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Annual Seattle-Eastside Real Estate Report: A Look Back at 2018
An increase in homes for sale coupled with rising interest rates have created a far more balanced market than we started 2018 with. This is a good thing as it will help our region tame affordability and create a sustainable marketplace. More homes came to market in 2018 than in any year since 2011. This provided home buyers with plentiful choices and forced home sellers to competitively position their homes to compete with other homes for sale—something they haven’t had to give much thought to in the last seven years.
The cost of a 30-year fixed-rate mortgage began the year at 3.95% and ended at 4.64%. Indications show rates could rise to 6% by the end of 2019. Mortgage rates are a far bigger factor than most people consider. A 1% increase in mortgage interest rates decreases buying power by 10%. Or said differently, a 1% rate increase has the same net effect on monthly payment as a 10% increase in the sale price. That also means if prices fell 10% but rates went up 1% the monthly mortgage payment would remain the same.
Our 2019 market will be driven by buyers motivated to beat interest rate hikes nipping at their heels and by sellers who will choose to price moderately following a seven-year appreciation growth run. Properly-priced homes in good condition and in desirable settings will do well, as will affordable homes on the periphery of the metro region. Strategic positioning, savvy marketing, and expert negotiation have never been so important as they are now.
Click or scroll down to find your area report:
Seattle | Eastside | Mercer Island | Condos | Waterfront
SEATTLE
2018 was a year of transition from an ultra-competitive seller’s market to a more balanced market. The first four months of the year saw dramatic price acceleration—arguably far beyond the comfort of Seattle area home buyers—as home values skyrocketed each month through the spring market. Around the beginning of May, home buying activity slowed as the number of homes for sale increased and buyers had more choices for the first time in years. Home prices have declined since that peak in most neighborhoods, but still ended the year up comfortably over 2017 values.
Seattle’s overall Median Sale Price was up 8.8% to $769,950, while its Average Sale Price was up 10.4% to $883,590. The Average $ Per Square Foot increased 9.7% to $437, with Lake Forest Park/Kenmore the most affordable region at $327/sq ft and Madison Park/Capitol Hill the most spendy at $561/sq ft.
Three Seattle neighborhoods had double-digit median price growth in 2018: Lake Forest Park/Kenmore at 14.4%, West Seattle at 12.7%, and Queen Anne/Magnolia at 12.2%.
Click here to view the complete report for a neighborhood by neighborhood breakdown of Average Sale Price, size, and number of homes sold.
EASTSIDE
Even with Eastside expansion announcements from several notable tech companies, 2018 saw a shift from an ultra-competitive seller’s market to a more balanced market. While the sky is not falling, price growth has slowed to a more modest and sustainable pace. After rising astronomically at the beginning of the year, prices have generally softened as buyers and sellers find their new norms.
The Eastside’s overall Median Sale Price was up 8.2% to $939,129, while its Average Sale Price was up 9.3% to $1,143,557. The higher average sale price reflects the impact of luxury home prices at the upper end of the market. The median sale price is attributed to the larger volume of mainstream sales at more moderate price points.
Four Eastside neighborhoods had double-digit median price growth in 2018: Kirkland at 23.8%, Woodinville at 12.9%, West Bellevue at 12.4%, and Mercer Island at 10.0%.
Click here for the full report and neighborhood-by-neighborhood statistics!
MERCER ISLAND
The Island, much like the region surrounding it, saw a shift from an ultra-competitive seller’s market to a more balanced market as the number of homes for sale increased markedly following a strong spring market. Home values have softened since the peak market of 2018, but still ended the year with a hefty increase over 2017 values.
The number of home sales were down in 2018: 285, as compared to 330 in 2017. Modern, turn-key homes and highly desirable settings were most sought after while those lacking essential attributes were often passed over, ending the year unsold.
Uniquely situated near both the Seattle and Eastside metro areas, the Island has always tended to fare better than most in a transitioning market. Mercer Island’s Median Sale Price was up 10.0% to $1,700,000, while its Average Sale Price was up 10.5% to $2,059,996. The higher average sale price reflects the impact of luxury home prices at the upper end of the market. The Average $ Per Square Foot increased 11.3% to $606.
Click here to view the complete report for a neighborhood by neighborhood breakdown of Average Sale Price, size, and number of homes sold.
CONDOS – SEATTLE & EASTSIDE
New construction added to the more than two-fold increase in the number of condos for sale during the year compared to 2017, from 2,131 to 4,857 units listed throughout the year. Even so, regional affordability issues drove condo desirability to all-time highs and fueled price increases that outpaced single-family homes.
