Originally posted August 15 2016, on the Windermere Blog by Shelley Rossi
It’s tough being a first time home buyer, especially in a fiercely competitive market like Seattle where multiple offers are the norm. Windermere clients Haley and Yash experienced this first hand when they started shopping for a home. With the help of their agent Elsa Nunes-Ueno, they found and fell in love with “the little blue house”. It had everything they were looking for, including the potential for them to fix it up and make it their own. But other bidders and a steep price increase threatened to get in their way. Just when it seemed that all hope was lost, Elsa went to bat for her clients and came up with a creative approach to make Haley and Yash’s dream of the little blue house a reality.
Throughout the year Windermere will be posting some of our favorite #YourStoryIsOurStory videos, photos, and blog posts. Please take a minute to share your experiences, and follow #YourStoryIsOurStory on our blog, Facebook, Twitter, Instagram, YouTube, and Pinterest pages.
Living on a golf course has obvious appeal to anyone who enjoys teeing up on a regular basis. In addition to having your next round of golf right outside your door, living on a golf course often affords you a view of a sprawling green vista. Many golf communities also feature newer homes and offer extra amenities such as spas, planned activities and more.
Yet for all their upsides, there are aspects of living on a golf course that might give you pause. They include:
Stray golf balls: The possibility of an airborne golf ball landing on you, your car or your home is a definite possibility when you’re living on a golf course. If you’re especially concerned about this, search for a home further away from the fairways. Also make sure you have the right insurance in place.
Noise from golf carts: You’ll want to check where the path for golf carts runs. If you’re close to a path, you’ll likely be subject to the noise of carts and people zipping by for a good part of each day.
Noise from the golf course: Things can get noisy if you’re very close to the course. This is especially true if your house borders a tee box. Another thing to consider is noise from groundskeepers. Courses are typically mowed very early in the morning. If your master bedroom faces out to the course, it’s likely your sleep could be interrupted by noise and headlights.
Deed restrictions: It’s common for golf communities to be regulated by a homeowners’ association in addition to having recorded CC&R’s that were designated upon the development of the community. A thorough review of the HOA Bylaws and the CC&R’s is very important. If the either set of regulations will seriously hinder your quiet enjoyment of your own home, or place too much demand/control on structural improvements, paint colors, yard maintenance, etc. then you may want to just stick with your membership and live elsewhere.
Situated just north of Phinney Ridge, Greenwood remains one of the iconic Seattle neighborhoods. The area immediately around North 85th Street and Greenwood Avenue North grew up around the streetcar that formerly ran up Greenwood Avenue. It still has the charm of the storefronts that went up in the early 1900s. Now converted into restaurants, bars and other businesses, the neighborhood is still a buzz with activity. Head over in the summer to see Seattle’s largest free car show, and while you’re there, stop by Gorditos for one of the best burritos in town.
With its proximity to nearly everything in north Seattle, and its quiet neighborhood vibe, Greenwood homes have seen strong appreciation in recent years. The median single family home price in Greenwood is currently $595,000.
Washington State continues to see strong employment growth, outpacing national numbers with an annual rate of more than 3%. Interestingly enough, despite these substantial job gains, the unemployment rate remains stubbornly high at 5.8%. However, I’m not overly concerned about this because it’s largely due to a growing labor force rather than a declining job market. This means that those who are unemployed who had previously stopped looking for work are now resurrecting their job searches because they have confidence in the economy.
I expect to see a modest drop in the unemployment rate through the balance of the year, and believe we will continue to outperform the nation as a whole with above-average job gains.
HOME SALES ACTIVITY
- There were 22,721 home sales during the second quarter of 2016, up by 4.4% from the same period in 2015. We finally saw a much-needed increase in listings, which rose by 30.1% between first and second quarter. This increase in the number of homes for sale led to an increase in sales, which rose by 4.4% when compared to the same period in 2015.
- Island County saw sales grow at the fastest rate over the past 12 months, with sales up by 22.1%. This is a small county which is subject to wild swings, so I take the data at face value. That said, the larger Thurston County saw sales up by an equally impressive 19.7%. Most interesting is that King County saw sales fall modestly compared to the same time period in 2015. Price—and supply—are clearly an issue in the most populous county in our state.
- Overall listing activity was down by 21.8% compared to the second quarter of 2015, but the good news is that the supply side deficit is actually getting a little less than we have seen over the past few years. The total number of homes for sale was 30.1% higher than seen at the end of the first quarter. While much of this can be attributed to seasonality, it is still nice to see!
