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Have You Ever Seen a Housing Market Like This?
By Keeping Current Matters
The year 2020 will certainly be one to remember, with new realities and norms that changed the way we live. This year’s real estate market is certainly no exception to that shift, with historic highlights continuing to break records and challenge what many thought possible in the housing market. Here’s a look at four key areas that are fundamentally defining the market this year.
Housing Market Recovery
The economy was intentionally put on pause this spring in response to the COVID-19 health crisis. Many aspects of the common real estate transaction were placed on hold at the same time. Thankfully, technology and innovation helped the industry power forward, and business gradually ramped back up as shelter-in-place orders were lifted.
The result? Total transformation of the market from rock-bottom lows to exceptional highs. Today, the housing recovery is being called truly remarkable by many experts and is far exceeding expectations. From pending home sales to purchase applications, buyers are back in business and homes are selling – fast.
According to the Housing Market Recovery Index by realtor.com, the market has surpassed pre-pandemic levels, and has regained the strength we remember from February of this year (See graph below):
Record-Breaking Mortgage Rates
Historically low mortgage rates are another 2020 game-changer. Today’s low rate is one of the big motivating factors bringing buyers back into the market. The average rate reached an all-time low on multiple occasions this year, and it continues to hover in record-low territory.
When rates are this low, buyers have a huge opportunity to get more for their money when purchasing a home, something many are eager to find while continuing to spend more time than expected at home this year, and likely beyond.
Continued Home Price Appreciation
One of the key drivers of home price appreciation this year is historically low inventory. Inventory was low going into the pandemic, and it is still sitting well below the level needed for a normal market. Although sellers are slowly making their way back into the game, buyers are scooping up homes faster than they’re coming up for sale.
This is a classic supply and demand scenario, forcing home prices to rise. Selling something when there is a higher demand for what is available naturally bumps up the price. If you’re ready to sell your house today, this may be the optimal time to make your move. As Bill Banfield, EVP of Capital Markets at Quicken Loans, notes:
“The pandemic has not stopped the consistent home price growth we have witnessed in recent years.”
Increasing Affordability
Even as home prices continue to rise, affordability is working in favor of today’s homebuyers. According to many experts, rates this low are off-setting rising home prices, which increases buyer purchasing power – an opportunity not to be missed, especially if your family’s needs have changed. If you now need space for a home office, gym, virtual classroom, and more, it may be time to reconsider your current house.
According to Mortgage News Daily:
“Those shopping for a home can afford 10 percent more home than they could have one year ago while keeping their monthly payment unchanged. This translates into nearly $32,000 more buying power.”
Bottom Line
With mortgage rates hitting historic lows, home prices appreciating, affordability rising, and the market recovering like no other, 2020 has been quite a year for real estate – perhaps one we’ve never seen before and may never see again. Let’s connect today if you’re ready to take advantage of this year’s record-breaking opportunities.
Summer is the New Spring for Real Estate
By: Keeping Current Matters
As the health crisis started making its way throughout our country earlier this spring, sellers have been cautious about putting their homes on the market. This hesitation stemmed primarily from fear of the spread of the coronavirus, and understandably so. This abundant caution has greatly impacted the number of homes for sale and slowed the pace of a typically busy spring real estate season. Mark Fleming, Chief Economist at First American notes:
“As more homeowners are reluctant to list their homes for sale amid the pandemic, the supply of homes available to potential home buyers continues to dwindle.”
With many states beginning a phased approach to reopening, virtual best practices and health and safety guidelines for the industry are in place to increase the comfort level of buyers and sellers. What we see today, though, is that sellers are still making a very calculated return to the market. In their latest Weekly Housing Trends Report, realtor.com indicates:
“New listings: On the slow path to recovery. Nationwide the size of declines held mostly steady this week, dropping 23 percent over last year, a slight increase over last week but still an improvement over the 30 percent declines in the first half of May.”