Seattle’s Condo Median Sale Price was up 12.8% to $505,500, while its Average Sale Price was up 10.5% to $582,163. The Average $ Per Square Foot increased 7.5% to $601. Three regions saw increases above 20%: Richmond Beach/Shoreline at 26.8%, Ballard/Green Lake at 24.1%, and South Seattle at 24.0%.
The Eastside’s Condo Median Sale Price was up 17.2% to $480,500, while its Average Sale Price was up 17.0% to $576,061. The Average $ Per Square Foot increased 13.5% to $453. Two regions saw increases above 20%: East Bellevue at 34.0% and Kirkland at 25.0%.
Check out all of these factoids and more in the full condo report.
WATERFRONT
While the number of sales in 2018 was down markedly compared to recent years as a result of fewer international buyer purchases, a handful of notable sales drove value markers up, creating the artificial appearance of appreciation when price growth was relatively flat in 2018. Those sales include three Media and Points properties sold above $14 M, a record Lake Sammamish sale above $11 M, a Mercer Island sale above $13 M, and a Laurelhurst sale at $11 M.
This top-level overview of the entire Seattle-Eastside private waterfront market, including Mercer Island and Lake Sammamish, provides a glance into the trends occurring in our region over time. Interesting, and certainly insightful, it in no way replaces an in-depth analysis on waterfront value provided by a savvy broker with years of local waterfront experience.
Check out the full Waterfront Report for a complete list of waterfront home sales by address and community.
ABOUT WINDERMERE MERCER ISLAND
We earn the trust and loyalty of our brokers and clients by doing real estate exceptionally well. The leader in our market, we deliver client-focused service in an authentic, collaborative and transparent manner and with the unmatched knowledge and expertise that comes from decades of experience.
© Copyright 2019, Windermere Real Estate/Mercer Island. Information and statistics derived from Northwest Multiple Listing Service and deemed accurate but not guaranteed.
Q3 2018 Seattle-Eastside Real Estate Report
As Q3 comes to a close, 30-year fixed-rate mortgages are at their highest levels since April 2011—now averaging just above 4.7%. Even so, they are still far lower than their 30-year trendline. A 1% increase in mortgage interest rates decreases buying power by 10%. Or said differently, a 1% rate increase has the same net effect on monthly payment as a 10% increase in the sale price. That also means if prices fell 10% but rates went up 1% your payment would remain the same. This is a far bigger factor than most people consider.
Both first-time and move-up home buyers, with (finally!) more homes for sale to choose from and motivated by anticipated further rate hikes nipping at their heels, will feel the urgency to get moved and settled while they can still afford to do so.
Our market is likely to increasingly favor buyers as interest rates cause mortgage payments to increase uncomfortably beyond the affordability ceiling governed by personal income and wages. Properly-priced turn-key homes, and those in the most desirable settings, are still commanding very attractive prices and occasionally multiple offers. Everything else is seeing slowing appreciation and market softening. Strategic positioning, savvy marketing, and expert negotiation have never been so important as they are now.
Click or scroll down to find your area report:
Seattle | Eastside | Mercer Island | Condos | Waterfront
SEATTLE
Seattle neighborhoods that were strongly bolstered by new construction and renovation saw the strongest sales activity, and not surprisingly, the greatest correlated price growth. Up 16.4% Q3 over Q3, the Queen Anne/Magnolia area led the charge, followed closely by Madison Park/Capitol Hill at 15.9%. Lake Forest Park/Kenmore at 13.2% and West Seattle at 12.5% also fared very well. Richmond Beach/Shoreline (6.2%), Ballard/Green Lake (4%), North Seattle (3.4%), and South Seattle (0.7%) saw notable price easing and contributed to rounding Seattle out to a modest 6.3% overall Q3 2017 to Q3 2018 median price increase.
Click here to view the complete report for a neighborhood by neighborhood breakdown of Average Sale Price, size, and number of homes sold.
EASTSIDE
Sharp increases in the number of homes for sale coupled with fewer international buyer transactions has caused a few ripples in the Eastside real estate market.
Mercer Island shows the strongest Q3 over Q3 increase in median sale price (see explanation below) at 19.7%, followed by Woodinville at 12.3% and Redmond at 12.2%. Bringing up the mid-section was West Bellevue at 8.0%, East of Lake Sammamish at 7.8%. Lagging the Eastside median increase of 7.3% were Kirkland (6.9%), South Eastside (2.0%), and East Bellevue (1.8%).
Click here for the full report and neighborhood-by-neighborhood statistics!
MERCER ISLAND
The Q3 median sale price was 19.7% higher than that of Q3 2017. However, its crucial to note that Q3 of 2017 was an anomaly with many land-value sales transacting at the low end of the price spectrum. The effect was that the median sale price was 10.2% lower than Q1 of that same year. Far fewer moderately priced homes transacted in Q3 of this year.
