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LARRY & KATHY REICHLE, EASTSIDE REAL ESTATE TEAM

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Housing market expected to heat up in King, Pierce Counties

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Real estate experts say low inventory will mean the hottest housing market in years. Experts also call for an increase in bidding wars on homes.

GIG HARBOR, Wash. — Real estate experts say the 2020 housing market is going to heat up to levels that haven’t been seen since 2017.

According to Northwest Multiple Listing Service, the number of homes on the market has dropped dramatically: 54% in Thurston County, 41.4% in King County, and 40% in Pierce County.

That means the homes that are on the market are expected to sell faster and go for more.

“We have record low inventory, so when houses do come on the market, they’re gone,” said Windermere real estate agent Cindy Marchand. “We normally have them sold within a week to 10 days. Sometimes faster.”

Windermere agent Nick Dahl said the crunch has triggered a heightened interest in new construction, like Gig Harbor’s Cushman Pointe development, which features 51 lots.

“We’ve been moving a lot faster than we actually anticipated,” said Dahl. “We’ve sold 19 homes already, and I think we’ve beat most of our goals in terms of selling houses per month.”

Come spring and summer, the hot market will likely mean an uptick in bidding wars.

Redfin, the Seattle-based real estate brokerage site, expects about 25% of offers to face bidding wars in 2020 compared to only 10% last year.

Along with low inventory, the factors driving the crunch include a strong job market, low-interest rates, and an influx of out-of-state buyers.

Marchand said current market forecasts show the market may not cool off until 2021.

http://www.king5.com/video/features/jonbyedec19/281-ab12c4ef-017e-4fb5-b024-26474c0264a3?jwsource=cl

Author: Christin Ayers

 

Curious Case: A U.S. Housing Market No One Saw Coming

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November inventory drops 9.5 percent year-over-year; homes priced below $200,000 decreased by a substantial 16.5 percent

SANTA CLARA, Calif., Dec. 9, 2019 /PRNewswire/ — What a difference a year makes. In November 2018, higher mortgage rates and increasing inventory characterized the U.S. housing market. This November, the number of homes for sale fell nearly 10 percent year-over-year in a market where low interest rates are spurring increased demand, according to the November 2019 Housing Trends report released today by realtor.com®.

“As millennials — the largest cohort of buyers in U.S. history — embrace homeownership and take advantage of this year’s unexpectedly low mortgage rates, demand is outstripping supply, causing inventory to vanish,” according to realtor.com senior economist, George Ratiu. “The housing shortage is felt acutely at the entry-level of the market, where most millennials are looking to break into the market for their first home.”

Ratiu added, “The issue is further compounded by the fact that sellers tend to be more reluctant to list during the colder time of year when the market typically makes a seasonal slowdown.”

Based on realtor.com’s listing data, the shortage of available homes for sale is accelerating. Overall, inventory declined 9.5 percent in November, compared to October’s drop of 6.9 percent.

November’s inventory declines amounted to a loss of 131,000 listings nationwide, compared to this time last year. In the nation’s 50 largest metros, inventory declined by 8.8 percent year-over-year. Additionally, the volume of new listings hitting the market has decreased by 7.7 percent since last year, adding to the nation’s inventory woes.

Finding an affordable home still remains one of the largest obstacles to homebuyers, and is predicted to continue to be a problem for many buyers heading into 2020. The inventory of homes priced below $200,000 decreased by a substantial 16.5 percent year-over-year in November, up from the 15.2 percent decrease seen in October. Inventory decreases were the norm across all price points in November. Mid-tier inventory priced between $200,000 and $750,000 also decreased by 7.4 percent year-over-year compared to October’s year-over-year drop of 4.3 percent, while high-end inventory priced above $1 million decreased by 1.7 percent year-over-year, compared to October’s year-over-year increase of 1.3 percent.

“The inventory decreases seen across all value ranges could in part be attributed to a spill-over effect, as the lack of inventory has pushed buyers up the price chain to stretch their budgets and search for homes above their initial price target,” Ratiu noted.

