Had such a lovely day at our local Farmers Market Saturday! Maybe it was the temperature, the sunny day, the vibrant colors, the community spirit or all of it combined, but it was FANTASTIC! We purchased fresh green kale, sweet carrots and vibrant yellow cauliflower from Farmhouse Organics. Sauntered over to Gloh and had Hilary whip us up the most incredible smoothie of superfoods, coconut water, fresh raspberries and dates!
But wait, there was more! We had to taste the wonderful Botanical Kombucha from iggy's as well as their famous Raw-Fermented Kraut's…simply delicious and they are bar none the nicest, most hospitable bunch of young adults! Then it was off to nibble on the best goat cheese I've ever tasted in my life from Mystery Bay Farm. I had to buy the honey flavored and the thyme and white pepper! Simply delicious! We sat in the warmth of the sun listening to Ranger and the Re-arrangers playing wonderful music and just taking it all in.
We ran into friends and neighbors, watched dogs play, watched people play for that matter and simply enjoyed a perfect day! We left feeling truly blessed that we have such a vibrant, successful, farmers market right here on our beautiful island!
There's still plenty of time to go and with this great weather…what are you waiting for!
2014 Summer Market
April 12 through November 15
Hours: 9am – 1pm
Town Square / City Hall
Always a good time to be had at Bainbridge Islands annual Rotary Auction! Really its the social event of the season! A great way to catch up with friends and neighbors while getting great deals on everything from balls to garden gnomes.
A great place to update your recreational supplies! Every Islander should experience this phenomenon known as the "Auction" at least once. The people watching alone, is worth it! No lie, I've witnessed mothers directing small children with extensive play diagrams of "goods to get" that would impress any professional coach.
In the end A LOT of money is raised and the volunteer organization is impressive. These Rotarians are dedicated!
Waiting For Inventory To Blossom
The Heart of the Matter
Last year’s 1st Quarter in Review highlighted the increase in the number of homes sold during that quarter over the same period in the previous year. We probably could have made a similar claim this year because the demand was there, but the number of homes sold actually dropped this year compared to last. (We sold 69 homes in the first quarter of 2014 versus 80 in 2013 – a 14% drop). The reason? Low inventory. You have probably been hearing this (at least if you have been listening to us), so we thought we would take this opportunity to explore it in a bit more detail, as inventory numbers have been defining our market in recent quarters.
The Power of Buyers
Buyers were precious commodities in 2008, ‘09, ‘10 and even 2011. The growing pool of buyers was concentrated at both ends of the market during 2012, leaving the middle of the market languishing. This improved in 2013, creating a more balanced and, for lack of a better word, healthy market. As “normalcy” continued to assert itself after our recession, the pool of buyers continued to grow but the number of homes coming on the market did not grow along with it. Buyers today are smart, well informed and pretty disciplined in going after (which sometimes means waiting for) what they want. They are willing to rent or stay where they are until the type of home they want comes onto the market. When they see it they move – quickly. There have been instances where we get five new listings in a week and four of those five are sold two weeks later. The problem: we would normally see ten new listings in a typical week, so the competition among those motivated buyers is fiercer than usual.
If you look at the bottom line of the stats, you see the “available” inventory. These are our active listings; the buyers’ cu rrent choices. Keep in mind this is the total number available from $0 to $10,000,000 and includes “pre-sales” – homes not even built yet! With a mere 73 available listings over all price ranges, buyers do not have many choices. Even at the market peak of 2006, there were 93 homes available in the first quarter (27% more than today).
