9 Massive Problems with the Western Washington Property Market (& 3 Tips to Navigate Them)
I’ve talked a lot in my videos and blog posts about what’s happening in our market, where are the best places to buy, and of course, what an incredible quality of life living in Kitsap offers. The market is hot, so I wanted to offer some information for those who are considering building their own home in the area… and I ran into an issue that will affect the whole market—buyers, sellers, homeowners—us all.
If you’ve been considering buying in Kitsap County, you need to pause now to read this article. We’ll take a look at how to tackle the market, the problems, and I’ll give you my best tips as a realtor here to ensure you get a property in a location you love.
Is it difficult to buy in Kitsap County? What problems are there?
- Lack of Homes on the Market
One of the biggest issues is that there’s currently no inventory in Kitsap County, Washington, and even across the country. There are 370,000 fewer homes on the market nationwide than what we’d normally have, which creates a knock-on effect.
Builders stopped building at the beginning of the pandemic, so their building inventory is gone. Now that they’re trying to rebuild, there’s a huge lumber shortage. The cost of softwood materials has gone up over 80% in just the last nine months, which means builders have to increase their prices. This issue means that there’s no longer the same incentive for buyers looking to buy a new build.
2. Fewer New-Build Incentives
First-time buyers trying to purchase a new build used to be able to get incentives to make the purchase easier, such as not putting as much money down with an FHA loan. Those incentives made it possible for many to buy, but those incentives are disappearing.
3. Higher Likelihood of Being Outbid
Subsequently, there’s more competition for the available properties, especially in a location like Kitsap County, which is so popular. Buyers looking for houses for sale in Kitsap County are getting outbid numerous times, having to put a lot of extra cash on top of their down payment and waiving their appraisal. This is a problem for everyone, but if moving to Kitsap County is already going to stretch your budget, moving here can suddenly become incredibly stressful.
4. People are Waiving Their Appraisals
Let’s circle back to a point I made above. So, what happens when you waive your appraisal?
If you are trying to purchase a resale home, waive appraisal, and that home doesn’t make an appraisal, you’ll have to make up the difference. So not only are you putting your 20% down, but you may also be $10,000 – $30,000 (or more) out of pocket.
5. Sellers are Reluctant to Sell
As a buyer trying to move into the area, you must think, “Everyone there must be keen to sell and make a profit!” Well… no. You see, unless you’re planning to move out of the area (and very few people do), you’re in the same situation as everyone else. Except this reluctance is causing the market to shrink even more.
6. Renting First Is Expensive
So, you may think that if the market is in a bad place, you’ll just rent until you find a property you want to buy. And yes, this is a good idea, but you should be aware that rental values always rise with the house prices, so rental prices have gone up. Depending on your financial circumstances and where you choose to rent, this may eat into the money you have available to buy.
7. You’ve Got to Make a Decision Fast
The houses sitting on the market are either overpriced or have a problem the average buyer isn’t willing to overlook. Unless you’re willing to invest a lot of money to repair it, you have to be ready to jump on any property as soon as it comes onto the market.
8. First Time Buyers Are Inheriting Bigger Problems Than They Can Fix
It’s never a bad idea to buy a home that could do with a little bit of work, provided you are up for the challenge and know exactly what needs repaired. The problem is that many first-time buyers are forced to take on problem properties just to get into the area and then find the problem costs more to fix than they expected.
Many first-time buyers often run into problems they have to pay for, potentially landing them with debt. This is tough as a first time home buyer because the best way to grow wealth is to buy a home, get equity in a home, sell it, move up and repeat. If their first property swallows their cash, it’s going to be a long time before they can realize the equity in the property.
9. Increasing Property Taxes & Forbearance
Rising home prices mean rising property taxes, which may force less affluent families out of their homes. Many homeowners went into forbearance, and they need to start paying it. Unfortunately, we’re likely going to see more properties coming onto the market from those who are forced to move – either from an inability to afford to live there or, worse, through foreclosure. As a real estate agent, this breaks my heart. My job is to help people find and build lives in homes they love – knowing the opposite is happening hurts.
So, how do you navigate the market?
I know, that’s a lot of doom and gloom – especially that last point. But I always want to be honest, so I wanted to share these points with you so you can go into your move with your eyes open. I love living here, and the people that move here adore it too. If you know you want to move to Kitsap County or are looking for houses to buy in Kitsap County and already live here, make sure you read the following tips to get in the best situation possible in a house and area you love.
1. Get Your Financing In Order
Get your pre-approval, and don’t use an out-of-state lender; go local. They’ll be able to help you in this process. If you’re getting multiple offers and using an out-of-state lender, those listing agents are going to throw your offer to the side. They’ll show it, but they’ll tell the client, “This is an out of state lender – I don’t want to deal with these people.” Or, “there are going to be issues”.
The same applies to big brand lenders, unfortunately. I hate to say it, but it’s reality.
2. Get Your Current Property Under Contract
Buying a house is thrilling, and it can be tempting to start looking for your new home as soon as you decide to move. But you need to consider the market and what you can offer the seller – if you haven’t sold your property and someone bids the same as you and is ready to go, they’ll get the home. With a hot market, very few sellers are going to wait for your house to sell. Get your ducks in a row and make sure your financing is together.
3. Be Clear on What You Want and Be Ready to Put in an Offer
Once you’ve got your mortgage pre-approved, you’ve got a buyer for your home, and you are clear on what you want from your new home (and are realistic about your budget), you’ll be ready to put in an offer. It’s scary to make a big decision fast, but if you are clear on what you want and know you’re ready to go, that decision won’t be scary. You can start talking to me at any stage in the process – as soon as you’ve got everything ready to go, I can help you secure a property you love.
The purpose of this article is not to scare you but to arm you with the knowledge that will help you make the right decisions. Buying a new home is always a challenge, even when everything goes right, but don’t be discouraged. When you decide to move to Kitsap County and other areas of Western Washington, I want you to win. I want you to get the quality of life we all enjoy here.
I’ve helped dozens of families move to Western Washington, and I can help you too. I have my process dialed in, and I can help you with every step of the transition. If you’re looking to buy and want some advice, please reach out to me by filling in my contact form or call me at 206-940-4039. Seriously, feel free to reach out even if you just have a few questions. However you want to get hold of me, I’ve got your back when moving to Kitsap County.