With school back in session, the holidays fast approaching and temps cooling, the inventory tends to decrease around this time of the year but I’ll share why it is still a great time to consider buying and selling.
Selling in the fall can be advantageous for a number of reasons. Less inventory means less competition from other sellers, and buyers during this time of the year are typically more serious due to reasons such as wanting to close on a home before the holidays or moving due to a new job/relocation. Market data shows us that more than half of home buyers do not have children under the age of 18 living with them so potential sellers shouldn’t be too worried about school being in session detracting buyers.
Something else for sellers to be aware of is a change to the Washington State Real Estate Excise Tax (REET) starting on January 1, 2020. Earlier this year in April the Washington State Legislature passed bill SB 5998 which modifies the REET tax rates in a tiered approach for different portions of a sale price. This change will bring a slightly lower tax rate for the portion of a sale up to $500,000 (1.28% -> 1.1%) and the same tax rate from $500,000 to $1,500,000 (1.28%). That means starting next year selling a $500,000 house will result in paying $900 less to the state. The break even point with the new rates compared to the old will be a sales price of $1,561,224 because the rates are applied to each portion of the sale specified in the table below. The biggest change will be for homes sold at a price above $3,000,000. The rate for the amount of the sale over $3MM will double from 1.28% to 3.0%.
This table breaks down the current vs. new rates:
How can buyers make the most of the fall real estate market? One way I love to help my clients during this time of the year is look for motivated sellers. I can help find properties that may have been sitting since the summer where we can then assume they are motivated to sell by the end of the year. In these scenarios we can carefully create an offer designed to get you the best price and terms on a home. That said, I believe it is important to work with an experienced real estate agent such as myself because submitting a “too-low” offer can be perceived as offensive to some sellers and throw out any chances for future negotiation opportunities.
Finally, this is a good time of the year to explore new construction as builders like to sell before the new tax year.
As always feel free to contact me with any home buying or selling questions!