April 15th, 2009 categories: Market Conditions
Sunny outlook for Seattle Real Estate
While driving yesterday morning to my monthly meeting at my Realty Executives - BRIO office in Bellevue, I was thinking about all the recent activity I have been seeing in the Seattle real estate market
via my client searches on the NWMLS. I have been seeing an increase in homes going pending, and then actually closing. I saw two earlier today, and one was a property one of my clients made an offer on last month. Unfortunately there were 3 other competing offers, and my client's was not the winning one since (I think) he wanted an extended closing date.
I have a hunch that we saw the bottom of the Seattle real estate market
(at least the Seattle urban areas) last month in March
. I had the same hunch in 2007 that we had hit the high point in May/June of that summer. The NWMLS sales data shows August of 2007 so I was close, and I may be off a month or two this time, but I have several reasons why I think March was it:
The First Time Home Buyer Tax Credit is now in effect through late December. This helps stimulate the "Move-up" home buyers chain reaction. The first time Seattle home buyers can now buy a house, that means the sellers of that house are now free to buy another, usually larger house and so on.
There are still many, really good programs to help first time home buyers buy their first home.
The interest rates are very low. While the rates are low, there are stricter guidelines to be met to obtain them such as more money down, and higher credit scores. However, these are really just returning to prudent lending practices that were in place long before the recent free wheeling credit spree.
Jumbo loans are becoming more available and with better rates. Jumbo loans started becoming harder to get, and almost impossible at first, when the Jumbo Loan contraction happened happened in August 2007. We are only just now starting to see improvement for home buyers needing Jumbo loans, which in the Seattle real estate market means a large percent of the Seattle home buyers.
There seems to be a faint sense of returning confidence in the stock market and recent news services have been reporting an improving level of optimism in the country.
So, there you have it, I think we have seen the low point in the Seattle real estate market in March, at least for the urban/metro areas
. The outer areas will still take some time. The closer in Seattle neighborhoods are more resilient to real estate market downturns because of their central, higher demand locations so they will be the first to recover as home buyers realize that there are homes out there that they can now afford...in some cases really good deals, at least for a while!