Chickens, Eggs and Pricing
Sellers continue to play a crucial role when it comes to inventory, because once they sell they enter the buyer pool and find themselves facing the same limited options as all other buyers. We hear clients ask over and over again, “If I sell, where will I go?” This so-called “chicken and egg” phenomenon is real. Good real estate agents have strategies to mitigate this problem (for example, this is a good market for contingent sales), but it is a stumbling block for many. Also, many people want to downsize and there simply aren’t many homes on the island that meet the requirements of people looking for homes they can live in through some of the transitions they will be facing in the foreseeable future. So pricing strategies are as important as ever. Prices are recovering rapidly from their recession-era lows, butare still far from the peaks we saw in 2006 and 2007 (and even into 2008). People who bought Bainbridge properties between 2005 and 2008 may very well still be upside down. If they aggressively financed their purchases, taking a paper loss may not even be an option as they may be “short” (with debt that exceeds current value). Other owners are simply waiting for the prices, and their equity, to go back up.
Time Will Help
As we’ve seen with most market eras, time will correct many of these challenges. Prices are going up at a healthy pace and will lure more sellers back to the market. More builders are re-entering the market and some already have mature buyers in mind. The risks, however, are still real. The interest rates may go up more (they are already 1-1.5% higher than their lowest levels) and rising prices may begin to shut certain buyers out. One of the undeniable benefits of our real estate correction was that Bainbridge became affordable to families once again; rising prices may gradually force them back out. It is a very interesting, complicated and exciting time, depending on where one is in the market.
Condominiums and Land
The condominium market is also very interesting right now. There were 21 sales in the first quarter, up 40% from last year’s 15. Of those 21, 17 were below $500,000 and four were over $1M with nothing in between. Land sales are up 30% from last year and developers are actively looking for potential sites.
Beyond the Island
What’s going on in our neighboring markets? As our market trends usually lag behind Seattle’s, North Kitsap traditionally lags behind us. We’re pleased to report that North Kitsap had a strong first quarter, with sales up 12.5%. Their average price was positive although me-dian price was down 3.5% (2014 first quarter median price was $262,750 versus the 2013 median price of $271,900). That being said, they are currently experiencing a predominately “seller’s market,” which will help bring price points up. So things are getting exciting and looking encouraging throughout the region.
The Ebbs and Flows of a Tidal Market
Riding the Waves, Up and Down
The expression “in like a lion, out like a lamb” seems to apply to our 2013 market. At the end of the first half of the year, we were up an impressive 21% from the 2012 numbers of homes sold. In the third quarter, that statistic cooled to 15% over last year. By the end of the fourth quarter, our numbers had softened again and we ended the year at just 7% above last year’s stats. In terms of the quantities of homes sold, we went from 93 in Q4 2012 to 77 in Q4 2013 – a decrease of 17%. When compared to the 2008
fourth quarter sales of 41 homes, this year’s 77 sales do not look so bad, but we were a bit perplexed about why the market did not maintain the momentum it enjoyed earlier in the year.
What’s Out There
The obvious and accurate key to what changed the trajectory of the 2013 market is inventory. The average inventory of active homes (homes on the market and not under contract) during the 2012 fourth quarter was 144 homes, and that number dropped 30% in 2013 to 100 homes. We ended 2013 with 76 active listings and by January 6th we had 70. These are historically low numbers and low inventory has a very damping effect on sales. For many buyers, real estate is the largest investment of their lives so a home needs to speak to them in order to inspire them to act. Without choices, they wait (as they should!).
Sellers and Buyers; Prices and Choices
Many sellers wait to list their homes for the same reasons buyers wait to make offers: they are not going to put their houses on the market if there are no choices waiting for them to transition to. Also, in general, prices have not rebounded for some segments of the marketplace. During 2011 and 2012, when we began to move out of the recession, the recovery was led by homes under $600K. Our “middle market” ($600K to $900K) made gains this year but our upper market really struggled. (We saw a 28%decrease in homes over $1M between 2012 and 2013.) These are not recipes for definitive general upward price movement. Buyers,although present, are not exhibiting a great sense of urgency where they would have a tendency to push prices higher faster. The end result is modest gains that are not enough to bring some sellers back into the marketplace, as they are still waiting for higher prices (and choices).
