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😮 Homebuyer agreement changes in WA, STEM in Bothell & market moves toward favoring buyers

😮 Homebuyer agreement changes in WA, STEM in Bothell & market moves toward favoring buyers

Check out what's happening in the Snohomish and Seattle area economy this week.

Lisa Bender
November 25, 2023

Happy Saturday!

I hope that you had an amazing Thanksgiving and that your travels are safe over the weekend if you are out visiting family.

This week on The Bender Buzz we have a lot of updates about the recent real estate commission lawsuit that you may have seen popping up in national headlines.

I’m explaining what the lawsuit will mean for consumers (mainly homebuyers!) so that you aren’t left in the dark on your next home purchase.

Speaking of homebuyers, I have some FANTASTIC news for homebuyers this week! The market is shifting and you are going to have more leverage in your negotiations than you have had in several years.

It’s essentially the best time in years to buy a home if you can afford your monthly payment.

Read to the end and I’ll tell you all about it!

— Lisa

🤔 Buying a Seattle-area home? The way your agent will be paid could change

Driving the news: A federal jury in Missouri recently ruled against the National Association of Realtors (NAR) and several large brokerages, spotlighting the longstanding practice of home sellers paying the commission for the buyer’s agent.

This ruling could lead to significant changes in the real estate market.

Details: The verdict, part of the Sitzer/Burnett commission lawsuit, challenges the cooperative agreements (co-op fees) between agents, potentially banning them.

This lawsuit, filed on behalf of 500,000 home sellers, is one of several cases against NAR and other major brokerages.

Why it matters: Consumer advocates argue that the current system limits competition and keeps prices artificially high.

They believe a change could lead to more affordable online options for buyers and sellers, reducing agent fees.

The big picture: Traditional agents, mainly affiliated with NAR, dominate the market despite the availability of cheaper online services.

The ruling may encourage a shift towards these more cost-effective platforms.

By the numbers: In King County, for example, the median home price is $883,000. The typical buyer’s agent commission of 2.5% to 3% amounts to approximately $22,000 to $26,500.

Between the lines: If co-op fees are banned, buyers might need to pay their agents directly, a cost-prohibitive move for many in expensive markets.

Critics argue this change could disproportionately affect veterans, minority buyers, and first-time homebuyers.

What’s next: The real estate industry is waiting to see how this ruling will affect agent fees and the home-buying process.

Already, Washington State and the Northwest Multiple Listing Service have made changes to enhance transparency and consumer choice.

The bottom line: This case has the potential to disrupt the traditional real estate model, promoting more competition and possibly leading to more diverse and cost-effective options for homebuyers and sellers.

However, its impact on the market, especially in high-cost areas like Seattle, remains to be seen.

🎥 $1B Realtor Lawsuit Explained: What This Means For Washington Home Buyers (Everything A to Z)

The main thing you need to know about the recent lawsuit is that buyer agreements are going to change. I'm covering everything you need to know about these changes in this video.

🔬 University of Wash. Bothell and Cascadia College celebrate new STEM-focused Innovation Hall

Driving the news: This week marked a significant milestone for the University of Washington Bothell and Cascadia College with the inauguration of their new facility, Innovation Hall.

Located northeast of Seattle, this $79 million complex is dedicated to STEM (Science, Technology, Engineering, and Mathematics) fields, offering advanced resources for students in biology, chemistry, computer science, physics, and various engineering disciplines.

Details: Spanning 80,000 square feet, Innovation Hall houses 15 science and engineering labs, 13 classrooms, 2 student-directed learning labs, and 34 faculty offices and open workspaces.

Its design promotes collaboration between the university and the community college, as well as across different academic departments.

The hall's shared and separate spaces for the two institutions foster an environment of joint learning and innovation.

Why it matters: The opening of the Innovation Hall is a crucial step in enhancing the educational facilities and opportunities available to students in the region.

It represents a significant investment in STEM education, a field that is increasingly vital in today's technology-driven world.

The big picture: The project underscores a growing trend in higher education to create spaces that are not only functional but also encourage cross-disciplinary collaboration.

This approach is seen as key to fostering innovation and addressing complex challenges in science and technology.

What’s next: With its official opening set for January, the Innovation Hall is poised to become a hub of STEM education and research in the region.

Its impact on student learning and collaboration among academic departments will be closely watched.

The bottom line: The University of Washington Bothell and Cascadia College's Innovation Hall is more than just a building.

It's a testament to the value placed on STEM education and the future of collaborative learning and innovation in higher education in the greater Seattle and Snohomish area.

🏠 More Than One-Third of Home Sellers Are Giving Concessions to Buyers

Driving the news: With a current climate of climbing mortgage rates, 35% of U.S. home sales incorporated seller concessions in recent months, a slight change from last year but a significant rise from the 27.6% observed two years ago.

Details: In a market recalibration due to mortgage rates hitting a 23-year peak, sellers are increasingly leveraging concessions to entice buyers.

This is a shift back to "normal" after the competitive landscape seen during the pandemic.

Concessions, as reported by Redfin agents, span from repair contributions to closing cost aid, excluding direct price reductions from listing negotiations.

Buyers are more empowered to demand concessions in these market conditions. They are wary of high purchase costs and are quick to walk away if terms don't meet their expectations.

The data suggests a cautious buyer sentiment, with a spike in deal terminations to 16.3% of homes under contract in September, the most since rates rose sharply in October 2022.

The rise in concessions is also influenced by a notable presence of new construction homes in the market, accounting for 30.6% of single-family homes for sale in the third quarter, driven by builders' efforts to offload inventory amidst a drop in listings by individual homeowners.

Yet, the market still experiences pockets of competition due to historically low inventory, partly because many homeowners opt to stay put, maintaining their low mortgage rates.

Why it matters: This concession trend shows a market adaptation where sellers are strategizing to navigate the cooling interest from buyers, who are contending with the financial squeeze of increased mortgage rates.

The big picture: The housing market is resetting from an extreme seller's market to a landscape where buyers are regaining negotiation power.

What’s next: As the market adjusts to the changing economic landscape, the evolution of seller concessions will be a key indicator of future real estate market health and dynamics.

The bottom line: It's a better time to be a home buyer than it has been in years if you can afford the monthly payment.

📊 Our Current Local Market Data

The real estate market in Snohomish County, WA is currently cooling off with the fall weather. However, interest rates and lack of inventory have us locked into a seller’s market for the foreseeable future.

If you want to buy a home in this market, you’ll need a solid strategy for searching and making strong offers. Your home search could take a while, but you’ll have to move quickly when you find a home you like.

I’m staying on top of the market daily and there are even financing options that can help you purchase at a lower rate.

If you ever have questions, don’t hesitate to ask.