How Much it Costs to Buy a House in the Hottest Housing Markets of 2018

Most areas of the country are in a seller’s market, meaning there’s not enough inventory for all the interested homebuyers. About half of all the homes in the country are worth as much or more than they were in April 2007 — the height of America’s housing boom.

This is all good news if you’re planning to sell your home. It’s less good news if you’re trying to find one. But as with most things when it comes to buying a house, like what kind of hidden fees you can expect during the process, where you live matters. Certain areas of the country are exploding in popularity, which is driving up the cost of homes.

Ahead, check out how much it costs to buy a home in the hottest real estate markets of 2018 according to Zillow’s latest housing report.  Hottest Housing Markets

Who’s moving where and for what jobs? Glassdoor study reveals top U.S. cities applicants are eyeing

Seattle is a leading destination when it comes to U.S. cities where people are most interested in moving for work, but it still trails several others, including San Francisco, New York, Los Angeles and more.

That finding is among many in a new economic research study out today from Glassdoor, the job and recruiting website. The study, Metro Movers: Where Are Americans Moving for Jobs, And Is It Worth It?, identifies, among other things, where job applicants are most interested in moving, where they’re interested in leaving, and which factors drive people to move for a new job.

The study is based on a sample of more than 668,000 online job applications started on Glassdoor during a one week period, from Jan. 8-14, for the 40 largest metro areas in the U.S.

“Metro movers” — defined by Glassdoor as job seekers located in one metro who start a job application in another metro — still find San Francisco to be the most attractive place to try to land work, despite a high cost of living and housing shortage.The city alone attracted 12.4 percent of all applications by job seekers looking to move cities. Seattle attracted 3.1 percent.

It shouldn’t come as any surprise which company is attracting the most people, by far, to apply for work in Seattle.

Companies in Providence, R.I., would appear to be having a hard time keeping people from leaving based on the fact that that city had the highest percentage of candidates applying for jobs elsewhere at 52.2 percent. The California cities of San Jose (47.6 percent), Riverside (47.3 percent) and Sacramento (44.4 percent) were in the top five, along with Baltimore (45.6 percent).

So if you’re about to flee Providence or you’re trying to get to San Francisco, what’s the most attractive thing about where you’re applying?

Company culture is a top factor, according to the study — even more so than salary. A company with a 1-star higher overall Glassdoor rating is six times more likely to attract a candidate than a company that’s offering $10,000 more in salary, but has a lower culture rating.

But what do all of these metro movers want to do? A lot of them want to be engineers or developers. And, some will move for a new flight attendant gig.

If all of this makes you just want to head to the bar for a drink, there’s good news there, too. If you like the person who serves you, it appears from the data that they’re not trying to go anywhere.

~Kurt Schlosser, GeekWire

Crucial things to know before you hire a home inspector

Hiring a home inspector before you make a purchase can save you thousands of dollars in unexpected repairs. But don’t assume every home inspector is the same.

Washington State law dictates the minimum standards for a residential home inspection. The state also requires home inspectors to complete 120 hours of special classes and 40 hours of field training and they must pass exams in order to obtain a home inspection license.

The best inspectors are also insured, and certified by a recognized home inspection certification organization.

While there are many excellent inspectors working in our state, unfortunately there are many who leave a lot to be desired. When you’re making one of the biggest investments you’ll ever make, you want someone who puts your best interest before keeping the deal alive.

Certified inspector Paul Rogers prides himself as being extremely thorough. So much so, that he says many real estate agents consider him a deal killer.
“I don’t kill the deal,” said Rogers. “I only report what the facts are. I have no vested interest in that property. My interest is in my client. Period.”

Ron Greene, a former electrical engineer, says he started doing residential inspections four years ago.

“I laugh when an agent tells me he hopes I don’t kill the deal,” said Greene. “I tell him, if the deal falls flat, it will be the home that killed it, not me.”
Greene says prospective home buyers need to understand that different home inspectors see things differently.

