2021 in Year Review

Speaker 1: [0:00] Hello, hello, and welcome to another edition of the Awesome in Seattle podcast. This is your host Christian Awesome of the Awesome and Awesome Group at Wilson Realty. And this is our first episode of 2022, so happy New Year to all of our listeners. Uh, the start of the new year means that it's time for our annual year in review episode, where we take a look at last year's real estate numbers both locally and nationally. We are going to discuss interest rates, home prices, how competitive the market was, and a bunch of other stuff. And this is gonna be a little bit more of a numbers-driven podcast, so you might want to break out your pen and paper and write some of this down so you can better comprehend it. Before we look back at our last year in real estate, I'd love to welcome my co-hosts, the wonderful agents of the Awesome and Awesome Group. First up, we got Reed Watson, the Seattle native.

Speaker 2: [0:50] Hello.

Speaker 1: [0:52] Welcome. Miss

Speaker 3: [0:52] Reed.

Speaker 1: [0:54] Next up- Sh … we have the other voice that you just heard, Mr. Jason Saldarriaga, the data guru.

Speaker 3: [0:59] Mr. Jason- … in the building. Oh, my, this, if this is the, if this is what is in store for 2022-

Speaker 1: [1:06] It's gonna be entertaining, I think … oh, my gosh. And then we got the dog whisperer, Mr. Les Cutting.

Speaker 4: [1:11] What up? What up? What up?

Speaker 1: [1:14] Welcome, everybody.

Speaker 3: [1:15] I was gonna make a dog noise, but then I, I, I can't really-

Speaker 1: [1:18] Yeah. Well, welcome everyone. This is, uh, one of our more anticipated and most listened to episodes of the year, so no pressure, guys.

Speaker 2: [1:26] Oh, absolutely. Let's maybe start off with some numbers about the national real estate climate in 2021.

Speaker 1: [1:33] Okay.

Speaker 2: [1:33] According to the CoreLogic Home Price Insight Report, say that five times fast. The CoreLogic Home Price Insight Report- … which used data from October 2020 through October 2021, home prices appreciated, or in other words, increased nationwide by 18% year over year. And this also really interested me, not a single state posted a decline in home prices this year. Yeah, where are we seeing the largest increases in terms of states?

Speaker 4: [2:03] Well, thank you for asking, girl. I'ma tell you where we're seeing the largest increases. All right. So the five states with the largest increase in home prices were, number one, Idaho, prices up 32.2%.

Speaker 1: [2:16] Dang.

Speaker 4: [2:16] Number two, Arizona, up 29.5%. Number three, Utah, up 26.2%. Number four, Montana, up 24.4%. And number five- Nevada. Neva- Nevada, Nevada. How do you guys say it?

Speaker 1: [2:35] Nevada.

Speaker 4: [2:36] Nevada? We say Nevada. Nevada. Nevada. I say Nevada. I say, I say-

Speaker 1: [2:39] Yeah, I think it's

Speaker 3: [2:39] Nevada, though. I think.

Speaker 1: [2:41] Nevada. Nevada is how I say it.

Speaker 4: [2:42] Okay. Well, Nevada is how I say it. Up 22.7%.

Speaker 3: [2:47] So Idaho, Arizona, Utah, Montana, Nevada, they are not located near each other at all.

Speaker 2: [2:53] No,

Speaker 3: [2:53] but- That's- I- That's an interesting geographic, you know, just that section.

Speaker 2: [2:58] Yeah.

Speaker 4: [2:59] Yeah.

Speaker 2: [2:59] I'm interested as well, I have a statistic I'll tell you soon, but second homes are really-

Speaker 3: [3:06] Mm-hmm … Speaker 2: far more popular than they've ever been in all of these states, um- The two U-Haul move? Do have a

Speaker 2: [3:11] lot of those.