- The region is experiencing positive job growth, and with it, migration to Washington State is running at a very brisk pace. Given these factors—in addition to our lack of new home construction—it is not surprising to see demand substantially usurping supply. As I look forward, I believe inventory levels will continue to rise modestly, but it will remain a solidly seller’s market for the rest of the year.
- With demand still exceeding supply, we should not be surprised to see average sale prices continuing to rise, as is certainly the case in our region. Home prices rose by 8.1% between the second quarter of 2015 and the second quarter of this year. This is down from the annual rate of 10.1% that we showed in our last report, but the rate is still far higher than the historic average of 4%.
- Regular readers of this report will remember that there were several counties where average sale prices in the first quarter were actually lower than seen a year before. I suggested that seasonality was to blame and that was indeed the case, with all counties in this report now showing annualized price gains.
- When compared to the second quarter of 2015, price growth was most pronounced in San Juan County and, in total, there were nine counties where annual price growth exceeded 10%.
- The prevailing supply/demand imbalance continues to push prices higher, and persistently low interest rates are just adding fuel to the flames. If rates stay at current levels, it is unlikely that we will see much in the way of slowing appreciation for the rest of the year.
DAYS ON MARKET
- The average number of days it took to sell a home dropped by 17 days when compared to the second quarter of 2015.
- It took an average of 67 days to sell a home in the second quarter of this year—down from both the 86 days it took to sell a home in the first quarter of this year, and from the 84 days that it took to sell a home in the second quarter of 2015.
- The only market where the length of time it took to sell a home rose was in the notoriously fickle San Juan County, where it rose by 30 days to 196 days. In the rest of the region, the average decrease in the time it took to sell a home between the second quarter of 2015 and the second quarter of 2016 was 20 days.
Snohomish County has joined King County as a market that takes less than a month to sell a home. At 18 days, King County is unarguably the hottest market in the region, but sales are slowing due to the lack of inventory. This imbalance is unsustainable over the long term.
This speedometer reflects the state of the region’s housing market using housing inventory, price gains, sales velocities, interest rates, and larger economics factors. For the second quarter of 2016, I am leaving the needle in the same position as last quarter. Inventory levels have improved, albeit modestly, and price growth has slowed very slightly. However, this is offset by a jump in pending sales, a slightly higher number of closed sales, and a drop in interest rates. As such, the region remains staunchly a seller’s market.
ABOUT MATTHEW GARDNER
Matthew Gardner is the Chief Economist for Windermere Real Estate, specializing in residential market analysis, commercial/industrial market analysis, financial analysis, and land use and regional economics. He is the former Principal of Gardner Economics, and has over 25 years of professional experience both in the U.S. and U.K.
July Premier Networking Breakfast: Windermere Brokers come together to discuss new trends in Luxury Vacation Homes
On Wednesday, July 27, over 100 brokers from all over Western Washington gathered at Broadmoor Golf and Country Club for Windermere’s monthly Premier Breakfast.
The breakfast opened with brokers presenting the newest luxury homes from Blaine to Eatonville and throughout the Puget Sound area. Following that, a guest panel including Khue Dang and Richard Blacharski of Union Bank, Cory Brewer and Lori Gill of Windermere Property Management, and Ty Evans of Windermere Bainbridge Island, discussed vacation rentals, second homes and the complexities of financing second homes, with an emphasis on luxury properties. Ty Evans spoke about dealing with buyers’ expectations with regards to inventory and the cost of owning waterfront property on an island. Lori Gill shared information of the great success her team has had with Windermere Vacation Rentals in Lake Chelan. Khue Dang and Richard Blacharski offered advice on helping clients understand the different financing options for these homes and how to best set up buyers for success by going through a pre-approval process prior to shopping for homes.
Windermere President, Jill Jacobi Wood, closed out the breakfast talking about the remarkable difference between Mercer and Bainbridge Islands. Jill noted that Mercer Island has never been considered a second home market, unlike Bainbridge Island, but how in recent years, Bainbridge has become more of a bedroom community to Seattle, with 80% of all residences now being primary homes, many of whom commute to Seattle via ferry.
We appreciate all the Windermere brokers who attended this month’s Premier Breakfast, sharing both their listings and extensive knowledge of luxury markets throughout Western Washington.