Lack of New Construction Inventory Trims Overall Absorption, Only 42 Resale Units Available
With an urban center of more than 70,000 residents, it’s remarkable that only 42 resale homes are listed for sale on the NWMLS with a median asking price of $1,175,000. Just 3 resale listings are available at prices below $500,000 and only 15 are priced below $1,000,000. Now consider that there are 46 pending resales, which means the rate of sales is eclipsing the supply of new listings. July is just a continuation of a trend discovered earlier when the first half of 2017 revealed diminishing affordability and an acceleration of luxury sales in downtown Seattle.
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Realogics Sotheby’s International Realty (RSIR) presents a look at the housing market trends for the first two quarters of 2017, from the shores of Bainbridge Island’s waterfront homes and in-city living opportunities to the Eastside’s most distinguished residences.
New Construction Struggles to Deliver Inventory Below Median Home Prices
The heat of summer is being felt across the Seattle metro area, especially in housing. The region continues to post new benchmark values for median home prices while a mounting supply and demand imbalance in downtown Seattle is exasperating homebuyers. There are plenty of buyers. The problem is it can take up to four years to migrate a new high-rise from conception to closing. Until then, the result is higher prices, less selection and dwindling prospects for attainable ownership into the next decade.
On and on it goes, the continuing ascent of Puget Sound home prices.
While prices are rising across the country, the S&P CoreLogic Case-Shiller Index for April 2017 shows the Seattle metropolitan region again out in front of all others tracked by the index, including other Pacific Coast gateway cities. The city registered a 12.9 percent year-over-year price gain that month, compared with increases of 9.3 percent in Portland, Oregon; 6.6 percent in San Diego; 5.3 percent in Los Angeles; and 5.0 percent in San Francisco.
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Resale Values Increasing by 13.9-Percent as New Construction Dwindles
Summer temperatures are heating up and so is demand for downtown Seattle condominiums. So why was there an 8.9-percent decrease in total absorption in downtown Seattle (NWMLS# 701) in May? The reason is there were no new construction closings last month, whereas there were last year. When looking at resales alone, the market posted a commensurate increase, rising 8.5-percent to 51 sales. Regardless, median home prices rose across the board, increasing 8.8-percent overall, but a staggering 13.9-percent when singling out resale properties.
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Downtown Seattle’s most anticipated condominium community is celebrating an exciting new chapter in its offering: the exclusive Sky Series Residences at NEXUS. The homes are being built within the towering, 41-story NEXUS condominium high-rise, and will hit the market ahead of their expected completion in 2019. To introduce this prime — and limited — real estate opportunity, NEXUS and Realogics Sotheby’s International Realty (RSIR) are bringing together some of the most innovative brands for the Luxe in the City event, a luxury lifestyle showcase for discerning future homeowners seeking the evolution of urban living. A public sales debut is scheduled for the weekend of June 17th and 18th with an exclusive preview event on June 14th for invited guests.
Median Home Price of Downtown Seattle Condos Rose 13.36% in 2016; Renters are “Vying and Buying”
A report by Realogics Sotheby’s International Realty (RSIR) in collaboration with Caliber Home Loans and real estate appraisal firm O’Connor Consulting Group determined an aggregate $60 million in income tax deductions were missed in 2016 by 12,562 tenants that occupied newer apartment units built since 2010 in downtown Seattle alone. This new rental supply compared to just 866 new condominium units delivered during that same period, all of which are sold. Rising demand to own a downtown condo and tight supply spurred a 13.36% year-over-year median home price increase last year. Had these aforementioned tenants owned their homes they might have enjoyed equity gains of more than $600 million, says experts.
Dean Jones, President and CEO of Realogics Sotheby’s International Realty, will be discussing the urbanization of Seattle and Bellevue and, after a long run of apartment development, the return of condos. He will share some case studies, including the recent launch of NEXUS and other new projects in the pipeline.