The spring selling rush may already be under way, as some home owners are already throwing their properties on the market to take advantage of rebounding home prices and improved equity.
Paul Reid, a real estate agent in Temecula, Calif., says some sellers are listing properties earlier than usual in anticipation of the spring season.
Sellers are “nervous about what the spring is going to bring,” says Reid. “They don’t know if everybody will list this spring — then you’ll have a big counterbalance toward too much inventory — or if there’ll be a crunch again. They figure they’ll get out ahead of the market, list, sell, and be done with it.”
Inventory shortages persisted last year, when supply was at a 12-year low leading into the spring. The shortages helped boost home prices, but gave home buyers limited choices and sparked bidding wars in many markets. New-home construction is now at a third of its 2006 peak, which likely will keep inventories tight this spring. But, economists say, improved home prices will likely convince more sellers to sell this year, and that should relieve the inventory crunch in many markets.
In the last four months of 2013, year-over-year inventory levels of homes for sale began to climb after 30 straight months of declines, according to the National Association of REALTORS®.
Inventories increased in some of the states with the tightest markets, such as Arizona, California, Georgia, and Florida. In Sacramento, Calif., asking prices rose 11 percent last year, and listings soared 58 percent in December, according to realtor.com®’s housing report. Inventories also rose by 20 percent or more in Minneapolis; Orlando, Fla.; Atlanta; Dayton, Ohio; Oakland, Calif.; and Phoenix.
“Rising inventory is the primary reason that we expect the pace of price gains to drop back,” says Paul Diggle, property economist for Capital Economics Ltd. Prices are expected to rise only 4 percent nationally this year, compared to an 11 percent gain in 2013.
Source: “U.S. Home Sellers Return for Spring as Buyers Get Relief,” Bloomberg (Feb. 7, 2014)
On a local note: Record low inventories persist on English Hill and the Seattle area. If you are considering selling, contact us to take advantage of our current market conditions.
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Nation’s Largest Home Builder Seeing Strong Sales – Raising Prices
Homebuilder Says It’s Upbeat Enough to Raise Prices Again
D.R. Horton, the largest U.S. home builder by homes sold, announced that strong sales will allow the company to raise prices for an early start of the spring home-selling season.
The homebuilder announced a 4 percent increase in sales contracts in the first fiscal quarter ending Dec. 31, and a net income of $123.2 million — its highest since 2006.
“In January, and especially in this last week, our sales have been better than expected,” says Donald Tomnitz, D.R. Horton’s chief executive. “I feel that we’re right on the cusp of a strong spring-selling season.”
In November, the builder had said that if sales signaled a slow start to the spring selling season it would try promotions such as free upgrades and assistance with closing to spur sales. But D.R. Horton says that sales are strong enough that it will mostly forgo incentives and raise home prices in some markets.
The average price of D.R. Horton homes under contract last quarter was $275,600, up 10 percent from last year.
The National Association of Home Builders predicts that new-home sales will increase 40 percent in 2014 over 2013. But any steep rise in mortgage rates and aggressive price increases from builders could derail that, housing analysts and economists warn.
The fact that D.R. Horton has “struck an optimistic chord gives us incremental confidence that the spring-selling season is off to a good start,” says Robert C. Wetenhall Jr., managing director of equity research at RBC Capital Markets.
Source: “D.R. Horton Says Strong Sales Allow It To Raise Prices,” The Wall Street Journal (Jan. 28, 2014)
Eastside Real Estate inventory remains tight and prices are up 13% from a year ago
Inventory levels in October remain tight with 1.7 months for single family homes and 1.5 months for condos. Sold prices for homes are up 13% and condos are up 17% as compared to one year ago. The chart below applies to the Greater Eastside, including Bellevue, Kirkland, Redmond, Issaquah, Sammamish, Woodinville and Bothell.
For more information on how the changing market applies to you, contact us here:
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SOLD FOR $511,100! English Hill Listing – Completely remodeled Redmond home features 3 bedrooms, 2.5 baths and 1,930 s.f.!
