Our esteemed economist, Matthew Gardner, has released his 3rd quarter assessment of our Western WA real estate market. Enjoy!
The Gardner Report will tell you what’s happening in WWA real estate and a forecast for 2019.
The other graphs show you how the Seattle real estate market is trending for Q1 of 2019.
Some of the hotter neighborhoods are seeing over +15% price appreciation Feb to Mar 2019.
But most economist don’t feel we’re returning to the craziness of the last few years.
A much more manageable growth rate moving forward for Seattle, that’s nice for everyone, buyers and sellers.
So much for the HQ2/3 impact on the Seattle employment picture.
This workforce report is pulled from LinkedIn data but a good indicator of what’s happening in the broader market.
While Amazon might be slowing down their rate of hiring in Seattle, others are ramping up for 2019 and beyond – Expedia, Facebook and Google to name a few.
Seattle is still a great place to invest your real estate dollar and looks to continue…
What you want to pay attention to in the attached eye chart of a graph is the bottom graph and how every winter (December) for the last 10 years, we see a dramatic slow down in sales.
So yes, the rate of appreciation has slowed in the Seattle area since May 2018.
But, we also see a slow down in transactional sales every winter.
Put them together and it seems more dramatic and remember we had quite a run up of prices over the last 5 years.
* Mortgage Rates will climb when Fed raises prime rate early 2019.
* Amazon announces HQ2 location(s), will Amazonians move? Not likely, Seattle is still one of the most desirable cities in US for tech workers.
* Facebook just announced, increasing office space in Bellevue + S. Lake Union.
* We have 34 Fortune 500 companies in Seattle, was only 7 in 2010!
* Seattle will still be hiring moving into 2019. We’re more than just Amazon.
* Home Prices will continue to increase at new slower rate but Still Increasing.
Because of all of these reasons, I think the Seattle housing market will continue to grow and appreciate.
So, waiting for prices to drop is a long shot and the wild card of increasing Interest Rates will lower buyer’s purchasing power next Spring.
We know where we are now, the future is a gamble with so many variables.
This is why buyer’s should purchase this winter in Seattle.
All things real estate in Western WA from our own Matthew Gardner.
The following analysis of the Western Washington real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere Agent.
Washington State continues to be one of the fastest growing states in the nation and there is little to suggest that there will be any marked slowdown in the foreseeable future. Over the past year, the state has added 105,900 new jobs, representing an annual growth rate of 3.2%. This remains well above the national rate of 1.65%. Private sector employment gains continue to be robust, increasing at an annual rate of 3.7%. The strongest growth sectors were Construction (+7.4%), Information (+6.2%), and Professional & Business Services (+6.1%). The state’s unemployment rate was 4.5%, down from 4.8% a year ago.
All year I’ve been predicting that Washington State’s annual job growth would outperform the nation as a whole, and we now know with certainty that this is going to be the case. Furthermore, I am now able to predict that statewide job growth in 2019 will be equally strong, with an expected increase of 2.6%.
HOME SALES ACTIVITY
- There were 22,310 home sales during the third quarter of 2018. This is a significant drop of 12.7% compared to the third quarter of 2017.
- The number of homes for sale last quarter was up 14.5% compared to the third quarter of 2017, continuing a trend that started earlier in the year. However, the increase in listings was only in Seattle’s tri-county area (King, Pierce, and Snohomish Counties) while listing activity was down across the balance of the region.
- Only two counties had a year-over-year increase in home sales, while the rest of Western Washington saw sales decrease.
- The region has reached an inflection point. With the increase in the number of homes for sale, buyers now have more choices and time to make a decision about what home to buy.
- As inventory levels start to rise, some of the heat has been taken off the market,
- which caused home prices in the Western Washington region to go up by a
- relatively modest 6.2% over last year to $503,039. Notably, prices are down
- by 4.4% when compared to the second quarter of this year.
- Home prices, although higher than a year ago, continue to slow due to the
- significant increase in the number of homes for sale. This, in my opinion,
- is a very good thing.
- When compared to the same period a year ago, price growth was strongest in
- Lewis County, where home prices were up 15.3%. Six other counties experienced
- double-digit price increases.
