I find myself telling all the Family Law Attorneys I work with that "You are not imagining things if you’ve noticed an increase in real estate pricing for equity buyouts in your cases".
I hope your transition to life in 2022 has been smooth so far.
As far as the real estate market goes, it continues to be not so smooth. I want to keep you updated on some of the projections for change this year — some of which will impact the options available to your clients when deciding whether to sell their house or refinance. The following are national trends. Below that are local metrics I’ve put together so you can gauge the climate of our local market.
- Prices are expected to remain high in 2022. Fannie Mae expects prices to increase 7.6%. If your clients need to sell, they’ll likely have a strong upper hand.
- Home inventory is at an all-time low, and rents continue to rise. Fortune recently reported that “the housing shortage has forced many potential buyers to move into rental properties as they look for their next home [...] That option, however, is becoming increasingly expensive.”
- Mortgage rates are increasing — rates have already risen to 3.55% this year from 2.65% a year ago. That means two things: 1) The refinancing boom is fizzling quickly, and 2) The hike in interest rates further erodes affordability (a 1% change in interest rate has the same impact as a 10% change in mortgage payment).
Local Trend in Prices:
Currently, our first quarter (Q1) market is seeing an upward trend.
Skagit: Quarter 1 2021: Avg Price 527,320 -vs- Quarter 1 2022: Avg Price $600,401 (Percentage Chg +14%)
Whatcom: Quarter 1 2021: Avg Price $543,289 -vs- Quarter 1 2022: Avg Price $590,058 (Percentage Chg +9%)
Island: Quarter 1 2021: Avg Price $573,362 -vs- Quarter 1 2022: Avg Price $665,984 (Percentage Chg +15%)
Snohomish: Quarter 1 2021: Avg Price $668,103 -vs- Quarter 1 2022: Avg Price $768,482 (Percentage Chg +15%)
Pricing Note: House values can fluctuate through the seasons. Spring is a different market than the Fall; mid-Summer looks much different from the end of the year. So in order to get an accurate reading as to whether or not prices have fallen or risen, we use the “year over year” barometer.
Local Days on Market:
County, Quarter 1, 2021/ DOM (Days on Market) -vs- Quarter 1, 2022/ (DOM (Days on Market)
Skagit: Quarter 1 2021: DOM 21 -vs- Quarter 1 2022: DOM 32 (Percentage Change +52%)
Whatcom: Quarter 1 2021: DOM 30 -vs- Quarter 1 2022: DOM 22 (Percentage Change -36%)
Island: Quarter 1 2021: DOM 22 -vs- Quarter 1 2022: DOM 23 (Percentage Change +05%)
Snohomish: Quarter 1 2021: DOM 15 -vs- Quarter 1 2022: DOM 16 (Percentage Change +05%)
Days on Market (“DOM”) Note: This metric will tell us how long it takes for homes to sell. This number is largely driven by supply and demand. An uptick in interest rates can cause DOM to increase; a drop in unemployment can cause DOM to decrease. All sorts of economic factors can affect this number, and ultimately, DOM affects pricing. When there are low days on market, prices go up; when DOM increase, prices usually go down but in this current market the prices are continuing to rise..
Market conditions are constantly fluctuating. If you would like a market analysis for your own knowledge or for a specific case, feel free to contact me . As a CDRE™, Certified Divorce Real Estate Expert I am a helpful resource.
As always, keep my attorney document portal handy, should you need title documents or property values: https://ilumniinstitute.com/
