We're almost half-way through February, so we have a pretty good idea of how the year is starting out. The news isn't as good as I'd like, nor as bad as I'd feared. Here is a link to the most recent Trendgraphix data and graphs for single-family homes.
http://www.trendgraphix.com/WAS/charts/Z110-01-01-01-0137-1-38-1B0507-200901.htm
The good news is that we're in a better place than we were a year ago. Twice as many homes are in contract and the number of solds is up 33%. Inventory is down. A year ago we had over 24 months of inventory, and that number is down to 15.7 months. The bad news for Sellers is that we are still in a massive Buyer's market and February has started out slowly. That being said, we're seeing good properties coming on the market, and Sellers are beginning to price homes where Buyer's will write an offer. One home waterfront home listed in our office received two offers this week.
We had a local mortgage broker speak to our office on Tuesday this week. Bainbridge Island remains with a ceiling of $417,000 for conforming loans, where the best rates are found. King County is up to $505,000, a fact that doesn't help us here. (The formula is based on median home price of the county, and we're lumped in with Kitsap, although our prices and demographics are more closely aligned with King.) The broker is showing a 30-year fixed rate of 5.375% with no points, and below 5% with the payment of a point. Owner occupied homes can be had with 95% down--something we thought and hoped would go the way of sub-prime lending.
Most of our buyers on Bainbridge have equity from prior real estate sales, which means that when their other property sells, they have over 20% to put down. A 20% down payment will get you a conforming loan on properties under $522,000. The median price of properties sold January 1, 2008, to today is $580,500, which means that more than half the properties sold would need more than 20% down to qualify for a conforming loan. Jumbo (non-conforming) loans are available from lenders like Washington Federal who make portfolio loans, and their rates range from 6 to 7.125 % or more.
The biggest news about residential real estate on Bainbridge remains the large inventory of unsold new construction. Here is the biggest "undropped shoe." With over 50 homes the builders need to sell, this could have a big impact on prices overall. Buchan Homes, a large corporate builder based on the Eastside, sold a home last week for $1,075,000, a $200,000 reduction from the last list price ( almost a 83.5% drop.) This home was listed over $1.6 million at one time. The large corporate builders can take these drops to unload their inventory. It will remain to be seen what effect this will have on appraisers and buyers. My prediction is that prices still have a way to go before we've reached the bottom.
http://www.trendgraphix.com/WAS/charts/Z110-01-01-01-0137-1-38-1B0507-200901.htm
The good news is that we're in a better place than we were a year ago. Twice as many homes are in contract and the number of solds is up 33%. Inventory is down. A year ago we had over 24 months of inventory, and that number is down to 15.7 months. The bad news for Sellers is that we are still in a massive Buyer's market and February has started out slowly. That being said, we're seeing good properties coming on the market, and Sellers are beginning to price homes where Buyer's will write an offer. One home waterfront home listed in our office received two offers this week.
We had a local mortgage broker speak to our office on Tuesday this week. Bainbridge Island remains with a ceiling of $417,000 for conforming loans, where the best rates are found. King County is up to $505,000, a fact that doesn't help us here. (The formula is based on median home price of the county, and we're lumped in with Kitsap, although our prices and demographics are more closely aligned with King.) The broker is showing a 30-year fixed rate of 5.375% with no points, and below 5% with the payment of a point. Owner occupied homes can be had with 95% down--something we thought and hoped would go the way of sub-prime lending.
Most of our buyers on Bainbridge have equity from prior real estate sales, which means that when their other property sells, they have over 20% to put down. A 20% down payment will get you a conforming loan on properties under $522,000. The median price of properties sold January 1, 2008, to today is $580,500, which means that more than half the properties sold would need more than 20% down to qualify for a conforming loan. Jumbo (non-conforming) loans are available from lenders like Washington Federal who make portfolio loans, and their rates range from 6 to 7.125 % or more.
The biggest news about residential real estate on Bainbridge remains the large inventory of unsold new construction. Here is the biggest "undropped shoe." With over 50 homes the builders need to sell, this could have a big impact on prices overall. Buchan Homes, a large corporate builder based on the Eastside, sold a home last week for $1,075,000, a $200,000 reduction from the last list price ( almost a 83.5% drop.) This home was listed over $1.6 million at one time. The large corporate builders can take these drops to unload their inventory. It will remain to be seen what effect this will have on appraisers and buyers. My prediction is that prices still have a way to go before we've reached the bottom.
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