The news is so busy elsewhere that it’s a little light on the real estate front. The ground got a bit shaky in parts of the state, due to fault activity that took place in Kitsap. Some people report having felt it in Bellevue. These were minor shakes that, experts say, don’t put us at risk for any of the big quakes everybody is waiting on.
Also, a rich Austrailian expressed opinions about millenials and avocados. Specifically, he cited avocado toast as the sort of thing millenials should give up in order to buy houses. I’m going to go ahead and say, as an industry professional, that avocados, toast, and the combination thereof have nothing to do with house purchase decisions made by the millenial portion of the public. In case you were worried about the great avocado threat to the housing market, go ahead and sleep easy. Everybody in the industry knows kombucha is the real threat.
There will not be a Wednesday links post next week, by the way. You’ll get two week’s worth on the 31st to make up for it.
The sun has been making regular appearances and the mercury is rising, so check out this map of Washington State’s depressing place names and the stories behind them. My favorite is #4, Desolation Peak, but I do have a literary bias so it was cheating by getting Jack Kerouac involved.
Rent prices are continuing to do interesting things, by which I mean, they’re still going up, but not uniformly and not at the rates we’ve been seeing. (Rents showing a slight drop in Capitol Hill? I’m wondering if that’s a data blip, or a settling out now that the light rail has been open for a while.) We’re still ranking in the top 10 nationally across a variety of sources. Rent prices in the region are a very important metric to watch for assessing the state of the housing market as a whole. We have a lot of outside investors, but not enough to power the entire market, and rents are a good indicator for where the locals are going to stand when they assess their relationship to the market.
That’s important because this year may or may not be the year that kicks off a genuine housing bubble. The housing stats since November have been an ambivalent will-we-won’t-we mix, and that’s continuing. So far we’ve been leaning more toward the won’t-we side, but March showed signs of a shift. April doesn’t appear to have supported that. Inventory is still low, but the number of sales finally dropped, and there are some indications that prices are starting to plateau. Those are both really good signs that the market isn’t getting frothy and the growth we’ve seen in the last few years have been a natural correction in response to the recession. It’s not definitive, though, and we’ll have to keep watching the numbers as the year continues. If sales continue to fall and prices hit a definitive plateau, we’ll be in good shape. Give us a couple years for inventory to correct toward something reasonable, and we might even see a sane market again.
The news this week is all about renting. Seattle is one of the few places in the country where the current median rent wouldn’t cover the mortgage on the median priced home according to a study from Zillow. Most of the time in most places, median rents and mortgage payments are commensurate, or the rents are higher. The Seattle market just keeps finding new ways to stay special. That doesn’t mean that buying can’t be the right choice for somebody renting in the current market, but it does mean the current market is challenging, and there may need to be reasons other than strictly budgetary ones at play to make renting a good choice for a buyer.
Which makes the timing of this article from Curbed Seattle on the best neighborhoods in the area to rent in fortuitously timed. They have several different categories based on your main priority in your neighborhood, and include a category for the best burb to rent in. Even if you’re stalwart in your property ownership, it’s a handy article just to see how your neighborhood stacks up from a renter’s-eye-view.
The burbs category in the Curbed article is especially handy in light of this article from rentcafe.com blog breaking down the growth rates for renters in 20 metropolitan cities and comparing it to the rates of growth in the suburbs. In most cases, including Seattle, the burbs are adding renters faster than their urban centers. That’s particularly surprising given the stereotype of people renting in the city, but moving to the burbs when they buy. Market norms and trends a generation from now probably aren’t going to look much like they traditionally did before the housing crisis, and this is a striking example of where those differences are going to come from.