The metros with the sharpest drops in inventory were San Diego (-28.1 percent); Phoenix (-24.1 percent); and Rochester, N.Y. (-22.4 percent). Only four of the 50 largest metros saw inventory increase year-over-year. The largest inventory increases were in Las Vegas (+14.4 percent); Minneapolis (+11.5 percent); and San Antonio, Texas (+7.2 percent).

Facing even fewer options than last year, eager buyers are acting quickly to close on the few homes that are currently available. During November, home sold in an average of 70 days nationally, two days more quickly than last year. Raleigh, N.C.; Hartford, Conn.; and Birmingham, Ala.; saw the largest declines in days on market with properties spending 10, 10, and 9, fewer days on the market than last year, respectively. Conversely, properties in some of metros found homes sitting on the market longer. Homes in Los Angeles; San Jose, Calif. and Las Vegas sold 20, 12, and 10 days more slowly than last year, respectively.

Meanwhile, the national median home price has yet to adjust to the recent inventory declines after a multi-month run up in inventory earlier this year. The median U.S. listing price grew by only 3.6 percent year-over-year, to $309,000 in November, which is less than the 4.3 percent year-over-year increase seen last month. However, of the 50 largest U.S. metros, 43 saw year-over-year gains in median listing prices. Los Angeles (+16.6 percent); Rochester, N.Y. (+12.8 percent); and Birmingham, Ala. (+12.3 percent); saw the highest year-over-year median list price growth in November. Conversely, the steepest price declines were seen in Louisville, Ky. (-4.0 percent); Minneapolis (-2.0 percent); and Houston (-1.6 percent).

Metros Seeing the Largest Declines in Inventory

Metro

Active Listing
Count YoY

Median Listing
Price

Median Listing
Price YoY

Median Days on
Market

Median Days on
Market Y-Y

San Diego-Carlsbad, Calif.

-28.1%

$715,000

8.4%

46

7

Phoenix-Mesa-Scottsdale, Ariz.

-24.1%

$375,000

8.9%

45

-1

Rochester, N.Y.

-22.4%

$202,900

12.8%

50

-8

San Jose-Sunnyvale-Santa Clara, Calif.

-22.2%

$1,099,000

1.5%

49

12

Seattle-Tacoma-Bellevue, Wash.

-22.1%

$580,000

5.5%

49

4

Cincinnati, Ohio-Ky.-Ind.

-21.5%

$260,000

5.7%

52

-5

Philadelphia-Camden-Wilmington, Pa.-N.J.-Del.-Md.

-21.4%

$295,000

11.9%

64

-2

Washington-Arlington-Alexandria, DC-Va.-Md.-W.V.

-21.2%

$475,000

6.8%

50

-1

Providence-Warwick, R.I.-Mass.

-20.1%

$375,000

7.2%

59

2

Sacramento–Roseville–Arden-Arcade, Calif.

-19.5%

$485,139

9.0%

55

6

Oklahoma City, Okla.

-18.5%

$250,000

5.9%

55

-6

Virginia Beach-Norfolk-Newport News, Va.-N.C.

-18.1%

$299,900

7.6%

63

-2

Memphis, Tenn.-Miss.-Ark.

-17.5%

$234,900

9.8%

60

-7

Riverside-San Bernardino-Ontario, Calif.

-17.4%

$409,900

3.8%

57

7

San Francisco-Oakland-Hayward, Calif.

-17.0%

$933,000

5.1%

43

7

Nashville-Davidson–Murfreesboro–Franklin, Tenn.

-16.2%

$369,900

5.7%

41

-2

Birmingham-Hoover, Ala.

-15.3%

$252,500

12.3%

72

-9

Portland-Vancouver-Hillsboro, Ore.-Wash.

-14.8%

$465,000

-1.0%

59

4

Hartford-West Hartford-East Hartford, Conn.

-14.2%

$275,000

3.0%

65

-10

Austin-Round Rock, Texas

-13.7%

$354,718

1.4%

61

-3

Tampa-St. Petersburg-Clearwater, Fla.

-13.3%

$279,000

4.8%

60

3

Charlotte-Concord-Gastonia, N.C.-S.C.

-13.0%

$335,000

1.5%

57

-6

St. Louis, Mo.-Ill.

-12.6%

$219,900

3.9%

70

1

Pittsburgh, Pa.

