Seattle Area Seasonal Real Estate Trends – Fall 2014

Filed in How's the Market by on August 27, 2014 0 Comments

When is the best time to sell or buy a home in the Seattle area?  These graphs show typical seasonal real estate market trends for houses in King County, WA.  You might be surprised to find out that summer is not usually the ‘hottest’ time of the year for our housing market, even though many news sources give the impression that it is.  Let’s take a look at the information below.

Supply, Sales, and Pending Homes

Housing Supply and Sales Trend - King County Single Family Homes - July 2012 to July 2014

Housing Supply and Sales Trend – King County Single Family Homes – July 2012 to July 2014

As you can see, in the beginning of the year inventory tends to be low, and as it increases (the blue line is the ‘New Listing’ line, and the light green bar shows the ‘Number of Homes for Sale’), Pending Sales (the red line) tends to increase accordingly. In 2013 and 2014 we experienced a huge number of multiple offers during that time, as demand increasingly outpaced supply.

The number of listings peaks in the late summer, and at around the same time pending sales tend to taper off. Interestingly, we usually see a perk in Pending Sales in the fall (September to October) which is not due to more listings coming on, as you can see from the downward trend of the ‘New Listing’ line.

 


 Price per Square Foot

Average price per square foot King County Homes 2014

Average Price per Square Foot – King County Single Family Homes – July 2012 to July 2014

Average sold price per square foot has increased by nearly 10% compared to the same quarter a year ago, and over 25% compared to two years ago.

You can see that sales with the lowest price per square foot tend to close in the winter months.

 


Median Sales Price

Median Sales Price - King County Single Family Homes - July 2012 to July 2014

Median Sales Price – King County Single Family Homes – July 2012 to July 2014

The median sale price also tends to be lowest for homes that close during the winter months.

A quick look at this graph might make it seem that July is the best time to list, but keep in mind that sales that close in July go pending in June and sometimes even May.  This means that July closed sale prices reflect a market that existed a month or two earlier.

 


Cumulative Days on Market (CDOM)

Market Time - King County Single Family Homes - July 2012 to July 2014

Average Market Time – King County Single Family Homes – July 2012 to July 2014

The yellow bars (cumulative days on market for closed sales) clearly show the run-up in competition over the past two springs, when multiple offers became the norm and CDOM plummeted. In 2014 you can see the summer demand tapered off a bit earlier, and expect August CDOM numbers to increase again.

Towards the holiday season many sellers take their home off market and CDOM gets much higher because many of the homes going off market at that time have been on the market for a while and their owners are finally eager to get them sold by the end of the year.

Sale price as a percent of list price (the purple line) has increased from 96% in July 2012 to 99% in July 2014.

 


Months of Inventory

Months of Inventory - King County Single Family Homes - July 2012 to July 2014

Months of Inventory Based on Closed Sales – King County Single Family Homes – July 2012 to July 2014

If homes continued to sell at the same rate and no new homes were listed, how long would it be until we ran out of inventory? That’s the MOI (Months of Inventory) indicator shown in the graph above.  We’re currently at 2 months, which is considered a Seller’s Market.  A balanced market is considered to be between 3 and 6 months of inventory.

That being said, MOI based on pending sales (a more recent indicator than closed sales) is higher, although still under 3 months, and this August of 2014 might be one of the most buyer-friendly months we’ve seen in the past year and a half.

 


Timing

So, when is the best time to list a house in the Seattle area?

Typically March, April and May are times when we see a lot of demand and we have not yet reached peak inventory.  We also tend to see a perk in demand between September and October.  Times when the market usually tapers off are in the summer months of July and August, and during November and December.

When is the best time to buy a house in the Seattle area?

The numbers will be more in your favor during the times mentioned above when the market is slower for sellers, although keep in mind that during the winter months inventory usually drops as well.

However, we never counsel people to wait until a specific time of year to buy as long as they are familiar with these market trends and know what to expect.

Why?  Because homes are very individual.  It’s not like waiting until the end of the year to get a deal on a certain model of car that is identical to thousands of others that are exactly the same make and model.  All homes are unique and some are especially hard to find, so it makes sense to be ready whenever the right one comes along.  You also never know when someone is going to list a home and make a mistake in the pricing, the advertising remarks, or do something else to cause the home to be under-marketed and ultimately sell for a ‘deal’ even though it’s not typically a slow time of year.  And finally, seasonal trends are not set in stone and could surprise us.

We’re coming up on another time of the year that is typically favorable for listing, so please call us soon if you’re thinking of selling this year.  You may want to also browse our recent listings or take a look at our new ‘Before and After Home Staging‘ video.

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About the Author ()

Irene Nash has been representing Seattle and Eastside home sellers and buyers in real estate since 1999. She and her husband Mike specialize in straightforward communication and providing top-notch staging and photography for every home listing.

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