Speaker 3: [3:12] The two U-Haul move. The two U-Haul move. We, in, in re- in real estate we know this, uh, we see this on occasion. It's when you sell your house and, you know, the week before close, you look at your neighbors who are moving. They're selling their house, and there's two U-Hauls. One of them is going to the condo, maybe downtown Seattle. The other one is going to Phoenix, where house prices- … are up 29.5%. Um- So let's really quick, y- we talked about best performing states. What about some best per- performing cities, cities with the highest appreciation or, or growth rate? So according to a list, this was done by Forbes, of the top 20 cities with the biggest price growth- The number one spot is basically my hometown, uh, a, a suburb of Austin, just north. Michael Dell land. It is Round Rock, Texas.

Speaker 2: [4:11] Woo. Never heard of it.

Speaker 3: [4:12] Oh, well now you have. And, uh, home prices increased, this is absurd, a whopping 39%.

Speaker 4: [4:20] Jeez. Say what?

Speaker 3: [4:22] Yeah. Yeah, crazy. Number 10 on the list was, uh, Bellevue, so our area made it. I th- Also

Speaker 2: [4:31] never heard of it.

Speaker 3: [4:32] Yeah. I don't know where that is. Which, uh, saw home prices appreciate 18.2%. Wow. What was it, like two years ago Tacoma was number one. Yep.

Speaker 1: [4:42] Mm.

Speaker 4: [4:42] Mm-hmm.

Speaker 3: [4:43] And then we've seen, uh, stuff in S- you know, Homish be on this list and stuff. So- Yep … we're, we're, we usually do pretty well. Seattle's

Speaker 1: [4:51] been

Speaker 3: [4:51] on

Speaker 1: [4:52] there- Yeah … numerous times, yeah.

Speaker 3: [4:54] Les did mention Arizona was number two in the nation, and they ended up with five cities- Wow on the, on this list of top 20 cities. Um, they include Scottsdale, Chandler, Surprise. Tempe, and Glendale.

Speaker 4: [5:10] Wait. R- you know what's really random? I'm sorry to interrupt, but it seems like everyone… There's quite a few people from Washington, they all moved to Arizona, so maybe that's what's going on over there. Mm-hmm.

Speaker 2: [5:19] Mm-hmm.

Speaker 4: [5:20] A lot of people moved to Arizona. I always found that awesome.

Speaker 1: [5:21] A lot of people snowbird there. Yeah. So in the winter they move down there and have a house there and a house up here, and yeah.

Speaker 2: [5:28] And to be clear, it's not that Tempe is a surprise, it's the city of Surprise is on the list.

Speaker 1: [5:34] Yes, exactly. Which is the home of numerous, uh- I would not have got that … that's the home of numerous spring training sites for Major League Baseball teams.

Speaker 3: [5:42] Only you care. Only you care. Uh-

Speaker 1: [5:46] And everyone in the city of Surprise … Speaker 3: yeah, I actually, this is a little tangent, but I was reading, like, a census, uh, migration report on states from last year. Sounds fascinating.

Speaker 3: [5:58] It is. Uh, Washington actually did pretty well. Uh, we, we did, we did not lose as many people as… We're very middle of the road. Um, so I think a lot of the people moving to Arizona definitely came from, uh, the Northeast and California. California lost a lot of people. Mm-hmm. But the net wasn't too crazy, not as much as you thought, you would think- Yeah based on the news. Which brings me to California being- Like, what's going on? You know, you read the news, you, you listen to the news, you read the newspaper. Everybody's leaving California. Is this true? Well, in terms of home price increases, they didn't really make the top of the list as a state, but several cities did perform very well. Um, Fremont, San Jose, Glendale, Palmdale, they all saw very impressive home price increases, and they did make the Forbes top 20 list. So-

Speaker 1: [6:54] Mm-hmm … Speaker 3: um, you know, the, there's nuance here. Yep. Another one, too, that's somewhat close to us is Boise, and that one topped, I think it was number five on the list at, like, 20, almost 24% increase. And I mean, we've had clients that moved from our area to Boise as well this year, over the last year, so not too surprised by that.

Speaker 3: [7:20] Yeah.

