827
Krisanne Heinze: 206.920.2541
Email: info@propertyinseattle.com
Web: www.propertyinseattle.com


Brooks & Heinze Seattle Real Estate Team – January 2019

January 14, 2019

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.

graph

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.

Our Listings

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


Brooks & Heinze Seattle Real Estate Team – November 2018 Newsletter

November 15, 2018

Seattle Market Update

The inventory of homes for sale this year compared to last year has increased for the last four months, all while sales of existing homes have slowed compared to last year’s numbers. For over three years leading up to this point, the exact opposite was true; Inventory dropped as sales soared. Rising interest rates coupled with high home prices and increased inventory have cooled the market. Rent growth has also slowed or reversed.

Good news for home buyers: inventory is up, so there’s more selection and prices have stopped going up. Bad news, Seattle is still an expensive market to buy into. Due to rising interest rates, someone who bought a $700,000 house a year ago is paying the same monthly mortgage bill as someone who pays $640,000 for a house today.
Home sellers have more competition today. Price drops are common now and so are seller concessions and seller paid repairs. Five years ago, the median price in Seattle was $461,000; this spring, the median price peaked at $830,000; and now the median price is down to $775,000. Appreciation has been fantastic over the last few years despite the recent dip. Emotionally, this price correction might be hard to take for some sellers but looking at the gains overall might help keep some perspective.

Sales are taking longer as a lot of buyers are playing a bit of the wait-and-see game. Waiting might not be a good idea, if you want to buy, as rising interest rates will make buying more expensive in the very near future.

For renters, it is getting easier to find an apartment to rent. Rents are still going up slightly in most neighborhoods but in some neighborhoods (i.e. downtown, South Lake Union) rents are going down. You can read more about the rental market here.

Did you know?

Do you know how hot the water should be in your hot water tank? Above 120F and below 130F.
At a temperature above 130 degrees there will be an increased amount of sediment build-up within the tank as well as wasted energy. There is also the health risk of scalding. Below 120 degrees there is a risk of contracting legionnaires disease. According to the Mayo Clinic, the risk of colonization of Legionnaire bacteria is significant in hot water tanks where the temperature is between 104 and 122 degrees.

Our Listings

25812 115th Ave SE #B104, Kent, WA 98030: 2bd/1.5bth Townhouse – SOLD.

Congratulations

Congratulations to our clients Laura and AJ on their new home in North Seattle.

We’d love to hear from you

Any questions, comments, or feedback? Contact us any time.

Thank you,
Kerstin

Brooks & Heinze Team
at Skyline Properties, Inc.
Kerstin Brooks: 206.276.5827
Krisanne Heinze: 206.920.2541
Email: info@propertyinseattle.com
Web: http://www.propertyinseattle.com


Brooks & Heinze Seattle Real Estate Team – October 2018 Newsletter

October 27, 2018

Seattle Market Update
There has been a small uptick in homes hitting the market but there are more homes available for purchase mostly because homes take longer to sell than earlier this year. So, if you are seeing more for sale signs in your neighborhood it is mostly because those signs are staying up longer.
Rising interest rates and price drops are affecting buyers’ emotions who are now more reluctant to commit to a purchase or at least are taking more time and are more discerning about which property they choose and how much they are willing to pay for it.
As long as the local economy remains strong, there’s little cause for concern about the sudden shift or market correction we are experiencing, and it should not be interpreted as a market crash. However, for sellers currently on the market the adjustment has been very sharp and unexpected.
We are in the middle of the shift and further downward price corrections may be in store as we head into the late fall and winter which can be challenging times for sellers to sell property even in a strong market.
Sellers going on the market this month should make sure their property shines, is in good condition and priced well to beat competition. Buyers seriously considering buying have more leverage now than in the last 5 years to secure a property at a good price in a popular urban market that long-term should always be an attractive investment.

Our Listings
$305,000 – 34212 S 18th Place S, Federal Way 98003 – under contract.
We are working on getting two listings ready for the market: a nicely updated townhouse in Kent and a 1930’s charmer in Everett. Stay tuned.

Did you know?
The baby boomers began turning 65 in 2011. Every single day, roughly 10,000 boomers are turning 65 and many retire at that age. By 2029, when all of the baby boomers will be 65 years and over, more than 20 percent of the total U.S. population will be over the age of 65.
Much of their wealth is in form of equity in their home and many will be faced with liquidating some or all of that equity to pay for daily living expenses, medical bills or renovations to their current home to allow for aging-in-place.
Krisanne and I have helped clients understand the pros and cons of reverse mortgages, downsizing, selling their home, aging-in-place and moving to assisted living depending on what stage of life they are in. We work with a team of trusted retirement community managers, financial advisors, HECM (reverse mortgage) lenders, elder law attorneys, and in-home care professionals to make sure our clients understand their options and can make an educated decision on what’s right for them. Do you know any seniors who are thinking of making a move, either downsizing their home or moving to senior housing? We would love to help them.