For example, one inspector might make note of swollen floor moldings. Another might investigate further to determine the actual cause of the swelling. Green also points out that some problems may not be easily detected by even the best inspectors.

Before you hire a home inspector, get referrals from other homeowners who give their inspector high marks.  Ideally, talk to more than one inspector and don’t limit your search to the few your agent suggests.
Find out everything the inspection will cover (review the state law linked above) and make note of anything that’s left out. Ask about their certification, and ask whether they have errors and omissions insurance, in case they miss something important.

Greene recommends home buyers also ask how long the inspection will take. He says even with a small home, a reasonably thorough inspection cannot be done in less than three hours and he typically takes 5 to 8 hours.
Local real estate agent Junior Torres says he gives his clients a list of questions including: How many inspections do you do in an average year?  According to Torres, more than around 30 inspections per month could mean the inspector is putting quantity over quality.

Rogers warns you should also be wary if the quoted price for the inspection is much lower than everyone else’s price. “You need to find somebody who is thorough, who isn’t discounting their inspection fee just to get the business,” Rogers said.

And even in this hot local housing market, where multiple bids are prompting many buyers to waive home inspections – the best home inspectors agree that waiving an inspection is never advised, especially with homes that have been flipped for fast profit.

~Connie Thompson, KOMO News

Seattle-area home-price growth from current boom has surpassed last decade’s bubble

SEATTLE – As the Seattle area continues its run as the nation’s hottest real estate market, it has now seen home prices surge upward for a full six years – with more growth in home values during the current boom than during past decade’s bubble.

Single-family home costs across the metro area grew 12.7 percent in February from a year earlier, the biggest increase in the nation for the 18th month in a row, according to the monthly Case-Shiller home price index, released last week. The report marked six years since home values bottomed out in February 2012. Since then, values have increased 85 percent – nearly triple the region’s historical average for a typical six-year span. Only San Francisco and Las Vegas had bigger gains during that period.

Even during the housing bubble last decade, prices didn’t rise this much. In the six years leading up to the peak of the bubble in 2007, Seattle-area prices grew a total of 73 percent before the bubble burst.

(During the bubble, home prices rocketed up quickly – fueled by lax and sometimes fraudulent mortgage lending that sowed the seeds for the Great Recession – but the peak surge only lasted a few years; this time, the growth has been steadier and keeps going and going.)

The recent boom locally has completely wiped out the effects of the recession on the housing market, when prices sank.

Local home values are now a bit higher than they were at the height of the bubble in 2007, even after accounting for inflation since then. Only Denver and Dallas have had price growth greater than Seattle’s since the old 2007 high.

There are no clear signs that we’re in another bubble. At the least, the elements that created last decade’s housing collapse – like homebuyers getting mortgages they couldn’t afford and rampant subprime lending – aren’t present this time around. The number of people defaulting on their mortgages locally is minuscule, for instance, and lenders are only issuing mortgages to people with good credit scores and financial assets.

A recession or other unexpected development – like a collapse at Amazon a la the Boeing bust of the 1970s – could change that, of course.

But for now the real-estate market shows no signs of slowing down amid record low supply of homes for sale and strong demand for homeownership. The Case-Shiller report noted that the Seattle metro area had the biggest job growth in the past year among the 20 regions covered in the report.

Compared with a month prior, home values increased 1.7 percent, according to the Case-Shiller data. The last time prices went up that much in a month was last summer.

The month-over-month growth also led the country, and was quadruple the national increase.

Seattle’s home-price increase of 12.7 percent, compared with a year earlier, was similar to the last several months and was again more than double the national rate of 6.3 percent.

Las Vegas again had the second-biggest home-price jump, and continues to heat up, with prices up 11.6 percent. San Francisco was close behind, followed by Denver, Detroit and Los Angeles.

