Category Archives: Blog

Home buyers are “better off,” but market is heating up

Source: NWMLS

KIRKLAND, Washington (June 6, 2019) – The housing market in western Washington may not be as hot
as it was last spring, but it is heating up, suggested one industry leader in commenting on the latest
statistics from Northwest Multiple Listing Service.

Matt Deasy, president of Windermere Real Estate/East, Inc. said his analysis of single family home sales
in King County reveals 7 out of 10 properties that sold during May had 15 or fewer days on the market. He
also noted more than half the listings (55 percent) in the county sold for at or above list price, the highest
ratio since July 2018.

Northwest MLS figures show last month’s 12,006 pending sales across its 23 county service area nearly
matched the year-ago total of 12,168 mutually accepted offers. Nine counties notched increases.

Two other indicators of activity – the volume of new listings, and the number of closed sales – both
showed slight gains from a year ago. MLS member brokers added 14,689 new listings to inventory during
May, up 165 units from twelve months ago. Year-over-year (YOY) closed sales rose about 1.6 percent
(from 9,011 in May 2018 to last month’s total of 9,153).

Several representatives of Northwest Multiple Listing Service commented on increasing activity:
 “The housing market definitely got busier in May with brokers reporting an uptick in showings,
open house traffic, and offers.”  OB Jacobi, Windermere Real Estate Co.

 “We are swinging into our summer market at a little faster clip than last year, and have a few
more houses for buyers to choose from.”  Frank Wilson, John L. Scott, Inc.

 “The spring real estate market remains very good for both buyers and sellers.”  Dean Rebhuhn,
Village Homes and Properties.

 “Buyers rejoiced at lower interest rates in May.”  J. Lennox Scott, John L. Scott, Inc.

In addition to favorable financing, Scott said, “Increased inventory and continued job growth built on
April’s momentum, translating to strong results in May.” While inventory has increased in many areas,
Scott noted there are still severe shortages of listings in some price ranges.

Inventory improved 24.5 percent from a year ago, with brokers adding 14,689 new listings to outpace the
12,006 pending sales. The MLS report for May shows 16,133 active listings at month end, up from the
year-ago total of 12,956. King County recorded the largest gain in total inventory, at more than 62
percent, but supply remained below 2 months in that and several other counties.

System-wide there was 1.76 months of supply at the end of May, well below the 4-to-6 months that
experts say indicate a balanced market. “While our inventory has grown a little, we’re still well within the
definition of a seller’s market,” said Frank Wilson, a broker in Kitsap County where there is only 1.46
months of supply.

It’s Still Smart to Bet on Housing

Source: Dr. Steve Sjuggerud

We are in the late stages of a massive wealth-creation event. When it’s over, we likely won’t see another opportunity like it for decades.

If you invested in housing in the last few years, you’ve likely made incredible gains… whether you bought a house or invested in real estate stocks.

Today, many investors are worried that the bull market is over… They’re worried that the massive gains we’ve seen in the housing market are behind us.

I hear this all the time…

“Steve, home sales fell hard in 2018. Houses aren’t as cheap as they were five years ago, either. Doesn’t that scare you?”

The concerns are understandable. But these ideas miss the bigger point.

Yes, home sales had a rough year last year. And yes, home prices have moved higher in recent years. But when you look under the hood, the housing market is actually healthier than you think.

It’s still smart to bet on housing now.

Let me explain…

First, let me be very clear… I’m not calling for another decade of booming housing prices.

Today’s opportunity isn’t the generational one we saw back in 2011. But there are a couple reasons why we should expect housing to do well over the next couple of years.

The first is that housing is a better deal than a lot of folks believe. That’s normal after a decadelong boom. But thanks to the recent decline in mortgage rates, housing isn’t out of reach for most.

Just a few months ago, 30-year mortgage rates were nearing 5%. Now, these rates are down to 4%. Take a look…

Falling mortgage rates tell us it’s getting cheaper to take out a home loan. That’s great for folks who are looking to buy in today’s market – and it should continue to drive demand.

On top of that, supply in the housing market is still extremely low… Homebuilders can’t keep up with demand.

You can see this by looking at existing home supply. It’s based on how many months it takes to sell the entire supply of existing homes on the market, according to current sales rates. Check it out…

The housing market is extremely tight. The number of existing homes on the market is historically low today.

That creates an interesting scenario…

With mortgage rates falling, housing has recently become more affordable. That should increase demand, bringing new buyers into the market. But they’ll be coming into a market with incredibly low supply.

New demand with limited supply… That’s a recipe for higher prices.

This isn’t what the average person would expect, of course. But it’s the reality of what’s going on in the housing market right now.

U.S. housing is much healthier than most people believe. And I expect the boom to continue in the coming years.

