What’s In Store for Seattle in 2016?

Each year I take a look back on the Seattle real estate market and consider what is coming up in the months to come. Here is a snapshot of my 2016 predictions for Seattle’s real estate market:

PRICES: December’s data is not yet available, but median residential home prices in Seattle have risen 13.1% over 2015. That is a significant increase! I don’t expect 2016 to have an increase quite so strong, but I do expect there to continue to be a more moderate increase since we are starting from a higher spot. Housing inventory will continue to be a challenge and a driver in our market, especially as jobs at Amazon, Google, and other tech industries continue to grow and fill the office space available. Although there are new projects and housing available, it will continue to get consumed quickly. Therefore, I predict Seattle home and condo prices to rise between 8- 10% over the next year.  They rose from 2012 to 2013: 11.2% and 2013 to 2014: 7.4%.

AFFORDABILITY: I do expect this will be a very hot topic in 2016 especially in Seattle. The areas around South Lake Union, Capitol Hill, Queen Anne, and Belltown will see the highest demand. These are already areas where rent – and prices – are soaring, and the people who are moving in for work may be priced out. First time homebuyers will be priced out of many of these areas (as well as renters if rent increases faster than wages). Therefore, they may be looking in neighborhoods just outside of there (such as Ballard, Greenlake, Leschi, etc) and look to mass transit.

INVENTORY: There were 1,133 homes and condos available for sale last November. This year there were only 739 – a 34.8% decline. The average days on market for a home or condo sold October-December of 2014 was 34. That has declined to 22 in October-December of 2015. There are a number of condo developments on the horizon for 2016, but we need more to house the number of people coming into the area.

According to Seattle.gov, 2010’s population estimate was 608,660 and the population estimate for 2015 is 662,400. This means that within the last five years, we needed to house 53,740 additional people. That is 10,748 per year or 207 people per week. No wonder we have an inventory challenge! The job market is going to continue to be strong in 2016 and more workers will be on the hunt for housing!

ADUs and DADUs: Accessory Dwelling Units (ADUs) and Tiny Accessory Dwelling Units (DADUs) are separate living spaces within a house or on the same property as an existing house which are legally permitted. Mayor Murray put forth his aggressive Housing Affordability and Livability (HALA) plan this past year to create 50,000 housing units over the next ten years. Increasing the number of ADUs and DADUs are on the HALA report for 2016 and I predict that we will see many ADU and DADU units built on lots to increase urban density. These are also referred to as cottage housing, small duplexes, and backyard cottages. There may be an opportunity for you to build an ADU or DADU in your own backyard! You can find out more information on ADUs and DADUs and the HALA report here:

INTEREST RATES: The Federal Reserve decided to raise the short term interest rates at their December meeting, which will undoubtedly cause mortgage interest rates to rise over the coming year, perhaps as much as to 5.5%. Although this will affect how much home a buyer can afford, I don’t expect it will diminish demand significantly.

If you would like to learn more about what is in store for 2016 and how what is happening with the real estate market affects your real estate investment, please give me a call or text: (206) 226-5300 or email: sold@windermere.com.

Seattle Real Estate Market Update, October 2015

Inventory of Seattle of homes for sale is still at a ten year low for October at 1,018 homes and condos available for sale. The ten year average up to 2014 is 2,879 homes which puts us 64.6% below that average. Our pending listings were at 985 for October, which is above our 802 average (22.8% above average).

Let’s see what happened in the October Seattle real estate market in key neighborhoods:

Inventory and Pendings

Below we compare the number of active listings (supply) and pendings (demand) for several of the key Seattle neighborhoods including Central Seattle, Queen Anne and Magnolia, Belltown and Downtown, Ballard and Greenlake, and North Seattle. Our table includes single family residences as well as condos comparing September 2014 and 2015.

marketupdate-2015-10a

Median Sales Prices

Seattle residential and condo median home prices continued to see median sales price increase of 8.9% over last October to a price of $485,000.

The average days on market for sold residential and condos in October was 18 days. This includes properties up to $5,750,000 (the highest price sale in October). This is one day less than September’s sales. Last October, the average days on market in Seattle was 32, so we have had a 43.8% decline in days on market over the last year. That is remarkable!

marketupdate-2015-10b

While the Seattle real estate market appears to be undefeated, I wish I could say the same for the Seahawks. However, like the real estate market, I expect great things in the coming weeks! We are only half way through the season and eight games to go and you can bet I show up in my team blue each Friday and I hope you do too. Go Hawks!

Please contact me – your Seattle Home Guy – at sold@windermere.com or give me a call: (206) 226-5300 to discuss what this market means for you.

