The Seattle Housing Market: A (Rich) Buyer’s Market
You hear a lot of talk about current real estate conditions. With such a high inventory of unsold properties across the nation, now is supposedly an ideal time to speak with a mortgage broker and arrange an offer on your terms.
But what happens if prices remain high? Such is the case in many parts of the Washington housing market, where buyers may be in control … but only if they have a lot of money.
The Northwest Multiple Listing Service’s October report continued a trend of increasing numbers of homes on the market and fewer sales month over month and year over year. However, the median home price in the city was $420,000, the same as July’s price.
As The Seattle Post-Intelligencer reports, until prices come down, there are only a select few buyers that can take advantage of this inventory.
King County as a whole showed a similar trend, with a slightly smaller increase in inventory, a decline in sales from October 2005 and a slightly higher rise in the median home price.
The price statistics reflect what home shoppers such as Dariush Zand are seeing.
“They keep saying it’s a buyer’s market,” he said while looking over a Montlake home last month. “Prices haven’t changed. I don’t see any reduction.”
Zand, who is planning to move back to the area from San Jose, Calif., said prices have declined there.
“[The California housing market] is starting to look like a pretty good deal now,” he said. “And it’s sunny and 75 (degrees) every day.”
J. Lennox Scott, the chairman and chief executive of John L. Scott Real Estate, speculated that prices have remained high in Seattle because the increase in inventory only brought the city from a 1.8-month supply a year ago to a 2.8-month supply in October.
“It’s up ever so slightly over the all-time-best market in the history of real estate,” he said. “Normal is five to six months of inventory. It’s just that we haven’t seen normal in a long time, and I’m not sure that we will.”
The statistics show the market is returning to normal, said Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University.
“Yes, the inventory is going up,” he said. “It’s still sitting lower than it was three years ago.”
Buyers and mortgage applicants now can take time to search out the house they really want, rather than jumping at something that will do, Crellin said.
“Because of the period of frenzied activity, we sort of lost sight of what a normal market looks like and feels like.”
Lennox said Seattle’s strong economy and low home mortgage rates would keep the housing supply tight, although not as tight as it was a year ago. Although some homes sell extremely fast in the Seattle area, other sellers will need to focus more on price, presentation and marketing, he said.
“What’s great about this market is buyers have selection.”