Homeworthy's 2020 Washington Homeowner Trends Report
By the end of 2019, the median value of Washington homes was so high that the entire state was classified as a “hot market”. With the average home worth more than $409K by the turn of the New Year, this means there was an excellent chance that state homeowners opting to sell would instigate a bidding war.
And as we enter prime real estate season in 2020, a shortening supply of housing inventory across the state will likely continue to make it a competitive seller’s market.
Here’s a look at some highlights which illustrate where Washington’s real estate market stood in 2019:
- 101,798 homes closed across the state in 2019, just 1,530 less than the year previous.
- The average home took 53 days to sell, 12 days longer than the average home stayed on the market in 2018 (41 days).
- The median sale price was $404,213.
With the lure of Washington metro areas like Seattle, Spokane and Tacoma growing — particularly amongst millennials — we expect to see home sellers capitalize on the number of out-of-staters eagerly moving to the pacific north-west to avail of its lower living costs and better job benefits.
In fact, Spokane, which has been named as one of the hottest markets countrywide with nearly three-quarters of home searches coming from out-of-town buyers, is expected to see home values appreciate by 10 percent this year. Great news for homeowners who, with talks of a potential recession still looming, may be looking to take advantage of a market on fire before valuations plummet.
As Homeworthy continues to help home sellers across the state hand over the heavy lifting of selling their home for a flat $4,995 fee rather than the traditional 6% commission rate charged by real estate brokers, the company commissioned its Washington Homeowner Trends Report to examine homeowners across the state are thinking about their next home sale.
A survey was administered in January 2020 to 300-plus Washington state homeowners. Here’s an overview of what we found:
- There’s no place like home! 68% of homeowners across the state would want to stay in-state with their next move, and 45% report wanting to stay in the same town or county.
- Washington homeowners are staying in their homes longer as home prices continue to outpace wages. In fact, the majority of Washington homeowners (59%) say they won’t sell for four-plus years. Of respondents to Homeworthy’s survey that are thinking about selling their home the soonest (within two years), nearly one-third have been living in their current home a decade-plus.
- The biggest factor for staying put in their homes was a lack of houses for sale in their price range (35%), followed by not getting a fair offer on their home (27%), and the cost of the home sale/move (22%).
Home Sweet Home: 45% of Washington State Homeowners Would Stay in the Same Town or County
With the average cost of living in Washington state coming in much lower than the national average (especially when you factor out major urban areas like Seattle), it’s no surprise today’s homeowners are happy to stay put, even if they decided to move homes.
In fact, 68% of homeowners stated that if they were to move home, they would not leave the state. 45% asserted they would stay in their current town or county. These statistics illustrate how content Washington state residents are as they enjoy significantly lower healthcare costs than other states alongside reduced utility bills.
And as cities and towns like Bellevue and Olympia make a name for themselves in the arts, not to forget the beautiful national parks at residents’ doorsteps, it turns out the cost to be entertained is much lower than average too.
There’s no doubting just how satisfied Washington homeowners are, and when you take into consideration the fact that homeowners are typically staying in their homes longer.
Homeworthy survey respondents were fairly evenly split between how long they’ve been in their current homes:
- 0-2 years (30%)
- 3-5 years (28%)
- 6-10 years (15%)
- 10+ years (27%)
However, despite the variety of length of time in the current home, the majority of homeowners are looking to stay put for at least four more years (59%). This is a trend playing out beyond Washington state and across the country, as homeowners are typically staying in their home 13 years on average, five years longer than they did in 2010.
Of respondents to Homeworthy’s survey that are closest to selling their homes (would like to sell in less than 2 years), nearly one-third have been living in their current home more than a decade.
Lack of Houses in Price Range and Home Selling Costs Lead to Staying Longer
So what are the reasons behind staying longer in their homes? Not surprisingly, the biggest factor for staying put in their homes was a lack of houses for sale in their price range (35%). The story is often the same. Homeowners move into their starter or first home and only anticipate to be there for 5-8 years. However, the housing market continues to outpace household incomes, and five years down the road, families are looking at comparable houses that are selling for $100,000 more than what they paid for their home. In fact, from 2005-2017 Washington state household income only increased 15%, while the median home sale price increased 39%!
Another often overlooked concern is actually effectively selling their current home to get their money’s worth. This was the second biggest reason (27%) why homeowners said they were hesitant to sell their home. Additionally, more than one-fifth (22%) note the costs associated with actually selling a home is too high. Of course, the decision to sell your home is one that shouldn’t be taken lightly, and many factors have to be taken into consideration. Costs are most definitely amongst the most critical components to ponder.
Some of these costs outside of the typical broker fees aren’t considered often. Home inspections can cost anywhere between $400 and $1K. Staging costs, if you hire professional stagers, can rack up bills to $2K. And these figures aren’t to mention title insurance ($1K - $4K) and other home improvements that need to be done before you host your first open house.
Of course, the difficulty and cost of selling a home were often overlooked when homeowners moved into their most recent house because, more often than not, homeowners haven’t moved before! In fact, more than half of homeowners noted that their next home sale will be their first home sale.
Beep-beep: Nearly 1-in-3 Washington Homeowners Say They Could Not Deal With Traffic and Noise Outside Next Home
With more and more out of state buyers moving into Washington state, traffic congestion is also increasing around urban areas. In fact, research released last year found that a Seattle-area driver who commuted at the slowest time of day would have lost 138 hours in traffic!
Therefore, it wasn’t a huge surprise to hear that the number one thing Washington homeowners say they couldn’t deal with when buying their next home (32%) is the traffic and noise around their home. In fact, one-in-four homeowners stated the need to decrease their own or household’s commute would be one reason to expedite selling their home.
With drivers reliance on real-time navigation apps such as Waze today to beat the increased traffic, neighborhoods in and around urban areas are becoming throughways. Interestingly, the Seattle area has some natural defenses against the Waze infiltration into neighborhoods. Namely, it leads the nation in traffic circles to hinder people from cutting through neighborhoods as shortcuts.
Those in Spokane, Tacoma, and Vancouver may not be quite as lucky and it's clear the traffic congestion and noise are getting homeowners to consider finding their next home in a more quiet or rural area. That may be leading to Washington homeowners to consider counties a bit further removed from the urban sprawl such as Whatcom County and Thurston County.
The second biggest issue that homeowners are looking to get away from in their next home is an outdated kitchen (15%). This increases even more among millennials, with 19% saying the outdated kitchen in their current home is something they couldn’t deal with in their next home.
Homeowners in the Evergreen State Are Split on Whether They Want to Upsize or Downsize
When it comes to their next home, 36% of Evergreen state homeowners say they’d be upsizing into a larger home, while 29% note they will be downsizing. Not surprisingly, this was often dictated by age range. 48% of millennial homeowners aim to upsize with their next home as they are likely living within their starter home now. Meanwhile, the split is nearly opposite with those 55-plus, with 61% of older homeowners looking to downsize.
The need to upsize often comes at homeowners often sneaks up lot quicker than the need to downsize. In fact, nearly 1-in-3 respondents to Homeworthy’s survey said the need to upsize would be one reason to sell their home and move quicker than planned.
Interestingly, of those planning to stay in-state with any future move, 40% said they would be interested in upsizing. Of those exploring potential future out of state moves, only 29% are looking to upsize. That seems to be another endorsement for the state being an ideal place to start and grow a family.