Summer 2024 welcomed an increase in available inventory, a drop in interest rates, and continued price stability, which has upheld strong home equity levels. After a double-digit ramp-up in price appreciation in the first half of 2024, prices have slightly come off the peak of May 2024 and found stability. This trend is historically consistent with seasonal patterns and nothing to be alarmed about.

Increased selection for buyers was a welcome relief as inventory was extremely tight in the spring. While there are still homes getting multiple offers and escalating, we have also seen some buyers make purchases contingent on the sale of their current home. The market has become a bit more nimble for buyer’s terms in some cases. It is important to understand the nuances of each location, product, and price point, as the environment can vary which would indicate whether a buyer would need to compete or be able to negotiate more.

These trends are coupled with rates dropping below 7% in June and they have recently sat in the mid-6%. Rates were a point and a half higher in October 2023; this is a great improvement! We anticipate rates slowly dropping further which will put upward pressure on prices. The Fed meets again this month and if rates come down even more, buyer activity will increase. Between the lower rates and higher inventory, buyers should be excited and ready to act!

As you can see from the chart below, this shift in rate directly relates to a buyer’s monthly payment. Homes are expensive, so the cost to carry a loan is critical. These recent drops are helping out and should be paid close attention to as buyers are payment-driven in most cases. The opportunity to secure a home now with today’s rate could mean a buyer could enjoy a stable price and choose to re-finance or adjust to a lower rate later, keeping their same basis. Buyers should also understand that homeownership is a key component to building wealth.

I anticipate a healthy late summer and fall market. Over the Labor Day Weekend, buyer traffic was busy despite the holiday and activity is bubbling up. The lower rates are helping some folks jump off the fence. Even some sellers are getting ready to sell and relinquish their lower rate, so they can move to a home that better fits their needs. I’m excited about the real estate market for the remainder of 2024 and into 2025. If you are curious about how the trends relate to your goals, please reach out. I am committed to staying connected and up-to-date on the latest trends so my clients make well-informed decisions.

Here is a quick update on a topic I have been keeping you up-to-date on all year. On August 17, 2024, the NAR Settlement requirements were enacted. This required significant changes to real estate practices across the country. This made big news and stirred headlines. The good news is in WA state we made the majority of these changes back on January 1, 2024, when the law surrounding buyer agency was changed.

Since January 1, 2024, we have been required to obtain Buyer Brokerage Services Agreements (BBSAs) with buyers we are providing real estate brokerage services. These agreements can be exclusive or non-exclusive, must establish clear buyer brokerage compensation parameters, have a defined agreement term, and call out whether dual agency is allowed. I have embraced these changes and have brought value to my clients through this modernized process.

Our local MLS, the NWMLS, chose to opt out of the NAR settlement in May 2024. They felt confident that the risk for exposure was low due to advancements they have been making since 2019 to elevate transparency around brokerage compensation. Their proactive consumer-focused approach along with the new WA state law have had our state ahead of the curve.

The majority of the required practice changes required by the settlement were already in place in WA state as of January 1, 2024. Due to their choice to opt out, the NWMLS will not have to comply with the requirement to not publish a seller’s offer of compensation to a buyer’s brokerage. This is confusing to all parties of a transaction and the opposite of transparency. I am proud to run my business as a member of the progressive NWMLS and under the new law established by our state on January 1, 2024.

On August 15th, 2024, the NWMLS made some slight updates to some of their forms to coincide with the final settlement details. Most notably, buyer brokerage compensation was made more clear in the Purchase and Sale Agreement. It can be connected to what the seller is offering in their listing, what is agreed upon in the BBSA, or both. Sellers can choose to offer buyer brokerage compensation, choose not to, or request to negotiate it as a term in a buyer’s offer. Depending on how the established BBSA aligns with the Purchase and Sale Agreement, the buyer brokerage compensation will be paid by the seller, buyer, or a combination of both.

If you have any questions about the settlement and all of the changes we have navigated since 2019 until now, please reach out. I am committed to providing valuable services and clear communication to the buyers and sellers I serve. I understand that purchasing and selling real estate is one of the largest financial decisions a person ever makes and it is often related to big life changes.  Navigating such importance takes great skill and care and I am committed to obtaining the best results for my clients while creating an enjoyable experience along the way.

Thank you to everyone who pitched in during the Summer Food Drive! Through your generosity, we collectively donated $1,240 and 1,058 pounds of food to Volunteers of America Western Washington food banks! This is all going directly into our communities to help our neighbors in need.

Thank you!