There were 89 sales in Q3 2017 and of those sales 45 were of homes priced below $1.5 million. Compare that to Q3 of 2018 with 74 sales, of which only 28 were priced below $1.5 million. The differential of sales between the two years was almost entirely composed of entry-level and land value home sales.
To further prove this, we looked at comparable homes sold this year and last (an approach like that of the Case-Schiller index). All things being roughly equal, the median sale price of that subset of homes increased only 9.0% from Q3 2017 to Q3 2018. This number is far more in alignment with what we have truly experienced in our market.
Click here to view the complete report for a neighborhood by neighborhood breakdown of Average Sale Price, size, and number of homes sold.
CONDOS – SEATTLE & EASTSIDE
Significant new construction projects underway or announced have dampened sales of existing condos somewhat, especially where they will directly compete with the new buildings. Neighborhood safety is being weighted more carefully against urban hip now more than ever. In Seattle, median sale prices of existing condos in Downtown Seattle/Belltown (-0.4%), Queen Anne/Magnolia (-4.8%), and North Seattle (-8.0%) have all decreased while surrounding areas have seen very strong to moderate Q3-Q3 increases. This quarter’s top contenders were Richmond Beach-Shoreline (30.3%), Ballard-Green Lake (26%), and West Seattle (25%).
On the Eastside, all areas except South Bellevue (-9.3%) saw considerable increases in the Q3 median sale price. East Bellevue (37.1%), Redmond (19.1%), and Kirkland (17.6%) topped the charts.
Check out all of these factoids and more in the full condo report.
WATERFRONT
The Eastside has been a hotbed of waterfront closed sale activity with as many Q3 sales as Seattle, Mercer Island, and Lake Sammamish combined. The number of active private waterfront listings for sale on the Eastside is down compared to Q3 of both 2015 and 2016, while the listing levels of Seattle, Mercer Island and Lake Sammamish waterfront properties remain about the same.
With only two closed sales in Q3, Months of Inventory—the number of homes for sale divided by the number of homes that sold—climbed dramatically on Mercer Island. Seattle, with four closed waterfront sales, saw a similar but more moderate increase. The Eastside and Lake Sammamish both experienced improvement in the Months of Inventory indicator.
The highest private waterfront Q3 sale was of a newer 6,570 square foot Hunts Point modern estate designed by Baylis Architects with 80 feet of no-bank waterfront on just over an acre of lush, private grounds for $18 million. The lowest sale was a 1,010 square feet westside Lake Sammamish 1958 beach house with 60 feet of waterfront on a shy ¼ acre lot with permitted approval for a new 5000 square foot home.
Check out the full Waterfront Report for a complete list of waterfront home sales by address and community.
ABOUT WINDERMERE MERCER ISLAND
We earn the trust and loyalty of our brokers and clients by doing real estate exceptionally well. The leader in our market, we deliver client-focused service in an authentic, collaborative and transparent manner and with the unmatched knowledge and expertise that comes from decades of experience.
© Copyright 2018, Windermere Real Estate/Mercer Island. Information and statistics derived from Northwest Multiple Listing Service and deemed accurate but not guaranteed.
Q2 2018 Seattle-Eastside Real Estate Report
Signs of transition to a more balanced market are becoming abundantly clear as we move further into 2018. Price growth, while still climbing in most areas, has tapered off and average market times are inching up. Brokers are beginning to dust off forms that have seen little use of late—finance and inspection contingencies—as buyers gain a stronger foothold at the negotiating table.
Some homes are still garnering multiple offers and commanding incredible prices and terms, but many more are seeing negotiations more equalized with fewer buyers at the table. Seattle has needed this return to balance for a very long time. It is likely that buyers who were beaten down and bruised over the past couple of years will return to the house hunt, but it will likely be on their own terms. Waiving all contingencies, releasing a substantial earnest money to the seller up front, and giving the seller a period of free possession after closing will be reserved for only the most coveted homes.
On the other hand, being able to conduct thorough due diligence on a prospective home over a comfortable period after offer acceptance is a buyer right that is returning to the picture. It has been a long time since that was even possible in the hottest neighborhoods. So long, it seems almost foreign. Yet that equalization of power is long overdue and needed to stabilize our market.
Overall median Q2 ‘17 to Q2 ‘18 prices in Seattle rose 11.3% to $801,000, while the Eastside rose 9.1% to $960,000. The average cost per home square foot was $459 in Seattle and $426 on the Eastside (which tends to have larger homes—2,752 square feet vs Seattle’s 2015 square feet—and thus a lower cost per square foot to construct).
