Seattle Real Estate Market Update | February 2021

 In #Market Updates, #Seattle Real Estate Market

Video Summary

Here are my latest thoughts on the Seattle Real Estate Market:

The Seattle real estate market is hot! Since the market is so competitive, homes are selling quite a bit above the asking price, especially in the surrounding suburbs. We are seeing more homes come on the market, but all the buyers are snatching them up, so inventory remains low and competition is high. In terms of applications for buyers and sellers, this current market is a seller’s market. If you’re thinking of selling, you’ll have a lot of negotiating power.

Spring 2021 could be the best time to sell your home in Seattle ever (so far). If you’re a buyer, it’s a competitive market, which means you should expect to pay above the asking price and make your offer more favorable to the seller.

Video Transcript:

Hey y’all, Zach McDonald, your real estate agent with Real Property Associates and this is my Seattle real
estate market update for February 2021. Before we get too far into this update, I want to just say it feels
a lot like it did back in 2016, 2017 and the beginning of 2018. The Seattle housing market is crazy and I
know a lot of places around the country are experiencing very similar things, but in Seattle, we
experience this and have experienced this off and on for the last five plus years.
So as we jump into this update, keep in mind that we’re in a super, super competitive market and I’ll talk
a little bit more about that here in a minute. As we jump into our market update here, I want to share a
story just like I do in every single one of these updates, but rather than featuring one specific client, I
want to just highlight and thank all of you here who’ve been following me on YouTube and following this
channel and continuing to contribute to its success.

Last month, three different people who’ve been following this channel were able to get into their new
homes last month and all of them did so virtually. So not only did we meet through YouTube, but we
also were able to make that purchase happen through FaceTime and through Zoom. So if you’re
somebody who’s out of the state and thinking about making a purchase, I know there’s some of you
watching right now. I’d love to connect, I’d love to get a conversation started.
Now, let’s jump into the Seattle housing market stats. And as I mentioned earlier, we’re in an extremely
hot housing market again, and it feels a lot like it did in 2016 as we started and started to head into this
two plus year period of being the hottest housing market in the entire US. And right now we’re not,
we’re trailing Phoenix Metro Area, but we’re starting to pick up and ramp up a lot like we did back in
2016. So I don’t want to predict right now that we’re going to see two and a half years of crazy growth like we
did a few years back, but it’s starting to feel like it did. And that’s the only comparison I’ll make. As we
look at the median sales price in the city of Seattle, we saw an 8.3% growth year over year and just
slightly over December’s numbers. And we came in at $780,000 for the median sales price in the city of
Seattle.
Something to note about the median sales price and prices in general, I mentioned that this market’s
starting to feel a lot like it did back in 2016/17 and beginning of 18 when it was super, super hot. And
what we saw in all of those years and typically historically, as we see prices start to climb and plateau
and even slightly decline after the summer kicks off. So we see this push typically all the way until early
mid summer and then we start to see prices level off or decline a little bit. Even in the hottest housing
market we’re experiencing, we did see a little bit of a lead off the gas and people were able to get
houses a little closer to the asking price. Now, they weren’t getting them below asking price, but closer
to asking price.

In those years though, we were seeing houses selling seven, 8% over asking price in the peak selling
season, April, May, June. So this year I’m thinking that we might start to see prices jumping at those
rates. And we’re already seeing lots of houses selling well over asking price 100,000, 150,000, 200,000,
depending on the price point. So I wouldn’t be surprised if we saw prices start to jump and to sell even
more above asking price than they already are selling.
Speaking of selling above asking price, the average house in Seattle last month sold 1 1/2% above asking
price. And that’s actually not a lot when you think about how many houses sold in the city. And when
you think about all the crazy multiple offer situations, maybe you’ve heard and I’m even experiencing
and talking about, and the truth is Seattle itself is not experiencing as much of the craziness as the
surrounding suburbs. And some of the suburbs surrounding Seattle are seeing four, five, 6% over asking
price. So they’re seeing this competition level that’s starting to heat up. We are seeing it in Seattle, but
on a little bit smaller scale.

Last month also saw a substantial jump in new homes coming to the market, which is completely normal
for January following a December holiday season. Although last month in December, we saw about 50%
more new listings than we normally do during the holidays. And then we added that jump onto January
and we’re seeing a considerably larger amount of new houses on the market in January as well. And for
perspective, we’re up almost 40% year over year and new listings in Seattle.
And in 2019, we did see numbers closer to this year, but we still saw a substantially larger amount of
new houses coming on the market this year than we did at the same time last year. One would think
that as a result, we would see an increase in the supply and the amount of homes that are on the
market and out there but we saw the opposite. We actually saw a decline in the amount of houses that
are on the market. And that’s because we’re seeing a lot of buyer activity in the market, lots and lots of
buyers out there. So even though a lot of new homes came on the market, they were all getting gobbled up. And what
that means is that we’re still seeing super, super tight inventory levels. And last year we were right
about 0.8 months of supply of homes on the market, which is not abnormal for this market. And we
were at the same level this month, 0.8 months of supply that we saw last year.

