Bellevue, Washington Real Estate Market

We are all watching the economy right now and wondering what’s going to happen next.  I am hearing more and more people talk about what they are doing to cut back on their expenses and increase their income.  Ebay and Craigslist are busy places right now as people scramble to sell  stuff they don’t need while others are looking for bargains for stuff they need or want.  Nothing like a crisis to cause us to live and spend more realistically.

It’s no different in the real estate market.  Sellers would like to be able to sell the real estate they no longer want, for any number of reasons, and buyers know this is a good time to buy.  But there is a rub.  Sellers are reluctant to adjust their prices downward in response to the new market conditions, hoping that the prices will go back up.  And, buyers are slow to buy because they are concerned the prices will continue to fall and they will have bought what turns out to be an “over-priced” house.  So, what should they do?

I believe this is a case of not having enough information.  My children used to come to me when they were trying to make a decision about something.  They would say, “I don’t know what to do.”  My response was “Then you need more information.”  I have found that when people have enough information (not too much) most of the time they can make a wise decision.  So, let’s take a look at what the Bellevue real estate market is telling us.

One of the most basic statistics to look at is the number of days on market (DOM).  This is an indication of how quickly houses are being sold in the market place.   There are always seasonal changes from month to month with the winter months usually being slower thus showing more “Days on Market” and the spring and summer being faster or fewer days on the market.  The chart below shows the month to month activity for 13 months–from March 2008 toMarch 2009.  The black line shows the overall trend for the market.

In Bellevue during the last year we have seen an increase in days on market from month to month over the year.  However, in March 2008  the average was 71 days and in March of 2009 the average was essentially the same at 72 days.  The trend line (the black line) suggests that we may see the number of days on the market increasing in the months ahead relative to one year ago.   This will be an important trend to watch and will signal when the market is beginning to heat up or at least get back to normal.

Days on Market March 2008-March 2009

The next statistic we want to take a look at is the total number of units sold that sold during the last year.  In this chart there is a very clear and definite trend that shows how the market activity has dropped off.  Of course, we all “feel it” happening and this chart just show how right our feelings are about market activity.  Again, it will be important to watch this statistic to get a sense of when the market picks up.

Number of Units Sold, March 2008-March 2009

Total volume of all single-family homes sold in Bellevue from March 2008 to March 2009 took a precipitous plunge.  This drop seems even more dramatic than the number of units sold, no doubt due to the fact that many of the houses that did sell were to first-time buyers (53%) and were pre-foreclosures, short sales or REOs.  Until this excess inventory is cleaned up we can expect to see a much lower volume than normal.

Total volume of all homes sold in Bellevue from March 2008 to March 2009.

Median price of single-family homes sold in Bellevue from March 2008 to March 2009.  The trend is expected and we need to continue to watch for the bottom.  I hear many people suggesting we may be there now–or close to it.  Let’s watch this carefully for the correction we all want to see so much.  On the positive side, first-time buyers, this is the best opportunity you will have for a long time.  House prices are the lowest they have been in 5 years, interest rates are the lowest they have been in 40 years and there are great programs to help you get started.

Median Price of single-family homes sold in Bellevue, WA from March 2008 to March 2009.

There is a lot of information in this chart which represents the ratio between the  price asked by the seller and what the property actually sold for based upon the length of time the house was on the market.  Not surprisingly, the ratio is significantly higher when the house is sold within the first 30 days than when it remains on the market for a longer period of time.  The moral of this story is that if its important to sell the house then the house must be priced right in the first place or corrected quickly when you are not getting offers from buyers.

Asked to Sold ratio for homes sold in Bellevue, WA from March 2008 to March 2009.

If you would like to be notified every time a new house comes on the market that meets your goals go Just Click Here.

The market will improve.  We are Americans and we are tough.