A look at the first quarter real estate market results

Posted April 14, 2022 at 11:56 am by

Mer­ri Ann Simon­son sends along an update about the state of the San Juan Island real estate market.

This seller’s mar­ket con­tin­ues to be very strong. The first quar­ter results in San Juan Coun­ty and on San Juan Island were as expect­ed for a first quar­ter. Per the NWMLS, the dol­lar vol­ume in San Juan Coun­ty was $87,735,644 with a total of 88 trans­ac­tions. The num­bers reflect a 7 per­cent increase in dol­lar vol­ume and a 34 per­cent decrease in the num­ber of trans­ac­tions as com­pared to the same peri­od in 2021.

For San Juan Island the trans­ac­tion vol­ume was $36,984,387 with a total of 39 trans­ac­tions. This was an 8.5 per­cent decrease in vol­ume and a 40 per­cent decrease in num­ber of trans­ac­tions. Orcas Island’s vol­ume is dic­tat­ing the Coun­ty num­bers as San Juan isn’t con­tribut­ing at the same level.

It is very clear in both the Coun­ty and on San Juan Island that the prices have increased con­sid­er­ably and there­fore few­er num­ber of trans­ac­tions can cre­ate vol­ume greater than the same peri­od in 2021 for the Coun­ty and with a slight decrease for San Juan Island.

It is also very clear that the lack of inven­to­ry is hin­der­ing both vol­ume and num­ber of trans­ac­tions. As of March 31, San Juan Coun­ty had a total of 138 list­ings for all types of prop­er­ties. The Coun­ty had 41 pend­ing and 97 active list­ings. This is a 36 per­cent decrease in total list­ings, a 50 per­cent decrease in pend­ing list­ings and a 28 per­cent decrease in active listings

For San Juan Island, the decreas­es were 44 per­cent in the total inven­to­ry, 39 per­cent in pend­ing and 50 per­cent in active listings.

As agents, we all have ready, will­ing, and qual­i­fied clients want­i­ng to pur­chase but they have been unable to do so for var­i­ous rea­sons, the most com­mon being, inven­to­ry and selec­tion. I assure you my buy­ers aren’t being picky, but they just can’t get in a posi­tion fast enough to make an offer on the homes that are suit­able for them.

Spring has brought some new list­ings to the mar­ket as sell­ers can spruce up their curb appeal and agents are pro­cess­ing their annu­al show­cas­es. How­ev­er, if the prop­er­ties are priced some­what close to mar­ket, they are being placed under con­tract with­in 10 to 15 days, often with mul­ti­ple offers and esca­lat­ing prices.

Due to how fast prop­er­ties are going pend­ing, we are not mak­ing any head­way for increas­ing the amount of inven­to­ry. We have been on a steady decline since May 2021.

It is also quite pos­si­ble that the cur­rent lev­el of infla­tion, spec­u­la­tion over increas­ing mort­gage inter­est rates, and the war are caus­ing uncer­tain­ty. Some buy­ers may have recon­sid­ered or post­poned their pur­chase in the islands. Some may have become frus­trat­ed due to the poor selec­tion. This will also have an impact on our vol­ume and trans­ac­tion num­bers as well.

This is just the first quar­ter of the year and his­tor­i­cal­ly it is always a volatile time and not a clear indi­ca­tor of what the next three quar­ters will produce.

Most of our sell­ers are in the age group of 65 to 85 and relo­cat­ing off island due to their desire to live clos­er to fam­i­ly and/or major med­ical facil­i­ties. Now we can also add frus­tra­tion with the fer­ry sys­tem to the list. There­fore, I under­stand why some own­er-occu­pied sell­ers are hes­i­tant to list, even when we have prece­dent set­ting prices. Unless a sell­er is mov­ing in with fam­i­ly mem­bers or a care facil­i­ty, it is very expen­sive to find replace­ment prop­er­ty in most areas in the nation.

Many of the new list­ings orig­i­nat­ed were invest­ment prop­er­ties or second/third dwellings for the prop­er­ty own­ers. This is a more moti­vat­ed group will­ing to cap­i­tal­ize on the extra­or­di­nary pricing.

Bot­tom line, we have a small­er pool of sell­ers that will con­sid­er list­ing at this time. We have also had three incred­i­ble vol­ume years that prompt­ed many of the prop­er­ty own­ers to already sell and move on.

Let’s place this into per­spec­tive — we have rough­ly 20,400 tax par­cel num­bers in San Juan Coun­ty, and of those parcels only around 140 are for­mal­ly list­ed with an agent. (Please note that some of the list­ings have mul­ti­ple tax parcels num­bers so the per­cent­age of list­ings to the total is not able to be cal­cu­lat­ed accu­rate­ly.) Clear­ly, not every­one wants or needs to leave or take advan­tage of the cur­rent pricing.

If you are con­sid­er­ing sell­ing in the next year or so, don’t wait. Buy­ers are moti­vat­ed and very coop­er­a­tive. If you’re a buy­er, you and your agent must be aggres­sive. Com­pete to the best of your abil­i­ty but don’t get your­self over-extend­ed in a mul­ti­ple offer sit­u­a­tion. As always if you need addi­tion­al infor­ma­tion, please be sure to con­tact one of us. To read all our past mar­ket updates and indus­try relat­ed arti­cles or view our lifestyle videos, please vis­it our blog.

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