Low Inventory in King County

King County has about 2.5 months of inventory. A 4-6 month supply is considered balanced, so we are definitely in a seller’s market. Seattle has 1.7 months of inventory; the Eastside 2.4 months. Here’s an example of what that means: Someone looking to buy a single family home between $500,000 and $600,000 in Bellevue today has just eight listings to choose from. Buyers can expect multiple offers on properties that are fairly priced.

Getting Organized

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The economy

The week’s economic calendar is packed full of key reports from housing, Gross Domestic Product, manufacturing and consumer attitudes on the economy.

Rising Prices

4 million homeowners climb out of negative equity

latimes.com in Residential Real Estate

Home Values Rise across the U.S.

It was reported this morning that the average U.S. home increased in value by 14% from 2012 to 2013.

Interest Rates

Interest rates on a 30 year loan are expected to reach 5% by the end of the year, according to many experts who follow our economy.

Mortgage Rates

Local mortgage rates, in contrast, are more attuned to the natural averages. Here, rates remain steady. Bankrate.com’s survey shows the 30-year fixed-rate loan averaged 4.48% over the past week, which is about where it was the week before. Freddie Mac’s survey shows a slight increase, with the rate on the 30-year loan rising to 4.37%.

From WestStar Pacific Mortgage: Mortgage rates are muted, and still very reasonable, which is something we have to continually remind people. Ten years ago, 6%-and-higher on the 30-year loan was the norm. A 4.5% rate on the same loan is a bargain in comparison.

New Home Sales

Compared to a year ago, the number of homes under construction nationally is up 27% and new Building Permits are up 2.4%, so builders are clearly planning to stay active. This is good news as our market continues to rebound.

National Sales

Expect some disappointing news about national home sales to be released. Much of this is the result of the weather! Spring will bring everyone out again. Our area, fortunately, has not been affected.

Home Sales Projection

From the February NAHB (National Association of Home Builders):  Of special note is that they “expect overall home sales to rise about 5 percent in 2014 relative to last year, with about a 3 percent rise in existing home sales coupled with a 30 percent jump in new home sales.” They also expect that the elevated rate of cash sales – about 30 percent of home purchases will decline with more new homes sales and a larger share of existing home sales financed with a mortgage in 2014.