-12.2%

$195,000

10.2%

74

-5

Baltimore-Columbia-Towson, Md.

-12.0%

$320,000

3.2%

58

-1

Orlando-Kissimmee-Sanford, Fla.

-11.7%

$319,000

5.1%

63

1

Los Angeles-Long Beach-Anaheim, Calif.

-11.2%

$859,000

16.6%

64

20

Boston-Cambridge-Newton, Mass.-N.H.

-10.7%

$589,900

9.4%

57

5

Buffalo-Cheektowaga-Niagara Falls, N.Y.

-10.7%

$189,900

1.7%

53

-3

Milwaukee-Waukesha-West Allis, Wis.

-10.1%

$279,900

4.4%

56

3

Columbus, Ohio

-9.9%

$275,000

5.8%

51

-2

Kansas City, Mo.-Kan.

-9.4%

$300,000

3.5%

63

1

Indianapolis-Carmel-Anderson, Ind.

-8.7%

$259,900

8.3%

59

1

New Orleans-Metairie, La.

-8.2%

$284,000

1.7%

73

-2

Cleveland-Elyria, Ohio

-7.9%

$185,000

0.3%

65

-1

Jacksonville, Fla.

-7.8%

$312,000

4.1%

68

-3

Denver-Aurora-Lakewood, Colo.

-7.2%

$498,000

4.8%

51

7

Miami-Fort Lauderdale-West Palm Beach, Fla.

-7.2%

$409,000

2.8%

91

5

Richmond, Va.

-6.0%

$315,000

2.3%

56

-1

Louisville/Jefferson County, Ky.-Ind.

-5.1%

$244,900

-4.0%

52

-1

Raleigh, N.C.

-3.8%

$359,900

1.4%

63

-10

New York-Newark-Jersey City, N.Y.-N.J.-Pa.

-3.1%

$550,000

2.8%

66

-4

Chicago-Naperville-Elgin, Ill.-Ind.-Wis.

-2.3%

$309,000

2.3%

57

1

Dallas-Fort Worth-Arlington, Texas

-1.0%

$340,000

0.0%

59

1

Houston-The Woodlands-Sugar Land, Texas

-1.0%

$305,000

-1.6%

64

0

Atlanta-Sandy Springs-Roswell, Ga.

-0.6%

$320,000

0.3%

57

3

Detroit-Warren-Dearborn, Mich.

0.8%

$232,500

3.3%

50

3

San Antonio-New Braunfels, Texas

7.2%

$285,750

-1.5%

63

-4

Minneapolis-St. Paul-Bloomington, Minn.-Wis.

11.5%

$342,990

-2.0%

50

-2

Las Vegas-Henderson-Paradise, Nev.

14.4%

$319,500

-0.1%

53

10

About realtor.com®
Realtor.com®, The Home of Home Search℠, offers the most MLS-listed for-sale listings among national real estate portals, and access to information, tools and professional expertise that help people move confidently through every step of their home journey. Through its Opcity platform, realtor.com® uses data science and machine learning to connect consumers with a real estate professional based on their specific buying and selling needs. Realtor.com® pioneered the world of digital real estate 20 years ago, and today is a trusted resource for home buyers, sellers and dreamers by making all things home simple, efficient and enjoyable. Realtor.com® is operated by News Corp [Nasdaq: NWS, NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. under a perpetual license from the National Association of REALTORS®. For more information, visit realtor.com®.

Media Contacts:
–  Cody Horvat – cody.horvat@move.com

 

You Might Not Want to Pay Off Your Mortgage Early — Here’s Why

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Paying off your loan early offers a guaranteed return — but you might be able to top that.

Being debt-free is a good feeling, while living under a mountain of debt is not. It’s reasonable that many people aim to get out of debt as soon as they can, and it’s actually imperative that those with high-interest-rate debt, such as credit card debt, pay that off pronto.

However, not all debt needs to be paid off as quickly as possible. For example, there’s a good case to be made for sticking with your regular mortgage payments and not aiming to retire that debt too soon.

Good debt vs. bad debt

Don’t assume that all debt is bad. When managed well, debt can be quite useful, such as when it helps you buy a home, or a car, or go to college. If you’re saddled with debt because you borrowed a lot of money charging things you can’t afford on your credit card, or you took out a home equity loan you’ll have trouble repaying because you wanted to renovate your kitchen, that’s not so good.

