Is Now a Good Time to Buy a Home in Seattle?

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Seattle isn’t just a hip city, it’s a city full of opportunity and a great place to settle. If you are thinking of buying a home in Seattle, here are some things you should know.

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The housing inventory is very limited

As of May, Seattle had just 0.49 months of housing in the real estate market, according to data compiled by Housing Tides, an EnergyLogic company. This represents a decrease of 1.15% compared to the previous year.

To be clear, limited inventory isn’t just a problem in Seattle. On the contrary, there is a dearth of houses available to buy nationally. In May, the national inventory stood at just 1.13 months of supply. For context, it takes a 4-5 month supply to create an equalized housing market – a market that doesn’t necessarily favor buyers over sellers or vice versa.

Since the housing stock is so low in Seattle, you might have a hard time finding a property that fits your price range. Or you might have a hard time finding a home with the features you’re looking for.

Seattle home prices have gone up

In February 2016, the median home price in Seattle was $ 405,000. In May 2021, the median home price reached $ 738,000. This represents an increase of 26.2% from the previous year, which is a pretty substantial jump.

Of course, it’s not just Seattle where house prices have gone up. Property values ​​are on the rise nationwide due to low supply and high demand. But given that median price of $ 738,000, buying in Seattle right now can be a boost, financially speaking.

Mortgage rates are always competitive

Home values ​​in Seattle can be rising and inventory can be extremely low. But mortgage rates remain at competitive levels.

At the time of this writing, the average interest rate in Washington State for a 30-year fixed loan is 3.16%. Meanwhile, the 15-year average mortgage rate is 2.47%. These rates are quite low, historically speaking, and they could allow you to buy a more expensive home.

In fact, if you fix a 30-year fixed mortgage at 3.16% on a $ 738,000 house for which you pay 20%, your monthly principal and interest payment will be $ 2,539. However, this figure does not include other expenses related to homeownership, such as:

Should you buy a house in Seattle today?

To buy a home in Seattle, you’ll need a fairly large down payment based on the value of the property. You will also need to make sure you can stagger your current mortgage payments.

Ask yourself the following questions to see if you are ready to buy:

  • Is my credit rating in good condition?
  • Do I have a low level of existing debt?
  • Can I get 20% off a house in Seattle? And if not, can I pay the cost of private mortgage insurance on top of my mortgage payments?
  • Is my job stable?
  • Have I done my research and determined that Seattle is where I want to settle?

If the answer to all of these questions is yes, then maybe now is a good time to buy a home, especially with mortgage rates so competitive. That said, there is nothing wrong with waiting if you prefer to hunt a house at a time when there are more properties to choose from. Low mortgage rates are unlikely to go away for a while, so there is certainly no need to rush your decision.


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