2016 was the all time best year ever for the Puget Sound housing market. A new record was set in 2016 for sales activity in the Central Puget Sound Region of King, Snohomish, Pierce and Kitsap Counties, making it the best year ever for residential real estate. The housing market remains frenzy hot on a seasonality basis. In December, the sales activity was substantially higher than the number of new listings, with Snohomish County topping the list at a whopping 68% and King County at 57%. These conditions continue to foster a competitive market where home buyers are just waiting for the next new home to come on the market. According to the S&P Case-Shiller National Home Price Index, Seattle home prices rose 11 percent year over year through 2016.
What has lead to this flourishing market? The thriving tech industry and consequent job growth alongside the increase in Chinese investors/buyers are the main factors. The number of tech workers in Seattle increased by 21 percent between 2014 and 2015, for every 1 percent increase in the population of tech workers, home prices rise by half a percent. New foreign buyer taxes in Vancouver, BC has led Chinese investors to seek properties south of the border; Seattle and the Eastside have become the center point for their focus; compared to Vancouver, BC, Seattle has a much lower median home price. Additionally, Facebook, Salesforce, Google, and eBay are among the tech companies that expanded their operations in Seattle. Facebook, for example, just doubled its operations by adding another 384,000 sq ft of office space. Our quality of life is wonderful and the office space and housing are affordable relative to cities like San Francisco. Seattle is still one of the most affordable cities on the West Coast. The pace of sales and price appreciation is suppose to continue through the summer of 2017.
On the National economic front, the Federal Reserve is planning on three interest rate increases in 2017; most likely a 1/4 point each, which will reduce many buyers affordability (a $1 Million mortgage at 3.8% versus at $4.8% increases your monthly payment by $870). The slowing of growth in December with a tick up in unemployment to 4.7% is something to watch. Finally, there has been talk of removing or reducing the deductable amount on mortgages on your Federal Tax return. The Federal Government could cap the mortgage deductibility at $500,000 from $1 Million which could affect the upper price ranges.
Navigating this unique market as a seller (and as a buyer) takes a unique skill set in order to maximize your return as a seller and make sure you’re getting the right home as a buyer. We are very skilled and successful as brokers in both of these endeavors. Our repeat and referral clientele is one of the highest in the industry; it’s thanks to folks like you who share our name with their family, neighbors and co-workers!
For your own personalized analysis, please contact us!
Patti & Brad Chalker
Mobile: 206 919-9135
Please visit my Zillow Site for past client reviews: www.zillow.com/profile/pattich/Reviews/