Seattle has topped the nation with the hottest housing market, recently passing its neighbors in Portland. According to The Seattle Times, this is the first time in nine years that Seattle has led the country in home growth prices. Examining the S&P Case-Shiller National Home Price Index, the home prices in the Seattle Region have risen by 11 percent between September 2015 and 2016, surpassing Portland which has had a 10.9 percent increase during this time period. Here is what you need to know about the causes and effects of Seattle’s booming housing market.
“Seattle leading the country in house-price growth is a testament to how attractive the region has become,” says Ralph McLaughlin, the chief economist at Trulia. He believes that this growth is based on three principles; increasing employment opportunities in the Seattle area, higher income potential, and, as most people in the Northwest already know, a great quality of life.
To read more please visit: The Seattle Times | Seattle Tops The Nation in Home-Price Growth for First Time in 9 Years
Geekwire has attributed the growth in the real estate market to the ever-expanding tech boom that Seattle is experiencing. “There are now more than 80 engineering offices in the Seattle area operated by large tech giants, including fast growing offices for Facebook, Salesforce, Ebay and others” Geekwire writer Monica Nickelsburg remarks. It can be surmised that as Seattle grows, driven by the tech boom, it is likely to experience a real estate market like that of the Bay Area.
To read more please visit: Geekwire | Seattle Becomes Nation’s Hottest Housing Market, Driven By Tech Boom
Another aspect that is driving the Seattle housing boom is an increasing demand by foreign buyers, particularly out of China, in the real estate market.
To learn more please visit: RSIR | The “Gold Rush” of Chinese buyers Entering the Seattle Real Estate Market
Zillow, in a recent report, has found that Seattle has one of the highest year-over-year rent appreciation rates, which has risen 9.1 percent in the past year in the Zillow Rent Index with a current median rent of $2,087 per month.
Zillow data also shows that overall Seattle prices are rising twice as fast as the rest of the country and have been doing so the most of this year. Home values across the Seattle metro area, including King, Pierce, and Snohomish counties have risen to over $400,000, which is up from only 300,000 just three years prior. The section of housing that has seen the highest increase is starter homes, which Case-Shiller have reported to of had a 12.7 percent annual increase while luxury homes have only seen a 10.2 percent increase.
To learn more about first time home buying in Seattle’s 2017 market please visit: RSIR | 2017 Real Estate Market: What Millenials Need to Know
The demand for housing is very evident in center city markets as well. Seattle is facing a lack of available condos due to the housing boom and, since 2011, only 866 condominiums were added. What’s more extraordinary is that so few of those new condominiums remain available to purchase today. Simply put, 99-percent of what was built for sale in the last five years has been sold and more than two-thirds of what’s planned for delivery by 2019 is already reserved through priority pre-sale.
“It’s a stark reminder that when it comes to new construction high-rises, demand can rise much quicker than supply,” says Dean Jones, President and CEO of Realogics Sotheby’s International Realty (RSIR). “It can take three to four years to design, entitle and build a new condominium tower. Median home prices are rising by double-digits year-over-year. Projects like NEXUS, with attainable price points starting at $300,000, are excellent for the current Seattle housing market, however are in very high demand; hundreds of pre-sale buyers lined up on June 4th, some of which slept overnight, in order to secure a reservation for priority pre-sales.
To learn more about Nexus, please visit: www.NEXUSseattle.com
With rising prices and a low supply of viable housing, Seattle has a lot of face in the upcoming years.