WHAT A DIFFERENCE THREE YEARS MAKES
In 2018 and 2019 the local real estate market was healthy and predictable with very moderate price appreciation. Sales were consistent with no significant market increases either in total dollar volume sold or number of properties sold. Inventories of homes and land for sale was consistent and the market was neither a buyer’s nor a seller’s market. Purchase negotiations generally had fair outcomes.
Then there was COVID and the related lockdowns which began in April 2020. Many people nationwide were working remotely from home and were mandated to stay home. It seems that many of these people began using their time to search the Internet for land for the future or a home immediately for a new way of life.
These buyers, who were from all parts of the country, began buying homes and land sight unseen or contingent upon viewing it in the future. These purchases rapidly began depleting available home and land inventories.
The federal and state government began programs pumping trillions of dollars of stimulus into reviving the failing national economy. The stimulus money that was distributed to business owners, organizations and individuals began circulating through the economy and that, in part, began feeding the real estate market nationally. Adding to the cash entering the real estate market, 30- year mortgage rates dropped to a little under 3% and 15-year mortgage rates dropped to 2.5%. Beginning in July 2020, the Seeley- Swan real estate market started trending a steep increase in total sales, nearly doubling in volume by July 2021.
SEELEY LAKE SALES FAST FACTS
Over the past 12 months, there has been a total of 75 homes sold for a total of $37.8 million. The average home price in Seeley Lake has risen from $262,000 to $399,000, a 53% increase! The average home is closing 34 days after being placed on the market in Seeley Lake.
There are currently seven homes active on the market under $800,000 with the least expensive being a 1,232 square foot home on one acre in Double Arrow Ranch for $359,000.
There are 24 vacant land parcels, with the least expensive being a lot in the new development of Alpine Trails for $83,000.
CONDON SALES FAST FACTS
Over the past 12 months, there has been a total of 33 homes sold for a total of $22.5 million. The average home price in Condon has risen from $385,000 to $650,000 a 68% increase!
The average home is closing 107 days after being placed on the market in Condon. There is currently only one home active on the market under $800,000 with the least expensive being a 1,624 square foot home on 12 acres for $725,000.
There are 11 vacant land parcels with the least expensive being 20 acres on Shay Lake Road for $225,000.
WHAT IF I WANT TO BUY A HOME?
In Seeley Lake, homes are selling for an average of 100% of asking price, meaning homes are selling at or over the asking price. Many homes are receiving multiple offers within one to three days after being placed on the market.
If you hope to be a successful buyer, there are some things you can do to increase your ability to buy a home:
• Select a real estate agent and ask them to place you on automatic email notifications of homes fitting your criteria immediately as they are placed on the market.
• Contact a mortgage lender who can work with you to determine the maximum price you can pay for a home and get prequalified to purchase. Also, request a letter of prequalification to be presented with your offer to the seller.
• If you are able, obtain cash in advance by borrowing from other home equity, a family member or liquidating investments so that you can offer cash to purchase.
• Be aware of your credit score and work to alleviate any negative marks on your credit.
• Don’t low ball the seller. Instead consider offering at or over the asking price in odd numbers (not even amounts).
• Place a larger earnest money deposit.
• Be flexible with the closing date or perhaps allow the seller to rent back for a short period after closing.
HOW LONG WILL THIS MARKET CONTINUE?
The question I get asked most often is, “How long will this market continue? Is it near a top?” No one knows for sure but the market data that is available to you can certainly help.
In order to detect a slowing market, I recommend watching market inventory, if market inventory begins rising beyond the normal seasonal declines that occur in our area, that could indicate softening in the market. The other two factors to watch are increasing average days on market and frequent price reductions.
Presently, inventory remains extremely low, average days on market are still going down and there are very few price reductions, resulting in a very strong market that seems to have the momentum to continue.
SHOULD I WAIT FOR WINTER?
Buyers often ask, “Should I wait for winter or after a tough winter when more listings will hit the market?” The past three years have not seen increases in inventory or reductions in asking prices resulting from the winter seasons. The market is too tight. The demand placed on the market from many buyers looking to buy in our area will likely quickly absorb any increase in available listings.
AVERAGE MORTGAGE INTEREST RATES
If your current mortgage has a rate that is 0.5% or more above the average posted mortgage interest rates, I recommend discussing refinancing with a lender to reduce your rate and monthly payment. I have witnessed several homeowners who refinanced a current 30-year mortgage at 2.93% into a new 15- year mortgage at 2.39%, a much lower interest rate resulting in their payment remaining the same but they pay their home off 15 years earlier than on their prior loan.
Rates are expected to begin to rise this fall.
If you have any questions regarding the local real estate market or the purchase or listing of property, please contact your local real estate professional.
Reader Comments(0)