Overall economic outlook for the region.
After the COVID-19 employment levels went down, Western Washington continues to rebuild, but regional employment is still 133,000 jobs lower than during the 2020 high in February. The return of jobs should continue, but it depends on how the new COVID-19 infection rates progress, and when the sections of the economy that are still shut down can reopen. More robust growth won’t happen until a vaccine becomes widely distributed, which is unlikely to happen before the summer.
Home sales in Western Washington.
A) Sales continue on strongly, with a little more than 23,000 transactions in the quarter, an increase of 26.6% from the same period in 2019, but 8.3% lower than in the third quarter of last year, despite what seems like a more active market. This is probably due to the lack of inventory and the shorter time on market.
B) Listing inventory remained very low. Total available homes in the third quarter was 37.3% lower than a year ago.
C) Not surprisingly, sales rose in every Western Washington county, with San Juan County seeing the greatest increase.
D) Pending sales were 25% higher than a year ago at this time, but down 31% compared to the third quarter of 2020. Experts agree that this is because of the lack of inventory.
What About the Home Prices in Western Washington?
As you would expect, when the housing market is hot, the law of supply and demand is evident. Here are a few notes on what happened to home prices as a result:
A) Overall, housing prices rose 17.4% compared to a year ago, with an average sale price of $617,475 in Western Washington.
B) Interestingly, home prices were only 1% higher in the 4th quarter than third quarter of 2020. While interest rates remained extremely low, the slowing of appreciation may be because the affordability ceiling in some markets.
C) The outlook for Mortgage rates is that they will remain low throughout 2021, which will help keep the market moving forward especially if our inventory remains so low.
Here are appreciation rates (sale price changes) for some of our Western Washington counties.
Lewis County leads the way with an approximate 32% increase in value from Q4-2019 to Q4-2020! Amazing!!
Grays, Cowlitz and Island Counties all had between a 25% and 30% increase as well!
Skagit and Whatcom Counties were both around 20%
What about DAYS ON MARKET?
1) The average number of days it took to sell a home in the final quarter dropped by a very significant 16 days compared to a year ago.
2) Our friends in Snohomish County again led the way in Western Washington, with homes taking an average of only 15 days to sell.
3) Overall across the region, it took an average of 31 days to sell a home in the quarter.
A few highlights from different counties regarding Days On Market:
What Does all this Mean for You?? IT IS A SELLERS MARKET!!
What we can clearly see by these numbers is that Covid-19, historically low interest rates throughout the year, and low inventory has caused the housing market to remain incredibly robust. While we wait to see how the economy rebounds with a virus vaccine and regions being allowed to open back up, we expect the real estate market to continue to be hot.
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