Seattle Real Estate Trends, July 2015

Usually we see Seattle real estate take a small breather in July. Not so this year. Although Seattle’s inventory has increased since its low point in January of 830, it has only increased 16.2% to 982 properties for sale in July. The number of homes under contract did decrease a bit to 1,122 from the high this year of 1,270 in May.

Here is a closer look at what is happening in the Seattle real estate market and trends for some its key neighborhoods:

Inventory and Pendings

Below we compare the number of active listings (supply) and pendings (demand) for several of the key Seattle neighborhoods including Central Seattle, Queen Anne and Magnolia, Belltown and Downtown, Ballard and Greenlake, and North Seattle. Our table includes single family residences as well as condos comparing July 2014 and 2015.

seattle-real-estate-trends-2015-07_01

All five of my listings are currently pending and were snapped up quick!

  • Ravenna Area Residential Listed at $800,000 – pended in 7 days
  • View Ridge Area Residential Listed at $550,000 – pended in 26 days
  • University District Area Residential Listed at $525,000 – pended in 9 days
  • Ravenna Area Residential Listed at $439,950 – pended in 19 days
  • Townhome in Shoreline Listed at $375,000 – pended in 7 days

Median Sales Prices

The median sales price for Seattle for residential and condos decreased very slightly last month to $506,050 from the previous high of $507,500 the month before. However, year over year, the median sales price is up 11.7% since last July when it was $453,150. I expect median sales prices to continue to increase through the rest of 2015 until we can satiate demand either through more homes on the market or a decrease in buyers (which could be imminent if interest rates rise).

seattle-real-estate-trends-2015-07_02

There is still time to sell if you want to take advantage of these market conditions. Things may start to change if the Federal Reserve increases interest rates in September (which, according to sources such as the Wall Street Journal, is likely to occur soon). Even if you are looking for an assessment of how your asset has appreciated, or may appreciate in the coming years, please contact me – your Seattle Home Guy – at sold@windermere.com or give me a call at (206) 226-5300.

Seattle Real Estate Trends, June 2015

The Seattle real estate market is hot and not just because of the weather! Multiple offers continue to be the name of the game. For the 1,241 properties in Seattle that sold in June, the average days on market was 20. The average list to sales price ratio for residential solds was 104.27% while it was 102.341% for condos. This is indicative of multiple offers for both types of property around Seattle.

Here is a closer look at what is happening in the Seattle real estate market and some of its key neighborhoods.

Inventory and Pendings

The number of condos and homes for sale in Seattle was at 966 for June which is 36.3% lower than June of 2014. Usually as we get into the summer months, the number of homes on the market increases. However, with waning new homes coming on the market and the current inventory going under contract quickly, there aren’t enough homes for sale for the number of buyers.

Below we compare the number of active listings (supply) and pendings (demand) for several of the key Seattle neighborhoods including Central Seattle, Queen Anne and Magnolia, Belltown and Downtown, Ballard and Greenlake, and North Seattle. Our table includes single family residences as well as condos comparing June 2014 and 2015.

2015-05-marketupdate-01

Median Sales Prices

The median sales price for Seattle hit yet another new record in June of $507,750. I am seeing gains in the neighborhoods I track as well. Interest rates are still near 4% which is a slight rise from this winter/spring when Freddie Mac reported it as low as 3.59% (for the week of February 5th), but 4% is still a screaming deal and the buyers are out looking for any real estate for sale.

In fact, I have nine listings right now. They have all pended within an average of 15 days with the exception of a new one I put on the market just today in Ravenna.  I expect it will go quickly and for multiple offers!

2015-05-marketupdate-02

I would love to talk with you about your real estate investment goals or let you know where your home stands in relation to today’s market. Contact me – your Seattle Home Guy – at sold@windermere.com or give me a call: (206) 226-5300.

Seattle Real Estate Trends, May 2015

Just how low can our inventory go? According to the Northwest Multiple Listing Service (NWMLS), our the number of homes (residential and condos) available for sale in the City of Seattle was only 992 in May. Although this isn’t the lowest it has been in the last 10 years (the lowest was 836 in January, 2015), this is the lowest inventory in a May since 2005 by a longshot. The second closest May had 1,451 listings in 2013.

Here is a closer look at what is happening in Seattle and some key neighborhoods:

Inventory and Pendings

While Seattle’s inventory is waning, the demand, measured by homes under contract or pendings, is on the rise. Seattle has 1,330 homes under contract in May, which is again the highest number on  record for a May. The only other month that had more pendings in the last 10 years was March, 2005 with 1,362.

