Wednesday, September 27th 2017
For most of the housing market, homes are selling in Pierce County faster than owners can put new ones up for sale, drawing down an already dwindling supply of houses just as the market heats up for the spring and summer.
Typically, Tacoma-area homes in the million-dollar range are immune to broader market trends or even what’s happening in King County. Until now.
Think of it as our new trending market, without the bidding wars (yet).
In recent months, dozens of million-dollar abodes have sold or are in the process of closing. If the pace keeps up, sales of homes worth a million dollars or more could eclipse the record of 86 sales set in 2007.
“This is crazy talk,” said Kevin Mullin, owner-partner and designated broker of Windermere Professional Partners in Tacoma. “If all (homes) currently under contract sell, that would mean 42 sales, which is already more than half of last year. And we are not even halfway through the year.”
To date, 16 such homes have sold in Pierce County, with another 26 million-dollar homes pending sale. Among those pending is the $5.5 million Weyerhaeuser mansion, also known as Haddaway Hall.
Compare that with just a few years ago, when 23 residences worth $1 million or more sold in each of 2011 and 2012, according to data from Northwest Multiple Listing Service.
Thurston County also has seen growth in these properties. Just one sold for $1 million or more in 2012, the data show. Last year, nine such homes sold in that county.
Where are these buyers coming from? Many fly in from other parts of the country, said Jeff Williams, a real estate broker for South Sound Property Group, part of Windemere Professional Partners. He works with fellow broker Mark Pinto.
“They could be coming for a job or lifestyle change,” Williams said. “It could be a second home for people who live in California.”
One historic home in Tacoma’s North End listed at nearly $1.3 million. Its sweeping views of Commencement Bay and the Olympic and Cascade mountains drew 25 showings in three weeks — a pace unheard of just a few years ago, Williams said. The final sale price was not available.
Williams and Pinto work together to sell luxury and historic properties in Tacoma, Lakewood and Gig Harbor. They said the luxury or “trophy home” market has heated up in the county in the past six months to a year.
“I think it speaks to the confidence that people have in the market and the broader economy,” Pinto said. “They probably have been sitting on the sidelines in a house that they like, but they want to buy up to that aspirational house.”
Unlike homes at lower price points, high-end buyers won’t get into a bidding war just yet, Williams said.
That’s because it’s a buyer’s market above $1 million. Unlike the rest of Pierce County’s housing market, which has less than one month’s supply in some areas of the county, million-plus homes have a whopping 19.6 months of supply, Williams said. Most of those homes have been on the market for more than 100 days — a dream for a buyer in the lower-end markets.
But not all homes at that price point are priced realistically, Pinto said.
“If it’s completely unrealistic, the phone doesn’t ring,” Pinto said. “Well-priced homes over $1 million are selling and much more so than we’ve seen in years.”
In 1999, just 34 homes in Pierce County were valued at more than $1 million, according to News Tribune archives. Last year, the county valued 715 residences at $1 million or more, according to Pierce County Assessor records.
All of the cranes and construction in downtown Seattle signify a city that’s exploding with growth.
New numbers released by the Downtown Seattle Association back that up, suggesting that record development is sweeping through the city.
The association’s new development guide found 68 current construction projects in the greater downtown area at the end of 2016, a new high.
DSA also suggests 6,000 new residential units will be built over the next year. Residential development is particularly hot right now.
Construction on a new 40-story tower called Nexus at Minor Ave. and Howell St. will break ground soon.
“We think Nexus is coming at the perfect time for Seattle,” said Dean Jones with Realogic Sotheby’s International Realty.
Jones says sales will begin shortly on the nearly 400 condos, which are expects to go quick.
Jake Whittenberg, King 5
You know that play in football where the quarterback seems to hand the ball off to a running back and the entire defense concentrates on that “runner,” only to find that the ball ended up in the hands of someone on the other side, who then sprints down the sideline and scores a touchdown? That’s pretty much what it’s like to buy a home during the holidays. While everyone is busy looking at all the pretty, shiny things and on-sale things and yummy things, you’re sneaking around the other side with the ball, or, rather, the offer, that gets you the house you want.
But buy over the holidays and you slice through the buyer pool. While others are trimming their tree or searching for the perfect pumpkin cheesecake recipe, you’re off snagging the home you want.