Although we’re starting to inch our way toward more homes for sale throughout the country, the number of homes on the market is still well below the demand from buyers. In the same report, Javier Vivas, Director of Economic Research for realtor.com shares:
“Sellers have yet to come back in full force, limiting the availability of homes for sale. Total active listings are declining from a year ago at a faster rate than observed in previous weeks, and this trend could worsen as buyers regain confidence and come back to the market before sellers.”
Lawrence Yun, Chief Economist at the National Association of Realtors (NAR) seems to agree:
“In the coming months, buying activity will rise as states reopen and more consumers feel comfortable about homebuying in the midst of the social distancing measures.”
What we can see today is that homebuyers are more confident than the sellers, and they’re ready to make up for lost time from the traditional spring market. Summer is gearing up to be the 2020 buying season, so including your house in the mix may be your best opportunity to sell yet. Interest in your house may be higher than you think with so few sellers on the market today. As Vivas says:
“More properties will have to enter the market in June to bring the number of options for buyers back to normal levels for this time of the year, nationwide and in all large markets.”
Bottom Line
If you’re ready to sell your house this summer, let’s connect today. Buyers are interested and they may be looking for a house just like yours.
Should You Refinance Your Mortgage?
By Erin Wright & Christina Waterhouse
Questions to Ask and Information to Gather Before You Refinance
Low interest rates are attracting more and more people to the market, especially those who are looking to refinance their mortgages. Clients have been reaching out to us to ask if they should be refinancing their homes. Our general response is, “it depends”. There are a few questions and pieces of key information you should gather before deciding whether to refinance.
With interest rates at an all time low, everyone should ask, “Is refinancing a good decision for me?”
1. What is the difference between your interest rate and current interest rate?
A good rule of thumb is for the current rate to be at least .5 – .75% less than your interest rate. This rule can change greatly depending on the size of the loan though. The more money that is being borrowed, the larger the difference is going to be in both your monthly payments and your total interest paid. You can find the daily interest rate here.
2. How close are you to paying off your mortgage
At the beginning of a loan, most of the monthly payment is going to interest. Only a small portion of the payment goes towards paying off the principal balance of the loan. As payments continue, the amount that goes towards interest goes down and the amount that goes towards the principal balance goes up. It is worth looking at an amortization schedule to see if refinancing will save you money over the life of the loan. You can find an amortization calculator here.
3. Has your credit or employment changed?
Employment history, debt to income ratios, and credit scores all impact the rate you will receive when applying for a loan. Speak to your lender regarding any changes in these areas to make sure you would qualify for a refinance and see what rate you would likely qualify for. Then you can determine if it is worth refinancing.
4. What is the property being used for?
Properties that are used as primary residences qualify for lower interest rates than those used as investment properties (usually .5 – 1% lower). If you purchased the property as a primary residence and subsequently turned it into a rental, you might not see much of a change in your interest rate or possibly your interest rate as an investment property could be higher. Speak with your lender to see what the current interest rate would be for the specific property.
5. Should you refinance into a 15 year loan or 30 year loan?
If you do decide that it is worth refinancing your loan, consider looking at both a 15 year and 30 year loan. Right now the interest rate for a 15 year loan is in the mid 2% range, while the interest rate for a 30 year loan is in the high 2% range. A 15 year loan will save you a lot of money in interest over the life of the loan. This is a great way to build strong equity in your property and pay it off in half of the time.
As always, we welcome any questions you may have and are happy to offer advice.
Mortgage insight and references provided by: Mathew Mattila, Cascade Northern Mortgage
Real Estate and Covid-19 Part 5
Procedures for Real Estate, How Covid-19 has Changed the Experience of Selling Real Estate
By Erin Wright and Christina Waterhouse
What challenges do sellers face when putting their house on the market? How can sellers help create a safer environment for showings? This week we continue to focus on the challenges that are currently being faced by buyers and sellers transacting real estate and how our local market has responded to those challenges to make the process safer and easier.
The Seller Process During Covid-19
Selling a house is always a stressful time, add a worldwide pandemic and it can seem overwhelming. However, speaking with an agent can help increase preparedness and reduce stress.
