State of the Market- a review of 2006 and a look at 2007

This information comes from the statistics charts for the full year, please take a look at
http://debrasinick.com/docs/2006_Year_to_Date.pdf

The 2006 real estate market was a real roller coaster ride. Overall, prices were up for the year. Inventory climbed each month, peaked in October, and dropped off at the end of the year. With the increase in inventory, the fall proved to be the toughest time to sell a home.

As I mentioned in a statistics report in June, I could see the number of homes for sale increasing dramatically. We started the year with only 2031 homes for sale. By September, inventory peaked with 3218 homes. December saw a drop in inventory to 2165 homes. This was1100 homes less than September, but only 100 more homes than we started with in January of 2006.

The best month to sell in 2006?
March, when 61% of all the homes listed sold!

The month with the greatest number of sales in 2006?
May with 1367 homes sold.

The month with the largest number of homes for sale in 2006?
September with 3218 homes for sale.

The toughest month to sell in 2006?
November when only 20% of the homes sold.

How did the year end? On the eastside prices increased an average of 19%. The increases varied, Mercer Island took the price, oops the prize, in 2006 with 36.9% appreciation. Downtown Redmond, Education Hill and Union Hill were next with a 26.9% increase in pricing and West Bellevue followed closely with 24.1% The Redmond/Bellevue area around Microsoft showed a price increase of 9.4% while Kirkland prices were up 15.3%.

Overall, 10% less homes sold in 2006 than in 2005. A few areas showed an increase in sales, but this was the exception rather than the rule. Seventeen percent more homes sold in West Bellevue and 16% on the plateau.

My crystal ball for 2007: We should see a strong market this year. The rate of appreciation will be less than 2006 and definitely less than 2005. I believe the increase for the Eastside will continue, but at a slower pace. There will be exceptions to this rule, such as the neighborhoods of West Bellevue and Mercer Island. Strong increases in pricing will still be seen there. The best time to sell your home in 2007? If you can do it, put your home on the market by April. The stronger absorption rates and the greatest number of sales happen in the spring.

Watch our employment rates. This will give you a good clue as to where we are heading in the real estate market. The more jobs created, the more houses will sell and the more likely will be an increase in prices. Pay attention to the absorption rate each month and this will also give you a clue as to market performance.


Enjoy 2007!