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BRIAN’s predictions

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significant current events

 

JUMP TO:
INTEREST RATES, BUYER SENTIMENTS, SELLER SENTIMENTS, GENERAL CONSUMER SENTIMENTS, WEEK on WEEK MARKET

JUMP TO:
AVERAGE DOM, # new listings, INVENTORY, Median of closed

JUMP to:
OTHER TRENDS HISTORICALLY FOR THIS TIME OF YEAR

News in 3-min

CURRENT TRENDS

  • 7.14% Interest Rates (avg 30yr conv), up m/m, up w/w

  • Buyer Sentiments up m/m, up w/w

    • Buyers are excited how rates have dropped since the 7.5% high early this year and 8.1% high at the end of 2023, even though they came up from 6.1% in early September. As expected, buyers who were holding off until the elections (no matter who won) hit the ground running the week after with a surge of buyer activity, with more pendings per month than new listings. They will remain excited but will become less “ready” until the new year as buyers do every year in December.

    • New buyers have also started looking with increased open house activity in SFHs but most won’t be serious until the new year as we see every year. Buyer eagerness is high but readiness is low.

  • Seller Sentiments up m/m, up w/w

    • Sellers are generally confident and are playing it safe, waiting to list in 2025 where economists are unanimously bullish nationwide — especially for Seattle Metro.

    • “Golden Handcuffs”: 84.2% of current homeowners have a sub-6% rate, 74.6% sub-5%, and 56.2% are sub-4 %. We expect resale to be low for many more years until lower interest rates encourage more sellers to consider upsizing or downsizing, but most economists don’t believe we will see sub-5% anytime soon. Few people are selling outside of necessity or major life changes, but more than last year.

  • WoW

    • The median sale price has increased, driven by steady demand alongside a stable median active price and a notable surge in new listings following the holiday week. Meanwhile, the number of pending listings held steady compared to the previous week in most areas, while the days on market saw a significant uptick.

  • MTD

    • Although activity has dipped compared to this same time the previous month, it is significantly higher than the same time last year. Pending listings and active listings have increased year-over-year, while the number of sold listings has declined.

  • YoY

    • October saw a notable increase in buyer activity compared to the previous year, driven by a surge in new listings and growing buyer confidence in the market. This uptick resulted in more properties going pending, alongside increases in both active listings and sold listings. Additionally, the average days on market have decreased, although they remain slightly higher than last year, and the median sale price has also experienced an upward trend.

 

CURRENT STATS

 

BRIAN’S FORECAST

  • Q4’24 Avg 7% (fluctuating 6.75-7.25); Q1’25 6.75% (fluctuating 6.5-7); Q4’25 6.25% (fluctuating 6-6.5).

  • Increase buyer competition in Q1/Q2’25

    • Widespread use of escalation clauses with promises to pay additional down in case of low appraisals or even waived financing in all of 2025 from the vast number of sidelined buyers, our growing population, Amazon and half dozen major companies returning to full return to office (1/1/25), and those “typical” new buyers each spring/summer.

    • Improved condo market from increased DT workers. Also increased metro traffic will increase desired urban living or at least pied-à-terres.

    • Bully offers will increase in the Eastside in Q1 and Seattle + Seattle metro will see frequent bully offers by Q2.

    • Increased absorption rate and decreased monthly supply due to World class events like 2025 FIFA Club World Cup in June ‘25 will increase buyer activity before Seattle’s hosting of FIFA’s ‘26 World Cup but won’t encourage sellers to sell

  • Continued low inventory at least into next decade

    • Minor bump in inventory in 2025 as more sellers will be more comfortable becoming buyers themselves with the lower interest rates and increased consumer confidence.

    • All economists agree of not enough housing at least through the decade nationwide but especially in Seattle metro where for decades it has been normal to only have 3-4 month inventory opposed to a “balanced” 6 months

 

HEADLINE NEWS

 

HISTORICAL TRENDS

Click bait headlines report these trends as if they are unprecedented - These graphs show trends similar to patterns we have seen happen nationwide and through several decades.

Data from 2017-2019/2021-2023 in Seattle, Mercer Island, Kirkand, Bellevue, Medina, Clyde Hill from WA-520 to I90

  • New Listings most frequent March-October

  • Most homes to choose from in October

  • Month Supply is the time it takes for the current active listings to deplete at the current sales pace. Very low in spring and summer despite having the most new listings, indicating higher buyer activity

Data from 2017-2019/2021-2023 in Seattle, Mercer Island, Kirkand, Bellevue, Medina, Clyde Hill from WA-520 to I90

  • Sale Price/Original Listing Price is highest in May and lowest in January but is a 2-6 week lagging indicator based on a successful sale and doesn’t include the original prices of prior unsuccessful listings (a home may have taken several listings over many months to sell).

  • Average time on market lowest in May, highest in December and doesn’t include the time a listing has spent on market in a prior unsuccessful listing (a home may have taken several listings over many months to sell).

  • New loan applications peak mid to late January each year.

  • Yellow markers indicate the highest point of applications in each year (January); Blue marker is the last reported data for that year (End of December)

  • National average time a buyer closes after their most recent preapproval is 50-days with a 45 day transaction. It is common in Seattle Greater to search for 3-9 months and transact in 15-28 days.

Average Fixed 30 Year Mortgage Rates

Brian’s Client Q&A:
Q: If fed rates don’t affect mortgage rates, what does?
A: 10Y Treasury bond, Inflation/CPI/Jobs Reports, World Events.
https://home.treasury.gov/policy-issues/financing-the-government/interest-rate-statistics
https://www.epi.org/indicators/unemployment/
https://www.bls.gov/cpi/