What’s happening to the Seattle Real Estate Market? The market has cooled off but compared to much of the rest of the country, the market in Seattle is healthy and not tanking.
Seattle has strict growth-managment policies and therefore has not seen the same building boom as some parts of Arizona, for example. So overbuilding isn’t as much a problem here as it is in some other areas that have seen tremendous urban sprawl. We do not have an overabundance of vacant inventory.
A strong job market is key to a healthy housing market. The number of new jobs has outpaced or at least kept up with building permits for single-family homes and condos in this area. The Seattle Area has seen a tremendous amount of local job and population growth. In fact, “growth in this sector is running twice the national average, plus high wages. Local per-capita income, expected to be $46,356 this year, is 19.7 percent above the national average” (Elizabeth Rhodes, Seattle Times, December 2007).
Location. Location. Location. Yes, real estate is local and even though some areas can be doing really poorly, some areas can do really well. And yes, Seattle is doing well, although, national factors do and will affect all local markets. National factors have affected the Seattle market.
In the summer of 2007, the mortgage industry saw a meltdown which resulted in a shortage of funds available to lenders for home loans. Money was and still is difficult to come by for credit-challenged borrows. With fewer qualified buyers there is less competition – less demand – lower prices.
So, although Seattle has a lot going for it, particularly a strong and good employment, it can’t be completely incubated from the national crisis.
We get a lot of clients asking us to predict the housing market. Obviously, we can’t do that. We think that the market has slowed down and that appreciation will be relatively flat for a while.
However, we would not expect home prices to drop in the Seattle area.
Some of our buyer clients we have been working with have decided to wait and see what the market will do. And some of our sellers have decided to sell “before the bottom drops out” or have decided to wait “until prices go up again”. Clients ask us what the best time is to buy and sell.
If you are looking to speculate in the market short term, I would say – stay out. It is simply impossible to predict with any certainty exactly what the market will do.
If you are a renter, thinking of buying, I would say – do it. If you can qualify for a mortgage now and you think you will occupy your new property for at least 5 years, buy now. It is a buyer’s market (for the first time in a long time in Seattle !!!). Now is the time to negotiate on a good price, get some closing costs paid for and get some critical repairs paid for by the seller). We do not predict prices to drop much if at all and mortgate rates are great right now.
If you are a seller, thinking of selling, I would say – maybe. If you plan on staying in the area for only a short while longer, because you are retiring, relocating, etc. Do not switch to being a renter. Do not list your home for sale in the winter months. Come on the market in the spring. (November through January – are usually slow months for real estate in Seattle). If you plan on staying in Seattle long-term and like your home, keep it. Remember, there are other benefits to owning a home besides appreciation such as tax benefits, pride of homeownership, etc. If you have outgrown your home and plan on moving into a bigger home, now is a good time to do that. Yes, you may not get top dollar for your current home but you will get a great deal on the new home (which presumably is more expensive and your savings in percentage will be greater on the new house than the “loss” on the old house).
If you have any questions regarding this particular blog entry or any other questions regarding real estate, please feel free to contact us at your convenience.
Happy New Year!!!
Kerstin G. Brooks
Brooks & Heinze Team
Remax Northwest Realtors (Seattle)
Email: info@propertyinseattle.com
Web: http://www.propertyinseattle.com/
Cell: 206.276.5827
This article was written by Kerstin G. Brooks, Realtor, ABR
Kerstin G. Brooks, Broker 