KIRKLAND, Washington (March 6, 2018) - Interest rates are creeping up, inventory is still squeezed, and some feared revised tax laws would have a chilling effect on home sales, but Northwest Multiple Listing Service leaders say the local market remains competitive.

The most recent market report notes that there should have been a chilling effect on the real estate market since the start of 2018 due to the newly revised tax laws limiting mortgage interest deductions. However, these revisions did not seem to matter. The "chilling effect" that the experts were expecting did not even dent and even hotter and more competitive market as compared to the same time last year.

Some Quick Facts and Figures:

  • Among the four Puget Sound area counties, Snohomish had the largest year-over-year price increase at 18.8 percent. Its countywide median price for February's sales spiked to $460,000 from $387,250.
  • Northwest MLS figures for last month indicated that other key indicators of the market - new listings, closed sales, and selling prices - all showed gains in February compared to 12 months ago. This despite showing a slight year-over-year decrease (about 2.8 percent) in overall pending sales, a likely consequence of inventory being down nearly 12.9 percent.
  • For single family homes (excluding condos), prices rose 13.7 percent overall, from $343,000 to $390,000. Within King County, the median price was $649,950, with three areas (Mercer Island, Bellevue west of I-405, and Kirkland-Bridle Trails) reporting median prices of more than $1 million for single-family homes

*Source Info: NWMLS March Market Update

Why Should You, as a Seller, Act Now?

Currently, both King and Snohomish counties have less than a month's supply which means, there are a lot of serious buyers out there looking. As we know, the real estate market is a cyclical thing. It would be interesting to note that this was the case in the last two years where home values spiked in February, thanks to a cyclical low point in supply. Prices are now back around the peak levels of last summer, and cyclically speaking, are headed for additional increases until summer arrives. 

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Finally, many brokers expect inventory levels to improve soon. "The arrival of daylight savings triggers a burst in new listings," proclaimed J. Lennox Scott, chairman, and CEO of John L. Scott Real Estate. "More listings lead to more sales. In real estate, it's all about the new listing," he stated. So it is best to take advantage of the current situation where you can get the most out of the sale rather than have competitors left and right and you'll have to accept that you'll have to sell at a lower price point than what you expected or wanted.

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How is This Relevant to You as a Buyer?

Many buyers feel a looming pressure. Some are frustrated with what appears to be a lack of choice, while most are beginning to understand the harsh reality that high home prices are here to stay. The challenge here is that while there is very little available inventory in the market, the number of buyers is near record highs, too. The supply and demand won't balance out thus driving the prices up. 

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Slight upticks in the mortgage interest rates are also a problem (Note: George Moorhead, designated broker at Bentley Properties, noted 30-year mortgage rates climbed slightly for the seventh consecutive weekly increase, but he said these small increases "are not yet creating too much of a stir." ) because such increases have led to slightly higher mortgage payments. The right plan, such as considering smaller homes, or longer than hoped for drives and help from a skilled broker, can help one find success in this fast-paced market.

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Are you planning to buy or sell anytime soon? Want to know more about what options you currently have available in the market? Come talk to us!

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