Over the last couple of weeks, interest rates climbed above 3%. Ultimately, this is going to affect homebuyers and could potentially affect sellers as well. Stay with me for a short update while I share what happened in our local housing market and what it means for the coming spring season.
On a National average, interest rates ended February at just above 3% which is a bit higher as compared to January, when they were averaging under 3%. Even still, when looking at a 30-year trend, interest rates are at an all-time low and are projected to remain low throughout the duration of the year. Homebuyers, this slight rise in rates could suppress prices but with such low inventory and strong buyer demand, I don’t think it’s safe to say that prices will “go down” or that we will see price reductions happening. What I do think could happen if rates stay where they’re at for a couple of months is that the housing market might “slow down” to the point where you may not have to waive everything and bid 10% over asking price in order to win a home. If you’re sitting on the sidelines waiting to buy until prices “go down”, I urge you to connect with your agent about this strategy. To learn more about what to expect for 2021 interest rates and prices, stay tuned to this month’s video series when I share 4 predictions from CoreLogic.
Sellers – listen to this! I was floored to see that home prices in East Pierce County ended at an all-time high, averaging $519,000! This is +14.9% over February of last year AND +4.2% over January of this year. Being down 55% in inventory from last year, we are in a strong seller’s market with only ½ month of housing supply available in Auburn, Bonney Lake, Buckley, Puyallup and Sumner. With the rise in interest rates, it could mean that we start to see homes sit on the market a bit longer than 6 days, like they’ve been averaging over the last few months – but that’s not a bad thing! In fact, having a bit more time to sell your home generally equals out to more money in your pocket.
And finally…when looking at inventory. We ended the month with 130 active homes, compared to Feb 2020 when we ended with 313 and compare to January, when we ended with 110 – we are starting to see more inventory hit the market. We Sold 272 homes, right on point with LY’s 278 homes sold.
Overall, this means that the spring season is going to be a great time to sell and buy a home. If you’re thinking about entering the market, give me a call and let’s see what we can do for you. I’m Lynea Carver with the Carver Home Team and I’m always here to help. And remember, whether you’re buying a home or selling a home, it all starts with a dream. Let’s dream together!
Lynea Carver
206-962-0247
lynea@lyneacarver.com