Redmond – English Hill – $465,000
Completely remodeled home in Olde Morrison on English Hill. The well laid out floorplan boasts 1930 s.f. and features 3 bedrooms, 2.5 baths on a private lot! Many recent updates include – remodeled kitchen and baths, newer carpets, new triple pane windows, new molding and doors! Sunken formal living room with bay windows. Formal dining room with coffered ceiling and ample windows. Totally updated kitchen with island, skylights, pantry, attached nook and features white cabinets, slab granite counters & stainless appliances included! Relaxing family room with cozy brick fireplace and big windows overlooking the rear yard. Remodeled powder room with bead board, cherry vanity and granite counter. Wonderful master suite with walk-in-closet. The 5 piece master bath has been totally remodeled with tile floors, pedestal sinks, glass block shower – all accented in white bead board. Two additional bedrooms upstairs are very spacious. The full bath in the hall has been remodeled with tile floors, cherry vanity and granite counter. Big, entertainment sized deck overlooks the private rear yard which is surrounded in greenery – great for relaxing or soaking up the sun! New cedar fence enclosing the yard, an 8 x 12 insulated shed and a fun play structure too! Southern exposed garden beds and lush plantings will satisfy any gardener! Attached two car garage with storage possibilities above. Outstanding Northshore schools – Sunrise Elementary,Timbercrest Jr High & Woodinville High.
Tony Meier
English Hill’s Top Selling Broker Since 2007
Making Real Estate Easy, Fun & Profitable!
Serving Buyers, Sellers & Their Referrals Since 1989
Windermere Real Estate/NE
EnglishHillOnline.com – Covering all aspects of live on English Hill
EastsideHomes.com – Seattle’s Eastside Real Estate Resource
Western Washington housing market “energized” and showing signs of “definite turnaround”
KIRKLAND, Wash. (May 3, 2012) – Northwest Multiple Listing Service brokers reported double-digit gains in both pending and closed sales during April compared to a year ago, but the most eye-catching number may pertain to prices. For the first time in more than four years (since January 2008) the year-over-year change in selling prices was positive.
The price gain was a modest 1.27 percent for last month’s sales of single family homes and condominiums that closed in the 21 counties served by Northwest MLS. For single family homes (excluding condominiums) the price gain compared to 12 months ago was 2.9 percent. Condo prices fell 7.9 percent.
The median price for last month’s closed sales area-wide was $240,000 for single family homes and condominiums combined. That compares to $237,000 for year-ago sales. The figure for April also outgained the median price for completed transactions during the months of March ($225,000) and February ($218,944).
Prices for single family homes continued climbing. The median price for last month’s closed sales was $250,000, up from both a year ago ($242,950) and from March ($234,487).
While cheered by the figure that snapped a 50-month string of negative numbers for year-over-year price comparisons, Northwest MLS brokers said consumers must be realistic in their expectations. They also noted the market recovery will be slow and incremental.
“We’ve seen appreciation three months in a row, signaling a definitive turnaround in the market,” remarked OB Jacobi, president of Windermere Real Estate. “Due to the shortcomings in the Case-Shiller index I think it will take them until November to report year-over-year appreciation,” he added
. (The S&P/Case-Shiller Home Price Indices track changes in the value of residential real estate both nationally as well as in 20 metropolitan regions.)
“As is fairly typical of a recovering market, the activity first heats up in the urban centers, and then spreads to the surrounding suburbs and outlining areas. We are now seeing this trend,” noted Jacobi, who is also a member of the Northwest MLS board of directors.
Tight inventory is creating sellers’ markets in some areas, according to reports from MLS directors. Inventory is down more than 27 percent for the Northwest MLS market overall, and by even larger margins in three counties: Snohomish (down 46.2 percent), King (down 39.4 percent), and Pierce (down 28.6 percent). Brokers say as demand outstrips supply, competition may intensify, especially for homes that are well-priced and in good condition in desirable locations.
Brokers added 9,166 new listings to inventory last month, which was 917 fewer listings than the same month a year ago. At month end, the selection totaled 25,291 active listings, a drop of 27.5 percent from a year ago according to the latest figures from Northwest MLS.
It is a seller’s market in Kitsap County, reported Northwest MLS director Frank Wilson, the branch managing broker at John L. Scott Real Estate in Poulsbo. Statistics show inventory there is down more than 13 percent compared with a year ago, pending sales jumped 39.3 percent and median prices increased more than 14 percent.