Home mortgage interest rates have continued to rise, averaging 4.54% in Q2 putting continued pressure on buyers to purchase before they are simply priced out of the Seattle-Eastside market. Our region is entering a sweet spot where home prices are stabilizing and have likely peaked but interest rates are still affordable. Because rising interest rates have a much larger impact on the monthly mortgage than home price, values would have to fall pretty sharply to offset the impact of a 1-2% increase in mortgage interest rates.
SEATTLE
Up 20.7%, affordable Richmond Beach and Shoreline saw the strongest price growth in Q2 followed closely by Lake Forest Park and Kenmore at 19.4%. West Seattle, South Seattle, Madison Park/Capitol Hill, and Queen Anne/Magnolia all saw increases in the mid-teens. Surprisingly, Ballard-Greenlake and North Seattle—strong contenders in the past couple of years—slowed to 11.8% and 6.3% respectively.
Click here to view the complete report for a neighborhood by neighborhood breakdown of Average Sale Price, size, and number of homes sold.
EASTSIDE
Kirkland was the height of the storm on the Eastside drawing a median price gain of 30.6% over Q2 of last year. This was very loosely followed by Juanita/Woodinville at 14.4%, West Bellevue at 14.0%, and Redmond at 11.2%. South Eastside 7.5%, East Bellevue 7.4%, East of Lake Sammamish 6.9%, and Mercer Island 4.5%, all below the Eastside median, represented the fringe of Q2 appreciation.
Click here for the full report and neighborhood-by-neighborhood statistics!
MERCER ISLAND
Mercer Island, with only two homes priced below $1 million, struggles with the lack of affordability at mainstream price points. While the number of $1-2 million homes for sale is up sharply (46%), finally giving buyers more options to choose from, the pace of sales in that price point has cooled off as buyers wait for the perfect home. A glut of homes for sale in the $3-5 million range—up 67% over this time last year—has caused that segment of the market to stagnate. Homes in the $2-3 million and $5 million plus ranges have fared slightly better than their middle sibling. Mercer Island condos, the only affordable option on the Island, have soared in value with recent sale prices creating shock waves within the industry.
Click here to view the complete report for a neighborhood by neighborhood breakdown of Average Sale Price, size, and number of homes sold.
CONDOS – SEATTLE & EASTSIDE
The number of Seattle metro condos for sale has steadily climbed in Q2 while those available in downtown Bellevue have diminished. Condo prices have continued to outpace their residential counterparts as demand to affordably own vs rent at astronomical prices drives buyer interest. Seattle condos appreciated 20.4-34.6% in all but two markets, North Seattle up 5.6% and SODO/Beacon Hill down 4.5%. On the Eastside, condos were up 13.3-35.2% except for Kirkland up 8.2% and West Bellevue down 3.5%. Not included in these numbers are the newly underway Bosa 188 condos which have a significant number of pending sales that will not close until 2020.
Check out all of these factoids and more in the full condo report.
WATERFRONT
Seattle and Mercer Island have fewer waterfront homes for sale in Q2 this year than in either of the past two years. The Eastside is up very slightly while Lake Sammamish has more than three-fold the number of homes for sale over the same time. The highest closed sale in Q2 was a NW-facing 1937 Yarrow Point estate on 100 feet of waterfront and just over an acre of land for $10 million. The most affordable waterfront sale was a Ripley Lane 2003-built home with 140 feet of waterfront for just shy of $1.7 million.
Check out the full Waterfront Report for a complete list of waterfront home sales by address and community.
ABOUT WINDERMERE MERCER ISLAND
We earn the trust and loyalty of our brokers and clients by doing real estate exceptionally well. The leader in our market, we deliver client-focused service in an authentic, collaborative and transparent manner and with the unmatched knowledge and expertise that comes from decades of experience.
© Copyright 2018, Windermere Real Estate/Mercer Island. Information and statistics derived from Northwest Multiple Listing Service and deemed accurate but not guaranteed.
The Seattle Magazine featuring Five Star agents is available at newsstands now!
The Seattle Magazine featuring Five Star agents is available at newsstands now! Thank you to all my wonderful clients for letting me be a part of your story in 2016 and sending in your positive reviews. Your acknowledgement of my real estate guidance is what enabled me to be selected as both a Zillow All Five Star Broker & a Seattle Magazine Five Star Winner in 2016. I enjoyed every minute of working with both buyers and sellers this past year, and I look forward to serving clients with the same eye towards excellence in 2017.
2016 Rising Star Award From Seattle Magazine
As a recipient of the 2016 Rising Star Real Estate Agent award, I have been recognized by clients and peers for the work I do. I’m very humbled to receive this award from Seattle Magazine, and grateful to my clients and the team of professionals who help me deliver top notch customer service.
I love my job, and am really excited to see where the Seattle housing market is headed in 2017. Thank you for being a part of my journey.