- Slowing price growth was inevitable; we simply could not sustain the increases
- we’ve experienced in recent years. Lower rates of appreciation will continue until
- wage growth catches up.
DAYS ON MARKET
- The average number of days it took to sell a home dropped by four days compared to the same quarter of 2017.
- Across the entire region, it took an average of 39 days to sell a home in the third quarter of this year. This is down from 43 days in the third quarter of 2017 and down 2 days when compared to the second quarter of 2018.
- King County continues to be the tightest market in Western Washington, with homes taking an average of only 19 days to sell. Every county in the region other than Skagit and King — which both saw the time on the market rise by 2 days — saw the length of time it took to sell a home drop when compared to the same period a year ago.
- More choice in the market would normally suggest that the length of time it takes to sell a home should rise, but the data has yet to show that. That said, compared to last quarter, we are seeing some marked increases in days on market in several counties, which will be reflected in future reports.
This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors. I started to move the needle toward buyers last quarter and have moved it even further this quarter. Price growth continues to slow, but more significant is the rise in listings, which I expect to continue as we move toward the quieter winter period.
I believe that psychology will start to play a part in the housing market going forward. It has been more than 15 years since we’ve experienced a “balanced” market, so many home buyers and sellers have a hard time remembering what one looks like. Concerns over price drops are overrated and the length of time it’s taking to sell a home is simply trending back to where it used to be in the early 2000s.
Mr. Gardner is the Chief Economist for Windermere Real Estate, specializing in residential market analysis, commercial/industrial market analysis, financial analysis, and land use and regional economics. He is the former Principal of Gardner Economics and has more than 30 years of professional experience both in the U.S. and U.K.
What would you do in your city, as part of your perfect day?
So my perfect day, or morning as I did it today, included coffee in my favorite neighborhood spot, Zoka, while reading an actual newspaper.
A haircut at a new neighborhood barber, Steele Barber and then a trip downtown for a shoe shine; it’s getting harder to find a shoe shine in Seattle. Nordstrom is one of the few places left with a stand?
And then an early lunch at one of my favorite spots in the South End of Lake Union, Re:public.
South Lake Union , SLU, has gone through a complete transformation and is now the hub not only for tech and biotech but also many of Seattle’s best restaurants and cocktail bars.
So many Seattle neighborhoods have great restaurants and not to diminish any of these but SLU is attracting some of the cities most talented chefs. From established spots like Wild Ginger, Serious Pie, Flying Fish and Cactus to new places on the rise like Revel, LOCAL and Henry’s Tavern.
The walkable vibe of this neighborhood with its connection to downtown Seattle on the South Lake Union Trolley (come up with your own acronym) is opening up the area to so many people. And the trolley will eventually link to the Capitol Hill trolley for more regional public transportation.
Click on the map for homes for sale in South Lake Union + Eastlake. Townhouses and condos dominate this area but there are some great old Seattle homes with amazing views of Lake Union scattered around the lake as well.
Hope you can make it out here soon for your Perfect Seattle Day!
As your realtor for life, my job is to inform, educate and protect my clients during the buying or selling process.
One of the most confusing times for a buyer is what to do with the avalanche of information from a Home Inspection.
The group of articles below from the NAR, Nat’l Assn. of Realtors, is a good resource to help you follow along as we go through the inspection together after walking through the prospective home with the inspector.
The walk-through step is important and often skipped in a hot market where buyers are waiving the home inspection or accepting a home inspection report that was procured by the seller.
By procuring your own inspection, the buyer gets to walk through the home and ask questions of the inspector as they’re preparing their report; very valuable.
Work with a friend.
My latest neighborhood series – Phinney Ridge in North Seattle just west of Greenlake.
Get the scoop on this super popular Seattle neighborhood in my video and in person.
I’ll be hosting an Open just off Phinney Ridge (Greenwood Ave) this Saturday from 11-2pm.
On tour in Phinney Ridge by Greenlake in Seattle.
Open House, Saturday, 10-20-18, 11-2p.
326 N 78th St.
Thank you Amy Hyden, Windermere Mt. Baker, (listing agent) for the great Phinney Ridge video below!