MLS members reported 8,790 pending sales across all 21 counties during April for a 22.9 percent increase from a year ago when there were 7,154 mutually accepted offers.
Talk of a seller’s market has to be tempered, Wilson emphasized, because “when sellers hear these words in the news they instantly think their homes are worth a lot more money….and they are not. Even if our home prices appreciated 2-to-3 percent a year – which they aren’t currently — it will take many years for homes to return to the values that we saw a few years ago,” he suggested.
Despite his cautionary words, Wilson was upbeat. “We continue to see an increase in activity across the board. More people at open houses, more listings coming on the market, more buyers making offers and more multiple offer situations on correctly priced and staged homes.”
While Kitsap County experienced an uptick in new listings in April compared to a year ago, 11 other counties reported drops. System-wide, based on current inventory and demand, there is less than a three month supply, about half the volume needed for a balanced market.
Inventory is considered by many industry observers to be a key indicator affecting the housing market. In a recent Bankrate.com interview about the market’s recovery, Stuart Gabriel, director of UCLA’s Ziman Center for Real Estate in Los Angeles, suggested zeroing in on inventory, which he called “the most important statistic.”
“The pent up demand of local home buyers who are now purchasing homes has ignited a surge of sales activity,” observed J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. He said this surge is creating a shortage of inventory, causing multiple offer situations for many new properties coming on the market. “For homeowners who have equity, and have been cautiously waiting to sell, this ultimately means they can sell their home today and purchase within the same market timing,” Scott explained. Historically low interest rates are an added advantage, he added.
Northwest MLS director Meribeth Hutchings, designated broker/owner of Windermere Real Estate in Lake Stevens also commented on surging activity. She credits favorable interest rates and low inventory for spurring activity. “The demand for ‘good clean homes’ is extremely high,” she commented, noting, “Our primary buyer today is still the first time homebuyer.” Hutchings, who has more than 27 years of real estate experience, also suggests sellers who want to sell and have the equity should be placing their homes on the market now.
Also commenting on inventory and the lively market was MLS director Joe Spencer, area director for Keller Williams Northwest Region.
“As Yogi Berra said, ‘It’s like déjà vu all over again’ as the Puget Sound real estate market continues trending in the same positive direction for the fourth month in a row,” Spencer remarked. With new and available inventory in a diminished state, he said there’s been a strong increase in buyer activity. “Low interest rates continue to energize buyers, while for sellers, prices in the Puget Sound are stable and up in areas close to job centers,” according to Spencer.
Darin Stenvers, office managing broker at John L. Scott in Bellingham believes the housing industry is recovering on its own, citing double-digit decreases in inventory for the past several months and a corresponding rise in pending sales as key indicators.
“It’s a slow process, but I expect it will continue for the balance of 2012 and through 2013,” Stenvers stated, noting he anticipates a return to home value appreciations in most markets by mid-2013. He also predicts consumer confidence will hold interest rates down through the fall elections and well into 2013.
“Consumers are bothered by the lack of inventory and are ready to make sure that they do not miss out on what may be the leveling off of the declining market values,” Stenvers stated. Buyers who were expecting to have offers accepted that are well below market value “are beginning to express frustrations” that this is no longer occurring, he added. “As prices stabilize and inventories drop many buyers will feel the chance at home ownership at bargain prices slipping from their grip,” the MLS director observed.
Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership includes more than 22,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 21 counties in Washington state.
Tony Meier
English Hill’s Top Selling Broker Since 2007
Making Real Estate Easy, Fun & Profitable!
Serving Buyers, Sellers & Their Referrals Since 1989
Windermere Real Estate/NE
EnglishHillOnline.com – Covering all aspects of live on English Hill
King County Real Estate Market Heats Up! – Your chances of sale haven’t been this great since 2006!
NWMLS April 5th, 2012
“Buyer Ready” Home Shoppers Have Edge as Brokers Report Rise in Multiple Offers
KIRKLAND, Wash. (April 5, 2012) – The housing market in the Puget Sound region is pointing toward a sustainable recovery, according to several brokers who commented on the March activity report from Northwest Multiple Listing Service.
