Home Values Rise Dramatically in 2012!
2012 was an interesting year in the real estate market. The year began with a shortage of homes for sale that continued to become more severe as the year progressed.
At the same time, more buyers and investors entered the market attempting to purchase homes. With severely low inventory and increasing demand, we consistently saw multiple offers on reasonably priced homes. February of 2012 marked the end of a five year side in home values. By the end of the year, home values in Snohomish County realized a 12.3% increase. If I take January’s losses out of the equation, we actually saw our home values rise by more than 20% since February! I have to go clear back to 1990 (21.7%) to find a year with that kind of appreciation.
So, what can we look forward to in 2013?
Because home values in Snohomish County plummeted by 40.6% from the peak of the market in 2007, the inventory of homes for sale is going to remain relatively low for a few reasons. First, the drop in value left many homeowners completely upside down in their homes. With little or no equity, a large percentage of homeowners are simply stuck in their homes and can’t sell yet. Despite 2012’s gains, it could realistically be another few years before they have enough equity to sell. The second reason is now that prices are rising, many homeowners that can sell are simply going to decide to stay put and recapture some of the value they have lost since 2007. Finally, low inventory and high demand sets the stage for more multiple offers. If you want to sell your house and buy a different one, it won’t be impossible, but it will be tougher to convince many sellers to accept a contingent offer over an offer from another buyer that doesn’t have to sell first.
Buyers Beware: Low inventory means prices could skyrocket in 2013. You will be competing against other buyers, so you will have to be thoroughly pre-approved by your lender. Sellers are going to scrutinize your approvals like never before. You will need to know exactly what you are looking for and make a decision quickly. And finally, make your offer at or above list price if the seller has other potential buyers. We are in a severe seller’s market and they have more control now.
Sellers you are in the driver’s seat. Avoid overpricing your home. The market has plenty of over-priced listings that buyers are ignoring. Price your home at market and you’ll probably get more than one offer and more money as they bid the price up. The easiest time to sell is when there aren’t many competing homes on the market.
If you are considering selling your home and want to know its current market value,
give us a call today!
Douglas Lovitt is the Managing Broker
CENTURY 21 North Homes Realty, Inc.
1133 164th St SW Suite 102
Lynnwood, WA 98087
“Statistics not compiled or published by the Northwest Multiple Listing Service.”