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Doug Holman
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Doug Holman’s Real Estate Insider — Fall 2015

 

Rainier

Photo credit: Joseph Koenig

Red hot real estate

Summer is over, school is back in session, and as predicted in January, this year’s real estate market has been hot, hot, hot. Leading to the inevitable question, “Can this continue?”

In the words of the recently deceased Yogi Berra, “It’s like deja-vu all over again.” Many newcomers to our region don’t realize that a)  we actually lost a Superbowl in 2005 before we won one and b)  the Seattle real estate market was equally white hot in 2006, just like it is today. The Case-Shiller Index (measures the change in single family home prices), has a reading of 183 today which is on par with January of 2008, just below our pre-recession peak.


 

past present

Current data:

Buyer’s are understandably cautious about buying above the red line, fearful of an impending valley. Sellers don’t want to leave money on the table by waiting too long. The most recent NWMLS figures report that the median single-family Seattle home price of $571,000 (Sept ’15) was 10.44% higher than in September 2014. This 10% increase follows a near 10% increase from 2013. Inventory continues to remain stubbornly low, just a one month’s supply in Seattle.


 

inventory

Crystal ball fine tuning:

So where are we headed? Local tech behemoth and number cruncher Zillow Inc predicts a 6.4 % increase for Seattle single family homes in 2016, lower than year’s past but still above the 3-4% annual appreciation that is considered normal. A stubborn lack of supply and many in-city properties still receiving multiple offers (even as we approach November), suggest there is no reason for the up trend not to continue, albeit at a more gradual pace.


 

Crowd1

population

A final word on 2016:

The Puget Sound Regional Council predicts our area will grow by over one million people in the next 25 years. Our region is a true hub for technology and medicine as well as being a gateway to the east. The current rapid pace of growth is almost certain to slow, but the growth curve is up.


 

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