Speaker 1: [7:20] Um, let's, let's shift over to interest rates and kind of what happened there. So if you think back, in 2020 when the pandemic started, the Federal Reserve cut interest rates in order to stimulate the economy so that it didn't fall apart. Uh, there was a slight increase in interest rates at the beginning of 2021, but pretty much over the entire year, they, they stayed pretty low. Uh, they were supposedly going to, and we kept hearing this from all the experts, saying that interest rates were expected to increase halfway through the year last year, and it really didn't ever happen. Uh, in fact, it started, interest rates started at the lowest national average ever at the beginning of the year at 2.65, and it hit the highest average for the year in April at 3.18%. So, and currently they ended the year at around right about 3%. So they didn't really do too much over the last year. They're still record lows. It's crazy.

Speaker 2: [8:25] Yeah, and due to those super low interest rates as well as the very high demand paired with the very low inventory we've been seeing, I've said it probably 1,000 times in 2021, but it's the first time I will say it in 2022, um, it's a very competitive market. And it's no secret that the real estate market was extremely competitive in 2021. Mm-hmm. According to The New York Times, there were tons of national real estate records set. The typical US home sold for nearly $400,000, which is up 24.4% year over year.

Speaker 3: [9:00] And- Oh,

Speaker 2: [9:00] n-

Speaker 3: [9:01] that's nothing. No big deal. That, that's- Pretty normal

Speaker 2: [9:05] And also nothing- That's crazy. Wow … supply dropped to the lowest level in recorded history, which was down 23% year over year.

Speaker 3: [9:14] Yeah, and to be clear, that's not the amount, the number of homes on the market. Because if you think, like, how's that possible? What? Mm-hmm. 1783 we had more houses on the market? No, it's a balance between, um… It's really how much is on the market compared to how quick they sell if no new homes were added. Right. Yeah. So things are going fast. We don't have a lot of surplus demand.

Speaker 1: [9:37] Mm-hmm.

Speaker 2: [9:37] No, and,

Speaker 3: [9:38] um- Or, or, um, uh, I'm sorry, inventory, not demand. Right. We have a lot of surplus demand.

Speaker 1: [9:42] Ton of demand, no inventory.

Speaker 2: [9:44] Yes. And on that note, a typical home was only on the market for 15 days. Uh, that's the lowest median number in recorded history as well, with more than 60% of homes going off of the market within two weeks.

Speaker 3: [9:59] That's crazy.

Speaker 2: [10:00] Nationwide. So things are just flying. Yeah, this is just crazy. That's nationwide. It sounds maybe like quite a few days here in Seattle, but this is across the country, and that's just bonkers.

Speaker 3: [10:09] Yeah, like if you think about, you know, uh, you know, growing up, we listed our house, right, in the '90s. Mm-hmm. And it was like, you know, it'll take like two or three months to sell, you know? Mm-hmm. And that would be great. Mm-hmm. Now the average for the entire nation, 15 days. Incredible.

Speaker 2: [10:26] Right. Very crazy. And over 55% of homes sold for above asking price, which is up almost 30% from last year.

Speaker 1: [10:35] Wow.

Speaker 2: [10:36] So- Wow … things are just kind of off the charts. And as I was saying earlier, the demand for second homes was up 91% over pre-pandemic levels.

Speaker 1: [10:48] Yeah, I

Speaker 2: [10:49] think- That's

Speaker 1: [10:50] just crazy … I think part of that is that people can work from home, and so- Right … they're choosing where they want their home to be. Mm-hmm. So they're willing to have a second home somewhere else that, you know, maybe they have vacant when they're not there, or maybe they rent it out on Airbnb if it's allowed while they're, while they're not there.

Speaker 3: [11:07] Well, is that gonna open up… And Seattle's recovered with the con- the condo market here is doing pretty well again. But, uh, is that gonna open up markets like the condo markets and the town home markets that we've seen kind of flail a tad compared to single family detached homes during COVID? Where if you have a second home, you know, out, uh, like a cabin that's huge, that- Mm-hmm you have space. Mm-hmm. And then I have this, like, two-bedroom condo that's, uh, you know, when I need to commute or whatever it may be.