Before Going on the Market
The first step is always getting the house ready for the market. Although it is fun to watch a house makeover in real time, it is best to avoid being home during this part of the process. Allow the landscapers, stagers, and photographers to focus on making the house look its best instead of maintaining social distance standards. Also, if the agent does not offer it, have the house thoroughly cleaned and disinfected by a professional right before going on the market.
A virtual floor plan and virtual tour of a property can help limit showings to only those buyers that the home is a good fit for.
Virtual and Paperless Marketing
The house is ready for the market. Work with the agent to give as many details about the house as possible to put into the MLS. This is a great time to have room measurements and amenities added. Virtual tours and floor plans allow perspective buyers to get a good idea of the house before a showing. Have a sturdy, permanent flyer attached to the sign post in lieu of paper flyers. I love a good flyer and being able to take one, but now is not the time to have lots of hands on pieces of paper being passed out to the public. If brochures are used inside of the house for showings, only put out one at a time prior to the showing.
Being Prepared for a Showing
Limit showings to pre-approved buyers only. This will minimize the number of people in the home. The buyers who do see the home will be the serious ones. Try to not be home for the first five days on the market. This allows buyers easier access and makes it easier to clean when you return. Have all lights on and doors open for a showing. This minimizes how many surfaces are touched inside of the home. Be prepared for showings to take longer since not everyone in a group can see the house at the same time. The agent should be providing ample shoe covers to be used inside. Place them by the front door. The best practice right now is to have buyers use the shoe covers and take them after the showing. Single use shoe covers minimize touching. Consider placing hand sanitizer with a pump at the front door for people to disinfect upon entering and leaving the home.
Sanitizing frequently touched surfaces after a showing is a good idea when selling a home during Covid-19
Sanitize When Returning Home
Thoroughly sanitize common surfaces when returning home. Places to consider are cabinets, countertops, door handles, handrails, and light switches.
When first listing a home, this can be overwhelming. Consider making a checklist so the house is prepared for every showing and sanitized after. For more information on how to stay safe and what to expect as a seller in this market, please feel free to comment on this blog post or reach out to us directly.
As always, we welcome any questions you may have and are happy to offer advice.
Real Estate and Covid-19 Part 4
How Covid-19 has Changed the Experience of Buying Real Estate
By Erin Wright and Christina Waterhouse
Over the last three weeks, we have explored the economic impacts of Covid-19 on our local Real Estate Market. These next two weeks we will be focusing on the challenges that are currently being faced by buyers and sellers transacting real estate and how our local market has responded to those challenges to make the process safer and easier.
The Buyer Process During Covid-19
Implementing the Governor’s Rules
Buying a house in the current pandemic has proven to be a bit challenging. There are some new practices we are seeing to help keep everything organized and try to keep people safe. We will start by reviewing what is required by the Governor of Washington State for Clark County. Currently there are two rules in place, no more than two people can be inside of a house at a time during a showing. Also, people must maintain six feet between them for social distancing. This means that buyers can only enter a house one at a time with a Realtor. This can be difficult because families, couples, friends, or investors cannot be in the house at the same time discussing their thoughts on it. We have found it helpful to take Buyers in one at a time while maintaining the 6 feet for a buffer, and then reconvene in the street in front of the house to discuss the property while it is still fresh in everyone’s mind. The sooner all buyers can discuss the property together the better to ensure that nothing is lost. This process does increase the time it takes to view properties. We plan on showings taking about twice as long because each person is shown individually and then we discuss at the end instead of while actually going through the property.
Virtually Viewing a Neighborhood and House
Researching a neighborhood online before doing a drive by is a great way to learn more while sheltering in place.
Prior to actually viewing a property in person, there are many things a buyer should plan on doing before ever having the agent schedule the showing. First, a buyer should become very familiar with a desired neighborhood. This can be done by discussing the neighborhood with a Realtor. Ask about the schools, amenities, and house styles to start. A Realtor can also send you links to local publications, neighborhood data, and school sites . It is also a good idea to take a drive through the neighborhood and see what it is like in person.
