King County’s Real Estate Market is Strong
There are several factors supporting the market’s strength. The 2020 Housing Forecast for Greater Seattle covering King, Pierce, and Snohomish counties, says the housing demand should stay strong and first-time buyers have a great opportunity. We have a strong job market which should see a 2.2% employment increase over last year. Millennials are buying rather than renting, especially as they begin a family and, as first-time home buyers they are a major part of the housing scene. King County’s property prices are less than those in many metro areas, including the California Bay area, so we are seeing out-of-state buyers moving in. There is limited new construction to compete with resales, which is good news for home sellers. Let us check out some statistics.
King County Housing Stats Support Predictions
2019’s stats show the market should hold for 2020. Based on average days on market for homes to go under contract, it is a seller’s market. The number of homes on the market shows sales inventory was down in December by almost 40% compared to December 2018. The single-family home median price rose 6% over December 2018 and was even up over November 2019. That is an interesting point given that December is a traditionally slow month for house sales because of winter weather and holidays. If we drill down into the numbers for Auburn, Kent, and Renton, their home prices rose 16% year-on-year.
The Northwest Multiple Listing Service (NWMLS) issued a news release saying (in January 2020) that “buyers are out there and are showing up at open houses and making multiple offers on new listings.” This is due, partly, to lower inventory and partly because buyers believe prices will continue to rise this year. The actual stats for single-family homes and condos were way down in 2018 in three counties are: King -38.8%, Pierce -38.9%, and Snohomish -35.6%. All pointing to a strong sellers’ market.
Eastside’s active listings in December were only 642, compared to December 2018’s 1,213 homes on the market. As we move into the spring weather, there are likely to be more homes coming on the market, so buyers may have a broader selection, but the number of buyers may also increase, so we still expect to see a seller’s market in 2020.
Home supply in King County is below one month. To put that into perspective, a “balanced real estate market” is considered to have an inventory of no less than four months’ supply of homes for sale. The record suggests that today, a properly-priced home marketed correctly should be on the market for less than 30 days.
The obvious conclusion is that home sellers may expect either multiple offers and to accept one of them within a month. The other side of the coin is that home buyers are preparing properly as far as loan pre-approval and other lending qualifications are concerned. Realtors are bringing ready, willing, and able buyers to view homes of serious sellers.
The forecast for 2020 looks good. Sellers who price their homes right, and who have them marketed effectively, should see contract prices very close to, or at, listing price. Buyers should have a greater selection of both single-family homes and condos, but they may have more competition for those homes. It looks like the demand for homes will not be met by new construction to move us beyond a sellers’ market.
With strong employment figures, good wage-earning potential in the tech industries and continuing low-interest rates, 2020 should be good for sellers who want to sell. It should also be good for buyers because, even though they may pay top dollar, they should see continuing appreciation on their new home’s market value.
Buying or selling is complex. Pricing and marketing a property effectively take experience and a strong track record. Helping buyers find the right home in the right area takes experience – and keeping one’s ear to the ground. Successful selling and buying come from making good decisions based on accurate and timely advice. So if you are thinking of selling or buying, please contact me to discuss your options so you take the best next step.