As we approach November and the Presidential election nears, it would be good to look back on how election years have historically affected the real estate market.  There is certainly a lot going on and this stimulation can cause pause.  Buying and selling real estate is a big life event and the election is a big national event.  Some buyers and sellers will delay their moves until after they know how the election is going to pan out.  Sometimes this delay is caused by pure distraction and sometimes there is a level of uncertainty that is created until a decision is made.

Here is some interesting data that illustrates the trends of consumer behavior surrounding a Presidential election.  Interest rates, the rate of home sales, and price growth are all analyzed below.  Looking back to look forward provides some concrete evidence of how a Presidential election can affect the performance of the housing market.

First, interest rates!  We have recently experienced a nice drop in rates.  Rates have been extremely volatile over the last two years.  Last October, rates peaked at almost 8%, came down to 6.75% in January 2024, went back up to 7.4% in April 2024, and have recently dropped to the lowest level we have seen since April 2023 and are hovering around 6.5%.  This is largely due to inflation finally settling and a recent jobs report showing increased unemployment.  This trend is predicted to continue as the Fed considers a rate cut in September with the plan of easing rates as we finish 2024 and head into 2025.

The chart below shows what rates have done over the last eleven election cycles and it certainly looks like the current trend with rates follows historical norms.  This is an opportunity for buyers to jump into the market as this reduction in rate is accompanied by an increase in inventory.  With lending costs lower and more selection buyers could even find themselves in a position to negotiate a further reduction in rate to help with the overall affordability of a purchase.

The market is very much driven by what a buyer’s monthly payment would be.  Lending costs are a huge factor that will play into consumer confidence and the amount of sales happening.  Further, we expect more home sellers to come to market as rates ease as they will be more inclined to give up their low rate to move to a home that is a better fit for their lifestyle.

The chart below shows the increase in home sales in nine out of the eleven past election cycles.  In fact, the first year after an election is historically robust with activity.  If history repeats itself in 2025, buyers who are ready may want to consider making a move now.  With the dip in rate, increased selection, and some buyers sidelined it could be a great time to make a purchase with a little less competition.

Even better news is that historically prices increase after an election year.  In seven out of the last eight post-election years, prices increased.  The only year they did not, was 2008 which was in the hollows of the Great Recession.  Of course, we will not be able to measure this until a year from now and this will be something that I will be paying close attention to.

So far, 2024 has been a year of price growth.  We experienced huge gains in the first half of the year over 2023.  2024 marks the year of recovering from the 2022 post-pandemic correction and re-gaining price stability.  Equity levels in our area are very strong with close to 60% of homeowners having at least 50% home equity.  We expect the movement of this equity to become more nimble as the cost of borrowing money comes down.

What we have in store over the next three months will be distracting, stimulating, and just a lot.  I hope the information above provides some history that helps ground the facts during a time of heightened angst and uncertainty.  As always, life dictates changes in real estate needs.  If you or someone you know has come up on some life changes that indicate a move would be beneficial, please reach out.

Despite the chaos of the election, you can never plan too early for these big life transitions and there might be some great opportunities amongst the noise.  Whether it’s a purchase, a sale, or both, I am equipped to help you assess your goals and help you devise a plan.  The best time to make a move is when you’re ready and I’m here to help.

Are you looking for an opportunity to give back to your Neighbors in Need? In tandem with our annual Windermere Community Service Day, and aligning with our passion to help alleviate food insecurity within our communities, we are holding a Summer Food Drive through Monday, August 19th. Everything we collect will go to the Volunteers of America of Western WA who will responsibly distribute these funds across their network of food banks.

>> Click here to donate or drop your non-perishable food donations at my office by August 19th.

To kick off the food drive, on June 7th my office spent our annual Windermere Community Service Day with the Snohomish Garden Club tilling soil, weeding, staking beds, planting, and labeling a half-acre of produce! The Garden Club will harvest this half-acre, which will yield close to 10,000 pounds of fresh produce to be donated to VOA food banks in Snohomish County over the summer and fall.  The combination of your donations and the bounty from the garden will make an impact; thank you for considering.

Are you looking for an opportunity to give back to your Neighbors in Need? In tandem with our annual Windermere Community Service Day, and aligning with our passion to help alleviate food insecurity within our communities, we are holding a Summer Food Drive through Friday, August 16th. Everything we collect will go to the Volunteers of America of Western WA who will responsibly distribute these funds across their network of food banks.

>> Click here to donate  or drop your non-perishable food donations at my office.

To kick off the food drive, on June 7th my office spent our annual Windermere Community Service Day with the Snohomish Garden Club tilling soil, weeding, staking beds, planting, and labeling a half-acre of produce! The Garden Club will harvest this half-acre, which will yield close to 10,000 pounds of fresh produce to be donated to VOA food banks in Snohomish County over the summer and fall.  The combination of your donations and the bounty from the garden will make an impact; thank you for considering.