Mortgage Rates Increase, Just as Home-Sales Activity Regains Momentum

Link to the original article on Realtor.com here

By Jacob Passy | Sep 19, 2019

Prospective Buyer Attends Open Houses Ahead Of Existing Home Sales

Daniel Acker/Bloomberg

Mortgage rates rose on a weekly basis for the second week in a row, potentially threatening to put a damper on home sales just as the real-estate market’s outlook was brightening.

The 30-year fixed-rate mortgage averaged 3.73% during the week ending Sept. 19, rising 13 basis points from the previous week, Freddie Mac reported Thursday. This was only the 11th weekly increase in mortgage rates this year.

The 15-year fixed-rate mortgage increased 12 basis points to an average of 3.21%, according to Freddie Mac. The 5/1 adjustable-rate mortgage averaged 3.49%, up 13 basis points.

MarketWatch

The Federal Reserve, when it cuts interest rates, is adjusting short-term rates. Mortgage rates, on the other hand, roughly track the direction of the 10-year Treasury note.

However, neither the Federal Reserve nor bond markets were the likely culprit behind this week’s increase in mortgages rates. Rather, improving economic data and the higher demand for mortgages, especially to purchase homes, gave lenders room to boost rates.

“While there was an initially slow response to the overall lower mortgage-rate environment this year, it is clear that the housing market is finally improving due to the strong labor market and low mortgage rates,” Freddie Mac chief economist Sam Khater said Thursday.

Northwest MLS Housing Report for April Signals Good News for Home Buyers

Northwest MLS Housing Report for April Signals Good News for Home Buyers

KIRKLAND, Washington (May 6, 2019) - Housing activity during April signaled good news for buyers in Western Washington as inventory continued to grow, the rate of price increases was slowing in many areas (and even decreasing in a few counties), and mortgage rates remained low.

Northwest Multiple Listing Service statistics for last month show a 28.5 percent overall increase in active listings compared to the same month a year ago, a 5.8 percent gain in pending sales, and a 2.4 percent rise in median prices for sales of single family homes and condos that closed during April. The volume of closings dipped slightly (down 1.9 percent).

"Listings were popping up like April flowers and the bloom has produced a vibrant and healthy market," exclaimed MLS director John Deely, principal managing broker at Coldwell Banker Bain. "With an increased supply of listing inventory, low interest rates, and a positive economic climate, buyers are confident that this is a good time to buy," he reported, while noting a larger number of buyers are opting out of competing with other buyers.

"This year's buyers and sellers are approaching the market with more caution and a focus on an analytical, versus emotional approach that has ruled the last several years," Deely said.

Northwest MLS members added 11,697 new listings to inventory during April for a year-over-year gain of nearly 3.8 percent. During the same period, brokers reported 11,188 pending sales (509 fewer than the number of new listings), resulting in net gains in the number of active listings in many counties, but changes in inventory were wide ranging across the 23 counties the MLS serves.

Seven counties had double-digit growth in inventory from a year ago, led by King County (up 78.5 percent) and Snohomish County (up nearly 57 percent). The number of active listings declined in 10 counties, with Jefferson County reporting the biggest drop at 24.8 percent. System-wide inventory at the end of April totaled 12,955 active listings, which represents a 7.8 gain from March.

"The spring market has arrived, bringing new listings and sales," stated Dean Rebhuhn, owner of Village Homes and Properties in Woodinville. Sellers who have prepared their homes for sale are experiencing brisk activity, and buyers are finding more opportunities to purchase, thanks to low mortgage rates and increased inventory, according to Rebhuhn.

"As we head into the prime buying and selling season, we're seeing better news for buyers in King County, with statistics showing there's a bit more time to look and make a decision," said Mike Grady, president and COO of Coldwell Banker Bain. Pointing to the 78 percent increase in total active listings in King County and the 57 percent jump in inventory in Snohomish County, he described the year-over-year gains as "impressive," but noted there is still less than two months of inventory in many areas. "Buyers now have three-to-four weeks instead of three-to-four days to make a decision, so it's still quite a ways from a balanced market," he emphasized.

Gary O'Leyar, designated broker/owner at Berkshire Hathaway HomeServices Signature Properties, echoed Grady. "Despite the increase in inventory over last year at this time in King County, we are seeing a very robust spring market laced with multiple offers in many instances," he stated.

Eight counties had double-digit increases in pending sales versus a year ago. In the four-county Puget Sound region, only King County had a double-digit gain, with a 15.1 percent jump in mutually accepted offers. Pierce County, with a 6.6 percent decrease, was one of seven counties reporting drops in pending sales. Even with mixed sales activity, supply remains tight.

Northwest MLS figures show both King County and its 23-county system have around 1.7 months of supply. "That is still slim compared to the National Association of Realtors' data showing a national average of 3.9 months of inventory," remarked O'Leyar.