Below we compare the number of active listings (supply) and pendings (demand) for several of the key Seattle neighborhoods including Central Seattle, Queen Anne and Magnolia, Belltown and Downtown, Ballard and Greenlake, and North Seattle. Our table includes single family residences as well as condos comparing May 2014 and 2015.

marketupdate-may2015-1

Median Sales Prices

Seattle hit a new median home sales price record in May at $482,500. This is a 9.67% change from May of 2014. The neighborhood report below is a bit of a mixed bag, even showing some losses, but also some big gains!

marketupdate-may2015-2

I would love to talk with you about your real estate investment goals or let you know where your home stands in relation to today’s market. Contact me at sold@windermere.com or give me a call: (206) 226-5300.

Seattle Real Estate Trends, April 2015

Listing Inventory

Below is a table comparing the number of active listings (supply) and pendings (demand) for several of the Seattle neighborhoods I specialize in: Central Seattle, Queen Anne / Magnolia, Belltown / Downtown, Ballard / Greenlake, and North Seattle. We are comparing April 2014 with April 2015.

market-update-2015-04_1

Homes in the Seattle market are selling like hotcakes this spring. The last few homes I have listed have sold very very quickly. I currently have three listings on the market – one is just coming on today in Ravenna (NWMLS #785368 – a 1,860 square foot remodeled home with Mt. Rainier views priced at $650,000), one in Whittier (NWMLS #781505 – a 1,880 square foot Cape Cod priced at $500,000 and on the market 7 days), and one in View Ridge (NWMLS #781486 – a 3,280 square foot Mid-Century Modern with a view of the lake and mountains priced at $1,200,000 and on the market for 11 days). I expect they will all sell in a matter of days.

Median Sales Prices

Median Sales Prices continue to creep up due to the inventory shortage which I predict will continue as long as our population is on the rise due to Seattle’s strong economy and there isn’t enough new construction to satiate the demand.

Below are the median sales prices for the neighborhoods I track, comparing April 2014 with April 2015. There are significant price increases in Queen Anne / Magnolia, Ballard / Greenlake, and North Seattle. Central Seattle and Belltown/Downtown have a number of condominium sales which are a slightly different animal than the predominantly residential sales we see throughout the rest of the city.

market-update-2015-04_2

This spring and summer is turning out to be one of the best times to sell in years. Once interest rates start rising, however, those trends may change. If you would like to know where your home stands in relation to the market, please give me a call or send me an email: (206) 226-5300 or sold@windermere.com.  Don’t look back and say, “If only we had sold then” Now might be your moment!

Could Rent Control be coming to Seattle?

According to the National Association of REALTORS®, over the last five years in the Seattle Metro area, rents have increased a whopping 22.26% between whereas wages for 25-44 year olds (which comprise a good number of renters) only increased 15.3%. This time period reviewed was quarter 3 2009 to quarter 3 2014 for the rents whereas wages were reviewed 2009-2014. According to Dupre+Scott Apartment Advisors, that number is even more staggering when looking only at Seattle and since spring of 2013 – 18% higher.

This disparity along with comparisons to tech-driven job markets such as San Francisco have many wondering if Seattle could be the next city to jump on the rent control bandwagon.

According to the Puget Sound Business Journal, there was a town meeting at City Hall on April 23rd to discuss this hot topic and Mayor Ed Murray has even created a housing affordability task force to tackle the problem. The hurdle is a big one – rent control is currently illegal in Washington State.

Seattle Magazine reports that renters make up 52% of Seattle’s population, so the effects of such a law – or not passing a law – will be felt by the majority of Seattle’s residents. With the average market rent for a one bedroom, one bathroom apartment in the city of Seattle going for $1,445 per month, there are a number of renters and would-be renters who are going to have to start finding housing further away from the city center.

People for rent control point to issues like transportation that become a bigger challenge when workers cannot afford to live near where they work and have to commute in. However, those who oppose it indicate that rent control will hamper development and reinvestment in the buildings that may be in need of updating.

Whether you are a proponent of rent control or not, this debate and rent increases are driving some to turn to home ownership, even with the inventory shortages that challenging the real estate market.

However, the economics of it make sense. If you are paying $3,000 per month for a three bedroom apartment in Capitol Hill and you can buy a 3 bedroom home in Wallingford for $600,000 (even taking into account multiple offers driving up the price from $500,000 to $600,000), depending on your down payment, that mortgage and principle may only come to $2,300 per month. Add taxes and insurance on there and you might be at $2,800 per month.  Remember, this is just an estimation, and prices vary, but if you are pounding your fist, hoping rent control is passed before your landlord decides to raise the rent again, you owe it to yourself to take a look at home ownership.

And remember! If you have a 30 year fixed rate mortgage, your monthly mortgage payment is your monthly mortgage payment – next year and 25 years down the road. Furthermore, you are building equity which could mean money in your pocket when you are ready to sell. Try doing that while renting!

I would be happy to give you additional information on how to make your housing dollars go further. Give me a call: (206) 226-5300 or send an email to: sold@windermere.com!

