Winter is winding down and meteorological spring is here. Nearly 60 degree temperatures while I’m driving around to appointments and showings has been a nice change from all the rain and snow lately!
Before I jump into the statistics for this year’s winter market and recent real estate trends for the Puget Sound region I’d like to share an update to the real estate Coronavirus rules for our area. All Washington counties are now in Phase 2 of reopening and effective February 24th the governor paused any Roadmap to Recovery movement, meaning all counties will stay in Phase 2 for the time being. This update to Phase 2 across the board means we can now consistently conduct the following in-person real estate activities:
- Previews and showing remain by appointment only. No more than 5 people (including the agent) are permitted at the property at any one time.
- In-person open houses are now allowed. No more than 10 people (including the agent) are allowed on-site at one time. Social distancing rules must be strictly adhered to.
It is nice to see that open houses can be safely conducted again. At hot listings we’re already seeing cars wrapped around the block waiting for their turn to get in! In other local real estate news the NWMLS made a major forms update that was effective March 3rd. I like to consider myself a purchase and sale forms expert so I have already taken a class hosted by the NWMLS to deep-dive the changes. Speaking of the NWMLS, they have provided all the market data for this post. The NWMLS covers 26-member counties and for this post I’ll be mostly focused on King and Snohomish counties as usual.
Market Volume and Supply
February 2020 was the final month before pandemic uncertainty and lockdowns began so it will be interesting to compare February 2020 to February 2021 in this post. Last month brokers added 7,418 new listings compared to 7,786 listings during the same month last year. A roughly 5% year-over-year drop in inventory during a pandemic isn’t surprising to me, but it reflects the general theme that our region is depleted of inventory.
A metric I’ve been tracking in these posts is months-of-inventory. This metric just means how many months would it take to sell the current supply of homes in a market. 4-6 months of inventory is considered a balanced market. In January across the NWMLS the average was .75 months of inventory. That is weeks not months! This remained mostly flat through February at .76 months. If you’re a buyer and wondering when bidding wars will subside – probably not until this number can climb into a few months of inventory. Note that for the Puget Sound market we’ve been at or below ~2 months of inventory for years now.
Price continues to climb but as I type this interest rates are ticking up and stocks, especially in tech, are experiencing a sell-off. We’ll want to keep a close eye on how these macro trends might trickle down to our local real estate market.
Snow last month did not slow things down! In February of this year NWMLS agents closed $3.58 billion in sales across the region. In King County, the median price for a home sale was up even from last month to $679,075. Compare this to an average median price of $512,000 across all 26 counties. Looking year-over-year that same median sales price increased 15% from $445,000. Last month brokers sold 1,014 new construction homes for a median price of $625,020.
Closings increased by 10.4% year-over-year with 5,812 closing representing the 3.58B in sales last month.
Prices are up and inventory remains low, but interest rates are on the rise too which can tamper buyer excitement. It is hard to tell how much longer the strong seller’s market will last so if you’re on the fence, consider taking action this spring. I am always happy to provide prospective clients with a comparative market analysis report on their home, and there is never any pressure. Feel free to contact me if you’d like to discuss further.
Finally, I don’t want buyers to feel discouraged right now. It is the most competitive market I’ve ever seen for home buying but I’m still submitting winning offers for my clients on a regular basis. Just this week I won a multiple offer scenario for a property that had been on the market for less than 24 hours by bringing a contract to the showing with me and having all parties (seller included!) sign on the spot. See my buying strategies for 2021 page for more of my thoughts in this area.