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Real Estate

Will a second lockdown cool off the red-hot Seattle housing market?

Multiple offers and tens of thousands over asking price are still the norm, agents say

Seattle-skyline-HW-1

In November, the state of Washington was placed in a second lockdown until Dec. 14, a move that suspended open houses (although private showings are allowed with no more than five people). What is this second lockdown going to do to the red-hot Seattle housing market?

A November study from Lombardo Homes found that it was the most competitive market in the country, with 71% of homes selling in under two weeks and the average time on the market at about 10 days. That demand is easy to see on the sell side. According to the Northwest MLS, the median price of single-family homes and condos that sold in the 23 counties it tracks was $500,000, up 19% from last year. Members of the MLS added 10,428 new listings to supply in October, up 24% from last year, but pending home sales were only at 11,039.

In King County, where Seattle is located, the median-priced single-family home was $685,000, according to the Northwest MLS. In October, there was less than a month’s worth of inventory in this market.

Yusef Nadir, a RE/MAX broker based in Seattle, told HousingWire that although people are hunkering down again, he doesn’t see any slowdown in the housing market yet.

“I think the market is still strong. Throughout the year I’d say typically the summertime and spring is buying season, but because of this year, everything has been pushed,” Nadir said. “And now fall, winter-time is still a strong time to buy, and it is a time to buy for folks that are looking to prepare to beat next year’s market. So, people are optimistically cautious, is what I would say.”

Nadir said that about a third of his clients this year have come from out-of-state, and he has been educating clients on how Washington is being proactive in combating COVID-19 as a lot of this year has been about “how we maneuver [and] strategize during these unprecedented times, difficult times and restrictive times.”

As buyers are becoming more cautious, Bellevue, Washington, Compass Realtor Carrie Foley said that more and more people are moving from condos in Seattle to single-family homes in the surrounding suburbs. According to the Northwest MLS, condo inventory has gone up about 5.4%.

No matter what the price range is, Foley said that it’s not unusual to have anywhere between eight and 20 offers on a house.

“Either people are leaving the state or if they are staying in the state, they’re working remotely,” Foley said. “They’re moving outside of the city, so our single-family home demand is through the roof. We’ve definitely seen a drop in condo demand.”

It’s been a record seller’s market, said Century 21 agent Michael Menin in Kirkland, Washington, and it’s tough out there for buyers right now. Off the top of his head, Menin said that he’s had home listing prices go over anywhere from $10,000 to $90,000.

“[Pace of business] is not crazy, the crazy part is trying to get buyers in the homes of all the multiple offers and trying to get creative,” Menin said.

As for being prepared to work through the second lockdown, Menin still thinks buyers will be coming out of the Seattle housing market and into the suburbs.

“Virtual staging, virtual tours, virtual open houses are definitely part of the game now because we can’t do open houses,” Menin said.

In Bothell, Washington, Keller Williams agent Grant Weaver said that his business didn’t slow down during the first lockdown, and he anticipates more homes to go on the market now during the second lockdown.

“People were figuring out how to purchase homes around [the restrictions], we actually even had a few days where we couldn’t even show homes,” Weaver said. “I actually sold a home for somebody sight unseen during that few day period.”

As holidays approach and Washington residents are forced to stay home, Weaver still thinks that a lockdown and the holidays won’t stop buyers in his market.

“I think that our market will continue to be very aggressive among buyers and competition, we’re still seeing multiple offers on homes in the majority of neighborhoods in Seattle and surrounding areas,” Weaver said. “I just submitted an offer for a buyer on a property in Everett [25 miles north of Seattle] last week, and there [were] 24 offers on it. It’s still a really hot market, I think the only thing that COVID did was to extend and kind of push out our sales cycle several months.”

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