The year’s real estate market is ending much differently than it started. We are very seasonal here and just as things started to get going in March for our spring selling season, the lights were shut out and real estate business was shut down by Governor Jay Inslee. We were not seen as essential initially and we all quarantined at home until certain real estate activities were allowed on a limited basis. As things quietly reopened to a larger extent in May, our market very slowly began to see new inventory emerge, but initially only people who really needed to move were transacting. Things were looking and feeling very grim. We had a few sellers take very low offers as the stock market plunge scared them and several other sellers pulled their homes off the market for virus concerns.
But, by the end of May/beginning of June the weather was great and the lockdown was looking like it may go on for months or even years. People were figuring out how to navigate our new norm safely in masks, gloves and sanitizer on hand. Many people were now working from home, some businesses were saying this would be their new norm and those living in the cities were realizing they had new options since commuting was taken out of the housing equation. The suburbs and rural areas like Bainbridge very quickly became very popular. Areas like Bainbridge, Bellingham, Wenatchee became red-hot markets over the summer. Our inventory stayed low all year. Inventory never got up to our normal spring/summer numbers, but our buyer pool increased dramatically with city dwellers from Seattle, San Francisco, Los Angeles and New York seeking out a home on the island. Many buyers bought sight-unseen. Some made long car trips to avoid flights. I spent a great deal of my year working with buyers, many from California, where I grew up. The fires raged there again this year and those who had been considering a move to the Pacific Northwest were pushed off the fence and decided to make the move.
In my thirteen years of working in real estate on they island, this his was indeed the most challenging year for buyers. It has been a solid seller’s market here for the last five years, but not at 2020’s intensity. In 2019 or 2018, a hot home saw five or six offers, this year, we saw 10-12 offers on several homes. Contracts started looking very lean and very different as buyers became very aggressive. And, cash buyers had more power than ever as lending was shaken after the stock market dive and the instability in some employment sectors.Tenacity, creativity, swiftness and experience were key in me helping 21 buyers be successful in our seller’s market last year. In short, summer was intense, especially on the heals of so much inactivity and uncertainty. And our “summer season,” which usually wraps up in August lasted well into November. And yes, with all of that low inventory, supply and demand did its job and prices went up. We will end the year at roughly 10% OVER our initial predicted price increase estimates at roughly a 14-15% gain at year end. Final number still to be calculated as we wrap up closings for December.
So, as buyers struggled, sellers, who were well prepared to sell in our new-COVID-normal market did very well. But many of them became buyers once again, so preparation and planning again were key, as even our rental market was historically lean. Right now, the inventory is even lower with less than 20 homes on the market and overall the market is quieter and calm as we wrap up our final closings for 2020. The radical pivots and changes of last year were dramatic. Working in masks, new showing protocols, extreme low inventory, remote buyers, multiple offer drama, and no open houses required the industry to make some shifts. How will things look on the island in 2021? I think that 2021 will be ‘2020 light’. I will get into that further in my next post in January. Cheers to a healthy new year and a healthy new market.