Seattle Real Estate Market Update | March 2021
Here are my latest thoughts on the Seattle Real Estate Market:
The Seattle real estate market continues to hover around its record-high median sales price. We’re seeing price increases in the Seattle area, but the surrounding suburbs are seeing explosive increases. Homes are selling significantly above the asking price, especially in the suburbs. Keep in mind that interest rates are starting to climb.
For sellers, if you’re thinking of selling, now is the time. We are entering into the housing market’s most competitive season. For buyers, it is a good time to start taking steps towards buying sooner than later if you’ve been entertaining the idea. Getting educated is a good place to start!
- Freddie Mac Mortgage Rates – http://www.freddiemac.com/pmms/
- My Seattle Real Estate and Housing Market Predication for 2021 – https://youtu.be/xHM9kOaiikc
- Last month’s market update – Seattle Real Estate Market Update February 2021
Hey all, Zach McDonald, your real estate agent with Real Property Associates and this is my Seattle Real Estate Market Update for March 2021.
Each month I share a client story, talk about the Seattle market stats, and talk about a little application for buyers and sellers. If you haven’t subscribed to my channel already, please take a minute and do so, so that you can see content like this on a regular basis.
Now we’re going to start off this update, just like we do all the others and we are going to talk about a client story from last month. Last month, I had the privilege of helping Becky and Brant, my former next-door neighbors, with the sale of their rental property. They contacted me about a month earlier. Their tenant had moved out. They were prepping it for sale and wanted to get it sold ASAP, and we got it ready, got it on the market. We had crazy interest within the first 24 hours and not only did we sell it on the first day, it was like 24 hours on the market, we ended up getting almost 12% above the asking price for them, and it was the highest sale ever in their entire townhouse community. So super excited for them. They had the best outcome they could have hoped for. Super appreciative clients, really fun to work with, and Becky and Brandon, you guys are watching this, thank you so much for the chance to work together.
It’s always fun to get to work with friends. Sometimes I get to work with people like yourself watching this, maybe through YouTube. Other times I get to work with personal friends and in this case, we got to help some friends. So a really fun month for us. We got to do a couple of different deals with friends and also some from this YouTube channel as well.
Let’s transition now to the stats, which I think is why many of you are here. You’re curious, what’s going on with the Seattle housing market? Is it going to stay hot? Is it going to keep going up or should I wait to buy? Should I sell now? I think these are the kinds of questions that are rolling around in your mind and I want to take a minute to address those towards the end, but at the beginning, I just want to talk about some of the stats here so you can get a feel for what’s going on in the market.
The median sales price in the city of Seattle itself was just under $780,000 last month in February, which is fairly close to our record high. We’ve been hovering around the 780 number here for the past few months, since December. Back in August 2020, we peaked out at 815. So that’s the highest median sales price we’ve had in the city and we’re hovering just below that here, heading into the busiest time of the year, and typically the time of the year where we see the highest median sales prices.
If we look at some of the surrounding areas, though, if we jump over to the Eastside like Bellevue, we’re seeing home prices up almost 19% year-over-year, at close to $1.4 million for perspective. In Seattle, we’re up a little over 8% year-over-year.
If we jumped to the North, some of the suburbs on the North like Lynnwood or Edmonds, Lynnwood is up 27.4% year-over-year median sales price. And Edmonds is up 21.4%. So, huge numbers, lots of price growth on the Northside of the city and on the East side but specifically in Seattle, we’re seeing good growth, but relatively consistent. Whereas, we’re seeing kind of explosive growth outside of the city. I think a lot of that has to do with a change in what people want in a house, which isn’t necessarily found in the city. It’s generally found in the suburbs.
The number of homes coming on the market in Seattle is actually up about 3.6% but the amount of pending sales is up 25.9% and the amount of closed sales is up 38.7%. So what that means is that even though we’re having more houses coming on the market, we have a lot more buyer activity and a lot more buyers in the market, which is causing houses to sell quickly.
In Seattle, the median days on market in February 2021, seven days. If we look over at the suburbs on the North, five days in Shoreline, five days in Lynnwood, six days in Edmonds. So things are selling even quicker in the suburbs and part of it is artificial. The dates, most people said a five to seven-day offer review period. So some sellers honor that which is how you get to that six, seven, eight days on market. If they don’t, a lot of times houses are selling in 24 hours, 48 hours, sometimes even faster like the first person that looks at it. So, sellers… Some sellers are patient and willing to wait and play out the multiple offer situations. Other sellers are impatient and if somebody makes a really good offer up front, they just take it and run.
