New year, new me? When it comes to unsold housing inventory on Mercer Island, not quite. As was the case a month ago, the local real estate market is tight on inventory – at press deadline, there were 41 single-family homes on the market on Mercer Island.
Many agents in the John L. Scott Mercer Island office are working with sellers who are preparing their homes for a market debut in the coming months. Though inventory is tighter, buyers are still out in the market searching for homes.
Now that the holiday season is over, we expect to see the number of buyers actively searching increase. Realtor.com recently called January the “new hot month” to start house hunting, noting that “January 2019 was the busiest month for listing views on record for home buyers in the Seattle metropolitan area.”
Those beginning the home search in January will be challenged by low inventory, but there are still great homes out there, and buyers who are actively monitoring and touring properties right now will have a leg up against competition as listings begin to crop up.
I foresee many opportunities in the local housing market in the year to come, as interest rates remain low and area job growth continues. Within John L. Scott chairman and CEO J. Lennox Scott’s 2020 housing forecast, he notes that the key factors essential to a healthy housing market (job growth, interest rates and months of unsold supply) all bode well for a positive year ahead.
“On the Eastside, we anticipate a frenzy market in 2020, with home price appreciation reaching 6 percent-plus for homes priced up to $1 million,” Scott said. “This price range makes up 71 percent of sales activity on the Eastside.”
In Scott’s 2020 Puget Sound housing forecast, he predicts a frenzy market with home price appreciation of 5 percent in the luxury price range of $1 to 1.5 million. Moving into the $1.5 to 3 million range, Scott said sales activity will be strong, then selective above $3 million.
“In the high-end and luxury market close to the job centers, sales activity intensity is projected to be up in spring 2020, then shift to moderate during the summer,” Scott said. “Luxury sales activity intensity will be slightly lower starting in summer as more luxury listings start coming on the market, with an approximate 15-point reduction in intensity. Buyers may have the opportunity to secure a home-for-sale contingency when negotiating to purchase a luxury home.”
Now that 2020 is here, the Real Estate Excise Tax (REET) rate is graduated, replacing the previous flat state REET rate.
Under the new tiered system, the REET rates (ranging from 1.1 to 3%) apply according to the portion of the selling price attributable to each tiered rate. More information can be found on the Washington State Department of Revenue’s website.
Sandra Levin is the office leader and business coach at John L. Scott Mercer Island.