Last year was an amazing come back year for many areas across the nation. Here in Seattle we saw about a 11% percentage increase in housing prices across the city (source NWMLS). The majority of the spike happened in the first two quarters of 2012 with steady rises seen throughout the year. Although those of us on the ground know we are dealing with low inventory, seeing the hard data was a bit of a shock. Since 2010 Seattle’s overall housing inventory dropped by 59%. The low inventory combined with a steady increase in demand is definitely pushing prices up. This uptick in prices has means those of us who have been holding tight on to our Diva Dwellings have a little bit more optimism and room to breath. The other strong trend is that the under $500K market was truly the hottest of the hot markets in 2012. Interestingly, this years boom has encouraged many sellers to revert back to the old practice of overpricing their homes in the over $600K and above market.The graph below gives amazing insight into the mind set of both buyers and sellers.

Listed Versus Actual Sold Prices  (Averages in Seattle)

Here are some of our favorite hoods and their come back numbers:

Divaliscious Hood                         Come Back Story (Comparing Dec 2011 to Dec 2012)
Capitol Hill Condos                            14% From 2011 to 2012
Columbia City                                       14% From 2011 to 2012 (most unstable market)
Ballard Area                                          27% From 2011 to 2012
Magnolia                                               2.7% From 2011 to 2012 (expect to see big changes in this number in 2013)

Moving into 2013 Here Are a Couple of Diva Predictions for the Market

House Love | Jenny Prepping Vegetables for Pickling at Chez Diva

Moving into this next year we Divas think it is all about more house love. We have always said that owning a house is like a hobby, a marriage, a passion, or in other words – it is a labor of love. Somewhere along the way we lost this expression with our abodes, casas, maisons, dwellings, and homes. It is our goal to share with many folks our love affair for our Diva Dwellings.

On the technical side the Divas predict that the inventory will improve just slightly. Be prepared to pay more both in your mortgage rates and purchase price. But on the flip side you are buying a house with some guaranteed appreciation – for now. It is also the year for our Diva Dwellers to start movin’ on up!

1. Sustained price increases. We expect Capitol Hill to go up about another 10%. The southend will probably see about 3-5% and the area around the Columbia City Light Rail station will continue to be feeding frenzies. Ballard – all you hipsters and shop local fiends should expect to bid like a crazy person to get house in this hot neighborhood. Magnolia is an interesting beast. The schools are great. Inventory is ridiculous low. But the price point is typically higher than other neighborhoods. Magnolia might well just remain stable or it could see a more substantial bump as the buy-up folks start hitting the market.
2. Mortgage Rates and Closing Costs to Increase: The fiscal cliff debacle kept interest rates super low. Our clients who closed in December saw probably saw of the lowest mortgage rates of our generation. Lucky Diva Dwellers! Our advice to buyers and refinance folks – DO IT NOW. With the financial debate in Congress on pause till March – rates will probably stay uber low rates. But, once the budget issues are resolved, we may start seeing minor rate increases throughout the year.
3. More Flipped Houses – Its 2006 All Over Again: An investor bought the house behind Chez Diva. Right now out of our home office window we get to spy on the progress of the contractor. Let’s just say we wouldn’t hire him. It did get us thinking about flippers in general. We realized in a short walk through our neighborhood there several active projects, one flip for sale and at least three that have sold in the last year. The interesting thing about the house behind ours is that the investor is from out of the city and so is the contractor. The Divas will be following the progress and reporting back. Check out a blog post from October/2011 that shows the first signs of this process »
4. Year of the Move Up Buyers: These are folks who have more than likely, been in their homes a while and have a pressing need to make a change; a new school district, a bigger house or maybe folks like the Divas, who feel the need to downsize. They often have been holding out for a more stable market for a while. These buyers are tough. They are committed to home ownership and house love. And this time around they are making a more intellectual decision with specific motivation. The Divas fall into this realm themselves so we are tuned into the needs of this small but growing demographic. We have a new packet to help peeps who are in this situation that gives a clear break down of how to navigate the process. Or check out the blog post we did this past fall »
5. Exalted Home Delight: Last summer we had so much fun hanging out in our house, roasting marshmallows, getting the garden in shape and entertaining so many people in our fab dining room. Experiences like this can only be achieved when you are the master of your domain. You own it and it is amazing! This year look for more videos and blog posts about the simple delight of being a Diva Dweller.

Seattle Market Watch - Seven Days / Note the Number of Pending Sales vs. New

KUOW just ran a great story spotlighting the super low inventory in some of the neighborhoods here in Seattle. Here at Team Diva HQ we have seen multiple offers for our buyers across the board this year. This leads to the perception by some sellers that we are back in 2005-2006 mode of increasing prices regardless of what is tossed on the market. But the reality is, despite the upward movement, there is still a distinct difference in the types of homes that are selling with multiple offers and those that are languishing on the market. The homes that selling in multiple offers are like the home in the KUOW story  “Aside from all the cosmetics you see, this house has all new systems, so it’s 100 percent new wiring, 100 percent new plumbing. There’s a new furnace.” The homes are prepped for the sale!

