The Seattle Times has had some good real estate coverage if you’re looking to get a feel for the flavor of the market. One is a behind-the-scenes look at the negotiation for a house in West Seattle. Another is a compilation of Mike Rosenberg’s reddit AMA on the local market and housing in general.
The Puget Sound Business journal dug into demolition and construction permits to find the areas of the city that are the hottest for teardowns and the answer isn’t surprising: Ballard is the winner. Of the hot neighborhoods in Seattle, it’s the one with the largest inventory of property that hasn’t been through an upgrade cycle or wasn’t built to the top of the market in the first place, so teardown activity now makes sense.
The Seattle Bubble appears to be running out of headlines for the perpetual sameness we’re seeing with the latest market numbers. I’m sympathetic to the sentiment, though I think Tim and the NWMLS both missed the important takeaway from the data indicating that more houses are sitting on the market past their review date and other listings having price reductions: it means that marketing a property does still matter and buyers aren’t literally buying anything. That’s good news of a sort, if you’re willing to strain for it. It means things can still get worse.
I was just singing the Seattle Bubble’s praises, but I’m going to do it again. They’ve put up an analysis of housing affordability in the area, with adjustments for what the index would be with different interest rates. I highly recommend reading the article as a whole, less for its information about affordability rates in the area, and more because it winds up being a very useful discussion of interest rates, where the current rates fall in comparison to historical norms, and the potential affect they can have on the market. With affordability reaching for historical lows and interest rates creeping back toward more normal ranges, the rising interest rates could put some pressure against rising prices in many markets. I don’t foresee it having much of an impact on that front in the Seattle market since we have plenty of cash, and high-cash buyers who can avoid or mitigate those effects, but it could start to affect national trends which will, eventually play into the Seattle market.
If you’ve been paying attention to the upzoning going on around the city as part HALA, then you’ll be wanting to pay attention to the next neighborhood up for review: the International District. And not just because increased density in that neighborhood might increase floorspace for tea shops. (Though, in my opinion, that’s a very good reason to pay attention.) The two neighborhoods that have already been through review had unanimous approval, but they were also, arguably, the least controversial choices. There was small but significant opposition to the downtown plan because many activists wanted an increase in the Mandatory Housing Affordability component of the downtown plan, the opposite of the NIMBY trend expected in most neighborhoods, but overall these were straightforward approvals. The International District is a different creature altogether, and relatively unique in the city, too. Paying attention to the conversations going on during its review could be enlightening about what to expect as HALA approvals move into more controversial parts of the city.
And a final farewell to Bertha. After many years, many breakages, and a lot of disappointment, she’s finished her job and gotten dismantled. SDOT has continued their support for webcam curiosity and has a video up to let you see the giant drill head for her final resting place. (She’s mostly getting recycled.)
2016 is out like a gone thing and 2017 is here. The weather is downright chilly, but from what I can see, the market hasn’t really noticed. We had a couple quieter weeks there in December, but things are picking right back up now that the holidays are over. It’s going to be an interesting year.
If you feel like the Seattle market was particularly adventurous last year, you aren’t wrong. The October numbers from Case – Shiller show Seattle with a 10.7% year-over-year increase in housing prices. That’s great for sellers, and while it could be rough for potential investors, it comes at the same time we’re continuing to have the biggest rent increases in the country. Potential first time buyers are the ones who are going to have the hardest time this year, but with their rent going up, it’s looking like a choice between the proverbial rock and hard place.
My resolutions for this year involve teaching more seminars, talking to more people, and petting more cats. I’d resolve to drink more tea, but I think I’m already fairly close to peak tea consumption.