Interest rates have a lot to do with whether given debt is good or bad, too. We’ve been in a low-interest rate environment for many years now, and if you’ve taken out a mortgage that you can repay on schedule, you won’t be forking over as much in interest as you might have in a worse environment.

Credit card debt, though, or any debt with steep interest rates, is a different beast. Many credit cards these days are charging rates in the high teens, and often well above 20%. (The overall average rate was recently around 17%.) If you owe, say, $20,000, and are paying 25% interest on it, that’s $5,000 in interest alone each year until you wipe out that debt.

Why you might not want to pay off your mortgage early

So, why not just pay off all debt early, and be rid of it all? Well, because you might be able to achieve other things with your money. Go ahead and pay off any high-interest-rate debt pronto, but with low-interest-rate debt such as your mortgage, consider just sticking to the repayment schedule and putting any extra cash toward other financial goals rather than paying off your debt early. You might allocate that money to a college savings account, for example, or let it accumulate until you can buy a needed car with it.

An especially fine idea is to invest that money for your retirement. Check out the long-term average growth rates for various investments below — they were calculated by Wharton Business School professor Jeremy Siegel, who used data from 1802 to 2012, a whopping 210 years!

Asset Class Annualized Nominal Return
Stocks 8.1%
Bonds 5.1%
Bills 4.2%
Gold 2.1%
U.S. dollar 1.4%

DATA SOURCE: STOCKS FOR THE LONG RUN, BY JEREMY SIEGEL.

Think about the interest rate you’re paying on your mortgage — let’s say it’s 5%, though much lower rates can be found today. (If your mortgage rate is about a point or more higher than prevailing rates, you may want to look into refinancing.)

Let’s also say that you have an extra $500 per month that you’re thinking about using either to make extra payments against principal on your mortgage or to invest in stocks for retirement. That’s $6,000 per year. If you make extra mortgage payments with it, you’ll essentially be earning a guaranteed 5% return — because you’ll no longer be having to pay 5% interest on the debt you pay off.

Alternatively, if you invest in the stock market, perhaps via a simple, low-fee broad-market index fund (such as one that tracks the S&P 500), you might expect to average an annual gain of 8%. That’s not guaranteed, but even if you end up averaging a 6% gain over many years, you’ll still come out ahead, and you’ll end up eventually retiring your mortgage while also having retirement savings. An annual $6,000 investment that grows at, say, 7% for 25 years will grow to more than $400,000!

On the other hand…maybe do pay off your mortgage early

When should you think about paying off your mortgage early? Well, if retirement is around the corner, you might reasonably want to enter it without mortgage debt and payments hanging over your head. Many people try to retire without a mortgage.

You might also pay off your home loan early if you’re not a great money manager and are likely to not have much to show for that extra $500 per month. If so, then paying off your home early is a worthwhile option.

Everyone’s situation is different, so do your own math and decide whether it makes sense to pay off your home loan early.

By: Selena Maranjian

Your home may not be a mansion. But you might still have to pay a ‘mansion tax’

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Beginning in January, homeowners in Washington state will soon pay a real estate tax that increases based on the sale price of their home.

Under the new provision, the tax rate on properties that sell above $1.5 million will more than double, rising from 1.28% to 2.75%. Homes that sell for more than $3 million will be taxed at 3%.

And Washington isn’t the only state changing the way it taxes real estate. New York also recently expanded its “mansion tax” — an additional tax that targets higher-end home sales.

Most real estate deals in the US trigger what is known as a transfer tax. But certain states — including Connecticut, Hawaii, New Jersey, Vermont and New York — also levy a mansion tax on homes that sell above a certain price.

Sellers in some states are paying the mansion tax, while in other states buyers are footing the bill. And, in some cases, they’re paying the tax on a home even though it isn’t quite what you would consider a mansion.

What is a mansion tax?

The aim of a mansion tax is to make the state and local tax systems fairer and to raise money, says Samantha Waxman, a policy analyst at the Center for Budget and Policy Priorities. The additional taxes can be used to fund things like schools or roads, or can be specifically targeted toward things like affordable housing projects.

