Single family home prices (Seattle, Sammamish: for sale, real estate, 2013)

[gardengirl87]

My husband has taken a voluntary transfer to the Seattle area from Central California and is living there already (staying with friends). We are very frustrated in our house search in Bothell/ Woodinville due to lack of inventory and escalating prices due to multiple bids on the homes we have made offers on- two houses we made bids on within the first two days with escalation clauses. We feel we have competent realtors who are also surprised by this. We even extended our search to Mill Creek and down to Issaquah and Maple Valley and are being told houses are being listed at a low price to generate interest and obtaining multiple bids. Is this typical for this time of year (told Jan/Feb slow months in real estate in Seattle area) or are we just going to be priced out of the market? Our current home is paid off but we don't want to sell ours until we know we have a house to go to! Unfortunately our house value is not going up at the same rate as those in Seattle.

Thanks for listening!

[Hemlock140]

There are some decent ones (flips) for sale in my neighborhood (Sammamish) for about $400,000 that have been on the market a few months now. Another on my street is about to hit the market for about $450,000. It depends on the location. North, closer to the 520 bridge is popular with all of the new people being hired at Amazon South Lake Union. South is selling fast because they are more affordable, though a co-worker just bought one for just over $300,000 in Lake Tapps area at a little under asking.

[mkarch]

Look at older homes that need work. Bothell and woodinville have plenty of decent older houses with good schools. There is less competition for places that aren't in like new condition out there. I grew up there, and the homes seem really cheap compared to seattle. You can buy a lot of square footage out there for not much money, so you're probably focusing on too narrow a property type that is in high demand. If you must have a certain kind of home, just be ready to jump on it as soon as it hits the market.

[VeronikaW]

If you're willing to look in Maple Valley, check out Duvall (just east of Woodinville). There are tons of new construction homes, and this place still feels like a small town, with a great community that really looks out for each other. I love it here!

[pw72]

From my understanding, home prices in the Seattle area are just now approaching what they were before the housing bust in 2007-2008. Breaking even from that period is attractive to many, so there may be opportunities for both buyers and sellers right now.

[mkarch]

Originally Posted by pw72

From my understanding, home prices in the Seattle area are just now approaching what they were before the housing bust in 2007-2008. Breaking even from that period is attractive to many, so there may be opportunities for both buyers and sellers right now.

Based on the case Schiller index, seattle metro is 25% below the market peak. Individual neighborhoods vary. Some are way below that, others are above.

The crop of new 2013 listing in my area are about 10% below peak. We'll see how that goes as the selling season gets underway.

[pw72]

Originally Posted by mkarch

Based on the case Schiller index, seattle metro is 25% below the market peak. Individual neighborhoods vary. Some are way below that, others are above.

The crop of new 2013 listing in my area are about 10% below peak. We'll see how that goes as the selling season gets underway.

I think the "market peak" was inflated. A realistic price is probably below this price, but has definitely made gains in the past year. A buyers market still exists, but perhaps not as much as 18 months ago.

[texastrigirl]

This is an excerpt of a letter my realtor send me via email a few weeks ago...

At the risk of sounding like a broken record, the key real estate word for 2013 remains the same as it was in 2012: inventory. Not only has the record low inventory situation not improved as we've started the new year, it's gotten even tighter. We began January, 2012 in King County with a decreased inventory supply from previous years. We start January, 2013 with almost exactly 50% fewer listings than even one year ago. Total inventory is now down 77% from our inventory peak in the summer of 2008.

While inventory should uptick modestly as we get farther into the year, the increase is likely to be insufficient in meeting current buyer demand. Given how much of a seller's market it has become in some locations, it's surprising that we have not seen more sellers trying their "luck."

If you'd like to read the rest, DM me and I will email to you. But basically it confirms your suspicions. And it also depends on the area you are looking in. Heck, I'm thinking about trying my luck after seeing what my neighbor's got trying their luck...problem is there is no place for me to move

Good luck!

[eskercurve]

If you go to Redfin and see charts of home inventory over the past two years, it's been on a steady decline. The new home buyer credit expired in 2012 and that dis-incentivized a lot of people from buying, and rising home prices due to lower supply is also a headache.

I saw that in my neck of the woods, there's less than a month of inventory. Compare that with two years ago there was three months.

So, to answer OP's question: NO, this is not normal, even adjusting for seasonal swings, and you're not alone in your frustrations.

Backstory: I think the market crash in 2007-2008 created what I call a "trapped" inventory set.

Basically these are normal folks who got suckered into the "real estate can NEVER go down!!!!" mantra or, worse, got suckered into the "if you don't buy NOW you will be priced out FOREVER!!!!"

Really? Forever? Hmmm ... unsustainable much? Well, believe it or not a lot of people DID believe it, and rushed into buying a house.

First to go were the multiple home buyers and speculators. Next came the folks who were already on shaky financial ground and defaulted or short-sold. Next came the folks who extended themselves and slowly defaulted. Combined with the bottom falling out on demand, what we have left are folks who CAN afford the house payment and all, but are TRAPPED because they don't want to eat / can't afford the 20, 30, 50%+ loss.

The place I bought in May last year was at a 120k discount from its peak, a 25% drop. The only reason why I got it is because the former resident died and his inheritors didn't want to keep it.

So, I'd be willing to guess that home supply through new construction will eventually bring prices down again and eventually start rising organically again. In other words, don't expect a quick fix to this trapped inventory problem.

[Ira500]

As someone dealing with this on a professional basis: Yes, it's true. Inventory is terrible, particularly in neighborhoods/towns people want to live in. Lots of people bought houses 6 or 7 years ago, sales were huge then. Many of these people would like to sell now, but either their houses are worth less than what they paid, or just barely above what they paid so they can't become a "move up" buyer. It's not as bad in places like Duvall or Maple Valley, and inventory can't stay this low forever. It's already been too low for too long. I'd recommend either expanding the area you're looking in, expanding the style of house you're looking for, or take a break and look again in a few months.