Swimming through the complicated waters that are the current Seattle housing market is not so easy these days.
Seattle’s housing market is the hottest in the nation, according to new data from The S&P Case-Shiller National Home Price Index. Home prices in the Seattle region rose 11 percent between September of 2015 and 2016, inching past Portland which saw 10.9 percent year-over-year growth.
Seattle’s booming technology industry is driving record population growth as transplants flock to the region for jobs. Those newcomers tend to be skilled recruits, meaning they can afford pricier homes.
As GeekWire has reported, 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. Homegrown tech companies such as Amazon.com, which now employs more than 25,000 people in the Seattle area, also are adding to the boom.
According to Zillow’s index, home prices in the broader Seattle region were $409,900 in September. In King County, the median value was $518,400 and in Seattle proper home values were starting at $611,500.
The rising prices, coupled with low supply, have discouraged some house-hunters.
So, you may ask, What’s In Store For The 2017 Seattle Housing Market?
In an article written by Matthew Gardner, Chief Economist, Windermere Real Estate, Matthew addresses some key items that my come into play for 2017. Matthew writes:
- Our market has benefited greatly from very healthy job growth, driven in no small part by our thriving technology companies. Economic vitality is the backbone of housing demand, so we should continue to see healthy employment growth in 2017; however, not quite as robust as 2016. Migration to Seattle from other states will also continue in the coming year, putting further pressure on our housing market.
- Are we building too many apartments? The answer to this question is “maybe”. I believe we are fast approaching oversupply of apartments; however, this glut will only be seen in select sub-markets, such as South Lake Union and Capitol Hill. Developers have been adding apartments downtown at frantic rates with many projects garnering very impressive rents. In the coming year, look for rental rate growth to slow and for concessions to come back into play as we add several thousand more apartments to downtown Seattle.
- The Millennials are here! And they are ready to buy. 2016 saw a significant increase in the number of Millennial buyers in Seattle, and I expect to see even more in 2017. The only problem will be whether Millennials will be able to find – or afford – anything to buy.
- Home prices will continue to rise. But price growth will taper somewhat. The market has been on a tear since bottoming out in 2012, with median home prices up by a remarkable 79% from the 2012 low, and 14% above the pre-recession peak seen in 2007. Given the fact that interest rates are now likely to rise at a faster rate than previously forecasted, I believe price appreciation will slow somewhat, but values will still increase at rates that are well above the national average. Look for home prices to increase by an average of 7.5 – 8.5% in 2017.
- More homes for sale? I am optimistic that inventory levels around Seattle will increase, but it still won’t be enough to meet continued high demand.
You can read more of the article that was written on Windermere’s Blog
What this all boils down to the home buyer is the desperate need for a competent team that is helping them to navigate these difficult housing waters in Seattle right now.
Making sure you have a Real Estate professional that truly understand the market is extremely important. Making sure your financing is set up ahead of time will often times come into play when a seller is deciding which offer to take.
In times like these you have to be smarter if you’re going to reel in that home you want to get into.