Real Estate in the West was booming a couple of years ago, but is it still? If you are looking to buy a home in the Evergreen State, or are thinking of taking on an investment property in 2019, we’ve outlined some of the trends for you to consider as you research where you might want to buy, and, if you are looking for a second home or rental property, a few factors that you may want to weigh. We’ve included top agent insights and statistics about location and home type, in this rundown of Washington real estate news.
Two years ago, Seattle’s tech sector saw the city as one of the United States’ hottest housing markets — but that is starting to change. In 2019, Zillow ranked Seattle the 14th top market in the country, ahead of Miami and behind Austin, giving it a “cool” rating. But maybe a little balance is a good thing and this cooldown means now is a good time to buy in the Seattle-area.
In August 2019, the median home value in Seattle was declining. The median list price per square foot in Seattle was $526, while the Seattle-Tacoma-Bellevue Metro average was $295.
Location, location, location
While the Seattle housing market may be the first place that you think of when it comes to the Pacific Northwest, there are other cities worth considering. You may find better returns for your investment if you look elsewhere.
According to SeattleRealEstateNews.com, the median price of a single-family home (excluding condos) that sold in July 2019 across Washington State was $440,000, up 3.5% from the same time last year. Only four counties reported year-over-year price drops, including King County (yes, Seattle) where prices were down 2.7%. Condo prices also lagged compared to a year ago, but by less than one percent. The area-wide median price for condo sales that closed during July was $350,000. So where is the best place to buy?
Consider these statistics for counties from SeattleBubble.com:
The experts say that markets in outlying counties are heating up as King County goes down. Although median home prices in King County have seen a six-month decline, dipping by 2.7% in July, according to monthly sales data from the Northwest Multiple Listing Service, King County is still the most expensive county in Washington for homebuyers.
With King being the most expensive county, more and more people are heading to nearby Kitsap and Skagit. In Kitsap County, the median home price in June was $391,657, which is 10.6% higher than a year ago, and around 1.7% higher than May’s median price. To the north in Skagit County, demand was even greater. In June, the median home price increased to $380,000, an 11.8% jump.
In Tacoma and Pierce Counties, the median home price in June climbed to $376,500, representing a 7.3% year-over-year increase, and a 1.7% increase over the median price in May. Pierce County’s relatively large supply of affordable homes are becoming more attractive to priced-out buyers from Seattle and King County. However, buyers should be aware that the Tacoma-to-Seattle commute can add two to three hours a day.
There are many reasons why you might want to consider buying a condo, either as your primary or secondary residence, or as a rental property. And if a condo is what you are after, then you’ll want to examine these trends.
Experts saw falling prices and rising inventory for condos in King County from spring to summer 2019. Median condo prices across the county were also down 3.4% year over year, to $400,000 in July 2019. The same research also found that condos are staying on the market for almost a month, with active listings up by 39% from 2018.
However, if you are looking to buy a condo to rent out as a source of income you may want to research city rules first. A June 2018 report from the University of Washington found that nearly 40% of Seattle owners who rent out their condos have sold or planned to sell them, because of frustrations about regulations.
If downtown Seattle is on your mind, you’ll find that the condo market there is on the uptick, with downtown condo sales up 18% in the last year, and presales for new condo developments also on the rise.
Bad news for renters, good news for landlords
Last summer, much of the Seattle-King County market seemed to hit a pause in rent increases as supplies were catching up to demand. Between June 2017 and June 2018, according to Zillow, the median price across all rental properties in King County fell by 0.5%, to $2,383. In Seattle, median rents fell by 1.5%, to $2,486, with the median for a 2-bedroom costing $2,100. However, that has now changed.
In Seattle, the median rental across all properties in June was up 3.3% year over year, to $2,569, according to Zillow. In Bellevue, median rent climbed 3.9%, to $2,835, in the same period, while in King County, the median rent was up 3.6% over last June, to $2,469.
It’s not clear from agent insights or other data whether the area will return to the 2014-2016 upswing, when many neighborhoods in the region endured yearly rent increases of 10% and more. The experts say it depends on several factors, like how quickly new apartments are added to the market. According to RealPage, a housing market data firm, as of June, Seattle had 19,345 apartment units headed for construction, ranking fifth among U.S. cities. But that’s a 19% decline from June 2018, when 24,000 apartment units were under construction, according to RealPage.
The key takeaway is that the market in Washington is constantly shifting and if you are looking to buy, it’s best to keep an eye on the trends to be sure that you are making an educated investment for the future.