“Mansion taxes are one way for states to provide for their long-term future,” she said.

But how expensive does a home have to be to trigger a mansion tax?

Washington state made its transfer tax progressive in 2019, according to CBPP, with graduated rates that increase for homes sold that are worth over $500,000, $1.5 million, and $3 million. These new rates will apply as of January 1, 2020. The state cut the rate for homes worth less than $500,000.

Who pays a mansion tax?

Using transfer taxes to raise public funds is nothing new, says Kim S. Rueben, director of the State and Local Finance Initiative at the Urban-Brookings Tax Policy Center. But more recently, some states and cities are adopting tax rates that go up as the value of the property increases, similar to income tax rates that go up as your income increases, rather than a flat tax.

In deciding who should pay these taxes, lawmakers are considering two things, said Rueben.

First: How badly does the state need the money?

“If you need the money for basic services, like Vermont, you need a lower threshold to get more people to pay,” Rueben said.

The second factor is income inequality and how housing prices in the area are widening the gap.

In Washington state, the real estate excise tax is typically paid by the seller of the property, although the buyer is liable for the tax if it is not paid, according to the state Department of Revenue.

 

Protected forestland will serve as a new scenic gateway to Cougar Mountain Regional Wildland Park

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A partnership led by the City of Issaquah, along with The Trust for Public Land and King County, permanently protected forestland that had been slated for development but will instead serve as a gateway to Cougar Mountain Regional Wildland Park.

 

Executive Constantine joins partners to celebrate the permanent protection of Issaquah forestland that will serve as a new gateway to King County’s Cougar Mountain Regional Wildland Park.

 

Executive Dow Constantine today congratulated the City of Issaquah and their partners, The Trust for Public Land, for protecting 46 acres of forestland that will serve as a scenic gateway to King County’s Cougar Mountain Regional Wildland Park.

The property – which was slated for a 57-home hillside subdivision – will instead connect the City of Issaquah’s Harvey Manning Park to a green necklace of other city parks, trails and open spaces, the master-planned Talus community, and a major transit center.

“Thanks to bold action by our partners, forestland that was destined to become a subdivision is now a permanently protected gateway to Cougar Mountain Regional Wildland Park,” said Executive Constantine. “This is the model for successful land conservation: Cities, nonprofits, and community organizations joining forces with King County serving as the catalyst. We need to replicate this success throughout the region to protect the last remaining, most vital greenspaces before they are lost forever.”

Commonly called Bergsma, the land located on the northeast corner of Cougar Mountain between Newport Way Northwest and Talus had long been proposed for residential development. The forestland is home to diverse wildlife, old-growth trees, and waterways that feed salmon-bearing streams.

“No one agency or person could have done this alone,” said Issaquah Mayor Mary Lou Pauly. “Thanks to strong partnerships; an engaged community; and our courageous and forward-thinking City Councilmembers, this historic purchase will preserve an important connection between our urban valley floor and the Issaquah Alps.

The acquisition helps accomplish two strategic projects for Issaquah – hillside acquisitions and a trail from Talus to Tibbetts Valley Park – outlined in the city’s 2018 Parks Strategic Plan, which was shaped by significant public input.

Executive Constantine’s proposal approved by the King County Council accelerates the funding available to cities and their partners before the open space is developed or priced out of range. It is part of the Land Conservation Initiative that Executive Constantine announced last year to protect 65,000 acres of the last remaining, most vital urban greenspace, forestland, and trail corridors within a single generation.

Starting in December 2017, the City of Issaquah partnered with The Trust for Public Land to explore options to protect the forestland. Ultimately, Issaquah purchased the eastern-most 33.5 acres for $10.6 million. Earlier this year, King County awarded Issaquah $5.3 million in Conservation Future Funds toward the acquisition. That award, along with other grants applied for next year, is estimated to reduce Issaquah’s ultimate cost to $3.8 million. To decrease the city’s upfront costs, The Trust for Public Land provided $3 million to Issaquah on an interest-free basis until Dec. 31, 2019.

“This newly protected land will make Washington’s great outdoors more accessible and easier to reach for folks across our state,” said David Patton, Northwest Area Director for The Trust for Public Land. “We’re proud to have played a part in making this a reality and are thankful to the exceptional work of our partners.”

