Hi, I’m Doron Weisbarth with Weisbarth & Associates. Happy New Year, and welcome to my January 2024 Market Update!
Today, we're taking a glimpse into the future—specifically, Seattle real estate market in 2024. I’m about to share my ironclad predictions for the Seattle real estate market for this coming year.
Now, before you roll your eyes and think, "Not another prediction, Doron," I promise you, I'm not relying on a crystal ball or a wizard wand. Instead, I'm drawing on my deep understanding of our local market, on historical data that create a definite pattern, and on recent observations of buyer and seller behavior.
So… Let's dive right in!
First off, let's dispel the myth that all real estate is the same. It’s not! I hear all these pundits who make predictions for the national real estate trends in 2024, and I really have to scratch my head sometime. The truth is that all real estate is local! In our beloved Seattle, we often dance to our own beat, thumbing our noses at national trends. Why? Blame it on the unique topography – we have the sound in the west, mountains on the east, a large lake in the middle, and very few open lots left anymore. And, of course, we have our unique circumstances, with a large number of people who are still moving to our area for high-paying jobs. All these make our real estate market as distinct as our iconic skyline.
So don’t fall into the trap of projecting national news onto our local real estate market.
Now, onto the pillars of this real estate saga: supply and demand. Yes, I've said it countless times before, but these forces are the maestros dictating pricing, market dynamics, and the overall real estate narrative. And who is the protagonist in this story? You—the discerning consumer.
Interestingly, as we bid adieu to the holiday season, a surge in buyer activity has caught my and my teammate’s attention. We believe this surge mirrors the drop in mortgage interest rates below the 7% mark. I mentioned this in last month’s vlog, that the 7% mark, seemingly a psychological threshold has energized buyers, especially when housing inventory is traditionally low. Rising rent costs in the region and companies urging employees to return to the office are further fueling this increasing demand.
Now, on the supply side, sellers remain relatively scarce. Last year, many sellers who needed to sell in order to adjust to life events, such as a growing family, empty nesters, job relocation, etc., these sellers held off from putting their homes on the market because of the high interest rates. On the one hand, they were worried that the high rate would scare buyers away, which would leave them selling their homes for less. On the other hand, if you’re selling a home, many times you have to buy another one, and they were not willing to trade their low interest rates for much higher ones.
But, as you know, life goes on, and these life events still drive a good amount of the decisions people make regarding selling their homes. And so, even sellers cautious about trading their historically low mortgage rates are likely to find encouragement in the ongoing decline in interest rates. To be clear, while we're not expecting a flood of new listings, a more substantial inventory compared to 2023 is very likely on the horizon for 2024.
So, what can we anticipate in terms of market movements?
The multi-year trend observed in the first quarter of each year suggests a familiar pattern: robust demand and limited supply, resulting in a more pronounced increase in home prices. I highlighted the first quarter of each year to help you see how these trends repeat every year. And while I’m only showing you data that goes back five year, I could have gone back twelve years or more, and you would have easily seen the same pattern playing out every year.
Then, as spring ushers in more inventory, we anticipate a moderation in price appreciation. Barring significant economic shifts, or inflation spikes, the ongoing decline in interest rates should create favorable conditions for both buyers and sellers.
By the way, if you want to look at this graph and read my report at your pace and leisure, you’ll find all this information in my January newsletter, available online and for download, for free, at Weisbarth.com/Newsletter, that’s Weisbarth.com/Newsletter.
So, in conclusion, 2024 promises to be a more favorable year compared to 2023. While we may not experience the same level of activity seen in recent years, there's every indication that the market will follow its familiar rhythm.
Now, if you or someone you know has made a New Year’s resolution to sell and or buy a home this year, consider this your invitation to reach out for education about the process, the market, and the specifics of your situation. My team and I are here to provide education and guidance, ensuring informed decisions to maximize your results. And let’s face it – you have to educate yourself if you want to get the most from this big move. We offer a no-obligation consultation. It would be improper and immoral to ask anyone to make a decision about such a big move before they had the appropriate education, don’t you think?
And the good news is that it's easy to refer your friends, family and colleagues to us by email, or on my website at weisbarth.com/refer. The best way to refer is to just connect us by phone. My number is 206-779-9808, and I’m always happy to speak with new people, truly.
And don’t forget that your business and referrals help the kids at Childhaven!