News Flash! Did you know we are in a shifting housing market? This isn’t theory and it is not hypothetical.
Yes, the Greater Seattle Real Estate Market is shifting…and it is happening right now. In today’s short video we are going to look at 3 indicators that buyer demand is dropping. Let’s get into it.
Looking at the most recent sales numbers is essential to staying informed on market trends. If you want to know the monthly market stats, then check out this video: https://youtu.be/qJxIwwnjKjc. However, if you just look at closed sales you would think we are still in a white hot-sellers’ market, which is not the case. Real estate isn’t liquid like the stock market and noticing changes can take more time. To stay informed about the Seattle Area Real Estate market, there are several other factors to consider besides closed sales.
The first indictor telling us that buyer demand is cooling is real time data from fellow real estate brokers AND our current experiences representing buyers and sellers in our local market. This includes active homes for sale, signs of rising inventory, the most recent pendings, the number of showings and how many offers are received.
As an example, we recently listed and sold a home, just north of Seattle, in Mountlake Terrace. We received 3 good offers, all above the asking price. The winning offer was $62,000 above the list price. However, earlier this year, we probably would have received 5 – 10 offers, and the price could have easily gone even higher. Many brokers we have talked to in the past week are telling us similar stories.
The consensus amongst real estate brokers is that the Seattle area market is still strong for sellers. But, it’s not the white-hot market we experienced earlier this year. Listings are receiving fewer showings and fewer offers. Yes, prices are maintaining for the most part. Still, we aren’t seeing the dramatic run up in prices we have been over the past 18 months. It’s the huge increase in both price and interest rates that have put many buyers out of the game. It’s just unaffordable for many.
Another sign the housing market is cooling concerns the market opinion. Look at this recent Gallup poll, saying that ONLY “Thirty percent of U.S. adults say it is a good time to buy a house, down 23 percentage points from a year ago and the first time the figure has been below 50%. Gallup has asked the question since 1978” (https://bit.ly/3LLisaJ). Real estate research groups like Corelogic and Fannie Mae echo these remarks of declining homebuyer interest. This is a big deal.
It is a big deal. When the majority of people think it is not a good time to purchase a home, what happens? Well, fewer people buy homes. With less demand, the market begins to soften. This is market sentiment, which is mere opinion. However, it is still important to track because perception can become reality.
The third thing we want to share with you regarding our market slowing down relates to this recent Seattle times article. The headline says “Pandemic’s vacation-home-buying frenzy beginning to fizzle” (https://bit.ly/3a268W8). This makes sense because a second home is not a necessity. It is a luxury and very appealing to a lot of folks. However, people who don’t have to buy a home as a primary residence are not as eager to pay the high prices and high rates. It’s that simple.
We all know the main driving force to real estate is supply and demand. However, other factors strongly influence the market. The national economy, local jobs, interest rates, new housing starts, market sentiment, population growth, inflation, and other factors will strongly influence our Seattle Area Real Estate market.
Our housing market is rarely stagnant. It is fluid and always changing. We are currently at an inflection point. As homebuyer demand wanes we are constantly monitoring how this, as well as other factors, affect the market so you can stay in the know!
If you found any of this information valuable or if you just want to stay up to date regarding our ever-changing Seattle Real Estate Market, please consider clicking that ‘like’ button and becoming a subscriber on our YouTube channel.
We’d also love to hear from you. What do you think is going to happen to our market for the remainder of 2022? Please leave a comment below.
See you next time!