King County purchased the western-most 12.5 acres, which adjoins the existing county-owned Cougar Mountain Regional Wildland Park, for $355,000.

Several other partners supported the effort to protect the forestland, including Save Cougar Mountain, Mountains to Sound Greenway Trust, Issaquah Alps Trails Club, and Washington Trails Association.

Benefits beyond the protected forestland

The benefits of protecting the forestland extend beyond the newly acquired 46 acres.

The forest cover will continue to cool the streams that feed into Lake Sammamish where King County and partners are taking emergency and long-range actions to ensure the survival of the native kokanee salmon after a sudden, alarming decline in the number of returning spawners.

The forest will also continue to absorb and store the carbon that fuels climate change, building on the progress King County has made with its first-of-its-kind Forest Carbon Program.

America’s Top Small Cities Will Blow Your Mind: Can You Guess Where’s Best?

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Do you adore living in a city, but cringe at the sky-high cost of housing there—or even whether you’ll be able to find a nice place for dinner and drinks? Then the perfect compromise may be to steer clear of the big cities and head toward a small city instead—starting with Leawood, KS.

Located about 10 miles south of Kansas City, Leawood, with a population of just under 35,000, was recently ranked 2019’s best small city in America by WalletHub.

More than 1,200 cities with populations between 25,000 and 100,000 were analyzed based on 42 elements of livability, including economic health, education, quality of life, safety, plus the existence of amenities typically associated with big cities (e.g., the density of restaurants and coffee shops).

And while small cities might not stand up to massive metros like New York City or Los Angeles in terms of nightlife of five-star restaurants, they do have one distinct advantage many will appreciate: a lower cost of living.

“The best thing about getting a home and moving to a small city is affordability,” Jill Gonzalez, an analyst at WalletHub, told realtor.com®. “The cost of living in these smaller cities can be as low as half of that in large metropolitan areas.”

And housing is a huge part of that affordability: “Small cities are a great place to buy a home for those who appreciate a quainter life and shorter commutes,” Gonzalez says.

Why Leawood is the best small city in America

So what are the housing prices like in Leawood, anyway? Realtor.com data shows that the median listing home price in Leawood is $525,000; that said, prices span a wide range among the 389 homes currently for sale in the area, from a mere $60,000 up to $4.4 million.

Leawood may be its own city, but it has a relaxing suburban vibe, a highly ranked school system, and plenty of parks, restaurants, and cafes. And for those who assume the eating-out options are subpar to bigger cities, get this: Leawood’s Rye restaurant just made a national ranking by Eater and People magazine as having one of the best apple pies in the country.

“Pie has always been America’s dessert. But it is getting a lot of attention right now, which is really fun,” reported Rye’s chef and co-owner, Megan Garrelts, who has been a James Beard Award semifinalist for Outstanding Pastry Chef from 2017 to 2019.

What other small cities made the list?

Another small-city option is Brentwood, TN, which was ranked No. 2 on the WalletHub list.

“Brentwood has a low crime rate and offers many great outdoor amenities with more than a dozen family and pet-friendly parks and a well-developed greenway network that spans more than 75 acres,” says Jeff Checko, a real estate broker with Ashton Real Estate Group in Nashville, TN.

Brentwood is about a 20-minute drive to downtown Nashville, has a bustling restaurant and retail scene on Franklin Road, and is home to top-rated schools. But, Checko says, it’s also one of the more expensive areas in the greater Nashville area.

Brentwood’s median home listing price is more than $671,000, with 436 active home listings. Checko says Brentwood features a variety of homes, including high-end subdivisions, new construction, and luxury homes.

The Seattle suburb of Sammamish, WA, placed third on the best small-cities list. Homes in the area come with a median listing price of $926,500, and there are more than 300 available. Popular properties include single-family homes, condos, and townhouses.

Sammamish is home to Lake Sammamish State Park and offers lots of outdoor activities. The city also has a low unemployment rate, highly rated schools, and very little crime.

