It’s no secret Eastside real estate prices have soared in recent years. An improved economy, foreign buyers, and cash-only bidding wars have caused prices in some areas to match pre-recession levels. Expensive housing is a sign of a good economy, but it can make buying a house frightening. Below, David Floan of Evergreen Home Loans explains how to navigate the Eastside housing market.
1. What’s in store for Eastside real estate in 2015?
The real estate market for the Eastside in 2015 looks to remain a sellers’ market, with inventory levels remaining low. Generally speaking, it is considered a sellers’ market when homes sell within 90 days of their listing date, and when the rate of home sales will exhaust the current inventory within three months. Eastside real estate is, on average, selling within 25–45 days of being listed for sale. This quick turnaround means the region will start 2015 with just over one month of inventory available. With home values appreciating, the economy stabilizing, and mortgage rates remaining low, 2015 promises to be a very competitive market for homebuyers.
2. Have property values rebounded to the levels we saw before the economic downturn?
For Eastside neighborhoods, home values peaked in the summer of 2007 and then hit rock-bottom in the summer of 2011. Since then, home values have been on a steady increase. According to Zillow, many cities on the Eastside have seen property values fully recover to the levels seen in 2007, with other cities expected to see property values increasing to peak levels by the end of 2015. This recovery is due to Eastside neighborhoods that experienced 5-9 percent price appreciation in 2014, with 4-5 percent price appreciation forecast for 2015.
3. What are three steps first-time homebuyers should take before jumping into the market?
First-time homebuyers face a very competitive real estate landscape in 2015. Buyers need to have their finances in order and should be working with professionals in both the mortgage lending and real estate fields. The first step is to work with a local lender to become pre-approved for financing. A lender will review your income, assets, and credit to issue you a preliminary loan approval, allowing you to shop for a home with confidence. Second, buyers should then enlist the services of a local real estate agent who is familiar with the various neighborhoods and trends in the markets being contemplated. Finally, since sellers will have a lot of homebuyers pursuing their home, first-time homebuyers need to be in a position to present the strongest offer possible, with their lender and real estate agent as their advocates.