No Homes For Sale in Leavenworth in 2014?
The Leavenworth real estate market often lags behind the Seattle market. The newest trend seems to be following this pattern. Last Spring Seattle saw a shortage of homes for sale and this extreme lack of inventory led to price gains for sellers. Home sellers in Leavenworth were wondering if we had a sellers market back then and the answer was definitely not. As I write this post at the beginning of 2014, I know that home buyers will ask again about a Leavenworth home shortage in 2014.
Image Courtesy of Steve Hoang on Flickr
I expect to get a huge number of emails asking: Are there no homes for sale in Leavenworth? Currently there are just over 80 single family homes for sale in the Leavenworth and Peshastin area. Looking at the broader single family market, this gives us about 7 months of supply. (Technically, less than 6 months is a sellers’ market but this is dramatically closer than we have been since 2006.) About 45 of these homes are located in the Leavenworth zip code and priced less than $400,000. Here we have just 5.5 months of supply which is truly a sellers’ market which is why it feels like there are so few choices.
Compare this to the boom years:
In 2006 inventory dropped down to a total of 65 homes for sale and only reached a peak of 110 homes for sale.
And during the recession:
In 2011 inventory peaked to as many as 255 homes for sale and only down to 144 during the winter months.
Why is there a shortage of homes for sale in Leavenworth?
Lack of inventory can come from two sources. No new listings or lots of new sales. This is a lot like the secret to losing weight – you can either consume less calories or exercise more (or both.) In the case of Leavenworth’s real estate inventory, it’s a bit of both. In the 4th quarter of 2013, a total of 34 new listings came on the market while 45 homes sold. Additionally, a number of home listings either expired or were cancelled/ withdrawn. It is common in Leavenworth for homeowners to take listings off the market in the winter and put them back on in the spring. To put this in context, in 2012 during the same 3 month period, 39 new homes came on the market and 32 homes sold. Excluding the number of expired and cancelled listings, there was a net decrease of 11 homes on the market in the fall of 2013 while there was a net increase of 7 homes in 2012.
Why don’t more sellers put their houses on the market?
Often it’s because they are waiting for higher home prices. Some bought at the peak of real estate prices and can’t afford to sell yet. Others think that higher prices are worth waiting for even if that might be later this year or perhaps the next year or two. Of course, supply and demand are inextricably linked. When demand is soft, prices are soft too. As demand increases, the prices increases and soon enough the supply catches up to meet the demand. If sellers wait until prices have climbed back up, all their neighbors will have joined them in listing their homes too and then the buyers will have lots of choices all over again (at which point prices stabilize or head down again.)
Boil this down: What does this mean for me?
For home buyers, you can expect less houses to choose from, rising prices, and competing against multiple offers. For home sellers, 2014 could be a great time to sell a home in Leavenworth compared to any other time since 2007.
The fine print
Unfortunately, these are just market generalizations and a “rising tide” doesn’t necessarily lift all boats.
Some neighborhoods continue to see flat or dropping prices, even though home prices continue to recover
Rising home values doesn’t mean that sellers can pick their price. Both buyers and appraisers will still use past sales as a benchmark for home values
It appears as though there will be a shortage in condo inventory as well.
Home prices have not rebounded to peak prices
********************************************************************************************************** Required Disclaimer NOTE: This representation is based in whole or in part on data supplied by the North Central Washington Association of Realtors or its Multiple Listing Service. Neither the Association nor its MLS guarantees or are in any way responsible for its accuracy. Data maintained by the Association or its MLS may not reflect all real estate activity in the Market.