Once the desired neighborhoods have been pinpointed, take advantage of all of the online tools to view specific properties. When looking at houses online, switch the map function to show an aerial view of the property. Look for both pros and cons of the property’s location. Are there parks nearby? Power lines? Is it on a busy road or to close to a large freeway? Once the properties with desirable locations are found, thoroughly look at the photos of the property. Pay attention to the sizes of rooms by using the furniture in the photos as a gauge. Also, pay attention to how the house flows, again furniture can be used to help identify how the photos are moving through the house. When available, look at the online floor plan and virtual tour. Combined, these tools help Buyers understand the property better to see if it is a fit for what they are looking for.
Hand sanitizer, shoe covers, and face masks are both common things to expect while viewing properties during Covid-19.
What to Expect During Showings
With a narrowed down list of approved properties, buyers should call their Realtors to set up showings. We already discussed the rules of showings above based on the Governor’s guidelines. However, there are additional things buyers should expect during this time. First and foremost, get pre-approved. Almost all sellers are requiring pre-approved buyers only to view properties. Once pre-approved send the letter to your Realtor, they may be required to submit it prior to a showing. Additionally, some sellers are having buyers and their Realtors submit a basic health questionnaire prior to a showing. With the showing scheduled and all necessary information submitted, be prepared to take a few extra steps to keep things sanitary. Sellers are requiring a variety of things for people going into their homes: masks, sanitation wipes, gloves, hand sanitizer, and shoe covers to name a few. Most items requested to be used will be provided at the house itself. If they are not provided at the house and you do not have access to them, request them from your Realtor. If the request is made in advance, it can often be accommodated.
When you first enter the market, this may all seem a bit alarming. However, we have seen several companies, agents, and sellers really step up to keep everyone safe and make everyone feel comfortable. For more information on how to stay safe and what to expect as a buyer in this market, please feel free to comment on this blog post or reach out to us directly.
As always, we welcome any questions you may have and are happy to offer advice.
Real Estate and Covid–19 Part 3
How the Current Selling Season Compares to Last Year’s Selling Season
By Erin Wright and Christina Waterhouse
We have been closely watching our local real estate market since the start of the pandemic. There is a lot of conflicting information about how the market is currently doing. Transactions are happening, but is it business as usual?
For this week’s blog topic, we are further looking into how the real estate market is currently performing and how it compares to last year. The quick answer is that we are still in a seller’s market, seeing homes go pending quickly for close to or over asking price. The more accurate picture is a bit more complicated. Last year Clark County saw a robust selling season, with the months of March through November having over 1,400 active listings per month up to over 1,800 active listings per month.[1] Additionally, the months of March through August in 2019 had over 800 pending listings per month.[2] Our current market is performing at about 80% of last years market. Last month we had 1,279 active listings and 608 pending listings. [3]
This is important to note because although we are seeing a seller’s market with quick activity, similar to last year, we are not seeing a normal amount of inventory or buyers. Currently we are seeing multiple offers and houses in certain price points selling for over asking. However, with fewer active buyers and fewer active sellers, there are some variables in our market to consider for how it will proceed moving forward. This current ratio of supply and demand may continue, more buyers may enter the market without more listings to buy, or more sellers may enter the market without more buyers to buy. If the ratios stay the same, we will continue to experience a relatively quick market favoring sellers. If more buyers enter the market without increasing the supply, we will experience an even more favorable seller’s market, encouraging multiple offers and driving prices up. If more sellers enter the market without an increase in buyers, we will begin to see a softening and a more neutral market where buyers and sellers both share equal bargaining power. Though no one knows for sure what will happen, there seems to be a consensus among real estate economists that home sales will be down 10-15% this year compared to last year.[4] Additionally, homes may experience a slight drop in value during the 3rd and 4th quarter of this year, but still appreciate marginally year over year by about 2.5%.[5] For more information on the specific economics of the housing market this year, please feel free to watch the video below from economist Matthew Gardner.
As always, we welcome any questions you may have and are happy to offer advice.
