Spring has sprung, and buyers are feeling the heat! By Jennifer Hawkins, key2see Team
Spring is seasonally the beginning of an active market here locally, and this year appears to be no different. Open house traffic has exceeded years past for a second month in a row, proving that our spring market is finally here! While it may look a little different than past spring markets, we shouldn’t be surprised. This past year has been temperamental, filled with rate hikes, inflation at record highs, and a constant murmur of a recession.
But we are here with some good news!
The Northwest Multiple Listing Service reported 7,904 new listings for March. This means we are still very much dealing with inventory woes; however, new listings have doubled from February to March. This surge is making buyers get off their computer search and into the open houses!
Even with the added new listings, that is only six weeks of inventory on an absorption rate. We believe this trend will carry us through the summer (a normal market carries six months of inventory). Something unusual about today’s market is low inventory typically drives up prices; however, home sellers are hesitant to jeopardize their current low-interest rate to purchase and replace with a new mortgage at the highest interest rate in the past 23 years. This hesitance is keeping the supply low, yet the high rates are keeping prices stable but not increasing.
For those who are entering back into the market, we are seeing an interesting return on bridge loans and home equity loans. Buyers are securing their new home before selling their current—and using large levels of equity to do so successfully.
The key to success in this “swing” market is appropriately pricing your home. The homes that are priced right are resulting in the pending sales being up from February by 14.5 percent. Well-priced homes are generating multiple offers, while overpriced homes are sitting and getting stale. The days of throwing out any old high number is gone for now. Our market continues to be infiltrated by out-of-state buyers feeding the tech and medical industries. If a real estate move is in your future, avoid sitting this one out. We have a feeling it is going to heat up again as soon as rates stabilize.
Make sure to have a good representative by your side to guide you through this swift “swing” market. Once rates and inflation are under control, the handcuffs will come off, giving buyers a small window of opportunity before things possibly get crazy again. Turning buyers loose into a limited inventory market will put Northwest home buyers back to where they were this time last year, limited inventory, high demand and softening interest rates.
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