It’s no secret that over the past several years Seattle has been a haven for relocating families, foreign investors, and transferring tech workers. That’s why it also came as no surprise to us that home values have been steadily increasing; and that the Seattle real estate market continues to be ranked one of the hottest in the nation. A recent article in the Seattle Times stated that 40% of all homes for sale in Seattle were listed at $1 million (in March). That’s months before the home-buying season even truly begins!
The Realogics Sotheby’s International Realty 2016/2017 Market Report reiterated the trends being reported nationwide. Seattle home values have increased year after year and the overall median home price in King County increased 12.64% in 2016. That was the highest percentage increase in the entire Western Washington region. The full market report has details and breaks down increases by zip code for even more detailed information; but we bet you can guess the most expensive areas on your own (hint: #1 is an island). Just this last week the Seattle Times reported that, “the median price for a house hit $700,000 for the first time. Prices in the city have doubled in the last five years, and have climbed $60,000 [just] in the last year.”
So, what’s driving these rapid increases? One of the largest factors is increase in population. The Puget Sound Business Journal reported last month that technology workers are leaving the Bay Area in droves because on average, Seattle tech workers keep nearly 59% of their paycheck after paying a rent or mortgage. Even with Bay Area tech workers making a higher salary, they average only 37% leftover (a difference of about $1,800 a month). That’s a pretty big difference. The Puget Sound Business Journal also reported that the Seattle area is the ninth fastest-growing metro in the nation; and that we gain an average of 1,100 residents per week. Curbed Seattle pulled information from the U.S. Census Bureau and found that King County, as a whole, was the fourth fastest-growing county in the nation with 35,714 new people in the year between July 2015 and July 2016 alone. People are moving here and they have money to spend. As GeekWire simply put it: “Those people need homes and can afford to pay more for them.”
This new population with money burning holes in their pockets are also coming into a limited market from which to buy. Reported Thursday, April 6, the Northwest MLS announced that their service area remained below 10,000 for a second straight month; and that “the lack of supply continues to put upward pressure on home prices.” King and Snohomish counties are both reporting less than a month’s supply. “Last week, Zillow noticed a 10.5 percent drop in inventory in the Seattle metro area since this time last year,” reports Curbed Seattle. However, and “despite the hurdles, more people are getting into homes… Northwest MLS figures show year-to-date closed sales are up nearly 10 percent compared to first quarter 2016.” So, there is hope after all! NWMLS reports that the luxury market is remaining strong; “For the first three months of 2017, the number of homes that sold and closed at prices of $1 million or more is up 60.5 percent compared to the same period a year ago…”
Have questions or are thinking of selling? Please don’t hesitate to contact us. Our team is ready and willing to help you with all your real estate needs.