Seattle Real Estate Trends, January 2015

Although the groundhog predicted six more weeks of winter, the Seattle real estate market is hopping like it is spring. Check out the market trends below.

Inventory of Listings

We are starting the year once again with a shortage of inventory in many of our Seattle neighborhoods. Since there are buyers in the market right at this moment, I see this as a window of opportunity for sellers before spring to sell before additional competition comes on the market and interest rates begin to creep up which will limit some buyers. Of course, whether the time is right for you to make a move will depend on a variety of factors including where you want to move to. If you are considering a move, please schedule a meeting with me as soon as possible to explore your options.

Below is a table comparing the number of active listings (supply) and pendings (demand) for several of our Seattle neighborhoods (these numbers include single family residences as well as condos). We are looking at January 2014 versus January 2015:

seattle-real-estate-trends-jan2015-01

Median Sales Prices

As a result of this low inventory, prices are up year over year in most neighborhoods. Check out Queen Anne / Magnolia with a 28% increase! However, with the inventory numbers above, there is bound to be increased demand. The opposite is currently true in Belltown / Downtown. The number of active listings has increased, and pendings have decreased. Prices seem to be adjusting accordingly, but it will be interesting to note if this is an ongoing trend.

seattle-real-estate-trends-jan2015-02

Want to learn more about what our 2015 market means for your real estate investment goals? Contact me at sold@windermere.com or give me a call: (206) 226-5300.

Seattle Real Estate Market Update 2014 Review

2014 was another strong year in our market! Just how strong? Check out the numbers below!

Inventory of Listings

Below is a table comparing the number of NEW active listings (supply) and pendings (demand) for several Seattle neighborhoods: Central Seattle, Queen Anne/Magnolia, Belltown/Downtown, Ballard/Greenlake, and North Seattle (these numbers include single family residences as well as condos):

2014reviewmarketupdate01

In Central Seattle, we saw both a drop in new active inventory along with homes under contract. Queen Anne/Magnolia saw a drop in new active listings along with a small drop in pendings (indicating this is still an area with high demand). Belltown/Downtown saw a large increase in new active listings which were mainly condo based. Inventory was absorbed quickly with Belltown/Downtown sporting both the largest swing in new active listings and new pendings.

Ballard/Greenlake saw both a slight increase in new active listings along with pendings while North Seattle continued its high demand profile with a slight decline in new active listings and a slight increase in pendings.

Median Sales Prices

Median sales prices tell the story even further.  It shouldn’t surprise you to see that median sales prices are up across the board in Seattle, ranging from 4.09% to 11.33%. Below are the median sales price averages for the neighborhoods I track comparing 2013 to 2014. Remember, these prices include both residences and condos.

2014reviewmarketupdate02

Please contact me at sold@windermere.com or give me a call: (206) 226-5300 to learn more about what to expect for 2015!

Urban Growth in Seattle

As we bid farewell to 2014, we can look forward to a continued strong real estate market in Seattle in 2015, driven by not only our strong economy, but also the influx of people wanting to live in the city.

In terms of the job market, Seattle Bellevue Everett Metropolitan Statistical Area unemployment rate is currently at 4.5%, below our ten-year average of 6.1%. In addition to growth in the number of jobs in our area, we are also seeing growth in wages due to the types of jobs we have been adding at companies such as Microsoft, Amazon, and Boeing.  However, retail and construction also had positive growth in the past year.

These companies are attracting young, skilled Millennial workers to our city’s core where companies like Amazon have set up shop. In an interview with Jeff Bezos, he indicated that an urban setting set the stage for the type of culture he sought for the company. NBBJ chairman (an architecture firm), Scott Wyatt, pointed to several reasons why this model works: Urban Seattle is growing faster than the suburbs, people want activities close by and don’t necessarily want to own a vehicle, companies want to foster a collaborative environment with not only employees from their own company, but other companies as well, and an urban setting allows for more physical movement. It is clear that if the Amazon model works, we will continue to see growth in the tech sector in the urban core.

We don’t currently have enough housing to keep up with the housing demand in the urban core, which is why rent rates are increasing at the pace they are as well as median home prices. I expect this will continue to be an issue in 2015 as our city amplifies its efforts to keep up with demand.

For example, according to the Seattle Times, there is a new skyscraper coming to town – a tower to replace the current Rainier Square shopping mall which will include eight stories of luxury apartments as well as 35 floors of offices and ground-floor retail. It sits between Fourth and Fifth avenues and Union and University streets on the site of the original University of Washington. This will be the second-highest skyscraper in the city, behind the Columbia Tower. However, this is still in the planning stages and will not be completed for several years.

These factors point to investment appreciation if you own real estate in Seattle. Our market is strong and all signs point to a robust 2015. Give me a call to learn more: Steve Laevastu: 206-226-5300 or sold@windermere.com.

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