MLS Members reported 9,126 pending sales during March, a year-over-year increase of nearly 21 percent. That total surpassed the previous month by 1,503 transactions (up 19.7 percent). Coupled with shrinking inventory, attractive financing, and rising consumer confidence, the market is becoming more balanced, and even being described by some brokers as “frenzied.” Other brokers commented on the “remarkable opportunities for investing in the residential rental market.”
Brokers added 8,170 new listings last month — nearly 1,000 fewer than the number of pending sales, and about 1,100 fewer new listings than the same month a year ago. With those additions, the number of active listings at month end totaled 24,883 across the 21 counties in the Northwest MLS service area. Compared to a year ago, inventory is down 25.6 percent.
“Buyers are screaming for more inventory and they’re being more aggressive with presenting offers on homes,” reported MLS director George Moorhead, branch manager at Bentley Properties in Bothell. Home shoppers perceive the bottom is nearing, he noted, “and both buyers and sellers want to catch the historically low interest rates.” Area-wide, he said bank-owned home sales are increasing. “The lagging inventory is actually helping prices stabilize, which we hope will have a positive impact on the real estate market as the year progresses,” he added.
“Close to the job centers, 45 percent of new listings are selling within a single month. We are seeing a frenzied market in the Puget Sound region, especially in the more affordable and mid-price ranges, with an increase in sales activity in the high end,” remarked J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. “Because of the shortage of homes for sale, combined with the sales surge being driven by job growth and historically low interest rates, if you are not ‘buyer ready’ you may not get a house in today’s market,” he added.
Northwest MLS brokers reported 5,044 closed sales last month, improving on the year-ago total by nearly 10 percent. The overall median price on last month’s completed transactions was $225,000, which reflects a decrease of 7.4 percent from the year-ago median sales price of $242,925.
Noting stabilizing prices are “forcing buyers to make offers that reflect a more balanced market,” Northwest MLS director Darin Stenvers said house-hunters have taken note of rising rents, fewer choices and increasing fuel costs. The trends are not universal, he acknowledged, but certainly reflect a higher buying confidence level and even a small uptick in new construction. “I’m seeing new home starts in areas that had been at a standstill for years,” reported Stenvers, the office managing broker at John L. Scott in Bellingham.
Multiple offers are occurring with regularity in some neighborhoods according to Northwest MLS directors. “The housing market in Seattle’s close-in neighborhoods began to show signs of buyer panic in February but reached a breaking point in March,” reported Mike Skahen, owner and designated broker of Lake & Co. Real Estate in Seattle. “I haven’t seen buyers this motivated since 2006 and in my opinion, prices on good houses have recovered at least 10 percent of their value since the low point a year ago,” he added.
Skahen said a small Ballard home listed for around $370,000 recently drew five offers and sold for considerably more than the list price. “It’s becoming common for multiple offers on most houses, especially those priced under $400,000 where the selection is very limited,” he observed.
“Now that buyers can track new listings online they are aware of how quickly most listings are selling and fear they’ve missed catching the bottom of the market. They realize continuing to wait would be a mistake,” Skahen commented.
Diedre Haines, another Northwest MLS director, said pending sales in Snohomish County, which jumped 21 percent, would have been “considerably greater were it not for the buyer competition due to the magnitude of multiple offer situations.” She said they are seeing the return of price escalator forms, pre- inspections, set dates for sellers to review offers and properties selling above list price,” according to Haines, the regional managing broker at Coldwell Banker Bain in Lynnwood. “Prices are not increasing dramatically but those properties that are listed and priced correctly, especially in the $300,000 and below range, are selling within days of coming on market,” she noted.
Haines also said they are seeing multiple offer situations in the higher priced market “but not as many over list price sales.” She reported the demand ratio in Snohomish County, based on a recent analysis, “is at the highest levels we have experienced since 2006.” She also noted the report showed there are two buyers for every current home on market in Snohomish County.
A similar scenario exists in Kitsap County. “Inventory is down by 11 percent, buyers making offers are up almost 34 percent, multiple offer situations are on the rise, and more people are coming by our open houses,” reported Frank Wilson, branch managing director at John L. Scott’s office in Poulsbo. “While the median price in Kitsap is down by 5 percent it is only a matter of time before prices stabilize,” he believes.