We’d love to hear from you
Any questions, comments, or feedback? Contact us any time.

Thank you,
Kerstin

Brooks & Heinze Team
at Skyline Properties, Inc.
Kerstin Brooks: 206.276.5827
Krisanne Heinze: 206.920.2541
Email: info@propertyinseattle.com
Web: http://www.propertyinseattle.com


Brooks & Heinze Seattle Real Estate Team – September 2018 Newsletter

October 27, 2018

Seattle Market Update
The current market condition can best be described as a major slowdown. Our roaring real estate market, fueled for years by the city’s historic population growth and, at least to some degree, foreign investment, has slowed dramatically in July and August.
It looks like there is more inventory on the market which technically is true in that there are more homes sitting on the market at this time. However, the “increase” in inventory is a byproduct of homes taking longer to sell not an actual increase in selection for buyers. August is often a slow month for new listings as Seattleites enjoy the summer and travels but this year it is combined with an overall slowdown in the market.
Exceptional homes in highly desirable neighborhoods are still selling quickly and we still see some competing offers. However, sellers in less desirable neighborhoods with a home that’s outdated or with deferred maintenance have found that even significant price drops and seller concessions aren’t always enough to attract buyers in this new market.
We have seen downward price corrections in rural Snohomish County, South King County and the suburban condo market. Wondering what has happened to the value of your home as a result of this market slowdown? Contact us, we’d be happy to prepare an individualized report for your home.

Our Listings
$309,900 – 34212 S 18th Place S, Federal Way 98003 – under contract.

Did you know?
Homeownership remains below 2006 levels for all age groups. Homeownership rates were lower in 2017 than in 2006, the year before the Great Recession (2007-2009). The homeownership rate among the largest group of homeowners — those age 65 and over — has returned to within about 2 percentage points of 2006 levels. However, householders under age 35 and 35-44 years old had 2017 rates about 7 and 10 percentage points lower than in 2006. More information on this is available on the Census Bureau website.

We’d love to hear from you
Any questions, comments, or feedback? Contact us any time.

Thank you,
Kerstin

Brooks & Heinze Team
at Skyline Properties, Inc.
Kerstin Brooks: 206.276.5827
Krisanne Heinze: 206.920.2541
Email: info@propertyinseattle.com
Web: http://www.propertyinseattle.com


Brooks & Heinze Seattle Real Estate Team – August 2018 Newsletter

August 7, 2018

Seattle Market Update

Here is what we are seeing in the real estate market: increased inventory, increased market time and price reductions. Multiple offers and offers over list price are rare now. What does this mean for buyers and sellers?
Sellers need to price their property to match the new market conditions. If the property doesn’t sell in the first 2-3 weeks on the market, it is time for a price drop. Sellers should also be prepared to pay for buyer’s closing costs, especially if the buyer is an FHA or VA buyer and sellers should not be surprised if they have to pay for repairs on defects called out in the buyer’s inspection.
Buyers have more inventory to choose from and more time for due diligence to research the neighborhood (schools, crime statistics, etc.) and condition of the home (structural/pest/sewer inspection, etc.).
There is a lot of confusion and resistance to what’s going on. Sellers are reluctant to adjust and drop their asking price when the property doesn’t sell. Sellers who ignore the new market conditions will remain on the market longer and homes that are sitting on the market longer almost always get less than market value. It is important for sellers to act quickly on these new market conditions.
Buyers are afraid to commit to what they perceive might be the top of the market. The fear of overpaying keeps some on the sidelines as they want to just wait and see what happens. However, this might be the best time for buyers to negotiate as sellers figure out the new playing field and are desperate to get their home sold.
We do not have a crystal ball and cannot predict where prices are going and what market conditions will be like in the months to come. However, we suspect the market has cooled because it needed to. The frenzy of the last few years is simply not sustainable. We see this change as a good change that will keep the housing market strong and healthy which is a good thing for both buyers and sellers in the long run.
Rents have declined in our area due to increased available inventory as a result of an increase in apartment building construction. More supply with the same demand = declines in rent.
There might be a push for more condo construction or condo conversions (apartment buildings being converted to condos) to meet the demand for condos. In fact, one building downtown which was to be an apartment building will now be condos. Read more about the Spire Building here.
There is very little new construction in urban areas for condos and single-family homes and the demand for these properties has not declined so we do not see home prices dropping in the long term after everyone adjust to the current shift unless employment, wages or other factors change.

