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Welcome to Friday, the natural bookend to the week. I had a lot to say this week which include getting mic’d up Thursday night for an evening with brokers & clients coming together for an in-person 2023 Annual Real Estate Forecast with Matthew Gardner. I purposely planned a date away from original turn into the new year and a little closer to spring. Not able to join us? No problem. Here is the full hour from last night’s event!
Ps, you did miss out however on the yummy catering, conversations around the bar and beauty of the UW Urban Horticulture Center – sorry, can’t help you there…maybe next time! Note: I’ll also send around full slide deck next week to offices…
What else happened this week? Stats dropped…
FEBRUARY MONTHLY TALKING POINTS Seattle (based on Residential report):
Note: if you need the updated password to WindermereStats.com – text me: 206.227.7133
FYI: talking points around interest rates below were penned at release of stats – I fully recognize they have been moving. The talking points still tell the story.
Hot or Cold? How would you describe the current real estate market?
Real estate brokers will say the market is heating up with more homes selling in multiple offers for more than the asking price. I will also include commentary that some of our mulitple offers this week are pending above list, some at list and some below list. Key: describe all possibilities with your upcoming Sellers!
The Seattle Times headline reads, “King County home prices drop for the first time since May 2020” and the opening sentence is “King County home prices tumbled 7% in February, the first year-over-year drop since the once-sizzling housing market began to see cooling prices.”
The Seattle Times is factually correct, but comparing the market to a year ago is old news.
Real estate brokers reported a change in activity in early January 2023 and the market has been heating up ever since.
• Both the number of homes selling above asking price and the amount over list price have increased in the last three months (November 2022 compared to February 2023) *The % of homes selling over the asking price increased from 15% to 28% * The median amount paid over the asking increased from 3% to 4%.
There is about a one month delay between the activities that generated the results because the two statistics are based on closed sales. Both these figures will increase when properties sold today close in about a month.
Sale prices have decreased 11% from the last year, but the monthly mortgage payment increased 18% or $796 from $4,289 to $5,085 because interest rates increased 2.5 points from 3.8% to 6.3%.
If you compare prices and payments to two years ago, February 2021, you will find sales prices are up 3.5% or $27,000 from $798,000 to $825,000 and payments are up 54% from $3,283 to $5,085 (an $1802 difference).
The significant increase in payment should limit the amount the monthly payment can increase in next year or two. If this is true, then sale prices will increase if interest rate decreases. Or if buyers are buying today with the expectations of lowering their payment by refinancing their mortgage with a lower interest rate mortgage.
Interest Rate and New listings Taken are driving our real estate market.
• Interest rates are up ½ point from 6.09% on February 2, 2023 to 6.65% on March 2, 2023.
• New listings taken in February 2023 (513) are down 33% from February 2022 (769) and down 19% from the 10-year February average (635).
• Active inventory is dropping at a time of year when the historical perspective shows it should be increasing.
• The number of homes selling above the asking price historically peaks in April/May and then starts to fall as the number of new listings increase. See graph on page 3 Seattle Residential Report on windermerestats. *again, need password?…
Text me: 206.227.7133
To the weekend we go in productive work & play – here to help, the ultimate goal.
Your fan, Laura