"We just experienced a strong spring market and are now heading into the pre-summer phase of the housing cycle where more inventory but also more buyer competition is commonplace," stated J. Lennox Scott, chairman and CEO of John L. Scott Real Estate. He expects momentum will continue "in line with positive job growth, lower interest rates and a strong U.S. economy," but believes price appreciation will start to level out heading into summer. "All eyes will be on each new listing this summer, a welcome sight for home buyers encountering multiple-offer situations in the more affordable and mid-price ranges," Scott added.

James Young, director of the Washington Center for Real Estate Research at the University of Washington, said low mortgage rates (averaging 4.4% for a 30-year fixed) are enabling buyers in outlying areas along the I-5 corridor to purchase in areas with cheaper prices, notably Skagit, Cowlitz and Whatcom counties.

"There are two key demographic trends driving prices along with mortgage interest rates," Young said. "Older householders trading down are competing with first-time buyers along this corridor seeking value." He used the example of an empty-nester Seattle homeowner deciding to trade down. "If I sell in Seattle to trade down, then I will have significant amounts of cash available from selling my existing home to be able to move to Mount Vernon or Cle Elum with cash left over." First-time buyers may look at the same relatively low priced areas as a place to raise a family. "With these two groups competing for value, this is a perfect storm for house price growth, particularly in regional markets," Young believes.

Areas adjacent to King County had mixed results.

"Listing activity in Snohomish County rose modestly in April but the rate of growth has slowed," said NWMLS director David Maider. MLS figures show brokers added 30 more new listings than a year ago (1,746 versus 1,716), with total inventory up 56.8 percent. Pending sales rose 6.9 percent and prices were flat (up 0.84 percent).

Maider, the owner/broker at Windermere Real Estate M2 in Everett, described the jump in pending sales as "significant" and an indicator that there is clearly demand in the market. "We expect that mortgage rates will not move significantly as we move toward summer and that well-positioned and well-priced homes will still see significant interest from potential buyers," he commented.

Another MLS director, Dick Beeson, principal managing broker at RE/MAX Northwest Realtors in Gig Harbor (in Pierce County), acknowledged the slowing rate of price increases in the Puget Sound region, commenting, "But the direction remains the same: higher prices." He believes buyer demand and scarce inventory mean buyers need to "be ready to rumble," since conditions don't favor "faint-hearted buyers." For sellers, he advised, "Don't be stupid, increases can't go on forever. Get a fair price and move on."

Home prices for last month's completed sales of single family homes and condos rose 2.4 percent area-wide compared to a year ago, with eight counties reporting double-digit gains. Mason County had the biggest jump, at 24.9 percent, followed by San Juan (up 23.5 percent), Kittitas (up 20.5 percent) and Skagit (up 18.7 percent). Six counties reported year-over-year decreases: Clallam, Clark, Ferry, Island, Jefferson, and King.

Condo prices dipped 3.2 percent as inventory improved (up 75 percent). Pending sales rose 3 percent.

"Interestingly, condominium prices in King County continue to fall as the number of properties on the market continues to climb rapidly," remarked Young. MLS figures show prices in King County dropped about 9.6 percent and inventory surged nearly 122 percent compared to twelve months ago.

"Anecdotally, this corresponds with possible regulatory and tax uncertainty signaled for private landlords in Seattle ahead of local government elections. Given this situation and significant supply in the multifamily sector coming online, many smaller landlords may be selling to lock in capital value growth and exit the rental market ahead of the November election," Young suggested.

Some developers of new condo projects are reporting strong activity. First Light, a 459-unit development to be built at 3rd and Virginia in downtown Seattle, has announced more than half the units in the 48-floor tower have been reserved prior to groundbreaking.

Looking ahead, Grady believes, "We are very slowly trending away from a complete seller's market," citing single-digit increases in sales prices, "instead of double-digit increases we saw in 2018," and the lack of inventory. "We believe these two considerations will now move sellers who have been waiting to sell in order to take advantage of equity gains to finally take action."

Northwest Multiple Listing Service, owned by its member real estate firms, is the largest full-service MLS in the Northwest. Its membership of around 2,200 member offices includes more than 29,000 real estate professionals. The organization, based in Kirkland, Wash., currently serves 23 counties in the state.

Courtesy NWMLS 

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Here is How We Help You Buy a Home and Stand Out Above All Other Offers:

1. Local Neighborhood Experts. Professional Realtors who will guide you from pre-approval to home search, inspections, closing and beyond.
2. We Move Faster...Access to listings. We can show most homes the same day, nearly any home within 24 hours!
3. Pre-Inspections. When the timing and situation allow we can have a home inspector go through the house before making an offer. This way, if you choose to move forward you can make an offer with no inspection contingency and essentially "waive inspection". This is one of the best and most common ways to get a leg up on the competition.
4. Escalations. The offer escalation clause allows you to add an amount you will escalate your offer if there is a competing higher offer.
5. The latest technology. Home search, email alerts, virtual tours, and electronic signatures all facilitate the home buying process and give our clients the ability to move quickly.
6. Contract Knowledge. Buying a home is a huge investment and you need an expert on your side. Having a knowledgeable Realtor will protect your interests and give you the best opportunity to succeed when buying a home.

