Summary: Do you plan to buy your first home in Washington in 2020? If so, there are some things you should know about recent mortgage and housing trends. Understanding the current “lay of the land” can improve your chance for success, which this article will go over.
If you’re a first-time homebuyer looking to buy your first WA home in 2020, your best bet is to gather as much information as you can to ensure a successful transaction. To that end, here are five things first-time home buyers in Washington should know in 2010.
1. Home Prices Are Rising
A couple of years ago, home prices in Washington were rising faster than any other state in the country. Washington led the way in terms of annual price growth, posting double-digit gains from one year to the next.
But things slowed down a bit over the first half of 2019, which allowed the housing market to cool down a little and give buyers a bit of a breather. But things have picked up since then and are expected to continue on that pace over the remainder of 2020. Over the past 12 months, home prices have risen 4.9% and are expected to rise by about the same pace over the next year through to March 2021.
According to the latest research by Zillow, the statewide median home value was around $419,900 as of March 2020. So, Washington State continues to outpace the nation in terms of appreciation rates and is considered a very hot market right now.
Looking forward, housing analysts have predicted that home prices across the state will most likely continue to rise throughout 2019.
The key takeaway here is that first-time buyers who put off their purchases until later in 2019 could encounter higher prices and reduced affordability.
2. Housing inventory market is growing, finally
Inventory shortages continue to be a big real estate news story in Washington State and are expected to continue to be throughout 2020. Many cities across the state and the country are experiencing a shortage of homes for sale, relative to the number of buyers in the market. Shortages were particularly severe in major cities across the Pacific Northwest, including those in Washington.
According to the Northwest Multiple Listing Service (NMLS), which covers 23 major counties in Washington State, including King County, pending sales outpaced new listings in January 2020. Housing inventory is down 33% from the same time last year, dipping to record lows.
While inventory may be picking up in certain parts, it’s still not enough to keep up with demand, leaving buyers to face fierce competition among other other.
3. Mortgage Rates Are Still Very Low
Mortgage rates continue to hover near historic lows, with rates for 30-year fixed-rate mortgages currently sitting around the 3.45% mark. They’ve been on a steady decline over the past year and show no sign of spiking any time soon. According to Freddie Mac, mortgage interest rates are expected to stay low throughout the year and not go anywhere over the 4.0% mark during 2020.
4. Mortgage Loans Are More Flexible Today Than in the Past
A recent report from CoreLogic showed that mortgage underwriting have relaxed somewhat for both conventional and FHA loans. Another report showed that home loan denial rates have declined steadily for the last few years.
Both of these trends point to a mortgage industry that has become more flexible. It also underscores the importance of speaking to a knowledgeable loan officer about the many financing options that are available. Please contact us if you have any mortgage-related questions, or if you’d like receive a quote on your next loan.
5. Getting Pre-Approved For a Home Loan Could Increase Your Chance For Success
In a previous article, we shared a report that showed most first-time buyers in Washington State and nationwide get pre-approved for a mortgage loan before house hunting. It makes sense to start the process in this order, and that’s why so many people do it.
Getting pre-approved for a home loan can help you zero in on a specific price range. This, in turn, can help you narrow down your housing search and expedite the overall process. Please contact us if you have questions about getting pre-approved for a mortgage loan in 2020.
Curious About Mortgages in Washington State?
If you’re ready to buy your first home in Washington State, Sammamish Mortgage would love to help you. We are a local, family-owned company based in Bellevue, Washington and serve the entire state, as well as Oregon, Colorado, and Idaho. We have various mortgage programs to offer you, depending on your exact financial situation. Please contact us if you have mortgage-related questions.