June Market Update

Our local real estate market is a bright spot in an otherwise challenging economy. Looking at the key metrics from May, we find the market to be healthy and growing though at a slower pace and lower volumes.

Inventory (balance of buyers to sellers) is stable month to month at 1.4 months, and down from last year when it was 2.3 months which is tilting the market in further favor of Sellers. This confirmed when looking at Days on Market which are averaging just 7 days slightly higher than April and lower than May 2019. Finally, list to sell ratio is 100.4% in May which shows despite the Seller favored market prices are not hugely escalating (on average… our experience has shown some high demand homes are getting 105%+ of their asking price).

Prices are mixed but healthy… in King County median price is $625k which is down from $650k in April, and down from $638k in 2019. In Snohomish County, it’s $485k down from $500k in April and up from $470k in 2019. We think these lower prices are directly due to instability in the ‘jumbo’ mortgage market (loans above $741,750). These loans are riskier for banks, and many put a hold on them during April and early-May, which meant a large number of homes in the $800k+ range took longer to sell or close which will market statistics down even though homes under $800-900k are seeing rising demand and prices.

The biggest difference in today’s market is volume (overall activity) which is down by about 35-40% for new listings, active and sold listings when compared to May 2019, yet Pending listings are only down by 10%. This interesting difference means we should see even lower inventory in June and July, and potentially higher prices due to the greater imbalance between supply and demand.

Historically low mortgage rates are helping boost this activity by increasing buying power by 11% in the last year with rates dropping from 3.99% to 3.15%. Current, expectations are these lower rates will persist for the coming months until we get through election season, at least.

For now the outlook for our market looks good… a decade of build-up of demand for housing combined with low rates has tempered the shock of the pandemic economy. As the economy begins to reopen, the forecast remains positive though it will be tied to regional and national re-employment and wage growth.

Three Key Opportunities of Today’s Market
Call us to learn more about put them to work for you:

• Low Mortgage Rates - whether buying or refinancing your existing mortgage, take advantage of today’s low rates. They are the lowest they’ve ever been saving 11% from 1 year ago.
  
  

• Sellers Market - if you have a home to sell, use the Seller’s market to gain an upper hand to give you time for your transition and finding your next home while still getting a great deal.
  
  

• Relief - if you’re financially distressed, consider utilizing forbearance and other programs to help you bridge your income gaps and provide time to make a long term plan while avoiding fees and credit damage.