Honing in Closer to Home, Let’s Check out Some of the Diva’s Favorite Neighborhoods:

Capitol Hill Condos | .84 Demand Rate / Less Than One Condo for Every Buyer
Buyers have swung into the market bought up everything priced below $200,000. Expect to pay closer to $250,000 for a one bedroom and anywhere from $325-450,000 for a two bedroom.
Listing Price: $390,000
Pending Price: $334,000 / $186,000 for Short Sales
Sold Price: $167,000

Columbia City Single Family Homes | .63 Demand Rate / Less Thank One Home for Every Buyer
Check out the list to sold price. Expect to pay $27,000 over the average list price to live in this up and coming neighborhood.
Average Listing Price: $283,000 (For homes actually on the market. Vast majority of homes are pre-sale or under construction priced above $350,000)
Pending Price: $308,000 / $248,000 for Short Sales
Sold Price: $310,000

Phinney Ridge Single Family Homes | .36 / Fight it Out Buyers. There is Only 1/3 of a House For you!
The demand rate in this neighborhood is really low. The interesting thing is that homes are either on the market for around 8 or over 100 days. The bottom line is that market has trends like 2005 but the buyers are very 2012 recession proof. That means that they are very smart and super conservative. The new generation of buyers expect houses on the market to look and be marketed with a little Diva Difference.
Average Listing Price: $556,000
Pending Price: $552,000 / $527,500 for Short Sales
Sold Price: $528,000 with about a 99% sold to list price.

The bottom line is that this is a great time to sell your house if you need to move up to the next generation of home or if you are sick and tired of being a landlord. For those who are still underwater on your home, the end is near. Buyers expect to compete for the good homes or get out the elbow grease and get to work on homes that need a little work. Do not expect a lot of new inventory to come on the market any time soon. Those with good houses in good neighborhoods are sitting tight until the market corrects itself.

Market Watch for 1/13/2012-1/20/2012

One of the biggest question we get from our clients is “What is the market doing? Are we improving yet?” Well if January is any indication of how the rest of 2012 is going to go then I say “We are on our way!”

The best way to clarify our answer is to look at the inventory in Seattle and where we see movement. During the last week only 127 homes came on the market as “new” listings. The majority of these homes were taken off over the holidays and are now back on the market. The number of homes that went under contract in the same time period was about 238. Basically this is indicating that there are way fewer homes on the market than meets the current demand. Now let’s look at that Demand rate.

Diva HQ Demand Rate
January has been a whopper of a month for Team Diva. Here at Diva Headquarters we have eight homes under contract and we are only in the third week in January. This exact same time last year we had ONE. That is just what we are experiencing, and as you know its different for everyone.

Let’s take a closer look at what we call the Demand Rate. Demand Rate indicates how many buyers are in the market for every home that is listed. On Capitol Hill we have averaged around six to nine months of inventory for condos. Or one buyer for every nine condos on the market. Right now the demand rate is hovering around 1.68. Basically that is one and 2/3 condo for every buyer. We like the look of those numbers!

Seattle Demand Rate
All of Seattle: 1.76
All of Seattle without Distressed Homes: 2.65
Seattle Residential Homes: 1.54
Seattle Condos: 2.4

Back to the question – What is the market doing?

• Buyers: Overall we are moving into a more positive environment. As a buyer I would recommend being aggressive if you are looking in the core Seattle neighborhoods. These would be Ballard, Wallingford, Greenlake, Bryant, Capitol Hill, Admiral Area of W. Seattle, Columbia City and the always super popular Central District. It’s been a real estate desert in these neighborhoods. Nothing new has come on market this entire January. And when it does, it’s snatched up quicker than a Drag Queen applies lipstick.
  
• Sellers: As for sellers, I would personally suggest you only sell your home if it gives you the opportunity to buy a larger home for your family while prices are still depreciated. 2012 is a comeback year and the only way prices are going to increase is if the inventory remains low. Luckily for all of us it looks like the inventory is going to stay low for quite awhile!

The Seattle Times recently released an article that shows the numbers improving from a national perspective. Check it out and let’s keep moving forward Seattle!

The last six months of watching Seattle’s real estate market has been fascinating. Increasingly the availability of high quality, well-priced and updated homes have dropped consistently. Sellers are reluctant to sell their homes in a market that they feel is harsh. Where as at the same time buyers are expecting stunning homes in high Walkscore areas. From the outside it seems like an impasse but not necessarily. Well-priced and perfectly updated homes are selling quickly. But homes that are in tough areas, short sales or estate sales are facing a tougher market timeline. Below we breakdown the single family home versus condo real estate market here in Seattle.

Single Family Home Market Update

Spring is typically a hotter moving time period in the market. We personally have not seen the influx of buyers until just recently.Part of it could be the unusual cold weather and the other part is general hesitancy in the zeitgeist. But if one looks at the actual numbers it shows a slowly improving market. The NWMLS just released data showing an increase of 41% in pending sales in the region. Looking closer at Seattle the number of pending sales has slowly climbed from 337 in December to 674 in May. Almost an 100% INCREASE! Below is a chart below the number of pending sales has steadily climbed.

Single Family Home Market Snapshot Q1-Q2/2011

Condo Market Update

The Condo market is also slowly starting to see improvement. Specifically in the lower price ranges. The pending sales have increased about 141% from 92 pending sales in December to 222 in May. Its great to see progress but we are still looking at 6-8 months of inventory in the Seattle area. However, looking closer in the urban core, Capitol Hill has seen a 3.6% drop in inventory and an 136% increase in pending sales. The average price per square foot has also increased about 1.3%. Below is the chart showing the entire city of Seattle:

Condo Market Snapshot Q1-Q2/2011