With demolition complete, excavation has begun at the Avenue Bellevue site located at the northwest corner of Bellevue Way NE and NE 8th Street. (This is the former Cost Plus site, or if you’ve been around Bellevue for a while, the former Albertsons grocery store.) The mixed use project will include 85,000 square feet of retail, the Pacific Northwest’s first Intercontinental Hotel and 322 luxury condominiums positioned in two towers. Completion is projected for mid-to-late 2022.
Today’s Seattle Times (link to the article below) provided a review of the region’s 2019 real estate market comparing sales activity and property values to the prior year. While prices in the county were flat throughout the year, the last quarter of 2019 bucked that trend with inventory selling quickly and multiple offers more common.
There are currently only 26 condominiums listed for sale in all of Bellevue. Since January 1st, 11 new condos were listed for sale – all have sales pending and many received multiple offers. What’s driving the spring market?
Low mortgage interest rates. Fannie Mae conforming loan limits increased to $741,750 in King County. (Jumbo loans will have slightly higher interest rates.) Conventional and FHA loan programs offer low down payment programs (3%, 5%, 10%) for qualified buyers, making it easier to purchase a first or move-up home.
Amazon is scheduled to start moving employees into the former Expedia office tower in downtown Bellevue this summer. Amazon has also signed leases for several office towers currently under construction that will be completed in the next 9-24 months. Employees who know their jobs will move from Seattle to Bellevue are already searching for homes in Bellevue.
Buyers want shorter commutes, and they’re willing to make compromises for less car time and more personal/family time. There are dozens of condo communities within a 15 minute or less commute to Bellevue’s central business district as well as Kirkland and Redmond workplaces. Those communities are in high demand.
The “spring” market is off to an early and active start. The next few weeks should set the pace and reveal what buyers and sellers can expect in the coming months.
Today’s Seattle Times and Puget Sound Business Journal reported that the 2020 real estate marketplace was likely to open fast paced with low inventory levels and high buyer demand following a robust December of residential sales. Without a significant increase in available housing inventory it could be a “red hot market” this year with a return to multiple offers and rising prices.
While most of 2019 was relatively flat for home sales and property appreciation in King County, the last quarter of the year ended up being the most active in recent years. The same was true for Snohomish, Pierce and Kitsap Counties.
Downtown Bellevue’s condo market was no different – flat throughout most of the year with a flurry of activity in the last quarter. There were 258 downtown condo sales in 2019 reflecting a median sales price of $729,500, less than a 1% increase over the prior year. More notable is that 46 of those 258 condos sold during the last quarter and the median sales price for the last 90 days of the year was $869,500. There are currently only 16 condos listed for sale in the Bellevue downtown/98004 zip code.
More jobs are coming to downtown Bellevue this year and continuing for the next few years as companies plan to move to or expand their footprint in Bellevue. Employees, anticipating a move to the Eastside, are already searching for homes close to workplaces and transit. Location, location, location is still true in real estate, but of growing importance are transit options and access to those workplaces, schools, amenities, services, etc. Communities in and near downtown will be in high demand as buyers more on available transit options (light rail, bus, ride services, bike, etc.) to reduce commute time and regain quality of life. Location will always favorably impact value, but the word for this decade may be “transit” when it comes to property values and market desirability.
In this fast paced, competitive real estate market, it’s common, in an effort to “win”, for buyers to waive contract conditions such as inspection, financing, appraisal, neighborhood review, etc. Buying a condominium is different than buying a house. With condominiums perhaps the most important contract condition in place to protect a buyer is the homeowner association (HOA) resale disclosure documents. The State of Washington requires a seller to provide the HOA resale disclosure to a buyer upon mutual acceptance and the buyer has the right to review and approve or disapprove based on the information contained in the package.
What is a resale certificate? It is a set of documents typically assembled by the condominium’s association manager that includes the summary “resale certificate” which discloses information about the HOA, delinquencies, pending special assessments, HOA reserve account balance, owner occupied vs. rental units, pending lawsuits, etc. Supporting documents will include detailed information about the HOA’s budget and financial statements, reserve study, meeting minutes, rules and regulations, recorded Bylaws and Declaration and insurance.
