Seattle Real Estate Market Watch 3/22/23

Hey y’all, Zach McDonald, your real estate agent with Real Property Associates, and this is my Seattle Real Estate Market Watch for March 22nd, 2023.

Well, interest rates have done the little up and down here and coming back up a little bit, creeping up towards 7% again for mortgage rates. As of today, 6.7% mortgage rates on Mortgage News Daley’s website. We’ll see what the day looks like tomorrow. I think that’ll factor in the fed’s increase of 0.25%, quarter percent. I think that was maybe what was expected. I think that there was a expectation maybe earlier on before the banking stuff over the past few weeks that maybe that was going to be higher. But I, I was thinking they do a smaller rate hike and still keep with that, which they did today. interestingly you know, mortgage rates are not, again, directly correlated to the fed rate. So we’ve seen these rates been going up over the past few months. but mortgage rates have hovered in the same range here for quite a while.

So again, there’s no direct correlation, although there is cause and effect. So it’ll be interesting to see what that and how that affects the mortgage markets here. but the market itself in Kingston, hoish County continues to remain hot. It’s really interesting to see multiple offer situations. Again, I’m seeing very frequently on new listings, the offer review dates, which is an interesting thing to navigate. Again, I think buyers became accustomed to seeing houses go beyond offer review dates or no offer review dates. So they were expecting to see houses, maybe sit on the market for a little while, be able to negotiate the price, maybe have more favorable terms in the contract, but it’s just not the reality right now, especially for houses that are a little bit more desirable or condos that are a little more desirable and especially in the more desirable location.

So there’s an interesting just balance right now going on where you’ve got some houses seeing price reductions. We saw 193 price reductions last week. So clearly not every single house is selling super quickly, but we are seeing those days on market trending downward, which we saw in the last Seattle real estate market update. That was the February data, and we’re still seeing a lot of things going pending. 761 pending transactions over the last week. And again, some of those are houses that were already pending that became closer to sold, is what I like to say. They were maybe pending inspection and gone depending, but we’re still seeing a large number here. in comparison to the new listing number, which although we saw 452 new listings come on the market, which is more than the 4 23 from last week’s update, we’re still not seeing what we would normally expect to see in a given month this time of year.

We’re typically seeing the most listings, or at least the beginning of that trend. And we’re not seeing the normal amount of new listings for this time of year, which is keeping our inventory low, which is why I think we’re seeing some of the multiple offers. The offer review dates in a low inventory environment, that’s where you have those offer review dates because you want to see are there multiple buyers that want to buy the same house? And the answer is yes. Right now we’re seeing competition, we’re seeing multiple offers, we’re seeing houses sell above, asking price. We’re sell seeing houses go directly to pending without being pending inspection. It’s becoming a more normal thing, again, where buyers are saying, you know what? I don’t need to inspect. Now, they’re not necessarily paying 20% over asking price. That’s not common. A lot of times it’s selling at asking price or really close to, but still seeing contingencies being removed.

That’s the first sign that the market’s heating up. And then you start to see the prices because that becomes a lever. People start pulling. So at first it’s buyers that are willing to remove contingencies and pay a little higher price, and then it starts to become everything, right? You gotta pull all the levers, price and the terms in the contingency. So again, we’re starting to see a little bit of both, but we’re still, I think in the situation where we’re seeing more of the better terms and contingencies for the seller, but not necessarily growth and price yet, but things may change here and, and it, it may get back into a more higher inventory environment later in the year. It’s hard to know for sure, especially with the lack of inventory, at least seasonally adjusted for right now. But I think contingencies are still happening.

15 contingent sales, 16 last time, we’re still seeing that. So I think Inston Home Mission, king County, it’s a very small amount of the sales, and I like to point this out. 15 out of 536, right, that 536 sold listings and 15 went pending or went pending contingent. So, and out of the 761 on there, the pending sales 15 contingent. So I wouldn’t say that’s a very large number or percentage, but it means that there’s a possibility for buyers cancel listings. you know, 67 versus 50 last week. I wouldn’t say that’s a substantial amount. Not a lot of expired listings either. Only 20. It’s not the end of the month though. So that’s typically when those happen. But I think things are starting to sell. We’re not seeing as large a numbers in this area. So I think overall, as I’m looking at things, I am, I think the thing I’m monitoring the most is the inventory.

And it seems that listings are down. There aren’t a lot of houses to show buyers, which feels a lot like last year when the market was really hot in the office and other agents, they’re having the same conversations. There’s not a lot of houses just to show and there’s not a lot of listings either, and they don’t have a lot of listings coming up. And I think that’s the barometer. Are we going to have enough houses for the buyers that are in the market? There’s clearly not as many buyers. I’m still having conversations with buyers that are feeling the effects of the higher interest rates on payments, which affects affordability. Also, having those same conversations around fear. What’s going to happen in the future? Where’s the housing market headed, right? Those are still those same conversations.

So we’ve got this interesting place. There are fewer buyers, but there are even fewer listings than the fewer buyers. Last year we saw the opposite, right? When the market was adjusting and shifting, we saw more listings, people trying to catch the top of the market, more listings than the buyers. And that’s where we start to see the downward pressure on prices. And we start to see the more flexible terms, the better prices. Well, right now we’re in this situation where we’re not seeing that, and I think it’s surprising to buyers. So I don’t want it to be a surprise. I think for sellers, it’s a refreshing thing to see, right? They were in this place where they were losing some of the negotiating power. I think sellers are back in a position where if they price their house right and, and they’re in the right location, that they do have a little bit of negotiating power again back in their favor. So I would say that’s my update here for today. If you have questions about what’s going on in the market, you want to connect about your situation, talk a little bit more about the Xs and Os so to speak, feel free to reach out, happy to be a resource for you.