As January comes to a close, the Seahawks’ season is over and the Seattle real estate market has home buyers’ undivided attention. Open houses the past two weekends have been mobbed. Listings that have sat on the market for 60-90 days over the holidays are now selling briskly, many with multiple offers. Attractive new listings are selling within days and sometimes even hours of hitting the MLS.
In 2006 I wrote a blog discussing market ratios and their importance to buyers and sellers. Ten years later, that old blog post is still timely. Understanding of market ratios is critical to buyers looking to buy a home in today’s Seattle market characterized by unprecedented low inventory levels and off the charts buyer demand. For example, a quick snapshot of this week’s market ratios for West Seattle: 75 active listings (residential properties not including condos), with 160 pending sales (homes under contract with a buyer.) The absorption rate (sales per month) in West Seattle has been 126 home sales per month in the last 6 months. So current pending sales are running 27% higher than the last 6 month average, with only an approximately 2 week supply of homes on the market!
OK, enough with the number crunching - What does this look like in practical terms? It looks like 31 offers on one home, as was the case for a recent listing, move in ready and attractively priced in a nice Admiral neighborhood near Hiawatha Park. (Said listing sold for $155K over asking price, all cash.)
The rest of Seattle is similarly squeezed for inventory. Only 82 available homes in Greenlake/Ballard. Only 44 in North Seattle, from the U-District all the way up to Lake Forest Park. What is interesting is that given the squeeze on inventory in Seattle, the neighborhoods just south of the city – Burien/Normandy Park/Boulevard Park/Tukwila have seen an explosion of activity in the last few months. The Tukwila light rail station and relatively unclogged transportation arterials into Seattle make these neighborhoods an attractive option for buyers looking for an affordable home with an easy commute to Downtown Seattle or south end employers such as Boeing in Renton. Pending sales in these neighborhoods are running a whopping 84% higher than in recent months. NOW may be the time for the ready, willing and able buyer to take a serious look at this area and get into your new home by spring.
All signs are pointing to a spring selling season characterized by limited inventory, strong buyer demand (to put it lightly) and continued upward pressure on prices. What does this mean for buyers? It is not cause for panic, but it does call for preparation. It is a given that almost every well priced, well turned out, and well located listing will have multiple interested buyers. The successful buyer in this type of market is:
- Calm, prepared, methodical and quick to act.
- Aggressive on price and terms.
- Pre-approved with a local lender, with all income/asset/credit and other needed documentation submitted and underwritten PRIOR to making an offer.
- Willing to pre-inspect a home, if appropriate, prior to making an offer.
- Comfortable with some level of risk and willing to waive typical protections such as appraisal, financing, or inspection contingencies.
- Willing to compromise a bit on such aspects as location, condition or amenities.
Thanks for reading. I have a strong track record of preparing my buyer clients for a successful home purchase and navigating a sometimes scary seller’s market. Give me a call if you’d like to talk further about buying a home this year. I’d love to meet you!