Here’s the full rundown of the top 10 best small cities in the U.S.:

  1. Leawood, KS
  2. Brentwood, TN
  3. Sammamish, WA
  4. Melrose, MA
  5. Carmel, IN
  6. Lexington, MA
  7. Milton, MA
  8. Brookfield, WI
  9. Fair Lawn, NJ
  10. Cedar Park, TX

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Report: Amazon’s rapid expansion in Bellevue could reach 4.8M square feet and power ‘spectacular’ growth for Seattle suburb

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A sketch of what Amazon’s big new tower in Bellevue, Wash. might look like. (NBBJ Sketch)

Amazon spent most of the last decade gobbling up every available piece of real estate in Seattle, helping power a building boom in the city. But with signs pointing to Amazon cooling on its hometown, a new report lays out how the tech giant’s expansion in nearby Bellevue could galvanize a level of growth over the next couple years that took decades to achieve in the past.

Just two years after opening its first office in Bellevue, Amazon has leased three additional office projects, and it is planning to build a tower — or two —on a high-profile site it bought earlier this year. Combined, those sites could total nearly 2.9 million square feet for Amazon, per the report from real estate firm Broderick Group — and that could be just the beginning.

Broderick Group pointed to three additional properties Amazon has been linked to, bringing its potential footprint in the city to 4.8 million square feet. The report came with a disclaimer that it is just speculating on the additional offices, which total 1.9 million square, and no leases have been signed.

Here is a look at everything Amazon has leased so far in Bellevue, and the properties Broderick Group speculates Amazon could take:

(Broderick Group Graphic)

The firm estimates that all this activity could bring upwards of 15,000 or more tech workers to downtown Bellevue over the next few years. And that doesn’t even take into consideration rapid growth from Facebook and others in the city.

Downtown Bellevue has been on the rise for the last few decades, powered by expansion from local and global firms, many of them in the tech industry. But, Broderick Group notes that Amazon’s appetite for space could set off an unprecedented period of growth, with the downtown office market ballooning in size by as much as 40 percent over the next few years.

“Given it took 30 years (1990-2019) for the downtown Bellevue market to develop a total of 5.8M (square feet), Amazon’s expected growth of 4.2M (square feet) in a period of 5 years is staggering,” according to the report. “The result will bring not only significant office growth, but residential developers are also lining up to supply the next wave of Amazon employees with new multi-family housing inventory. The positive impact to the Eastside economy, and to downtown Bellevue in particular, will be nothing short of spectacular.”

Amazon’s real estate expansion in Bellevue kicked off a couple years ago but went into overdrive in 2019. Following a contentious debate over a “head tax” on top employers in Seattle, Amazon confirmed plans to back out of one of its most high-profile buildings and turned its attention to Bellevue.

In April, Amazon said it planned to relocate its entire Seattle-based worldwide operations team to Bellevue by 2023. The new tower Amazon is planning atop a future light rail station at 600 Bellevue will be home to many of these employees when the move is done.

 

Nat Levy is a staff reporter at Geekwire covering a variety of technology topics, including Microsoft, Amazon, tech startups, and the intersection of technology with real estate, courts and government. Contact him at nat@geekwire.com and follow him on Twitter at @natjlevy.

 

Real estate is still the best investment you can make today, millionaires say—here’s why

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Billionaire Andrew Carnegie famously said that 90% of millionaires got their wealth by investing in real estate. We wanted to know: Is this still true? Is investing in real estate still a good idea?

According to these nine Advisors in The Oracles, who made millions by investing in real estate, the answer is a resounding yes.

1. ‘Owning made me rich.’

“Buying real estate has made me rich — mostly through necessity, not by design. I bought my first itty-bitty studio after scraping together a few bucks because I needed to live somewhere anyway.

A few years later, the studio doubled in value, giving me enough cash to plunk down 50% on a one-bedroom apartment. That soon rolled into a two-bedroom, then a three-bedroom, and finally landed me in my 10-room penthouse on Fifth Avenue in New York City.

Buying that tiny studio was the most important decision I made because it got me in the game.”

—Barbara Corcoran, founder of The Corcoran Group, podcast host of “Business Unusual,” judge on “Shark Tank”

2. ‘Residential properties can generate income year-round.’

“Investing in real estate is a great idea if you are in it for the long haul, not a quick return.