Because: First-time buyers
The above scenario, where buyers are constantly being outbid on homes, is a nightmare for first-timers looking for a home. Not only is there a verrrrrry limited supply of available homes that are affordable in the first place, but the number of folks that are vying for them is tremendous. If you’re in the market and have never done this before, you’re probably pretty frustrated.
There are time-tested tips for winning in a multiple-offer situation, like getting pre-approved, limiting contingencies on the home, being flexible about the closing, and writing a “love letter” to the seller, which can appeal “to the heart can make your offer stand out,” said NerdWallet.
But acting during a time when others may be distracted and not actively searching is perhaps the most effective method of getting what you want. “About one million consumers will purchase a home from November to January this year, when home prices are a bit softer,” said Forbes.
If that sounds like a big number, consider this: “More than 85 percent of buyers who say they plan to buy a home in the next year say they will wait until the spring or summer,” according to data from Realtor.com’s “Top Tips for Home Buyers and Sellers in 2016” survey.
Because you might actually get a deal
No one likes to overpay, regardless of their price point. And multiple offers that drive up home prices are a drag for everyone (but the seller!). If you consider that those who are selling their home during the holidays are generally doing so because they have to, not because they want to, it makes sense that when you do find a house, it might be priced better than anything you’d find months later. In fact, according to The Balance, “Home prices typically drop to a 12-month low” in the month of December.
“Sellers tend to avoid the end of the year due to the short days, wintry weather and conventional wisdom that says buyers are otherwise occupied, Tim Deihl, associate broker at Gibson Sotheby’s International Realty in Boston, told Bankrate. “But those who do choose to sell at year-end are often under pressure and highly motivated to cut a deal. A seller who’s looking to move a piece of real estate during the holidays is a seller who needs to sell, because nobody in their right mind would pick that as the most convenient time to list their property. And that’s why the year-end might be a smart time to buy: Determined house-hunters can take advantage of sellers’ urgency.”
Because what better present could there be?!
You might want a new KitchenAid mixer or a flat screen or a weekend getaway. But do any of those things compare to a new home? The answer is no. No, they don’t. If you’re stumped at what to get your honey or your family, or what to ask for, here it is. And, if you time it right, you might even be able to get that home on Christmas Day.
“Almost nobody looks at homes on Christmas Day. It doesn’t matter whether you are a Christian nor whether you celebrate that holiday, there are much lower numbers of buyers shopping for a home in December,” said The Balance. “But buying on or near Christmas Day is a smart move.”
In addition to all the other reasons the Christmas holiday season is so attractive for buyers, “People are in good moods, celebrating, opening presents, enjoying family and, let’s face it, some are a little tipsy,” they said. And, “People are more inclined to be generous, even if it means coming down on the price. Of course, the key is to find a real estate agent who will a) work on Christmas and b) be aggressive enough to worm her way into the seller’s home without batting an eyelash.”
It’s getting even more expensive to become a homeowner — especially if you’re looking to buy in Seattle or Dallas.
Those cities saw their median home prices rise to the highest point ever: $385,000 in Seattle and $240,156 in Dallas, according to a report released Thursday from real estate data company ATTOM Data Solutions.
Across the nation, home prices reached an all-time high of $231,000 in June, up 6% from May and up 9% over the same time last year. That exceeds the peak set before the housing crisis, when they reached an average of $228,000 in 2005. June also marks the 52nd month in a row of rising home prices across the nation.
The spike in home prices is being helped along by falling mortgage rates, which have plummeted to three-year lows, said Daren Blomquist, senior vice president at ATTOM Data Solutions. It’s also a sign of confidence in the rebounding housing market and the economy as a whole. For instance, job growth nationwide soared in June, and consumer confidence has remained high even amid global economic shock following Britain’s decision to leave the European Union.
Seattle’s increase in home prices can be explained by “not only continued faith in the housing market, but also the buoyancy of the regional economy,” said Matthew Gardner, chief economist at Windermere Real Estate, who covers the Seattle market, in a statement. (The city is a thriving tech center that houses multiple Fortune 500 companies, including Amazon and Starbucks.)
A similar phenomenon can be seen in cities around the country. Nearly a third of the 130 metro areas analyzed saw all-time home price highs in June, including Minneapolis, at $235,950, Atlanta ($192,000), and St. Louis, ($190,209).