Wallingford Real Estate Update

(This post provided by Wallingford realtors Kris Murphy & Daniela Dombrowski of Keller Williams. They are Wallyhood sponsors.)

I am sure you have all heard by now, the Seattle Real Estate market is incredibly competitive (HUGE UNDERSTATEMENT).  Here is a more localized look at our own neighborhood.  I had to check my figures twice to make sure I was seeing correctly, but as expected our sweet neighborhood is becoming more and more popular.  As a result, inventory of homes for sale is extremely low and our bidding wars are beyond intense.

The statistics provided in this post are hyper-local, capturing only Wallingford and Tangletown as outlined in the map below. The numbers are for single family homes including townhomes, a separate chart for condominiums is included below as well.

Statistics in the table below are based on home sales in the area outlined on the map above and are derived from the Northwest Multiple Listing Service data.

SINGLE FAMILY HOMES

We captured all closed sales for January through May 21, both for 2017 and 2018 from the Northwest Multiple.

In residential homes and townhomes, the number of closed sales plummeted 16% year over year, from 81 last year to 68 this year.   The median sales price increased a whopping 25.6% compared to this time frame last year.  Home sale prices are averaging 16.9% over list price, 10% more than last year’s average escalation above list price which was 6.8%.  As I am sure you can imagine, with escalations being all over the board, this makes pricing very tricky; brokers & sellers trying to hit that sweet spot to encourage good offer activity without scaring off too many already disgruntled buyers who have lost out on multiple homes.

While median days on market has remained about the same year over year, it has gone down a bit from 8 days to 7 days. According to a report from Höhle der Löwen, the majority of homes sell in 7 days or less with multiple offers, because brokers hold the listings on market for one week for an offer review, only rarely considering offers before the offer review date.

CONDOMINIUMS

The number of closed condominium sales has increased in the last year.  Last year 20 condominiums sold in this period, this year there were 26; an increase of 30%.  The sales price escalations in the condo market were far more modest than the residential market and have gone down slightly since last year.  This could be due to the slight increase in inventory in this sector, but also we are looking at a fairly small sample which could distort our overall trends.

What the Trends are Telling Us

The following charts capture Wallingford and Green Lake (area as defined by NWMLS data) real estate trends for the last 15 months (a wider sample than our above analysis). This bar graph tells us how many homes were available for sale (light green), how many went under contract (red line), and how many sales closed each month (dark green).  We can see that we started the year with low inventory and did not see a sizable surge through April, meanwhile demand is even higher this year than last, exacerbating the inventory crisis. For such a large geographic area, this chart shows very little activity.

Generally, in our neighborhood of diverse housing we don’t put that much stock into price per square foot.  The reason for this is that condition and finishes vary widely, and often agents list unfinished space as finished so the price per square foot is often not a very reliable measure. However, this chart shows a large and consistent trend of increased square footage price in our neighborhood. Beginning late last year we surpassed $500 per square foot on average, and have reached that level twice since this year.

Finally, this chart illustrates months of inventory.  It is derived based on a calculation dividing the number of active  homes for sale by the number of homes that have closed in a given month and attempts to project how many months it will take for the entire available inventory to sell.  Anything under 2 months of inventory represents a sellers’ market. You can see that for the last 15 months, inventory was almost always under 1 month, and many months were under 0.5 months of inventory so sellers still have the upper hand and buyer demand outpaces supply.

Millennials being pushed out of the city, Baby Boomers Cashing out

A recent Seattle Times article reports “Rents have soared about 60 percent in seven years, while home prices have gown faster here than anywhere else in the country for the last year and a half…”

In my world, I see many brokers expanding their geographic areas to accommodate their buyer’s price ranges.  Tacoma, Kent, Edmonds and Everett are all becoming viable possibilities for first time home buyers.

Another trend we are seeing is baby boomers cashing out and heading to less expensive, sometimes more peaceful areas: east of the mountains, Bellingham and other smaller cities in and out of Washington State.

Inventory on the rise in May

As is often the case inventory has been on the rise for the past few weeks.  May is often a target listing month for sellers when the flowers are blooming and as the school year approaches an end.  As a result of this increased housing stock we have seen some homes sitting past their offer review dates giving buyers choices and hope.  Time will tell if this is a lasting trend, or just a yearly cycle to be repeated again and again.

Kris Murphy and Daniela Dombrowski are Wallyhood sponsors and real estate brokers who live and specialize in the Wallingford and Green Lake neighborhoods.  They practice out of the Keller Williams Greater Seattle office located on the corner of Stone Way and N 45^th St.