Komo News recently published an article called, “Seattle Home Prices at Lowest Level Since Housing Crisis”. The article explains that housing prices fell in Seattle year over year by a little over 5%. Home prices also fell across the country in most other cities surveyed.
This fall in prices has brought values to an all time low since the housing crisis started. We’ve seen a total loss of about 34% on average, which has returned us to roughly 2002 values.
This has made housing the most affordable it’s been since 1987 (accounting for inflation). The article does state that values may continue to fall due to the volume of foreclosures and short-sale properties on the market. But it appears to be talking on a national basis, as opposed to Seattle specifically. At the moment, North Seattle’s available inventory is about 18% short-sales and 9% foreclosures (bank-owned). These percentages are a lot lower than some other distressed areas across the nation.
Even if values do fall another 5% in the next 12 months, you may not care if you’re planning on living in the home for 10+ years. Also, if prices do fall another 5% but interest rates inch up just 1%, you’d still be looking at roughly the same mortgage payment. So you would still pay about the same amount for the home in the long run.
BUT if you’re only planning on being in the home for a couple of years, a 5% decrease in value could be devastating. Especially considering that even if prices stabalize tomorrow, we may not see any appreciation for another year or two. Generally speaking, you probably don’t want to buy a house unless you can stay in the property for at least 5-7 years, regardless of the type of existing economic environment.
There are many factors to consider when buying a home. If you would like to gather more information, go to our Calendar/Reservations page and sign up for one of our FREE Home Buyer workshops.
