By Erin Flemming
Special to the Reporter
As we enter the winter residential real estate market, historically the number of resale listings by month dips downward. Over the last five months, we’ve seen more inventory than we have in years previously, which can be favorable for buyers who previously could not afford a home or secure a home in a multiple-offer situation.
Now, Mona Spencer, branch manager for John L. Scott’s Redmond office, said these buyers may be able to do some negotiating on price and also secure more protections under the contract such as the ability to do an inspection before moving forward on the purchase.
“As more inventory enters the market, buyers have more options,” she said. “Bidding wars are less likely and we are seeing some price reductions. This does not mean that houses are falling in value; it means that the rate of appreciation is decelerating.”
While the current real estate market is certainly different from the frenzy conditions present last May, Spencer said there’s no cause for worry.
“Concern about the housing market can come from confusion,” she said. “Reach out to your trusted real estate advisor to get clarity on the housing market in your area of interest.”
When looking toward the future, it’s difficult to say exactly what will happen with home prices in the years to come. Many sources — including Zelman & Associates, the Mortgage Bankers Association, Freddie Mac, Fannie Mae and the National Association of Realtors — indicate that home prices are continuing to appreciate, but at a lower rate than we saw in previous years. The National Association of Realtors prediction of prices going forward in 2019 is an increase of 3.5 percent, while it was an increase of 4.8 percent in 2018.
One good starting point for understanding the current local market is median list and median sale price — though it’s only one piece of a much larger picture of the local housing market. In Redmond, the median list price is $899,000, and the median sale price is $820,000.
When looking to sell a home, the “best” timing can really depend on personal needs or preferences. Spencer said for people considering selling their home, they can wait for the spring when many other homes go on the market and demand drums up, or if they’re facing a life event currently, it’s not an issue to list this winter.
Regardless of the time buyers decide to enter the residential housing market, it’s always a great idea to begin conversations with a skilled broker and potential lenders. With a loan amount of $100,000 on a 30-year fixed, the most popular mortgage, the principal and interest payment would be $536 per month with an interest rate of five percent. To give an approximate idea of monthly payments with current interest rates, simply multiply that number accordingly to match up with a price range you’re looking at. For a more detailed look at financing, connect with a lender to chat through options.
“It’s good to get a head start on financing so you understand your placement in the market,” Spencer said. “And as always, taking the steps to improve your credit score will always benefit you when looking to purchase a home.”