The optimism comes with a cautionary note. “It is still extremely important for sellers to price their property correctly,” Haines emphasized. Even with high demand, homes that are priced above comparable properties are not receiving offers, she explained, adding, “We are seeing very positive signs of a continuing recovery but buyers are well educated regarding values and pricing. Sellers should not expect huge increases in values and need to price their properties accordingly and realistically.”
The uptick in activity is attracting not only first-time and move-up buyers, but also investors, according to industry experts.
“Rental demand is surging, interest rates are at historic lows, and recent economic activity has erased nearly a decade of appreciation,” reported MLS director OB Jacobi, president of Windermere Real Estate.. He believes the combination of these three factors has created “remarkable opportunities for investing in the residential rental market,” explain “The long-term financial benefits can be significant, but the first step is to closely analyze the details with your real estate agent.”
Another MLS director was equally upbeat. “The market in the Puget Sound region is showing optimistic signs of not only stabilization, but turning point towards a sustainable recovery,” said Joe Spencer, area director for Keller Williams Northwest Region. He suggested the cause is “simply the growing imbalance of supply and demand, which has resulted in the lowest inventory levels since 2006. This doesn’t mean that we’re out of the dark yet,” he acknowledged, adding, “However, I wouldn’t be surprised to see modest appreciation, especially close to job centers, in the latter half of 2012 or early 2013.”
Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership includes more than 22,000 real estate brokers. The organization, based in Kirkland, Wash., currently serves 21 counties in Washington state.
Statistical Summary by Counties:Market Activity Summary – March 2012 Single Fam. Homes + Condos | LISTINGS | PENDING SALES | CLOSED SALES | ||||||||||
New Listings | Total Active | # Pending Sales | # Closings | Avg. Price | Median Price | ||||||||
King | 3,415 | 6,700 | 3,878 | 2,082 | $379,213 | $295,000 | |||||||
Snohomish | 1,210 | 2,617 | 1,665 | 828 | $250,191 | $228,500 | |||||||
Pierce | 1,260 | 3,788 | 1,439 | 803 | $193,570 | $175,000 | |||||||
Kitsap | 418 | 1,400 | 404 | 217 | $287,581 | $217,500 | |||||||
Mason | 131 | 628 | 85 | 58 | $148,478 | $151,600 | |||||||
Skagit | 192 | 787 | 154 | 106 | $269,702 | $209,995 | |||||||
Grays Harbor | 176 | 735 | 98 | 75 | $99,161 | $89,000 | |||||||
Lewis | 92 | 611 | 77 | 45 | $145,508 | $118,599 | |||||||
Cowlitz | 132 | 494 | 91 | 58 | $131,539 | $125,950 | |||||||
Grant | 99 | 505 | 57 | 37 | $155,017 | $150,000 | |||||||
Thurston | 409 | 1,299 | 386 | 219 | $215,571 | $212,000 | |||||||
San Juan | 35 | 343 | 28 | 12 | $336,958 | $281,750 | |||||||
Island | 176 | 746 | 135 | 71 | $282,122 | $220,000 | |||||||
Kittitas | 78 | 397 | 45 | 26 | $319,248 | $194,450 | |||||||
Jefferson | 92 | 453 | 37 | 27 | $238,215 | $222,500 | |||||||
Okanogan | 38 | 316 | 27 | 20 | $133,808 | $122,750 | |||||||
Whatcom | 364 | 1,285 | 280 | 186 | $271,838 | $235,000 | |||||||
Clark | 46 | 252 | 56 | 38 | $209,392 | $183,550 | |||||||
Pacific | 86 | 376 | 30 | 28 | $117,175 | $107,500 | |||||||
Ferry | 7 | 61 | 5 | 2 | $67,250 | $67,250 | |||||||
Clallam | 81 | 379 | 43 | 31 | $297,620 | $167,500 | |||||||
Others | 173 | 711 | 106 | 75 | $150,328 | $134,900 | |||||||
MLS TOTAL | 8,710 | 24,883 | 9,126 | 5,044 | $268,957 | $225,000 |
Tony Meier
English Hill’s Top Selling Broker Since 2007
Making Real Estate Easy, Fun & Profitable!
Serving Buyers, Sellers & Their Referrals Since 1989
Windermere Real Estate/NE
EnglishHillOnline.com – Covering all aspects of live on English Hill
EastsideHomes.com – Seattle’s Eastside Real Estate Resource