We are over one-third of the way through the year and in the midst of the spring market. The story of the year thus far is rising inventory. Inventory in Seattle is up 111% over April and May of last year. On the Eastside there are 75% more listings than this time last year. More listings translate into more sales. Pending sales (under contract but not closed) are up 22% in Seattle and 25% on the Eastside from this point in 2018.
But more importantly, buyers are having an easier time in the market than during the last several years. Today a buyer can take a few days to think about which home to buy and what to offer. In the Spring markets since 2012 buyers needed to act immediately and had to pay over full price in most cases. And while it’s true that some areas still have multiple offer we see fewer of those than in recent years. In fact, there is a segment of buyers in today’s market that refuse to participate in multiple offers and one reason is that in most cases there is another home they can buy. So, while the phrases “Buyer Fatigue” and “Buyer Burnout” described many buyers by this time of year, in today’s market we don’t hear those words very often. And while in recent years by late Spring many buyers who had lost out on several homes had quit the market, today most are still active because they understand they will be able to purchase a home without paying much if any over full asking price.
Buyers and sellers continue to hear conflicting reports regarding prices and appreciation. Earlier in the Spring we literally had conflicting news reports which one day said Seattle area prices were falling and the next said we had seen the largest price increases in Seattle in many years.
Today, most media outlets state that prices in Seattle are falling. We believe that prices in Seattle and the Eastside are flat. The latest Case-Schiller report for the Seattle area shows that in February (the latest month available for this report) price rose 2.8 % over last year. In February of last year prices were up over 12% over 2017. So, the rate of price increase has slowed steadily over the last 8 months, but we are yet to see actual negative numbers for area appreciation. And if we extrapolate the Case-Schiller numbers from September of last year it does suggest that when we see the May numbers when they are published in July they could show that the market is flat. There is one caveat, with the increase in pending sales and the robust market we are seeing today prices could be pushed up slightly because in spite of the dramatic increase in listing inventory there is still less than 2 months of inventory (1.7) in King County with Seattle showing 1.54 months of inventory and the Eastside at 1.98 months.
With interest rates lower than anyone predicted, it’s a good time for buyers to enter the market while sellers should consider listing now while the inventory picture is still tilted in their favor.