There is good news in both the condominium and land categories, both of which showed solid gains in 2013. Condominium sales were up 16% with average prices growing 11%. In 2012, there was only one sale over $600K, while there were three in 2013. This included two sales of million dollar condominiums in 2013 (and one already this year) – the first condominium sales in that price range since July of 2010. Condominiums are also subject to the lack of inventory, with only 18 active listings as of this writing.
A Busy Time for Land and Development
Land sales were up 30% in 2013, which was part of a post-correction breakout year for new construction. The first phase of Grow Village is sold out. Four new homes were listed on Ruys Lane, and they have all sold (all four went under contract in a period of 22 days!). Timberbrook on Solana Lane has finished two of their 10 homes and both are sold. Burlingame Court has sold half of their six homes. The Housing Resources Board CLT project off Ferncliff is sold out. These sales represent a broad spectrum of traditional family homes, urban cottages, affordable homes and “edgier” modern homes. The variety is very island-like and the market response is very clear: we like it!
All in all, 2013 was a very good year. As we kick off 2014, there is a general positive buzz around here. We believe inventory is coming and the phone is definitely ringing. Our year-end tally of 414 homes sold is the most since 2005 (and remember there were only 187 sales in 2008!). Condominium and land sales also improved by a statistically significant amount, with sales num-bers exceeding all the years since the market peaks in 2006 and 2007. Prices in general held their own with some market seg-ments improving. New construction has returned (with a bang) to our marketplace. With the outlook for 2014 promising more of the same, we look forward to our future on this beautiful island.
Bainbridge Island Single Family Homes Sold 2013
*As of January 2014
It's a new year and I'm declaring that it will be an outrageous one! In the interest of seeing the positive expand I thought, why not go for a big, positive word like "Outrageous"! I can't wait to see that expand and what incredible things come from it. Personally, it's going to be exactly that… My grandmother turned 100, my son is turning 18 and going off to college and my daughter turned 13, my husband starts a new career with Amazon and we are so excited about it…lots of new chapters for sure!
What does your year look like? Wouldn't it be great to look at 2014 and see all of the new changes as positive, blessings a plenty and simply outrageous! I'm choosing to go into 2014 with a positive outlook, coming from a place of plenty, rather than not enough. It feels so great!
In fact one thing I've started is a "2014 Blessings Jar" or "Year in a Jar". It's very easy; simply get a a jar, any jar will do, slap a label on it that is colorful and inspiring, maybe add a ribbon and get to writing. Anytime you feel like it was a great moment, blessing, a gift, accomplishment, LOL moments, etc. write it on a slip of paper, fold it in half and stick it in the jar. Won't it be fun to read them all next New Years Eve! It's a great way to remember even the smallest of things that brighten your day! That's just one of many things you can do.
When I find myself feeling gloomy, usually around this time of year, I try and do things to bring a bit of light in and beat the blues.
-Go for a walk. Breathing in the fresh air and taking a moment to appreciate this beautiful Island really clears my head. Ask a friend to join you and it becomes a great way to catch up! Be active.
-Meet a friend for coffee/tea or a glass of wine. People need people and catching up with a friend is great therapy!
-Help or give to someone in need, this is my favorite. It takes you completely out of "your stuff" and you gain so much from the give or help. It doesn't need to be anything grandios, it can be a simple smile to a stranger, pay if forward in the Starbucks line and treat the person behind you without them knowing, help someone to their car with groceries, tell someone they look beautiful, drop a family member a hand written note just to say "I'm thinking of you". There are so many ways to brighten someone elses day and you'll find that it brightens yours as well!
-Volunteer in some capacity; at the senior center, library, church, school.
-Create something; try a new recipe, draw, paint, scrap book…just be creative!
-Put a bouquet of bright fresh flowers on your kichen table. I love having this in my home, especially on dreary rainy days. When my nest is cheery I'm happy!
For me, being around other positive people energizes me! So get out there, get involved in your community and then sit back and feel the light come pouring in!