This is a large package of detailed information which too often buyers glance at briefly or ignore totally. It’s important to understand the health of the HOA and how well it is functioning, how well funded the reserve account is, and what conditions or community rules and regulations could impact a buyer’s planned use of the property.
What should you look for? The recorded Declarations can be hundreds of pages, which is overwhelming. There are major pieces you should review, but it’s wise to spend some time going through all the documents to understand how the HOA is governed and how owner’s monthly assessment dollars are being spent.
Resale Certificate – A 5-7 page document highlighting the major elements of the HOA (owner occupancy, delinquencies, reserve balance, special assessments, lawsuits, etc.).
Budget and financial statements – Review the annual financial statements and current operating budget to see the line-by-line operating expenses. Is the HOA staying within budget? Is the HOA building adequate reserves? Is the HOA financially healthy? Continue reading
Earlier this month the Seattle Times reported on a recent Zillow Zestimate for a home in Belfair on the Kitsap Peninsula. The Mason County assessor’s value of the home was $283,000. The home recently sold for $225,000 (below market value because the home was headed for foreclosure). A Zillow Zestimate published the home’s value at $1.8 million – 700% higher than the county assessor’s office, several real estate companies and just about any local Realtor® who knows and understands the local market. This is an example of how algorithms can go wrong.
The Zillow real estate website is both loved and hated by buyers, sellers, appraisers and real estate professionals. This recent error in valuation is a classic example why Zillow’s Zestimates should be taken with a grain of salt. Zillow is a popular real estate data company that provides real estate data on millions of homes throughout the United States. Zestimates are created using algorithms, publicly available sales and market data. Zillow has no real estate brokers – no one from Zillow has ever visited the homes or neighborhoods for which their estimates of value are provided. Continue reading
Earlier this month I shared 2017 King County real estate market statistics supplied by the NWMLS. Median sales prices were up 15% county-wide (houses and condos) over 2016. Taking a closer look, here are the 2017 market stats for Bellevue condos:
- 759 condos sold in 2017 (resale and new construction), up from 746 in 2016 for a 2% increase
- The median Bellevue condo sales price was $500,550 in 2017, up 30% over 2016.
Just eight weeks into the new year stats haven’t changed much. There are just 20 condos available for sale in Bellevue. Newly listed condos are trickling into the market and selling quickly. So far this year 61 resale condos (vs. new construction pre-sales) have sold with an average market time of 15 days. Sales prices are averaging 5.5% over the list price.
This year has already seen an all time record condo sale in Bellevue. A penthouse at Bellevue Towers sold earlier this month for $11,950,000. Custom designed throughout, the home offers 6,398 SF of luxury interior living space plus multiple terraces that add 10,000 SF of outdoor space with 360 degree views.
No doubt the penthouse sale will hold the city/county/state condo sales record for some time, but sales data for the balance of the market is a bit more realistic. Of the 61 resale condos sold since January 1st, sales prices ranged from $202,750 for a 691 SF one bedroom/one bath to $2,237,500 for a 2,615 SF 2 bedroom + den/2 bath penthouse. The median Bellevue condo sales price so far this year is $558,568, but of those 61 sales, 17 (20%) sold for $400,000 or less. Condo values in and around the central business district will continue to command higher prices per square foot, but step just outside the downtown core and prices are far more affordable while still offering easy access to downtown’s workplaces, nightlife and arts and Bellevue’s sought after schools.
Available condos are going to be in short supply for the foreseeable future. A limited number of communities are in design review or under construction, but delivery of those homes is 2+ years away. A few recently completed new communities, mostly multi-level townhomes, are adding new homes to the mix but supply is limited with prices starting in the $700,000s and up. The supply of condos this year is likely to be found in the dozens of existing communities just outside the central business district. They offer a sought after Bellevue address and access to great schools. New construction is very sexy, and the amenities luxurious, but older communities often offer larger floor plans, more green space and more affordable prices. Trading a few blocks of location may gain you a lot of space and lifestyle for less money. Those resale condos are going to be in short supply this year too. If you’re ready to sell, be ready to move quickly. If you’re ready to buy, be ready to act quickly and work with a Realtor® who knows and understands the market.
