We have to go back before the bubble burst to February 2007 to find so few homes for sale on Seattle’s eastside! There’s a healthy number of homes for sale on the eastside, 1897 at the close of December, so there are good choices for buyers. With fewer homes on the market, it spurs the competition among buyers for the best homes and should help stabilize prices. In some neighborhoods, there aren’t any homes for sale right now.
Pricing is becoming more affordable for a new set of buyers who are coming to the market for the first time. A mortgage payment that would have bought a home for $500,000 in 2008, would now cover the purchase of a home in the mid-$600,000s!
Here’s a snapshot of Seattle-Eastside real estate in December, 2011 compared to 2010:
- 24% fewer homes were on the market.
- The time it took to sell a home went from 129 days to 111 days this past December.
- Sales prices were 8% below the seller’s original asking price, while in 2010 they averaged 10% below the asking price.
- Eighteen percent of the homes for sale this December received offers and sold, while only 14% received offers in 2010.
- 338 homes sold in 2011, while in December 2010, 351 homes received offers.
The actual number of homes sold did not change much, which, surprisingly, is almost always the case. The difference was not in the number of sales, but in the number of homes for sale. There were 597 fewer homes for sale at the end of 2011 than 2010. When there are fewer homes for sale, there are fewer “for sale” signs out in neighborhoods. The “sold” signs also pop up a lot faster.
When the supply increases, there’s increased competition and homes take longer to sell. Most people think homes are not selling because there are more real estate signs and they stay posted in yards for a longer time. This is not the case. Homes are selling, but there’s just more competition which makes it feel as if the market is slower.
The real difference then is the supply, the number of homes for sale. If there’s a smaller supply the market will seem faster because these homes will sell faster. If there is a larger supply, there is more competition and the market will seem slower because it takes longer to sell a home. In both markets, though, the number of homes that sell does not vary all that much. It is the Supply that varies and changes what we think is happening in the real estate market. The above chart confirms this as you can see the supply changes far more dramatically than the number of sales, which are shown at the bottom of each month.
In my next piece, I’ll talk about how Seattle-eastside real estate should play out for the coming year. Have a great 2012 and hope you are able to make it through this week’s snow.
Since real estate is neighborhood specific, if you’d like more information about your home, contact us, we’re here to help.
*The numbers are a result of the real estate sales activity that happened that particular month only. In order to see a trend, it is important to look at a number of months together. One month is only indicative of that particular month’s sales.