Many top brokers are urging their financially secure clients to buy now. A new mantra is in town. "Marry the house, date the rate." This means, buy your longer-term home but refinance in the next 12-24 months. The result: You get the house you want without making dangerous offers in competition with the mass of other buyers. You pay far less for your new home. You position yourself to enjoying rapid price appreciation once the FED lowers rates as Fannie Mae expects in 2024. You also position yourself to refinancing once the rates drop. In 2024, you could be in a home you never thought you could afford while myriads of buyers rush back into the market all around your new neighborhood.
The FED Is currently in the "Wait and See" mode in regard to any further rate hikes.
It appears that the Eastside found its "trading base" in terms of median price at the end of 2022 and the beginning of 2023. [Please see the slides below] While prices adjusted greatly in 2022, they are rising after numerous months in the "sideways formation" that we saw in Q3 and Q4. They are just beginning their breakout.
The time to "sharp shoot" the bottom of the market is over. Prices are beginnning to rise, but the ability to make contingecies and put safety measures into offers is still there for many homes. Fortunately, we are not yet back to the days of competition with 10+ other buyers who are willing to pay above actual market value. In the past, we saw contract prices of 3 to 22% above listing price. Currently, for homes priced correctly, we're seeing offers closer to 4% to 7% above list price.
The opportunity is still huge for buyers.
Many have been priced out of the market before. There is one more chance to get into a home and begin building equity in the equity-rich soil of the Eastside.
My advice is this: Don't miss the opportunity. There is no certainty that it will come again for a long time on the Eastside.
If the monthly payment is a pain point, a strategic purchase now (if you have the ability) and then a refinance in 1 to 2 years could save you money every month while gaining far more house than if
you waited.
If interest rates drop into the mid 5's, far more buyers will qualify and the compeititve marketplace will drive prices higher. Strong buyers have an opportunity right now to build a large amount of wealth in a short amount of time.
Please reach out to me wtih questions about the market and the latest on where I see our market headed.
Gary Nims
425-269-8151