Our Listings

$326,000 – 34212 S 18th Place S, Federal Way 98003. Wonderful mid-century rambler set high above the street. Great room concept with spacious living room flowing into formal dining room. Updated kitchen and baths. Light-filled informal dining room off kitchen with sliding doors to level backyard perfect for outdoor summer fun and entertaining. 3 bedrooms on main floor plus a spacious lower level with bonus room. Enclosed carport offers additional storage or work / hobby space. Close to shops, restaurants and freeway access. Click here for more info, pictures and a video.

Did you know?

The National Association of Realtors (NAR) keeps historical data on many aspects of homeownership. One of their data points, which has changed dramatically, is the median tenure of a family in a home, meaning how long a family stays in a home prior to moving.
Over the last twenty years (1985-2008), the median tenure averaged exactly six years. However, since 2014, that average is almost ten years.
The main factor for this change is the fall in home prices during the housing crisis which left many homeowners in a negative equity situation (where their home was worth less than the mortgage on the property). Also, the uncertainty of the economy during that time made some homeowners much more fiscally conservative about making a move.
It will be interesting to see how this number changes as a large portion of homeowners are not in a house that is best for their current family circumstance such as baby boomers living in an empty, four-bedroom colonial, or a millennial couple living in a tiny urban one-bedroom condo planning to start a family.

We’d love to hear from you

Any questions, comments, or feedback? Contact us any time.

Thank you,
Krisanne and Kerstin

Brooks & Heinze Team
at Skyline Properties, Inc.
Kerstin Brooks: 206.276.5827
Krisanne Heinze: 206.920.2541
Email: info@propertyinseattle.com
Web: http://www.propertyinseattle.com


Brooks & Heinze Seattle Real Estate Team – July 2018 Newsletter

July 10, 2018

Seattle Market Update

Last month we told you there might be a shift in the air? We reported on an increase in inventory for the first time in years. Well, we can now confirm that the market has changed. It is still a seller’s market but we are seeing signs of a more balanced market. There are fewer bidding wars and more homes are selling for asking price rather than well above list price. Gone are the days where sellers could overprice, especially homes in less desirable neighborhoods or in poor condition; factors that seemed not to matter a couple of months ago. Buyers still have to make strong offers, especially on the better homes, but competitive conditions have eased a little.

Rents Continue Decline

After years of steep increases, Seattle rents are seeing a decline, and those declining returns could persuade some landlords to sell their property. Many rentals are multi-family properties but one in six single-family houses across the Seattle metro area is actually rented out rather than owner occupied. If some of those landlords decide to sell, it could add more inventory to the home-buying market.
The real big change in availability and reduction in rent is happening in new/newer apartments downtown/SLU/Belltown where vacancy rates hit their highest levels since the recession; one-fourth of all apartments there are now sitting empty and move-in specials (one-month free rent, gift cards, free parking, etc.) have become commonplace.
Are you thinking of selling your rental investment property? Let us know.

Median Rent price was Down YoY 3.7%:
May 2017: $2,700
May 2018: $2,600

Average Rent Price was Down YoY 3.23%
May 2017: $2,877
May 2018: $2,784

Our Listings

$326,000 – 34212 S 18th Place S, Federal Way 98003 – NEW ON MARKET. Wonderful mid-century rambler set high above the street. Great room concept with spacious living room flowing into formal dining room. Updated kitchen and baths. Light-filled informal dining room off kitchen with sliding doors to level backyard perfect for outdoor summer fun and entertaining. 3 bedrooms on main floor plus a spacious lower level with bonus room. Enclosed carport offers additional storage or work / hobby space. Close to shops, restaurants and freeway access. Click here for more info, pictures and a video. Open House: Saturday, July 7 from noon to 3pm and Sunday, July 8 from 11am – 2pm.

Did you know?
Together with your income and assets, your credit score is an essential part of your loan application. However, credit scoring methods for mortgages are different than for credit cards and other consumer accounts. FICO® stands for Fair Isaac Corporation, the inventor of the analytics software that produces most credit scores. A person has three FICO® scores, one for each of the three major credit bureaus – Equifax®, Experian® and TransUnion®. Many consumers are led to believe that they only have one FICO® score, but this isn’t true. Currently, 55 different FICO® scoring models are in use. Many are industry-specific and not available to the public. If you recently purchased your FICO® score online, it may be vastly different than your FICO® score used for mortgage loan qualification. To learn more about this speak with your mortgage lender.

We’d love to hear from you
Any questions, comments, or feedback? Contact us any time.

Thank you,
Krisanne and Kerstin

Brooks & Heinze Team
at Skyline Properties, Inc.
Kerstin Brooks: 206.276.5827
Krisanne Heinze: 206.920.2541
Email: info@propertyinseattle.com
Web: http://www.propertyinseattle.com

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