Are buyers competing to bid prices up above current list prices? The answer is yes, at least for the nice homes that most buyers want. I thought you might find this interactive chart interesting. Drag your mouse across the chart to see the data. It shows the sales prices of homes as a percentage of the list price. The time period covers the last 10 years and is a 3-month moving average for homes $300,000 and above. The top black line represents all Northwest MLS listings, which covers almost the entire state of Washington, and the lower green line shows the Sequim area zip code of 98382 and the selling prices of homes as a percentage of the list price.
I imagine you’re not surprised to see the prices skyrocket this year as the Sequim area inventory (and all of Washington) dropped like a rock and demand from California buyers (and Colorado, Texas, Florida, Alaska, Hawaii, New York, West Virginia, etc.) increased dramatically.
All the way to the right, place your mouse on the last data on the two lines. All NWMLS on an average sold for over 107% of the list price, and in the Sequim area over 102% of the list price. This means if a home was listed at $600,000, it sold for 102.2% of that price or $613,200. The same home in Washington listed at $600,000 sold for $642,000. Wow!
Since we’re dealing with averages, that means some homes sold for much more. In the Sequim area I have seen homes sell for $50,000 to $100,000 above the list price as buyers compete aggressively to get the one home on the market they want. I’m sure the more competitive markets in luxury areas around Seattle have seen homes sell for $100,000 to $250,000 above list price.
What we’re seeing from some desperate California buyers who already sold their homes and got top dollar, is all cash offers well above the list price with all contingencies waived. That’s another “Wow” as far as I’m concerned. You have to really want a home and be able to afford a big undiscovered nightmare, but perhaps the risk isn’t all that great for the kind of quality construction that indicates a well built home that is also clearly well maintained. The building code here is the Uniform Building Code, and every property has to have potable water and a septic system, so some buyers are waiving the home inspection and other due diligence. That makes their cash offers that require no appraisals extremely attractive to sellers.
My last note is a self-serving promotion. I get calls and emails all the time from buyers who hired a buyer’s agent who turned out to be “less than desireable,” and they want me to save them. I cannot step into a transaction when a buyer is already represented. This market is definitely not one for the inexperienced Realtor handling hundreds of thousands of your hard earned dollars. The key to avoiding a nightmare is doing your research and interviewing a buyer’s agent before you make an offer. That’s all I’ll say about that, but you know how to get ahold of me if you need my experience to buy a home in this kind of intense and competitive market.
Last Updated on May 23, 2021 by Chuck Marunde