All of the craziness though is causing prices to increase because there aren’t very many houses on the market, everybody is making offers on the same houses. So what we’re seeing is houses selling well above the asking price, which is not abnormal for the Seattle housing market, but we’re seeing prices continue to sell for more and more and more and more above asking prices. Buyers get beat out, maybe less aggressive at the beginning, and become increasingly more aggressive over time.
So in Seattle, we saw houses selling about 4% above the asking price. In Shoreline, we saw houses selling for 6% above the asking price. In Lynnwood, we saw houses selling for 8.7% above the asking price. And in Edmonds, we saw houses selling 5% above the asking price. If we jump over to the Eastside, though, Kirkland was up over 8% above the asking price. Redmond was over 13% above the asking price, which is crazy. And Bellevue was up around 10% above the asking price. So if you’re outside of the city, what we’re seeing is we’re seeing more competition, higher amounts above the asking price as a result.
One more thing to look at here before we talk about applications; interest rates are up. So at the beginning of January, interest rates were hovering on average, according to Freddie Mac’s Primary Market Survey, right around 2.65%. And this last week, they were up over 3%; just above 3% on average. So we’re seeing interest rates climb. Nothing to be concerned about right now. It does affect buyer affordability, not drastically, but half a percentage point is a substantial difference in the monthly payment. So we got to continue to keep an eye on this one because if interest rates keep going up, I think it’s going to stall out some of the competition that we’re seeing in the market.
So for sellers application for you here, watching this video, if you’re thinking about selling maybe in the next year or even the next six months, you might want to consider doing that sooner first, because this is the typical time of the year where homes do sell for the most and typically fetch the highest price.
So we’ve got a couple of months here up until about mid-May, beginning of June, where if you get your house on the market, you’re going to have the nice weather, but you’re also going to have that sweet spot of a lot of buyers looking and a lot of competition, which typically for a seller gives you three things. It’s going to give you the highest price. It’s going to give you the fewest contingencies on your contract, which means the buyer has fewer opportunities to back out. And then you’re also going to get the best terms. So if you need a one or a two-month rent back, that’s usually the max a lender’s going to allow, or you want to see some kind of non-refundable earnest money from the buyer, anything like that, special terms above and beyond what a normal purchase and sale agreement looks like, those are things that you get right now that you might not see later in the year, especially if interest rates keep going up.
For buyers, I think this is the time to start thinking about buying. That doesn’t mean you should jump in full blast right now but if you’re somebody who’s thinking, “Yeah, I want to buy a house this year and I’m not started.” First of all, if you’re already looking, keep looking because it does take some time. But if you’re new to the process and you haven’t gotten started yet, start getting educated. It takes time. I’ve been working with some clients here for three, four, or five months now, and it takes a little bit of time to get ready usually about a month to do a buyer consultation. That’s where I sit down with buyers and we talk through needs and wants. We talk about the process and then we talk about getting pre-approved and then we actually go and start looking at houses. That part takes a little bit of time.
And then at the same time, because there’s so little inventory, it does take a few swings usually to be successful. No matter how good I am in negotiating or how bad you want the house, sometimes somebody is wanting to just flat out pay more and that’s what it comes down to. So definitely get started sooner rather than later, if you’re a buyer. So if you’re thinking, “I want to buy a house in the summer sometime.” It typically takes three to four months to find the house and then another month to close. So if we’re in March and you want to buy in the summer, we should probably start the conversation now.
So FYI to buyers get started sooner, but get started with education, get started with prep work so that you’re ready to take action when the market opens up or shifts a little bit, or you’re just ready to start taking some swings at the ball.
Thanks so much for watching my Seattle Housing Market Update for March 2021. I hope and I know that if you made it all the way to the end here that this content was valuable for you. So a couple of requests. First of all, please subscribe to my channel if you haven’t already done so. Number two, please, if you got some value out of this content, share it with somebody that you know who could benefit from it. And number three, if you need help with buying or selling in the general Seattle area, please feel free to reach out.