Here is the market at a glance for Thurston County WA, including the major cities of Olympia, Lacey and Tumwater. 2019 was a strong year for our local housing market.
Why was 2019 such a strong year for the Olympia area housing market?
1. Strong Regional Job Market and Low Unemployment
2. Relative Affordability of our Area
3. More Buyers and More Inbound Migration than Expected
4. Not Enough Home Building and Fewer Sellers of Existing Homes
5. Low Interest Rates
A strong regional job market has boosted consumer confidence and has helped drive sales to near-record levels.
Government is by far the largest employer in Thurston County with 39,000 jobs as of the 2018 employment total.
Thurston County remains the most affordable major county in Western Washington, and this is contributing to high levels of inbound migration.
Despite years of steadily rising prices, a sharp drop in interest rates helped keep homes affordable.
For a decade now, building has not kept up with the area’s growing population. The amount of construction dropped, even more, a year ago. Between fewer re-sellers coming to the market combined with a reduction in building, this made Thurston County the most undersupplied market in western Washington.
Record Seller's Market Brings Record High Prices to Olympia
High demand and lower levels of sellers brought 2019 to the strongest seller's market ever recorded.
We are starting 2020 at just a 0.6 month supply of homes for sale (a balanced market sees between four to six months supply).
Home prices rose higher than the historical average but surprisingly did not rise as much as might be expected given the supply-demand imbalance. This is keeping our area affordable, which keeps buyers interested and capable.
It's no coincidence that homeowners in our area are seeing record levels of equity, particularly those who purchased between 2010 and 2015. Those sellers who recently sold are averaging well over $120,000 in price gains since they purchased. Those are sizeable given the average sales price was $367,000.
Where do we go from here?
It's my prediction that 2020 will be similar to 2019 as we are not anticipating significant changes to the top five factors listed above.
Unemployment should remain low and consumer incomes and confidence rising. This combination of willing and able buyers and low interest rates will be enough to keep the market favorable for sellers. Having more sellers come on the market this year would be helpful as buyers are waiting for the next listing to come online.
2020 will be a great year for sellers in Thurston County
When can we ever say taxes have decreased?! For home sellers, your excise tax to the state of Washington that you pay when you sell has decreased from a flat rate of 1.78% of the sales price to 1.6% for most sellers (under $500,000), and a graduated rate for home sales above $500,000. Read more about this tax relief here.
Who you hire matters. That AT&T commercial about the surgeon (who is “just okay” and “who just got reinstated—well, not officially”) cracks me up! But just OK is not OK in real estate, either. New challenges are cropping up in this uncharted market for sellers.
Who thought multiple offers would be a challenge?
An experienced agent like myself who has been through the highs and lows of the market, can tell you that although it's exciting to receive multiple offers, it can be very difficult to choose the right offer.
My experience has taught me to ask A LOT of questions of those buyer-agents to determine buyer motivation, capability, determination along with chatting with their lender, asking for proof of funds, and much more to give my sellers as many facts as possible so they can make the best decision for them. Who you hire matters. Call me today if you are considering making a move in 2020.
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