Speaker 1: [11:39] Yeah. It'll

Speaker 3: [11:39] be interesting to see.

Speaker 1: [11:40] Yeah. I, I think that is kinda how… And this was already somewhat happening before the pandemic happened, where, you know, people that did have to work in city, um, and maybe they did, like, three or four, like, four 10 or 12-hour shifts, um, if their job allowed them to do that, and then they didn't have to be in town for three days, they were already doing this. And I think that that's gonna just become more and more popular if you don't have to be in city. If you only have to come into work once a week or twice a week, and you can do it on back-to-back days, um, maybe that makes more sense. You know, you show up in the afternoon to the city, you stay that one night, you come back to work the next day, you leave in the afternoon, you go back to your other home. Like, that's… I could see that happening more and more.

Speaker 3: [12:28] Yeah.

Speaker 1: [12:29] We'll, we'll just have to see. All right, let's, let's kind of shift to what's going on locally. So Reid just said that the average typical home in nationwide was only on the market for 15 days. Let's look at our area. Um, I mean, we definitely saw an interesting year.

Speaker 3: [12:49] Um- Homes on the market here for an average of 15 minutes.

Speaker 1: [12:52] Yes, 15- … minutes, 37 seconds. Yes. Uh, no. Um, when you break down the stats by counties that make up the Seattle metro area, you'll find that it was slightly more competitive here. Shocker, I know. Uh, so King and Snohomish County, they both, our average days on market was only six days. That's average. That means that there were still homes that sold longer than six days, but there were also quite a bit that sold in less than six days. It's kind of crazy.

Speaker 3: [13:23] Yeah, Reid, you had one where it was, like, listed, let's say on a Thursday and- Oh, man, yeah … and you knew, you knew that offers were due on Tuesday, but then on Friday morning or something, you look and the agent's like, "Oh, we're actually gonna review offers tonight."

Speaker 2: [13:38] Yep. Mm-hmm. They already had three offers

Speaker 3: [13:40] Like, on day one.

Speaker 2: [13:42] Yeah.

Speaker 1: [13:43] Yeah, that's just crazy.

Speaker 3: [13:44] And we had a listing that had a s- kind of similar thing where, uh, Christian, what was it? They, they, how many showings?

Speaker 1: [13:52] Oh, we had, what was it? 82 showings in the first 24 hours we were on the market. Oh,

Speaker 4: [13:58] yeah, and the open houses for that were crazy as well. Were just

Speaker 1: [14:01] stupid,

Speaker 4: [14:01] yeah. How many, how many people did, uh, so we did the open house for that. So how many open, people did you have at your open house, Christian, that day?

Speaker 1: [14:07] Uh, b- uh, probably at least 100.

Speaker 4: [14:09] Yeah, and then I did it the following day and I probably had, like, 70 different groups of people, to the point where I didn't even know- Yeah who was who.

Speaker 1: [14:15] Oh, I had no clue. No, I could not keep track whatsoever. Yeah, yeah. Um, to jump back into what I was saying earlier, so King and Snohomish, they averaged six days on the market. Pierce was only a day longer, seven days on average. Um, and out of all of our listings that we held this last year in 2021, I don't think any of them lasted longer than a week. So it's pretty typical to what we were seeing as well.

Speaker 4: [14:40] Yeah, so, um, just like the rest of the country, home value appreciation increased in the Seattle area year over year. Um, like these guys have been saying, the highest increase was in Snohomish County with a 22.6% increase, which moved the average price from 530 to almost 650 in Snohomish County. Pierce County was right behind Snohomish with, uh, a 17.4% increase. The average price of homes rose from 430 to around 505. King County saw the smallest increase at 10.9%, with the average home price moving from 674 up to 749.

Speaker 1: [15:20] Yep.

Speaker 3: [15:20] Yeah, it's impressive. Uh, 10.9% is still not a small increase. No. Especially when you consider… And a lot of this has to do with the baseline. It start- King County was already expensive.

