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Jennie's Market Intel - February 2024

Jennie Wetter February 21, 2024
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We're up, we're down, we're up again, wait, we're heading in which direction? Welcome to our crazy economic news, and therefore our crazy interest rates. That said, as discussed last month, real estate is local, so despite stubborn rates, the greater Gig Harbor market has continued to increase momentum as we head toward spring. Let's dive in.
The Fed held rates steady in the Jan 31st meeting, but Powell's comments after weren't exactly what we wanted to hear. “Inflation is still too high,” he cautioned. “Ongoing progress in bringing it down is not assured, and the path forward is uncertain." This was confirmed by the CPI data released on Feb 13th, showing inflation at 3.1% year over year and up 0.3% in Jan vs Dec. This news, in practical terms, means the Fed is now far less likely to begin cutting rates in the next couple of months, but instead is targeting cuts sometime this summer (fingers crossed) or fall.
I would call it a slight setback to our hopes of being able to watch mortgage rates come down at the same time as the spring market heats up. This news may keep would be sellers on the sidelines for a bit longer. Recall the data from last month...we need more listings to keep up with the increased buyer demand and the most recent data through 2/15 is showing just that.
In January and especially thus far in February, there has been a significant increase in the number of pending sales on a daily basis, compared to new listings in Greater Gig Harbor*. My most recent listings have sold within the first weekend, and one had 5 offers. (It will close next week for well over the list price.) To date in February (2/15) there have been 40 pending sales. Compare this to December when the entire month we had only 39, and in January a total of 53. We're at 75% of January's total after just 15 days. In December there were 124 active listings, today just 111.
This chart depicts the narrowing between the number of total active and new pending listings each month since September 2023. (Noting Feb data is only for 15 days)
What does all this mean?
One important thing to note in looking at Median or Average Sale prices is that Greater Gig Harbor* is quite diverse. The average sale price in Gig Harbor Proper* (includes Fox Island, excludes Key Peninsula) was $822k in January and on Key Peninsula it was $579k. If you're a buyer willing to travel across the Purdy Bridge and be slightly further from town, there is more opportunity to snag a home that has been on the market a bit longer and you'll get more bang for your buck. In Gig Harbor Proper*, the competition is quite stiff at just about every price point under $2m.
Buyers - Get your ducks in a row and be ready to jump when you see the perfect house. It's unlikely to last long. Don't delay on a pre-approval and please, use a local lender. As top listing agents, we've worked with tried and true local lenders many times and we trust them. If they vouch for you, it gives you a leg up in a competitive situation. If you find "THE" one, you may need to do a preinspection and consider shortening or waiving other contingencies to be the successful buyer.
Sellers - You don't need to wait for "the perfect time" to sell your house. It's a Sellers market in every price range, despite the interest rates, and buyers are waiting in the wings for homes to pop onto the market. Interest rates won't likely come down until later summer or fall, so don't miss out on this season.
Sellers, you already know its my soap box, but I'll say it again, Presentation is EVERYTHING! A well prepped and presented house WILL sell the fastest and for the most money. If you're willing to spend for tasteful updates, they will absolutely attract the highest prices. If you can't, that's ok, as we can coach you to make the smartest investments that will still give your home the WOW factor buyers need and want to see to fall in love. And, we have the resources (trusted contractors and $$ if need be) to help you get there!
If the ups and downs of the economic news and interest rates tell us anything, I think they are reminding us we're in for a wild ride for the foreseable future. "Normal" seems out the window, perhaps for good.
For all these reasons, it's infinitely more important than ever to choose to work with a trusted LOCAL broker who specializes in, and has had success, in THIS area. You won't be served by a broker who doesn't have intimate knowledge of this market and experience successfully navigating transactions to Closing.
As one of the top brokers in Gig Harbor year after year, you can trust me and my team to help you achieve your goals. Call, text, or email anytime if you would like to talk further!
* Greater Gig Harbor includes Fox Island and the Key Peninsula
* Gig Harbor Proper includes Fox Island but not the Key Peninsula

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