What is going on with the Seattle housing market?
Will the “Bubble” burst? Is there a bubble?
How high will interest rates go?
Will the nationwide recession affect our home values?
There are a lot of people who are freaked out that the market is going to crash or that we are in some sort of housing bubble.
However, this time is not like 2008 because we’ve got better underwriting on our loans – people were thoroughly vetted to make sure they could pay their mortgages, we had good appraisals, and people have a lot of equity.
We are seeing fewer and fewer Forbearance Plans going into effect – which is basically an “emergency payment plan” lenders work out with borrowers who have gotten behind on their monthly payments. Fewer of those are going into effect, meaning fewer people are having trouble making mortgage payments.
We just have a lot of money in this area, and limited housing options available, so that’s really forced prices up quickly, but for the most part, people who are in homes, can afford their homes. House payments for homeowners today are much more comfortable (nationwide) than they were in 2007 before the market crash and are similar to or better than they have been historical. And if someone did have financial trouble due to job loss, bankruptcy, hospital bills, etc. they would be unlikely to have a foreclosure, because they could still sell the home for enough to pay the mortgage.
Anecdotally, I will say I am seeing a softening market. In the affordable price points, say under $800K, we are still seeing multiple-offer competition for homes, but in more expensive priced homes, things seem to be cooling off.
We have been seeing more homes sell with just one offer, whether it is on the offer review date, or afterward.
We used to price homes at the level of our “Comparable sales” and then see them get bid up by six figures.
Now we are pricing them at the level of comparable sales and seeing them sell for around that amount – sometimes with a price increase if there are multiple offers, but we are also more frequently seeing them sell for less – and even having to reduce the listing price if sellers have gone out of the gate too aggressively. Most homes are selling for within 5% of the list price, assuming it was appropriately calculated.
This is the time when seller’s should be more cautious about who they work with as their listing agent. No longer can we just have Uncle Joe put a sign in the yard, and throw it in the MLS and create a bidding war.
That’s why I always do more when we list every home: We market through phone, video, text messaging, flyers, open houses, and online advertising (like this video that you’re seeing) to make sure likely candidates get a chance to see your home. 96% of Buyers see a home online before making a decision to visit it, so we need to make sure we’re getting in front of them!
If you’d like to learn more about how we implement our A-PLUS system to help your home sell quickly and for the top price, be sure to click the link below and request a home valuation.
For now, my forecast for the Shoreline area is to observe that home sales have softened up quite a bit lately, but values are still high and should continue to increase – just more slowly, helped along by inflation and our imbalance, buyer-heavy marketplace. If you have questions or want to discuss the economic models behind this update, feel free to reach out or write a comment below.
Otherwise, I’ll see you at the next one. Thanks for watching. I’m Emily Cressey, and here at HomeSmart Real Estate – We do more.