Yelm’s housing market has increased by 25.6% since the COVID-19 pandemic started as the median sale price for homes has ballooned.
Theresa Bjorke of Keller Williams Realty said in pre-pandemic times realtors expected to see about a 4% growth in the market in a given year, but now, it’s up to 25%.
“That’s in sales,” Bjorke said. “I have people who just bought their homes in 2019, and they’re walking away with over $100,000 after fees. It’s awesome for the sellers and it just shows how much growth there’s been since I first started.”
Though Bjorke’s office is in Puyallup, she said she does about 35% of her business in Yelm and considers herself an expert on the city’s housing market.
“I actually started marketing Yelm when I first started real estate back in January of 2019,” Bjorke said. “It’s heavily military and that’s what I go after, is military clients. That’s because I’m a military spouse and I love military (clients). I love getting them a home. And then they turn around and sell the home much faster than just your average couple.”
In March 2020, the median sale price for homes in Yelm was $327,500. Now, it’s $455,000, according to Bjorke.
There are a couple reasons for the growth, she said, namely low interest rates and cash buyers.
“Interest rates still are at historic lows,” Bjorke said. “When my parents and grandparents were buying a home, they were paying 28 to 29% interest. Right now, we’re still sitting around a 3% interest rate. So buyers who would never have been able to buy a home, when you add in interest rates, can now buy a home.”
When interest rates are low, she said, it brings a lot of buyers into the market, which then drives up the prices.
And people living in King County are moving south and buying homes for cash in Thurston County, she said.
“Houses are so expensive in King County, and with so many employers going virtual, (people are) able to sell their homes for a ton of money right now, and move down into Thurston County and pay cash,” Bjorke said. “If they want that house, they are going to go for it. Say that house is only worth $400,000, but this cash buyer really wants this house and they’re now offering $500,000. Now that’s the cost.”
In June and July, houses were selling on average 105.8% higher than their listing prices, with September seeing an increase of 104.2%.
Supply has also seen a deficit, which drives up the prices.
“I think it was right before the summer when we had less than a month of inventory,” Bjorke said.
Experts say the rate of growth will continue for the next few years, she said, and while that’s great for sellers, it can be a pain for buyers.
“Because I represent military families, I’m saddened because their cost of living (pay increase) doesn’t go up as fast as civilians’ do,” Bjorke said. “So it’s affecting them and the quality of home they can buy.”
Before the pandemic, buyers could get a brand new home for $450,000, she said. Now, they’ve got to settle for a house that’s been on the market for a while, often without upgrades, to make that budget work.
“It’s great for sellers,” Bjorke said. “We own a home in Bonney Lake, and we bought our home for $600,000 in April 2020. I can list my home for $800,000 all day long.”
If she wanted to move to Yelm this month, she’d see an almost $350,000 return if she bought at the median sale price.