April 2022 Market Report
What’s going on in Snohomish County:
Interest rates are skyrocketing
New listings are up
When will we see the market start to shift
New strategies for buyers and sellers in this current market
Watch the video to get the full breakdown
We’re back again with another real estate market report for Snohomish County, and we’ve got interest rates skyrocketing this month!
So, let’s talk about some of the key data points we’re seeing right now.
We’ll talk about how buyers and sellers can be prepared in this hyper competitive market, and finally we’ll provide some insight for the rest of 2022 and what our expectations are for the Snohomish real estate market.
The Highlights
Starting with Sales Price, we are still seeing an increase in the average sales price year over year at 24%. This increases the average sales price for a single family home in Snohomish County to $769,000. Still a staggering increase year over year. This has been going on for over seven months straight.
Slightly up from last month, New Listings are up 9% year over year, meaning there is slightly more inventory coming onto the market this month. This is a great sign! While there are more homes coming on the market than there were a year ago, they are still selling super fast because there is still a huge buyer back log. Total Number of Homes for Sale is still at a decrease of 27% year over year.
Days on the Market are at 5 days, no change from the last three months. To be honest, those five days are merely for the offer review time. If we had no offer review dates we would probably have homes selling in one day with so much interest and offers being put on each house that goes on the market.
Months of Inventory Supply, which helps understand how long it would take to sell every home on the market, is at about 0.5 months of inventory. A 6 month inventory of homes is what most economists see as a balanced market. With low inventory and high demand, this quick cycling market in Snohomish County is making it extremely difficult for buyers.
List Price to Sale Price Ratio is 106.7% meaning on average homes are selling for 6.7% above the original list price. This is slightly higher than last month as homes are still going for well above list price.
What does this mean for buyers, sellers, and homeowners?
As a buyer, interest rates have gone up significantly. We’re seen rates as high as 5.8%. We cannot say whether or not they will go even higher or not. While the Fed has indicated that they will keep raising rates, no one knows just how high that could go.
We highly recommend reaching out to your lender, especially if you were approved months ago, to see if your approval number is still the same. More than likely it has come down due to the rising rates.
Historically speaking, 5-6% interest rates are still great. Keeping into perspective that there have been times in the past where interest rates were at 19%.
We are still seeing multiple offers on most properties at certain price points. When you get to those really big numbers, well above a million, there is less competition compared to lowered priced homes.
Buyers should still enter the home buying process knowing that it could take three to six months from start to finish. Allowing ample time for your search will keep you from making any rushed decisions.
Another thing to keep in mind, prices will not start to drop until months of inventory goes up to three or four months. There is still too much buyer demand right now for prices to start shifting down.
As markets do begin to soften and shift, offer review dates will be missed. Sellers may not get any offers in that time frame and just have to wait for an offer to come along. This is a tell tale sign that higher interest rates are having an impact on buyer interests and also consumer confidence. As the market continues to shift, I believe that offer review dates will be removed all together.
We should also expect inspection contingencies to start coming back. Buyers have had to forgo any contingencies in the current market to get an offer accepted often times.
We also expect contingent buyers to return to the market. As homes start to sit longer, sellers will be open to contingent offers because it is better than no offers. This will make buying and selling at the same time much easier.
As a seller, things are changing fast. Waiting to price your home until a day or so before you go on the market is the smartest decision because things are changing so quickly. See what your competition is like right before listing is your smartest move as people often shop by comparison.
The lottery ticket days are gone. You can’t just put your home on the market and price it however you want. Especially with consumer confidence challenges, you should be pricing your home based on what the comparable homes support. Pricing too high could have you encountering appraisal issues or your home sitting on the market for an extended period of time.
Are you ready to take the next steps toward buying or selling your home?
When you work with The Novak Team, you are putting to work the vast experience of some of the top agents in the industry, not just the area. Tap the link below to schedule a zero commitment consultation with me to see if it would be a good fit.