The home buying process is one of the most exciting, and frequently stressful, experiences you’ll ever go through. This holds true whether you’re in the market for a new primary residence, an investment property or that perfect vacation getaway. Contact us to see any home or just ask a question. We are always happy to hear from you!

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First impressions matter. If you’re preparing to sell your home, your curb appeal could mean the difference between wowing your buyer or losing out on an offer. When the outside of your house looks tidy and inviting, it encourages buyers to venture inside. Enhancing your home’s curb appeal doesn’t have to cost an arm and a leg. Plus, your repairs will pay for themselves; homes with greater curb appeal sell faster and for more money than their competition.

Here are 10 Easy Ways to Increase Curb Appeal.

1. Manicure your landscaping.

We’re talking about more than just mowing the lawn. Edge along the sidewalks and driveway, trim back any unruly plants or bushes, and get rid of weeds or dead foliage. Fertilize your lawn if needed to prevent any brown areas in your sod. Buyers want to see lush, green grass when they pull up to the curb.

2. Dress up your flowerbeds.

Never underestimate the power of some fresh mulch and a few new pops of color. Pull weeds from your flowerbeds, plant flowers that will continue to bloom in the coming weeks, and trim back any plants that are past their prime. Adding a touch of color to your garden will draw attention to your home – and that’s the whole idea.

3. Replace outdated light fixtures.

This one requires a little more handiwork, but the payoff is worth the effort. Outdated light fixtures are like a stain on your home’s otherwise beautiful exterior. New fixtures don’t have to be extravagant or expensive, but they’ll add a modern touch that will appeal to potential buyers.

4. Add window shutters.

If the front of your home looks a little too dull, consider adding shutters around the windows to add interest and depth. You can purchase ready-made shutters, or save some money and build them on your own.

5. Power wash your surfaces.

Everything looks better after a good cleaning. Power washing your brick or siding, sidewalks, and patio will make a world of difference in your home’s overall appearance. If you don’t own a power washer, you can rent one from a local hardware or home improvement store.

6. Add planters.

Potted plants or flowers can bring color to any space with relative ease. Add a few planters to your patio, walkways, or driveway to make the space more welcoming. Mix and match greenery and flowers, tall and short, to add dimension and interest to any area. This fix doesn’t need to be costly. Many discount home goods stores offer eye-catching planters at extremely affordable prices. Fill pots with budget-friendly decorative grasses, and voila! A reinvented front yard that will make your buyers swoon.

7. Install outdoor lighting.

Lights soften your space and add charm to your home. Add them just about anywhere: at the entrance to your driveway, along walkways, or along the flowerbeds. Outdoor lighting not only adds beauty but also creates a sense of security and safety. Solar-powered path lights are inexpensive and can be installed in a matter of minutes.

8. Paint your front door.

Draw attention to your home with a fresh coat of paint in an eye-popping color. This easy fix can be done in a matter of hours, but will make a long-lasting impression. While it might not seem like a necessary project, many Realtors insist a freshly-painted front door can make a significant impact.

9. Display patio furniture.

Nothing says “this home is inviting, charming, and lovely” like a porch with cozy, comfortable seating. Make sure your outdoor furniture is clean, free of tears or holes, and is organized neatly in all outdoor areas.

10. Get a new doormat.

While it doesn’t seem like much, your home’s welcome mat can add a special charm. Your doormat should be brand-new, free of dirt and mud, and should be inviting. A witty saying that makes potential buyers chuckle couldn’t hurt, either.

By spending a little time and a little extra cash, you can increase your home’s curb appeal dramatically.

Curious where your children will attend school next year? Or how the changes may impact your home value?  Considering buying a home but wondering what schools will be assigned?

We can help. We know the area and the community.

Real Estate Maps

• New! Tambark Creek Elementary School Area Homes For Sale
• Forest View Elementary School Area Homes For Sale
• Area Most likely to stay at Jackson HS (unofficial)

New Everett School District Boundary Maps

• 2019 Everett School District Boundaries Map
• Proposed Everett School District High School Boundaries Map
• High School Growth Mitigation Committee
• Everett School District Calendar
• Everett School District Website

The Everett School District will open the new Tambark Creek Elementary School No. 18 near Sunset Rd. and 180th St in 2019 and with that they have redrawn the Everett School District Boundary Maps. The district is also working to redraw the Cascade High School boundaries, Everett High School boundaries as well as the Henry M. Jackson High School boundary lines. These changes will impact many of our children, our community and real estate. We live, work, and raise our children here too; so I have been keeping a close eye on the map and seeing how this could impact our friends and clients. If you are considering a move into or around the Everett School District Area contact us for expert guidance and in-depth knowledge of the coming changes.

