Seattle Real Estate Market Update | April 2018
Here’s a story about a client who saved thousands of dollars in taxes and my latest update on the Seattle real estate market.
Below are the links I mention in the video:
Hey y’all Zach McDonald your real estate agent here with real property associates. And I’m bringing you my April monthly market update for the city of Seattle and surrounding suburbs. I want to start off these market updates like I always do. So if you’re new, here’s the format I want to start off with a story, some quick high level stats and then some application for you if you’re a buyer or if you’re a seller.
So really quick I want to share a story with you. And this story is of some clients that just closed here a couple weeks ago. They’re some good friends from college that approached me last year about the same time and said, “Zach, we want to sell our house and buy another house.” Now the reason they contacted me was because they were outgrowing their space. They were adding to their family and their two bedroom, one bath house was getting a little bit small. And so after talking with them and just doing a little bit of research upfront, I realized that they’d bought this house a year ago and they got a sweetheart deal. So it was a good price for them. But they got the house a year prior and after talking, we discussed this. And this is something that I did another video on here recently and I’ll link that up here as well in the description or somewhere near this video.
And that is, that if you have owned your home and also occupied it for two out of the last five years, you’re eligible to be able to skip out on some capital gains taxes. So you’d have an exemption on $250,000 of gain if you’re single or filing separately. Or if you’re married, and you’re filing together you’d have an exemption up to $500,000 of gains. So something significant for most people, that’s going to save them tens of thousands of dollars on their sale if it’s their primary residence. Now it does have to be your primary residence.
And so talking with them about that last year, they decided that you know what it’s going to be in their best interest to wait one year to sell their home so that they’ve had that two years of living and owning and living in their house before selling. So fast forward, we’re working together here a year later. We get their house on the market, get multiple offers, sell way over asking price. And first of all, they made more because they didn’t have to pay as much in taxes. The market also went up. Their home value went up. And so they were also able to make more on the sale of their house. So kind of a win-win. And plus their situation changed and they were able to actually they have a special rental situation going on, which is awesome for them. But they’re not actually looking to buy and don’t need to at this point.
So lots of wins by waiting, but something to take into consideration if you’re thinking about selling or know somebody who’s thinking about selling. It is really important to know those rules. So again as I said, I’ll link that up nearby this video.
The stats, so the city of Seattle, for now, the seventeenth month in a row according to Seattle Times article here I read last week. Seventeen months straight being the hottest real estate market in the country and that’s going to affect all the suburbs around, which it does. We’re three months away from breaking San Francisco’s record of 20 months straight. So stay tuned, they think we’re going to break it. But we’ve got a few real estate markets nipping at our heels including San Francisco. So the big news for this month, city of Seattle set a new median sales price record, $780,000 is according to the northwest multiple listing services stats for the city of Seattle. The Seattle Times has removed a little bit of the city and so their numbers are a little different, actually higher. They’re saying about 820. But the point here is, Seattle’s prices keep going up, Shoreline and Linwood also set median sales price records.
I do expect this to continue into the summer. As a buyer, this is the application piece. If you’re a buyer this is first of all the time where there’s going to be the most inventory. So the next few months we’re going to see inventory levels pick up. Just like we did this month. There’s still going to be a lot of competition in the market. So it’s not necessarily going to be easier to buy a house. But you’re going to have more chances at least to buy a house. And there will be more options.
The downside is, like I said competition is going to be fierce. And typically during quarter three, as we’re coming into in the summertime, we’re going to see the highest prices, the most competition. So you’re going to see the highest amount over asking price. So be prepared if you’re looking to buy a house in the summer. You are going to have the most options, but you are going to be facing the most competition. I would say a little caveat, waiting isn’t necessarily going to help. As home prices don’t typically drop, they typically level off after the summer months. By waiting, you’re probably going to end up paying more and interest rates have been going up, and are projected to keep going up a little bit here over the next year and into the future. So waiting isn’t necessarily going to be in your best interest. So I would, if you’re thinking about buying, start to get a little more serious about that.
Sellers, or if you know somebody who’s thinking about selling, this is going to be the best time in 2018 to sell your house period. Like there’s not going to be a better time. You’re going to see like I said inventory is going to go up, but you have the most competition in the market. You’ve got nice weather and why not capitalize on that right now. So your house looks great, you’ve got a lot of buyers in the market and inventory is still super tight. So this is a time to get your house on the market and take advantage of that.
And typically June, July is kind of the peak of the home prices. They come up gradually until then and then they typically level off for the rest of the year, if this year is anything like the last few. Which I suspect that it is. This is going to be your prime time to list your house.
So if you are a client of mine, I would love a connection to somebody that you know who’s looking to buy or sell. As you know that is the biggest way that I grow my business. It’ll be great for them and I’ll take great care of them. If we haven’t had the chance to work together yet, I’d love to be a resource for you. So please don’t hesitate to reach out if you need some real estate assistance here going into the near future. If you enjoyed this video, if this was helpful for you. Please give it a thumbs up and say Hi in the comments below. And if you want to get more info on the market, more into the numbers I’m going to be also recording a quarterly market update and I’ll link that one up as well so you can dive into those stats as well. Hope this was helpful for you and we’ll talk to you next month. Bye for now.