Are you planning to buy a home in Washington during summer 2018? It might work to your advantage. Competition tends to drop off a bit after the spring, research shows.
For example, a study by Zillow found that “In Seattle, over half of homes sold between March and May will sell above list price. By late summer this falls to one in three.” So patient buyers willing to hold off until summer might benefit from a seasonal sift in demand.
With that being said, home buyers across Washington State will probably feel more urgency in summer 2018 — compared to years past. Mortgage rates have risen in recent months, and home prices across Washington continue to climb steadily. So many buyers are feeling the need to move quickly.
A Sense of Urgency for Washington Home Buyers This Summer?
The latest reports from real estate companies and listing services show that home prices in the state continue to climb. So those planning to buy a house in Washington this summer might want to expedite the process, if at all possible.
Here are three reasons why a sense of urgency might be warranted:
1. Home prices are almost certain to continue rising.
The median home price for the state of Washington rose to around $371,000 in May 2018. That was an increase of nearly 12% from the same month last year. A June 2018 report from CoreLogic showed that house values in Washington State rose more than any other state from April 2017 to April 2018, posting a gain of 12.8%.
And with the current supply-and-demand situation in real estate markets across the state, it appears likely that prices will continue climbing throughout 2018 and into 2019. Washington home buyers might want to consider buying sooner rather than later, to avoid higher costs toward the end of the year.
2. Mortgage rates are higher now than the start of this year.
In mid-June, 2018, Freddie Mac reported that the average rate for a 30-year fixed mortgage loan had risen to 4.62%. That was the second-highest average of the year, and an increase of more than 60 basis points since January 2018.
Over the last few weeks, average 30-year mortgage rates have been fluctuating in the 4.6% range. But they might rise further as we move into the summer. Federal Reserve policy changes (and other factors) could contribute to this.
According to a recent article in the Washington Post:
“…economists say rates are still low by historical standards, but they are expected to rise further if the Federal Reserve continues to boost interest rates. Fed officials bumped up the benchmark interest rate by 0.25 percentage points to a range of 1.75 percent to 2 percent at the end of Wednesday’s meeting.”
This is another trend to watch, if you’re thinking of buying a home in Washington over the summer of 2018. There is a chance that both home prices and mortgage rates could inch upward over the summer months, and into the latter half of the year. Once again, it makes a strong case for buying sooner rather than later.
3. With fewer homes available, buyers should start early.
If you’ve been following real estate market trends lately, you probably already know that inventory is tight right now. There’s a shortage of supply in real estate markets across Washington State — and especially within the Seattle metro area.
Recent MLS reports show that housing inventory is tightest at the lower end of the price spectrum (i.e., “starter homes”). That’s because there are more buyers competing within that range. But things are tight up and down the price scale.
This gives home buyers a good reason to start early, when shopping for a house in Washington. If your goal is to find a property and make an offer during the summer, you’ll want to start now. It can take longer to find a house these days, due to the supply situation.
Have questions? Sammamish Mortgage is a local, family-owned company based in Bellevue, Washington. We serve the entire state, as well as the broader Pacific Northwest region. Please contact us if you have mortgage-related questions.