Seattle Real Estate Market Update | January 2019
The Seattle housing market finished 2018 with a resounding thud. Will home prices continue to decline in 2019 or are we primed for a rebound after the correction? I’m thinking the latter.
I dove deeper into this discussion in my 2019 Seattle Real Estate Market Predictions video a few weeks ago.
[Video transcript of January 2019 Seattle Real Estate Market Update]
Zach McDonald: Hey y’all. Zach McDonald, you’re real estate agent with Real Property Associates. This is my January 2019 real estate market update. Now, you gotta excuse my nasally tone today. I’ve got the sniffles. I just can’t help it. Rather than delaying this more, I’m gonna get this market update out to you today.
Zach McDonald: Now, before we dive into some of the questions everybody always asks, “Where’s the market going? Where are we at?” I wanted to start off with a story, just like I do in all these updates, to kind of illustrate and paint a picture the practical side of it, where are we at? We’re gonna jump back. We talked about Dan and Monica a couple months ago. I think it’s my November market updates. We’ll show that one, pop it up on the screen here for ya. We talked about how they contacted me out of the blue, after selling their house earlier in the year, deciding they wanted to jump back in and buy a house.
Zach McDonald: They really didn’t last long as renters. That was something we joked about throughout the process. They just couldn’t take it. They wanted to be owners again. They ended up not buying the house in that story. I shared that in that video. What they did do is we found another house, a couple months later. Really a way better house for them, a lot less work to do. That ended up being a better fit. We closed on that one, a few weeks ago. They’ve already demoed the bathroom and are working on a remodel there. High five to you guys, if you’re watching Dan and Monica. Good to see you guys.
Zach McDonald: Now, let’s talk a little bit more about the stats. We did the story. Now we’re gonna talk about the stats. Here, bear with me here, as I pull it up on the cell phone. We’ve got the median sales price. This last month I went on record and I said, “The dust has settled, we’re done. The home prices aren’t going down anymore.” Somebody graciously posted an article about the most recent stats and all the median sales price went down a little bit more. That’s the case. We ended with a thud in 2018, which isn’t really uncommon.
Zach McDonald: Home prices in December tend to go down as … Typically, they will trickle off as the year goes on. It’s almost like a yearly correction, as you get all the homes on the market, you get all the buyers in the spring, and you see the prices climb, as there’s competition. As the year goes on, there are fewer buyers and people still need to sell. You kind of have that better balance of supply and demand versus, in the springtime, which is gonna, you’re gonna see that correction.
Zach McDonald: Now, in the last few years, we haven’t seen as drastic of a correction, but what’s surprising is we actually have seen some corrections. I wanted to show those and point those out. I’m gonna show a graph on the screen here. This is an article, or I guess a graph from Altos Research as of last week, 1/8. They’re showing here, the trends and the corrections just on an annual basis, even in what we were considering the hottest real estate market in the country, until a few months ago.
Zach McDonald: In 2016, we saw correction here of 12.9% in prices. This is using their seven-day average. We saw a correction in 2017, with a 9.6% drop in prices, and then we saw this year … You’ll see this is a lot more drawn out and a little bit more … Well, it’s pretty steep at the beginning, and then it continues to trail off. Almost 13%, 12.79% drop in prices from the high to where we’re at now.
Zach McDonald: Now, the big question everybody asks is, “Okay. Where is the market going?” We know that the prices have dropped, we know that there was a correction. Are we heading into a recession? That’s a scary word. Are we heading into a recession, or are we going to start climbing again like we have the past few years? Now, I’ve gone on record and I’ve said, “I think that we’re gonna be continuing to see prices go up.” I agree with that sentiment. I haven’t changed my thoughts on that. You’ll see … I’ll link up this video as well, my 2019 Seattle real estate predictions. I think we’re going to see home prices climb a little bit.
Zach McDonald: I’ll share it just a really quick story here. My own personal experience with clients recently is that there are more people out in the market. I have a listing that sat for a little bit longer. Some of these homes that have been sitting on the market. We’re seeing more showings. We’re talking about a lot more showings than we were getting. Other agents in the office, are talking about the same things, as well working with buyers. There are more people out there. There are even listings that are doing offer review dates again, where they’re waiting and delaying their review of offers, rather than just taking the first good offer that comes, and milking it for multiple offers. They’re confident enough, they’re getting enough showings and people coming to look at it, to warrant that.
Zach McDonald: Other agents are even saying they’re writing competitive offers. I haven’t written a competitive offer in the last couple weeks. I think that we’re gonna see that market continue to shift in … What happens there is that you’re gonna see prices go up as there’s more demand for the supply, which is back down. We’re at 1.3 months as of December 2018. We also saw fewer listings come on the market this year. We saw more homes go pending, which means we’ll have more closed sales in January. All this to say I do still stand by those predictions. Go check those out for sure.
Zach McDonald: I do think we’re gonna see home prices in 2019 raise back up, not to where they were, I don’t think. From where they’re at now, I think we can reasonably expect to see three to five percent, like a lot of the other news outlets are predicting, as well as other major real estate companies are predicting. Now, if you’re getting value from this video and this content, which I know you are, please consider subscribing to my channel. If you’re watching in the background, and you’re seeing these videos on a regular basis, please comment below, engage. I love to say hi and engage with you. As you’ll see, I do that on all my videos. Again, thanks so much for watching. We’ll talk to you next month. Bye for now.