Good investing,

Steve

Brokers Seeing “Simple Economic Recipe For a Softening Housing Market”

Source: NWMLS

KIRKLAND, Washington (July 5, 2018) – Home buyers around many parts of Washington state had
more choices and less competition during June, prompting some industry leaders to comment on “a
feeling of change in the market.”

“Inventory is up and demand has dropped,” reported Robert Wasser, an officer with the board of directors
at Northwest Multiple Listing Service. That combination is “a pretty simple economic recipe for a
softening market,” he added in commenting on the latest MLS statistics.

Figures for June show a 5.2 percent improvement in the number of active listings system-wide, coupled
with drops in the volume of pending sales (down 8.4 percent) and closed sales (down .07 percent)
compared with a year ago. Despite the shift of some indicators favoring buyers, prices area-wide
continued to rise, increasing more than 10 percent from twelve months ago.

“There was a feeling of change in the market this June and the numbers supported that feeling,” remarked
John Deely, principal managing broker at Coldwell Banker Bain. He noted many brokers also reported an
increase in properties going past their offer review date, more price reductions, and an increase in reverse
prospecting (a tool that allows the listing broker to view a list of brokers with potential buyers for that
listing). “We’re also experiencing a decrease in multiple offers and the number of buyers participating in
multiple offers,” added Deely.

Northwest MLS brokers added 13,153 new listings to inventory during June, a drop from both a year ago
when they added 13,658, and from May when 14,524 new listings were added. With new listings
outgaining sales, total inventory as measured by active listings and months of supply improved.

At month end, Northwest MLS reported 15,234 active listings and 1.5 months of supply. Inventory of
single family homes and condos reached its highest level since October. The supply of active listings in
King County surged 47 percent from a year ago, boosting the months of supply to just under 1.3 months –
the highest level since September 2016 when there was 1.37 months of supply.

“Although still a quick response market, with more new listings coming on the market during the summer
months, we experienced dispersed buyer energy due to the greater availability and selection,” stated J.
Lennox Scott, chairman and CEO of John L. Scott Real Estate. He estimates sales activity is off 15-to-20
percent for each new listing’s first 30 days on the market. “Now through October will be the best time of
year for homebuyers,” he remarked.

“Sellers are becoming more active in the market as they sense buyers pulling back,” suggested George
Moorhead, designated broker and owner at Bentley Properties. Improving supply, a marked increase in
expired or cancelled listings, and market times almost doubling are factors he mentioned when describing
the market as “more than just lackluster” with summer showing no sign of improvement.

Cybercrime Hitting Real Estate – Beware of Scams!

Source: RISMedia

Online criminals are targeting the real estate industry and stealing large sums of money from unwary homebuyers. This fraud can destroy real estate transactions, so the National Association of REALTORS® is urging real estate professionals across the country to immediately implement safety measures to reduce the risk of becoming a victim

In a typical scenario, a criminal will hack into the email account of the person involved in an upcoming real estate transaction. The hacker will then send a sham email to the buyer, or another individual who will be wiring transaction-related funds. The email will state that there has been a last-minute change to the wiring instructions. Following the new instructions
contained in the email, the recipient will then wire the money directly to the hacker’s account, which will be cleared out in a matter of minutes. The money is almost always lost forever.

Most email users today can easily recognize the email scams that are rife with poor spelling and grammatical oddities. In contrast, the fraudulent emails being utilized in this wire scam are virtually indistinguishable from legitimate communications. Because hackers are gaining access to the email accounts of individuals directly involved in the transaction, they’re able to include detailed information in their fraudulent emails, including key names, dates, and mocked-up signature lines.

There are a number of measures that real estate agents and others involved in real estate transactions can take to help keep themselves and clients from falling victim to this crime. First, from the outset of any deal, inform all parties to the transaction of this ongoing scheme, to ensure that everyone stays alert to suspicious activity. Second, request that all parties implement reasonable security practices throughout the course of the transaction, such as only using confirmed telephone numbers or face-to-face communication to share sensitive financial or personal information. As a final failsafe, immediately prior to wiring any money, the person initiating the wire should call the intended recipient via a verified
telephone number to confirm the wiring instructions.

Other important steps to avoiding exposure to email fraud include:

  • Never conduct business over unsecured WiFi.
  • Clean out email accounts on a regular basis
  • Change email passwords on a regular basis
  • Implement complex passwords with a combination of letters, numbers, and special characters.
  • Implement the most up-to-date firewall and anti-virus technologies.

If a fraudster has successfully infiltrated a transaction, NAR says:

  • If money has already been wired via false wiring instructions, immediately call all banks and financial institutions that could possibly stop the wire.
  • Contact your local police.
  • Contact all parties who may have been exposed during the attack so that they take appropriate action.
  • Change all passwords.
  • Report the activity to the FBI via their Internet Crime Complaint Center.

This advice is not all-inclusive, and real estate professionals should work with information technology and cybersecurity professionals to ensure that their email accounts, online systems, and business practices are as secure and up-to-date as possible.