Speaker 1: [15:32] Yep.

Speaker 3: [15:32] Um, and what happened over COVID, we saw people leaving the city centers, and- Mm-hmm … that's what my data I'm gonna speak about now really demonstrates. Um, we don't have final Seattle data just yet. It's usually- Like two weeks into the following month. Um, but preliminary data looks like Seattle median sales price was about 5 to 6% higher year over year. Again, we'll have final numbers in a few days, and we always do an Instagram post. It's usually, like, the second week of each month for the previous m- month's real estate market data. So definitely follow us, the Awesome Nossum group. Christian does an amazing job. Christian and Shannon, she, she works behind the scenes. She does a- they do an amazing job with Instagram. So

Speaker 1: [16:21] if you like real estate, follow them.

Speaker 3: [16:23] So I went and I pulled… I sat- we have access to something called Matrix, and that's, like, the MLS, the Northwest MLS database, and I went and pulled tons of numbers for King County, and I separated it out based on MLS areas, which is more or less neighborhoods-ish.

Speaker 1: [16:42] Yep.

Speaker 3: [16:42] So looking at this data that I pulled, all areas in King County appreciated year over year, though the lowest area was, uh, Belltown/downtown, and that appreciated. But, uh, it barely did. Yeah. It only 0.01% year over year. That's so funny. Median s- yeah, median sales price w- was, uh, 690… $649,950 in 2020, and it grew a whopping $50- Wow. -to, to a very nice, round $650,000. The highest price growth was in the east side/south of I-90 area, which is Factoria, Newcastle, Issaquah, also where that listing that Christian and Les were just talking about- Mm-hmm … having crazy open houses was located. Median sales price in that area appreciated 31% year over year, going from $900,000 to $1.18 million.

Speaker 1: [17:47] Yeah, that's insane. Wow. Yeah. That's insane, and that's kind of what we saw with that listing, too, is it just went crazy.

Speaker 3: [17:54] Exactly. But it, what's insane is then you look at what Les said earlier with the states with the largest price increases, and Idaho as a state went up 32.2%. Yeah. Now, Idaho, you know, uh, it, it, the population is so centered on just Boise. It's more or less- Mm-hmm … in some, if you look at certain data, it's pretty much urban data, if you really think about it, and this is kind of true- Yeah … for, for that, but I digress. Um, moving back to King County, on average the data follows- The stereotypical pandemic exodus that we've been discussing for two years now. Thank you, COVID. Coronavirus.

Speaker 2: [18:37] Deep cut.

Speaker 3: [18:39] If you know the reference, you're my friend. Yes. Um, the worst performing areas were generally city centers, higher density areas, whereas the suburbs experienced very impressive year over year gains. If you don't understand the logic there, I recommend you go back to all 80 of the past

Speaker 1: [19:00] podcast episodes. Where we go over this in depth.

Speaker 3: [19:01] Yeah. East-

Speaker 1: [19:02] And every single monthly real estate recap where Jason and I go over data.

Speaker 3: [19:07] And every monthly newsletter. And every email. It's in my signature. I have it tattooed on my forehead. Eastside, the Eastside did very well, though, uh, the Bellevue area west of I-405, which is… I love how I said I-405 because that's what the name is on the area, but west of 405- Mm-hmm … which is downtown Bellevue, that was an outlier. Um, they saw only 4.59% price appreciation, uh, by far the lowest on the Eastside. That makes sense. It's urban. It's the downtown Bellevue area of mainly condos.

Speaker 1: [19:48] Mm-hmm.

Speaker 3: [19:48] But if you cross 405 straight from downtown, instead of prices going up 4.5%, you saw prices going up almost 25% year over year.

Speaker 1: [20:00] Yeah. Crazy.

