Real estate: Year-over-year activity remains steady

Year-over-year real estate activity in our neighborhood remains steady with prices slightly down in 98112. Interest rates have limited buying power resulting in a slight decline in prices and number of sale. A lack of homes for sale is adding to the sluggish market; King County inventory is down nearly 24% from this time last year. Typically low inventory would result in higher sales prices. However, higher interest rates are constricting prices resulting in the current stagnation.

There is some indication that interest rates will increase in the near future. This turns conventional wisdom not to come on the market during the holiday season on its head. Many sellers are considering listing their homes before the end of the year to beat another rate increase and capture active house hunters as well as relocation buyers who are often shopping for homes during holiday vacations. There is still pent-up demand for homes in our area after years of low inventory. In addition, our region continues to have many cash buyers who are not impacted by rising rates.

As always, pricing and presentation are essential. Even the most simple refresh (new paint and carpet) offer big results. Many buyers seek homes that are move-in ready and do not require updates. Homes that need work are less appealing often due to interest rates; buyers are forced to put more cash down to keep payments at a reasonable level eliminating reserves they would normally set aside for upgrades and remodeling. They are willing to do projects over time, but prefer homes that they can envision living in while they tackle long-term updates to suit their personal tastes if desired.

In the under $1.5M market, we continue to see multiple offers and few contingencies, especially when homes are carefully prepared for market. In-city inventory remains low at this price point, and our area still has a backlog of buyers looking for homes. Pro Tip: If you are in the market under $1.5M, do not assume that a house is going to sell way over list price with multiple offers. We consistently get feedback that buyers “don’t want to compete.” However, most homes are not escalating near to the degree that they have in the past. Make an offer you are comfortable with and get in the game. Strong early offers are always compelling to sellers.

Here’s a snapshot of the recent housing market stats in our area:

July 20, 2023 through October 20, 2023: 

Sold Homes: 31

Average Sales Price: $1,824,742

Average Days on Market: 30

Average Price Per Square Foot: $825.61

Lowest Sales Price: $440,000

Highest Sales Price: $6,000,000

Selling at 96.64% of original listed price

Worth note: 19 of these are $1M+ and the average market time over $1M is 20 days

July 20, 2022 through October 20, 2022: 

Sold Homes: 36

Average Sales Price: $2,083,000

Average Days on Market: 30

Average Price Per Square Foot: $863

Lowest Sales Price: $656,500

Highest Sales Price: $4,815,000

Selling at 94.19% of original listed price

For 98112

July 20, 2023 through October 20, 2023: 

Sold homes: 66

Average Sales Price: $1,470,000

Average Days on Market: 28

Average Price Per Square Foot: $718

Lowest Sales Price: $630,000

Highest Sales Price: $6,000,000

Selling at 97.03% of original listed price

Worth note: 38 of these are $1M+ and the average market time over $1M is 31 days

July 20, 2022 through October 20, 2022:

Sold homes: 78

Average Sales Price: $1,610,000

Average Days on Market: 26

Average Price Per Square Foot: $726

Lowest Sales Price: $235,000

Highest Sales Price: $5,250,000

Selling at 97.5% of original listed price

My takeaways:

• Activity in our neighborhood remains steady
• Sellers who are realistic about pricing have opportunity to sell
• Not seeing as many multiple offer situations, but homes are still selling in a reasonable time
• Interest rates have limited buying power resulting in a slight decline in prices and number of sales
• Move-in ready homes are more appealing to current buyers than fixer uppers

Some things to consider:

• Sellers: pricing is more important than ever. We need to drill down on pricing taking many factors into account including recent sales, days on market, price reductions, and interest rates. Pie-in-the-sky pricing will likely result in longer market time and a larger price reduction than if the home had come on the market at a strategic listing price.
• Sellers: Cluttered and dark homes fail to captivate buyers' attention online (virtual showings), resulting in fewer in-person showings and prolonged time on the market. Tackle projects that give you bang for your buck: painting, surface updates, and landscaping. Declutter — packing more now means packing less later! Make sure every room is inviting, neutral, and appealing to a broad demographic. Hire a broker to represent your home who utilizes staging services.
• Sellers: If you need help preparing your home for sale we have a Compass Concierge program. Compass fronts the money for certain improvements (flooring, tile, painting etc.) and you pay the money back at closing.
• Sellers: Consider doing a pre-inspection for your property so you can tackle fixes that can become a distraction for buyers. Often items called out on inspections are easy fixes that will help your home be competitive.
• Buyers: Ask us about lenders that can provide you with ways to circumvent the current higher rates until lower rates come down the road. Be very wise about your credit and have your lender relationship solid when you enter the market.
• Buyers: work with a trusted broker with strong agent relationships. This will really help you stand out if you are in a multiple offer situation.

As of press time, there are 14 homes for sale over $2.5M in Madison Park, Washington Park, Broadmoor, and Denny Blaine. Three of the residences are condominiums, and the highest priced single-family home for sale is a Georgian Colonial with lake views for $9,895,000. Call me to learn more about our Compass experts in Madison Park who are ready to help you navigate this market to your advantage with the latest technology, top-notch marketing, and proven pricing strategies. If you’re buying, our knowledgeable and savvy agents will help you achieve success.

Evan Wyman, Broker/Partner, The Wyman Group @ COMPASS