[1] History of Monthly Active Listings According to Trendgraphix
[2] Last Months Active and Pending Listings According to Trendgraphix
[3] Last Months Active and Pending Listings According to Trendgraphix
[4] Market Forecast According to Matthew Gardner
[5] Market Forecast According to Matthew Gardner
Come Play Bingo for a Cause!
Looking for a fun event to do in March with the whole family? This month to give back, Erin Wright Homes is partnering with Habitat for Humanity for a fun night playing Bingo for a cause. Join us Friday, March 18, 2016 for a fun night of Bingo while helping support the Evergreen Habitat for Humanity. Games are $2 a piece and all prizes are valued at $25 or more! Complimentary snacks provided and beer and wine available for purchase. This event is family friendly, so bring your kids! Want to get even more involved? Join Erin Wright Homes for our Habitat Build April 2, 2016! We would love to see everyone there!
What: Bingo for Habitat for Humanity
When: Friday, March 18, 2016 from 6pm-8pm
Where: Clark County Habitat Store
10811 SE 2nd Ave.
Vancouver, WA
Please RSVP to Erin Wright by Wednesday, March 16, 2016 by e-mail at ErinWright@Windermere.com
or by phone by calling 360-356-1445
Hope to see you all there!
For more information on the Evergreen Habitat for Humanity, please visit their website at:
***Want to plan ahead for April’s Community Event? We will be doing a Habitat for Humanity Build with the Evergreen Habitat for Humanity on Saturday, April 2, 2016. We would love to see everyone there. This event is for people 18 years and older.***
* * * * * * Ending 2015 with a Celebration & Looking Forward to 2016!* * * * * *
Thank you for a Successful Share the Warmth Drive
and a Great Night at the Miracle of a Million Lights!
With 2016 already starting off with excitement and positive change, I want to take a moment to thank everyone for making 2015 a great year for me both personally and professionally. I celebrated many milestones in 2015; Winslow and I got married and started our life together, I was able to hire an amazing assitant, Jenny Vrtiska, and Erin Wright Homes was branded by the talented Megan Armand. December 11, 2015 marked a great celebration for a great year! I am so grateful for everyone who was able to come out and support Erin Wright Homes that evening and celebrate a wonderful year. I want to thank everyone for joining and for all the generous donations for the Share the Warmth Drive. I also want to thank all of my clients for trusting me with your real estate needs and for all your referrals. A special thanks to Jenny Vrtiska, Megan Armand, Simply Sweets, the Victorian Belle, and Leah Smith Photography for making the event increadibly special for everyone. Please see below for a collection of photos from the event that night. If you would like a copy of any one photo, please contact me and I can get you the full resolution version.
With referrals already coming in for 2016, I am excited to start this year off running. If you know anyone looking to buy or sell real estate in the future, please feel free to share my information with them. Your referrals will receive the same expertise, time, and care that I have given all past clients. I am fortunate to have the best clients in the world and look forward to serving all of you in 2016.
From my family to yours, wishing you all a great 2016!
Erin Wright
Local Real Estate Markets are on the Rise
By: Erin Wright, Clark County, WA Realtor
Buyer's are out in full swing in Clark County and Multnomah County. As a result of all the Buyers entering the market place, the inventory is still low and real estate prices are on the rise.
The local real estate markets have seen low inventory over the last 2 years and they continue to remain low. When looking at all homes currently on the market in Clark County, there is 2.5 months of inventory. This indicates a Seller's Market. However, many of those homes are proposed construction and new construction. If those two categories are taken out, then there is only 2 months of inventory. For Multnomah County, there is currently 1.4 months of inventory. If you take out the new and proposed construction again, then there is 1.3 months of inventory. This low inventory with an increased number of Buyers has resulted in the listing prices of homes to continue to rise.
Last year, the average list price of properties in Clark County in May 2014 was $384,000. This year, the average list price of properties in Clark County at the end of April 2015 was $452,000. That is an increase of 18%. In Multnomah County the average list price from May 2014 was $440,000. This year the average list price of properties in Multnomah County at the end of April 2015 was $489,000. That is an increase of 11%.
