What Will Be Different in 2019 Washington Real Estate – By, Jim Clifford
Because I have been in the business for many years and seen both up and down economies it is easy to draw on that experience to see trends. Some things change some things stay constant. At the start of 2018 there were 28045 sales associates in the local MLS. We are now just over 29500 associate or an increase of 1500 licensed sales associates. What is interesting is that the average transaction per sales associate is almost the same as it was 10 years ago, 20 years ago and 30 years ago. That number is about 1/3 of a transaction per sales associate per month, or about 4 transactions per year.
What has not remained constant is the average sales price and the cost of buying or selling a home. In 1990 the average cost to sell a home was approximately 9%. Buyers usually had to have 2.75% of loan amount in addition to their down payment. Today even though the average listing agent and selling agent commission percentages have fallen, the seller’s cost has increased to 10%. Buyer cost has increase to about 3.5%.
It makes sense that the commissions percentages paid to real estate agents have decreased. The cost to market homes has gone down. Exposure to millions or even billions of potential buyers is available at a fraction of the cost of marketing 20 years ago to a potential of a few thousand buyers. More transparency of the process of selling and buying has created better systems for getting home sellers and buyers to completion of the transfer of ownership.
What does not make sense is that the State of Washington continues to increase the tax percentage of home sales price even as the prices have climbed. Seller’s do not pay on their “net” sales price but on the gross sales price at a tax rate of just under 3% which varies slightly by city or county. When I started in real estate is was 1.25%.
What will be different in 2019 for buyers? They will have more homes to view and more information about the homes available. We have used 3D video over 3 years, and each year enhancements make it better and easier for potential buyers. It creates the floor plan and now we can virtually create how the home will look with the style of furniture you desire. Buyer’s will also have more information about financing with more options of types of loans, assisted down payments and full understanding of total cost of buying. In addition, the market place will provide more options for buyers to purchase homes with either limited real estate agent services or none at all. Potentially this can reduce the cost of the home.
Seller’s will have more options in 2019 with increased number and variety of marketing plans that allow a seller to choose marketing they want at different levels of services and cost. Agents that have only one service program for sellers or buyers are finding themselves with fewer clients. The transparency of homes sales is eliminating the mystery of the process and allowing buyers and sellers to participate more in the process if they choose. This trend will increase in 2019.
To find out more about buying or selling real estate contact Jim Clifford at 253-826-7513 or email at [email protected]