It is not my goal to understand what Amazon might do, but it is my goal to understand what the local real estate market is doing, and I can report to you that we have seen and felt a measurable change in the market place this summer.
For months it had become common for real estate agents to bring on a new listing and include in the agent remarks the phrase: “all offers to be reviewed on…” and then provide a date for that review. Multiple offers on most listings had become the norm, homes were selling fast, sellers were happily reporting huge successes, and life was good –at least on the sell side of the transaction.
Turn to the buy side of these transactions and it has been quite another story. Buyers were getting weary, agents were working many times harder trying to pull deals together, inspectors were busy doing multiple inspections for multiple buyers on the same home, and in the end, only one buyer could purchase the home. All the other buyers had to swallow their losses and start looking for the next home to repeat the process on – and wonder what it would take to finally be the successful bidder.
Inspections were waived, appraisals were waived, seller’s disclosures were waived, and dollars were waved, and still somebody else found a way to walk away with the deal.
But something happened on the way to the market this summer! It was almost as if every buyer in the pool of active buyers in the entire region had gone to a town hall meeting and together arrived at the same decision “enough is enough,” and committed to acting on that decision.
And it was felt. Overnight it seemed, the buyers simply stopped bringing multiple offers to the expectant listing agents for their new listings. The offer review dates came to pass and not one offer was on the table, or maybe there was one offer, but not a second one. Without that second offer, the listing agent had no leverage to pump the price up over list price!
Sellers were incensed. Agents were blamed. Buyers were coy.
But, the fact remained – the buyers had turned a corner. I could almost hear the collective voice of the buyers saying “Enough is Enough! We will not continue to bring multiple offers to your over-priced listings.”
Perhaps it was nothing more than a seasonal adjustment in an otherwise robust market, but even if were only a seasonal change, it was felt. In the past few summer months we have hardly seen a listing with the agent remarks that read: “all offers to be reviewed on (such and such a date).” The paradigm has shifted, sellers have had to enjoy some humble pie at the table, agents have had to sharpen their pencils, and buyers have had some relief.
A bubble? Not a chance. Fundamentally the regional real estate market continues very strong. Statistically our market is still a seller’s market with less than a month of available inventory throughout most of the Puget Sound region. Employment is at record strength, Amazon continues to grow, workers continue to arrive from everywhere to work here, life is still good.
How have buyers gained some say in the market? I believe it is because the apartment rental market has improved substantially over the past couple of years giving buyers an option rather than forcing them to buy just to find housing.
And this is good. Some re-balancing of the market will steady it. Seller expectations will adjust, and buyers will continue to buy – maybe even with a little less pressure.