September 2020 Housing Market
September was another wild and crazy month for the housing market in Kitsap County. We’re seeing a sharp drop in the inventory of homes for sale (down 47% from a year ago). Low supply and high buyer demand are causing home prices to surge for single family homes, as values are up 26% year-over-year. Record-low interest rates continue to bring new buyers into a crowded market, especially as people migrate from King County in search of high-quality, affordable living.
Well-priced homes are selling in less than a week on the market, with multiple offers significantly above asking price. Many buyers get outbid on 10-12 homes before finally going under contract. Cash investors and desperate buyers are increasingly waiving all contingencies, including inspections, often paying $30,000 – $50,000 or more over list price.
A balanced market has 4-6 months of inventory; currently we have less than a month’s supply. That’s what makes this an extreme sellers market for single family homes — we’re virtually sold old!
Tips for Sellers
If you are thinking about selling your home, there’s never been a better time! Buyers are still out in full force, watching more virtual tours and setting records for online traffic, and taking precautions for in-home showings. Brokers and buyers should be practicing social distancing at all times, wearing face masks, using hand sanitizer and Clorox wipes, and allowing no more than 3 people in a home at a time (6 ft. apart).
Listing your home with a digital-savvy broker is critical, as open houses aren’t permitted right now… but with strong online advertising, you can get thousands more views on your home listing. And all the research shows that buyers start their home search online, especially during this difficult season. We don’t yet know the long-term economic effects of this pandemic, and home values may not continue to increase at the same rate in the future, if buyers struggle to afford housing.
Tips for Buyers
Mortgage interest rates are still historically low. However, in some cases it can be more difficult to qualify for a loan, as lenders tighten their requirements due to economic uncertainty. And with homes selling fast, it’s never been more important to get pre-approved before you start looking at houses. Because of the stay at home order, only pre-approved buyers should be touring homes at this time.
It’s a tough seller’s market, so if you’re planning to buy a home soon, don’t wait to make a solid game plan with me and your lender. Talk with me first about recommendations for a trusted lender! Deals have been falling through due to poor lender practices, so an experienced and responsive mortgage broker can make all the difference in a successful closing.
Finally, the competition has increased this summer—If you find a home you love, you may need to consider illogical tactics to win the bidding wars. You may want to consider waiving inspections, paying more than the home is worth, offering the sellers more time to move out after closing, and other strategies.
Economists and real estate industry experts are predicting a strong and resilient real estate market, despite the economic downturn and rising unemployment. So far, that is proving true in our current Kitsap housing market, as demand is still much higher than the supply. Click here to learn more about the impact of COVID-19 on housing in Kitsap County. The current crisis is not like 2008, when the real estate market was unhealthy. But these are likely to be “bridge” months, where market activity is less predictable than usual.
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Thinking of buying or selling? Call or text me at 360-979-6411 to set up a free, no-pressure consultation. I am a skilled negotiator who will advocate for your best interests.