Seattle home costs have grown more than 10 percent, year-over-year, for 26 months in a row. That’s pushed the median cost of a single-family house to $820,000 in Seattle and $926,000 on the Eastside. Even more affordable areas have recently hit record prices: $485,000 in Snohomish County, $350,000 in Pierce County and $341,000 in Kitsap County.

~Mike Rosenberg, The Seattle Times

Western Washington Real Estate Market Update

The following analysis of the Western Washington real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact me.

ECONOMIC OVERVIEW

The Washington State economy added 96,900 new jobs over the past 12 months, representing an annual growth rate of 2.9%—still solidly above the national rate of 1.5%. Most of the employment gains were in the private sector, which rose by 3.4%. The public sector saw a more modest increase of 1.6%.

The strongest growth was in the Education & Health Services and Retail sectors, which added 17,300 and 16,700 jobs, respectively. The Construction sector added 10,900 new positions over the past 12 months.

Even with solid increases in jobs, the state unemployment rate held steady at 4.7%—a figure that has not moved since September of last year.

I expect the Washington State economy to continue adding jobs in 2018, but not at the same rate as last year given that we are nearing full employment. That said, we will still outperform the nation as a whole when it comes to job creation.

HOME SALES ACTIVITY

There were 14,961 home sales during the first quarter of 2018. This is a drop of 5.4% over the same period in 2017.
Clallam County saw sales rise the fastest relative to the first quarter of 2017, with an increase of 16.5%. In most of the other markets, the lack of available homes for sale slowed the number of closings during this period.

Listing inventory in the quarter was down by 17.6% when compared to the first quarter of 2017, but pending home sales rose by 2.6% over the same period, suggesting that closings in the second quarter should be fairly robust.

The takeaway from this data is that the lack of supply continues to put a damper on sales. I also believe that the rise in interest rates in the final quarter of 2017 likely pulled sales forward, leading to a drop in sales in the first quarter of 2018.

HOME PRICES

With ongoing limited inventory, it’s not surprising that the growth in home prices continues to trend well above the long-term average. Year-over-year, average prices rose 14.4% to $468,312.
Economic vitality in the region is leading to robust housing demand that far exceeds supply. Given the relative lack of new construction homes— something that is unlikely to change any time soon—there will continue to be pressure on the resale market. As a result, home prices will continue to rise at above-average rates in the coming year.
When compared to the same period a year ago, price growth was strongest in Grays Harbor County at 27.5%. Ten additional counties experienced double-digit price growth.

Mortgage rates continued to rise during first quarter, and are expected to increase modestly in the coming months. By the end of the year, interest rates will likely land around 4.9%, which should take some of the steam out of price growth. This is actually a good thing and should help address the challenges we face with housing affordability—especially in markets near the major job centers.

 

 

DAYS ON MARKET

The average number of days it took to sell a home dropped by seven days when compared to the same quarter of 2017.
King County continues to be the tightest market in Western Washington, with homes taking an average of 24 days to sell. Every county in the region saw the length of time it took to sell a home either drop or remain essentially static relative to the same period a year ago.
In looking at the entire region, it took an average of 61 days to sell a home in the first quarter of this year. This is down from 68 days in the first quarter of 2017 but up by eleven days when compared to the fourth quarter of 2017.

Anyone expecting to see a rapid rise in the number of homes for sale in 2018 will likely be disappointed. New construction permit activity—a leading indicator—remains well below historic levels and this will continue to put increasing pressure on the resale home market.

CONCLUSIONS

This speedometer reflects the state of the region’s housing market using housing inventory, price gains, home sales, interest rates, and larger economic factors. For the first quarter of 2018, I have left the needle at the same point as fourth quarter of last year. Price growth remains strong even as sales activity slowed. All things being equal, 2018 is setting itself up to be another very good year for sellers but, unfortunately, not for buyers who will still see stiff competition for the limited number of available homes for sale.

 

~Dr. Matthew Gardner, Windermere Real Estate