Quick Summary and Infographic for the Snohomish County housing market 2017

• Median Price Snohomish County $419,950

• 7 Billion in closed home sales in 2017

• 1 Month supply of homes! (Inventory)

• Less listings in 2017 than in 2016 (down .5%)

By Matthew Gardner, Chief Economist, Windermere Real Estate

It’s the time of the year when I look deep into my crystal ball to see what’s on the horizon for the upcoming year. As we are all aware, 2017 has been a stellar year for housing across the country, but can we expect that to continue in 2018?

Millennial Home Buyers

Last year, I predicted that the big story for 2017 would be millennial home buyers and it appears I was a little too bullish. To date, first-time buyers have made up 34% of all home purchases this year – still below the 40% that is expected in a normalized market.  Although they are buying, it is not across all regions of the country, but rather in less expensive markets such as North Dakota, Ohio, and Maryland.

For the coming year, I believe the number of millennial buyers will expand further and be one of the biggest influencers in the U.S. housing market. I also believe that they will begin buying in more expensive markets. That’s because millennials are getting older and further into their careers, enabling them to save more money and raise their credit profiles.

Existing Home Sales

As far as existing home sales are concerned, in 2018 we should expect a reasonable increase of 3.7% – or 5.62 million housing units. In many areas, demand will continue to exceed supply, but a slight increase in inventory will help take some heat off the market. Because of this, home prices are likely to rise but by a more modest 4.4%.

New Home Sales

New home sales in 2018 should rise by around 8% to 655,000 units, with prices increasing by 4.1%. While housing starts – and therefore sales – will rise next year, they will still remain well below the long-term average due to escalating land, labor, materials, and regulatory costs. I do hold out hope that home builders will be able to help meet the high demand we’re expecting from first-time buyers, but in many markets, it’s very difficult for them to do so due to rising construction costs. 

Interest Rates

Interest rates continue to baffle forecasters. The anticipated rise that many of us have been predicting for several years has yet to materialize. As it stands right now, my forecast for 2018 is for interest rates to rise modestly to an average of 4.4% for a conventional 30-year fixed-rate mortgage – still remarkably low when compared to historic averages.

Tax Reform

Something that has the potential to have a major impact on housing is the current proposals relative to tax reform. As I write this, we know that both the House and Senate propose doubling the standard deduction, and the House plans to lower the mortgage interest deduction from $1,000,000 to $500,000. If passed, the mortgage deduction would no longer have value for homeowners who would likely opt to take the standard deduction.

If either of the current proposals is adopted into law, the potential reduction in mortgage-related tax savings means the after-tax cost of home ownership will increase for most homeowners. Additionally, both the House and Senate bills also end tax benefits for interest on second homes, and this could have a devastating effect in areas with higher concentrations of second homes.

The capping of the deduction for state and local property taxes (SALT) at $10,000 will also negatively impact states with high property taxes, such as California, Connecticut, and New York. Furthermore, proposed changes to the capital gains exemption on profits from the sale of a home (requiring five years of continuous residence as compared to the current two) could impact approximately 750,000 home sellers a year and slow the growth of home ownership.

Something else to consider is that all of the aforementioned changes will only affect new home purchases, which I fear might become a deterrent for current homeowners to sell. Given the severe shortage of homes for sale in a number of markets across the country, this could serve to exacerbate an already-persistent problem.

Housing Bubble

I continue to be concerned about housing affordability. Home prices have been rising across much of the country at unsustainable rates, and although I still contend that we are not in “bubble” territory, it does represent a substantial impediment to the long-term health of the housing market. But if home price growth begins to taper, as I predict it will in 2018, that should provide some relief in many markets where there are concerns about a housing bubble.

In summary, along with slowing home price growth, there should be a modest improvement in the number of homes for sale in 2018, and the total home sales will be higher than 2017. First-time buyers will continue to play a substantial role in the nation’s housing market, but their influence may be limited depending on where the government lands on tax reform. 

originally published on windermere.com

Fall is a great time to take care of home repair projects before shorter and colder days make it more difficult. Here’s a handy checklist to get your home ready for the season ahead. And if you’re considering making a move, it’s a great time to get started on that too. I can help you here and anywhere in the world, so give me a call today!

• Schedule chimney cleaning
• Conduct energy audit
• Clean dryer vents
• Add weather stripping
• Care for trees and shrubs
• Clean Gutters and downspouts
• Seal gaps where pests could enter