All data for this article was gathered from Trendgraphix.
Clark County Data Provided by Trendgraphix Below
All Clark County Inventory Over the Last Year
Clark County Resale Inventory Over the Last Year
Clark County Listing Prices Over the Last Year
Multnomah County Data Provided by Trendgraphix Below
All Multnomah County Inventory Over the Last Year
Multnomah County Resale Inventory Over the Last Year
Multnomah County Listing Prices Over the Last Year
The Importance of Staging
By Erin Wright, Real Estate Agent with Windermere Real Estate
Image courtesy of WorldWideStock at FreeDigitalPhotos.net
Sellers often ask me about staging, the benefits of staging, how in depth their staging needs to be, and if there are any small tips or tricks to the staging process. These are all valid questions, and ones Sellers should ask. When I go through my listing presentation, I spend a good deal of time on this very subject, to fully showcase the benefits of staging. I also bring a staging consultant to every one of my listings, so we can all go room by room and talk about the best way to showcase the homes features. Staging helps create the first impression, so it is a vital role in listing a home. When staging, there are a few key rules to follow: keep the style neutral, less is more and focus on light.
Neutral Style: Although some Buyers are able to look past a Seller's style, to create a positive first impression, it is best to make the home a blank canvas. This will allow Buyers to walk through the home and picture their own style and stuff throughout the home. A key piece of advice I give my clients is to go through their home and see what elements are more personal in nature or style. For example, the huge family portrait over your fireplace, not the best way to allow a Buyer to picture themselves in the home. The bright red accent wall in the family room will likely also keep a potential Buyer from picturing themselves in your home. When staging, it is best to depersonalize your home, remove most family pictures, and create a neutral tone and feel in all the rooms throughout the house. It is nice to have a pop of color around the house, so to achieve this consider a fruit bowl filled with colorful fruit in the kitchen, colorful pillows in the family room, and colorful towels in the bathroom.
Less is More: In our day-to-day lives, I think we tend to like to surround ourselves with our belongings. A beautiful chair, decorative plates, and walls full of artwork. However, when staging a home, less really is more. The goal of staging is to make a space feel welcoming and attractive to as many potential Buyers as possible. Space and the size of rooms are two of the most important things Buyers look for in a house. Therefore, placing furniture and decor in a way that maximizes the space in a room is an essential part of staging. One of the key tricks to doing this is to keep the amount of furniture and decor minimal. Let the space showcase itself. So in a normal sized family room, a Seller may have a sectional, coffee table, two chairs and two side tables. Likely, if the Seller removed the two chairs and two side tables, the space would feel larger and more open. Consider what furniture and decor is essential in each room and place it intentionally. Then I recommend my clients rent a storage unit, use a shed, or use a garage and store the remainder of the furniture. This will allow the home to breath and feel more spacious. Also, this allows Buyers to more comfortably move throughout the home. A great rule of thumb is to keep all pathways and open spaces wide enough for 2-3 people to comfortably walk through them at the same time. Often times my Sellers end up liking the open feel better, and decorate their new home in the same manner as they staged their previous home.
Light is Key: Buyers often request homes with great light. This is because the natural lighting of a home can often create positive energy within a home. This is especially true in the Northwest where it rains for a large portion of the year. Therefore, it is important for Sellers to showcase the areas in the home with natural light. The best way to do this is to keep anything from blocking the light. If there are blinds, raise them. If there are curtains, open them. Allow the light to shine in through the house wherever possible. Another great way to create the feeling of a light and bright home is to keep the walls painted a lighter color and have the ceiling painted white. This will reflect the natural light throughout the home, making it feel lighter and brighter. Also, white ceilings give the illusion of taller ceilings, which is a great-added benefit. Another great idea is to allow there to be ample room in front of windows and exterior doors. Buyers love to go up to windows and look out of them to see the light and the view.
For information on these and other staging tips, feel free to contact me at ErinWright@Windermere.com or (360) 356-1445.