The info-graphic above provides a quick look at 2017 King County real estate market statistics.
- nearly 3% more homes (condos and houses) sold in 2017 vs. 2016
- the median sales price was up nearly 15% county-wide
- at the end of 2017 there was less than a one month supply of available homes
- a 4 – 6 month supply is considered normal – we haven’t sen a “normal” level of supply for 2+ years
Six weeks into 2018 the stats haven’t changed much. Homes are coming on the market slowly and are selling quickly. Inventory still can’t meet buyer demand. The “spring” market generally opens up in mid-to-late February. Hopefully there will be more condos and houses available as the weather begins to warm.
The take away . . .
- Planning to sell? Buyer demand is high but condition and location are still important selling factors.
- Ready to buy? Position yourself to be a strong buyer. Meet with your lender and obtain a current loan pre-approval . Work with your Realtor® to educate yourself on neighborhoods, schools, recent sales prices and list vs. sold statistics, commute times, etc.
- Expand your options – maybe the home that fits your lifestyle isn’t a house. Don’t rule out a condo or townhouse which can offer a single family lifestyle with lower maintenance responsibility, a great alternative if you don’t want a lot of yard or exterior home maintenance.
2018 is expected to be another challenging real estate market for buyers and sellers. Be patient. Be flexible. Be ready to move quickly.
Robin is a Realtor® with Windermere Real Estate/East. She lives and works in Bellevue and specializes in the Eastside’s condo and townhome communities.
An article in the Puget Sound Business Journal this week compared the available local condominium inventory to New York City. Granted, NYC is a much larger and more expensive market, but currently NYC has 388 condos for sale priced less than $500,00. At the time the article was written there were only five condos available for sale in Seattle priced under $500,000. Here on the greater Eastside there are less than 100 condos available for sale – not nearly enough to satisfy demand.
We are fortunate to live in a region where the economy is thriving, employers are hiring, housing is relatively affordable (compared to some other major metropolitan areas) and its a beautiful place to live with a temperate climate and year-round recreation options. Recent U.S. Census Bureau reports show that nearly 250 people move to the Seattle/Bellevue metropolitan area every week (for all the reasons just mentioned). Its also a great place to retire because of the mild climate, vibrant arts, entertainment and social scene and world class health care services, so people aren’t leaving in great numbers either. Because retirees stay in the area and because job opportunities bring hundreds of people a day to the area, it doesn’t appear there will be much change or relief to the tight inventory or escalating housing prices in the near future. Continue reading
I was recently approached for an on-the-street survey conducted by a major local tech company regarding smart houses, asking if I would value "smart house" features for comfort, convenience, energy conservation and security.
The growth of "smart homes" has exploded worldwide. According to a recent article in Realtor® Magazine, approximately 100 million households will be "smart" by the end of the year and that number is expected to grow to 300 million in the next ten years. Obviously tech companies are banking on this trend, as the market for products regulating home automation, appliances, energy use, security and data analytics is growing. The big question is consumer need and acceptance . . .
- will a smart home factor in a buyer's decision to purchase one home over another
- with prices still relatively high and the technology still fairly complicated, will the average homeowner embrace the technology
- is this just a passing fad, or could the technology eventually take off (solar panels took years) and demonstrate a return-on-investment
Consumers are increasingly tech savvy and showing more interest in smart home technology. While these products are growing in popularity (thermostats, alarms, cameras, auto-locking doors, etc.) and can be easily controlled from a phone or tablet, how many buyers will be more likely to buy a home if smart products are installed? Is smart home technology an upgrade the average homeowner would consider instead of making cosmetic updates? It will be interesting to see how long it takes for smart home technology to be the new norm.