There are many factors that are currently influencing the real estate market. Interest rates for conforming loans have risen from August at 5.22% to 6.11% in September. The direct correlation between interest rates and affordability is that for every 1% change in rate, buyer’s affordability is affected by 10%.
Buyer demand is still there, but buyers are very price sensitive right now. Interest rates are at their highest they’ve been in 14 years and have an undeniable affect on buyer’s affordability. However, 23% of homes sold at or above list price, 30% sold below list price, and 47% sold after a price change.
As the July stats report, we have seen a continued decline in prices and increase in inventory. However, the pace of each has slowed. The current market conditions were caused by rapid price appreciation and interest increases.
The June stats are out and we aren’t too disappointed. Yes, the market has shifted, but its not all bad news. Interest rates have risen and stock portfolios have been hit hard, but the local real estate market is still robust and inventory numbers are still in seller’s favor.
May numbers continue to support that the market is shifting. In April 2022 we began to see a decline in median price and increase in inventory. In May, active inventory grew by 403% from February 28th to May 31st.
April stats indicate a changing market as the buyer affordability index indicates that we are at a peak.
The median sold price has flattened out to $1,722,500 from $1,700,000 in March. In January the median price was $1,515,500 so still up significantly.
March was a great month overall with 82% of listings selling for a median of 21% above list price. Prices shot in rapidly in the last quarter and are now facing headwinds from rising interest rates and stock market woes.
Last month I made a prediction based on my real time, “boots-on-the-ground” experience of the bidding wars we were experiencing. The homes that went pending in January closed in February and the stats are out.
What an incredible start to the year. I’m sure by now you all have heard about the frenzy that kicked the year off. Between the tight inventory and the Fed raising interest rates, buyers in need
October stats show a further decrease inventory and thus a decrease in pending sales. Days on market remain low and sales above asking remain similar to last month, however the median price remained stable since last month.
September statistics show more of the same, although all three figures show the “minor relief” for buyers that was predicted in May 2021.
Median closed sales price vs $1,310,000 up 26% year over year vs
August $1,300,000 up 24%
July $1,330,563 up 32%
June $1,364,000 up 40%
70% of homes sold for over list price.
As predicted, August statistics show some relief for buyers. The median price for homes on the Eastside has been relatively flat since March (ranging from $1,298,475 to $1,364,000) and is expected to continue through the end of the year.
As much as I want to share the stats of recent sales and tell you how busy we’ve been and the bidding wars we’ve encountered. I would much rather answer the question that I keep hearing over and over. “Is this market sustainable? Are we in a bubble? Is the market going to crash?”
Finally, the sun returns this week, and you know what that means for downtown Kirkland, busy, busy, busy. We always say, Kirkland is a “solar-powered community” and, let’s be honest, no other city shines as bright as Kirkland on a sunny day.
If you’ve been following along on my social media you can see, the market is hot! Two new listings this week and they’re booked solid with showings this weekend and slated for offer reviews on Monday.