Now some markets around the country are experiencing this maybe for the first time or on a rare
occasion right now they’re starting to experience this and they don’t normally experience this. For
people in Seattle and people that have been in this housing market, we experience this on a regular
basis, so it’s a little less jarring. But at the same time, we’re seeing very few houses on the market
compared to the amount of buyers. What that means is the market’s super, super competitive and
definitely favoring the sellers.

Now, previously, I mentioned that the Seattle housing market itself isn’t quite as hot as the suburbs and
as we look at median days on market, we see this truth played out as well. And we see about 15 days is
the median amount of time for a house in Seattle to be on the market versus eight days on the market
in Shoreline, five days on the market in Linwood and six days on the market in Edmonds. And all of those
are in Snohomish County, which is just North of King County, which Seattle, Bellevue, Kirkland, all those
cities are in. And it’s the county that a lot of people have been flocking to. As well, people have been
flocking down towards Pierce County in the south.

So what does all of this information mean? We just went through a lot of housing market stats and we
talked about how competitive the Seattle housing market is. But if you’re somebody who’s thinking
about selling a house, this means that you have a lot of negotiation power. And if you price your house
right, you’re likely going to see multiple offers on your house and potentially see the price go up.
Now there’s never any guarantees of that, but most likely your house is going to sell pretty quickly and
it’s going to sell for more than you’re asking price. And you’re most likely going to get more favorable
terms. In a previous video that I published a couple of weeks back, I talked about how this might be so
far the best time to sell your house in Seattle or the surrounding suburbs. Now that’s assuming that you
want to get something different or you’re planning to move out of the area. If you’re not, there’s not
much motivation to sell, but if you’re planning to relocate or move somewhere else, you might find that
this is a good time to get your house on the market and capitalize on some of the craziness.
On the flip side, if you’re a home buyer, it’s a competitive market. And what that means is you’re
competing with other buyers for the same houses. There aren’t a lot of houses on the market, the
inventory is the technical term. Supply is low. So that means that you are most likely going to pay above
the asking price for a house and you’re most likely going to be making your offer more favorable to the
seller versus more favorable to you. So what that looks like is you’re probably adjusting some of the
terms in the contract to make your offer more appealing to the seller and you may be removing
contingencies as well.

Does this mean though that as a buyer, that you shouldn’t buy a house right now? I’ve had people ask
me that, should I wait to buy a house till the fall? Should I wait to buy a house until next year or two
years from now? And I don’t have a crystal ball. And in these videos, you find that I talk about the stats
and I talk about what’s going on right now. And I’ll make brief predictions into the future, maybe a
couple months down the line, but it’s really, really, really hard to predict what’s going to happen.
And last year was a great case in point of that fact, we had a global pandemic. It’s hard to predict what’s
going to happen. We had no clue that was going to happen. The Seattle housing market was starting to
pick up steam heading into the late winter and early spring. And then all of a sudden everything slowed
down. People didn’t put their houses on the market. People weren’t buying houses, but then all of a
sudden we saw interest rates drop, and we saw people starting to put their house on the market. We
started seeing people buying houses, and then we ended the year in this frenzy and headed into 2021
with a full head of steam.

Now, could we have predicted that last year? No way. So, as we think about buying, as we think about
selling, we want to think about the more immediate. Can I buy a house right now? Can I afford to buy a
house right now? What are my goals? Do I plan to live in this house for five to seven years? Do I plan to
stay here for a while or am I thinking about moving in a year or two?And all of those things play into whether it makes sense to buy a house versus renting a house.
And so if you’re somebody who’s thinking about buying a house, I’d love to have that conversation with you and
talk about your goals and walk through that with you.

Thank you so much for watching my February 2021 Seattle housing market update. And if you made it
all the way to the end of this video, I know you got a lot of value out of it. So I’m going to ask you to do
two things, first off, please give this video a thumbs up. Like this video and maybe drop a comment
down below to help boost the algorithm so more people can see it. And secondly, if you haven’t
subscribed to my channel, please do so, so that you can see other market updates like this and other real estate videos that you might find helpful as well.

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