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CURRENT MARKET CONDITIONS
Due to the current low interest rates (which have edged up somewhat from their 40 year lows of a few years ago but which are still very low by historical standards) and steady demand due to the local diversified economy and continuing in-migration, the Seattle real estate market remains one of the strongest real estate markets in the country.
Seattle has not escaped the problems on Wall Street and the sub-prime mortgage crisis battering much of the country but, overall, local in-city home prices are down only a modest amount as we revert back to a more balanced market. There are fewer transactions taking place, though, as many loan products (such as zero down, no documentation and Alt-A loans) utilized by barely or non-qualified buyers are no longer available. Also, there are significantly more homes on the market these days which gives buyers a greater selection of properties to look at compared to what was normally available during the recent real estate boom years. Overall, this is an excellent time to trade up for qualified buyers and national publications have continued to identify Seattle as one of the best positioned large urban areas in the country for sustained price appreciation over time.
Close in-city neighborhoods are faring much better price wise compared to the far out suburbs in King, Pierce and Snohomish County with their glut of new construction homes. National builders in these outlying areas have been deeply discounting these homes to move inventory but this is not happening in Seattle proper - although when sellers do bring their homes on the market these days they tend to price them more realistically now that it is acknowledged that the long running seller's market is over.
It has always been true of real estate that you are "buying the neighborhood." Because of the charm and downtown proximity of the "urban villages" that Seattle is blessed with, the in-city neighborhoods have remained extremely desirable. Places such as Fremont, Wallingford, Ballard, Queen Anne, Capitol Hill, Magnolia and Phinney Ridge, etc. are still the most livable and walkable neighborhoods in the city. Private enterprise has provided a vibrant tapestry here of eclectic shops, supermarkets, restaurants, bars and clubs of all types. The many music, food and heritage festivals during the summer months generate strong community connections. With many new infrastructure improvements moving forward (such as light rail) and many other improvements already completed (such as new parks, bike lanes and local branch libraries) these neighborhoods offer a small town feel while still being a quick commute to downtown employment centers.
Although the in-city housing stock is older and the floor plans smaller, many Seattle homes have been updated to a more modern aesthetic while still retaining a historic cozy feel. Well maintained and updated homes that come on the market at a realistic price, generally still sell fairly quickly. Homes needing work or those in more outlying areas can sit on the market for much longer.
In all cases, though, the pendulum has now swung to being more of a buyer's market. It is not uncommon for sellers to pick up a good portion of the buyer's closing costs and to get seller concessions and repair credits off the asking price.
Seattle is a relatively narrow city with a hilly topography that is bounded by water on two sides that is now completely built out. Builders need to acquire a tear down property before they can put up new construction. This, along with the challenging building terrain in many areas, has kept lot prices high and has led to a rash of town home development (especially on the arterials) as more homes are forced unto smaller parcels of land. The current Growth Management Act is also pushing increased density into Seattle's urban villages. As traffic congestion grows (with 1.7 million more residents expected to move to the Puget Sound area by 2040) and fuel prices rise, people will be willing to pay a premium to avoid a lengthy and expensive commute. Like San Francisco (which has similar characteristics), these trends indicate that the demand for well located in-city homes will continue.
I educate my buyers with extensive market knowledge to allow them to really understand home values in the various neighborhoods that they are considering. Then, when an appropriate home does hit the market that is priced correctly, my buyers are comfortable enough to act quickly. Focused and determined teamwork between buyer and agent does pay off in the end.
I look forward to helping you achieve your dream of home ownership as well.
Contact Tom
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