Speaker 3: [20:01] Crazy. And lastly, 15% more properties closed in 2021 versus 2020 for King County as a whole. That does not mean we have 15% more inventory. Uh, like- Not

Speaker 1: [20:13] at all … Speaker 3: i- in fact, not… Yeah, not in any way the case, but more sellers decided to sell. Mm-hmm. Yep. Makes a lot of sense. So that's it for this episode. We covered a lot of numbers. I hope that makes sense. Please go back and listen to any spot that you need a refresher on. If you want to talk one-on-one with us and better understand these things, just reach out. Schedule a strategy session with us online. They're free, totally easy to do. Just go to awesomeandawesome.com/schedule. Super simple. Um, but I think we painted a pretty clear picture of what the market did in 2021. Before we sign off, anyone have anything else they want to add to our little year in review podcast?

Speaker 4: [20:58] I actually do. Ooh. I was reading fr- And this is from CoreLogic as well. Mm-hmm. Um, I was actually reading an article, and last year, the average homeowner across the country gained approximately around $51,000 in equity. Um, Washington State, we are at $93,000. If you're a homeowner, the average is $93,000 in equity in the past year. Wow. Um, and that puts us at number four at a, out of all 50 states.

Speaker 1: [21:28] Wow.

Speaker 4: [21:29] Yeah. Crazy, right?

Speaker 1: [21:30] That's amazing. So owning a home can make sense, huh? Is that what you're trying to tell me? It, it, pretty,

Speaker 4: [21:34] pretty much. Pretty much. So that's a shameless plug. Come to our home buyer class.

Speaker 1: [21:39] Yeah. beersandhomebuying.com. beersandhomebuying.com. And

Speaker 3: [21:43] along the lines of that logic, the biggest myth in real estate is what? That you have to put 20% or more down.

Speaker 1: [21:51] You don't.

Speaker 3: [21:52] So we're talking, you know, what was it, 90,000 in equity?

Speaker 1: [21:55] Yeah.

Speaker 4: [21:55] 93,000. Yep.

Speaker 3: [21:56] Yeah.

Speaker 1: [21:57] Yep. Most people put a 5 to 10% down payment. The majority of them put about a 5% down payment. That's, I think it's 68% of buyers in the Seattle area only have a 5% down payment. That's all buyers, so- It's not as hard as you think to buy. Go to beersandhomebuying.com and sign up for our next home buying class.

Speaker 3: [22:16] We have a lot coming up.

Speaker 1: [22:17] We do. We have two in January. Uh, actually three in January. Three in January. Three, wow. And then we do them- And you- … at least one a month.

Speaker 4: [22:25] And you're thinking about selling too?

Speaker 1: [22:27] Yep.

Speaker 4: [22:27] Hey, that's some good coin.

Speaker 1: [22:29] Definitely. I mean, going to the home buying class is actually how you can learn how to sell your house as well. So, um, I know that logic might not add up if you don't think about it real deep, but basically- Oh, was that- You need to understand-

Speaker 3: [22:41] Was that a slight?

Speaker 1: [22:42] W- no, I'm just saying you need to understand how it, what it's gonna take to buy, and then we can relate that to the strategy to selling. So if you understand the buying side, you can understand the selling side.

Speaker 3: [22:53] Yeah. What better way to know this, your enemy, your, the other side, than to sit in an audience of other buyers?

Speaker 1: [23:01] That's funny. All right. Well, I wanna say to everyone here on the team, the Awesome Nossum group, you guys were awesome. Thank you. For everyone else, I am super excited for all the things we have planned for 2022 with, with us here at the Awesome Nossum Group. Uh, we definitely have some big things planned. Um, we're gonna expand slightly, so that'll be fun. And to our listeners, we wish you all the best in the new year, and please be on the lookout for our next episode, which will include our next most anticipated podcast every year, which is our annual real estate market prediction episode for 2022. Oh, yes. So that'll be out in, uh, towards the end of January, I think, is when we'll actually post that, so. Maybe it's the middle. I don't really know. Reid, do you know when we're gonna post that?

Speaker 2: [23:43] In January.

Speaker 1: [23:47] Awesome. Well, thank you everyone for joining us, and we will see you next time.

Speaker 4: [23:51] Bye. Bye. Bye guys. Happy New Year.