Your best bet is investing in residential properties that produce rental income year-round. Just make sure you understand all of the associated legal fees and are prepared for unexpected costs.”

—Bethenny Frankel, entrepreneur, philanthropist, founder of Skinnygirl and BStrong. Follow her on Instagram

3. ‘The right investment will continue to appreciate.’

“Real estate is real, and it’s always a good idea to put your money in real assets. But let me be clear: That doesn’t mean that all real estate is a good idea.

I only buy certain types of properties, generally multifamily ones in upscale locations that provide consistent cash flow and great potential for future appreciation.

I stay away from low-income areas and single-family homes. But even those assets are probably a better place to store your money than letting cash depreciate while sitting in the bank!”

—Grant Cardone, sales expert, New York Times best-selling author. Follow him on Facebook, Instagram and YouTube

4. ‘Buying is smarter than renting.’

“Most millionaires I know made more money from owning real estate than any other investment. Real estate consistently increases in value over time and outperforms other investments.

Plus, it isn’t as vulnerable to short-term fluctuations as the stock market. You get a tangible, usable asset, whether you’re renting out an apartment or commercial building for income or buying a home. And there can also be tax benefits for investment properties.

It’s always a good time to buy real estate. In fact, the real wealth is made by buying when everyone else is selling and vice versa. While many are talking about a recession, the market is strong, with increasing prices and transactions.

Renting a one-bedroom apartment can cost $5,000 a month in certain neighborhoods today, yet you can buy a $1 million house with just $4,000 a month in mortgage payments. And the rate is fixed for 30 years — the best kind of rent control.

So why would you rent? Besides, if you rent your property to someone else, you can cover your mortgage or better.”

—Peter Hernandez, president of the Western Region at Douglas Elliman, founder and president of Teles Properties

5. ‘You get six-figure tax breaks.’

“Real estate has incredible tax benefits. In certain situations, you don’t have to pay taxes on your gains from investment properties. You can also get a $250,000 tax break as an individual and $500,000 as a married couple.

The wealthiest people collect property the way they used to collect cars. Interest rates are low, prices have fallen, and you don’t have to tie up a lot of cash in the investment.

At the same time, more people are choosing to rent instead of own. You can have a lucrative rental property using other peoples’ money to cover the mortgage, taxes, and upkeep. With sites like Vrbo and Airbnb, you can also find short-term renters to subsidize your overhead.

While I suggest diversifying your investments, there is no better place to park your money than brick-and-mortar investments you can live in and enjoy. When you invest in your surroundings, you invest in yourself!”

—Holly Parker, founder and CEO of The Holly Parker Team at Douglas Elliman, award-winning broker who made over $8 billion in sales. Follow her on LinkedIn and Instagram

6. ‘It doesn’t tie up a lot of cash.’

“Real estate is a bankable asset, so you can always leverage it. It also doesn’t tie up a lot of cash. You can put down as little as 10% and use banks’ money to grow your investment. With such low interest rates, that’s like free money.

Unlike the stock market, where many factors are out of your control, your investment can’t disappear overnight. You can also build your wealth with excellent return rates and tax advantages.

The only people who lose money in real estate are those who bought at the height of the market and sold at the wrong time or took too much equity out of their home, leaving no profit margin when they sold it. It often takes time to see big appreciations, but if you hold on to your investment, you will.

—Dottie Herman, CEO of Douglas Elliman, a real estate brokerage empire with more than $27 billion in annual sales. Follow her on Facebook and Instagram

7. ‘Real estate offers unlimited options.’

“Real estate is always a great investment because you have more options than with other types of investments.

If you invest in stocks, bonds, or a private offering, your success is completely dependent on factors outside of your control. At most, your options are to hold or sell. With real estate, you have unlimited options.

You can buy a house with the intent of flipping it, then rent it if the market turns south. If you buy a rental that appreciates in value significantly, you can sell it. Real estate can be refinanced, rehabbed, and rezoned. You can develop it, lease it, subdivide it, or add parcels to it.

These are just a few of your options. This flexibility is one of the reasons it has created more millionaires than any other asset class.”

—Daniel Lesniak, founder of Orange Line Living, broker at the Keri Shull Team, co-founder of real estate coaching business HyperFast Agent, author of “The HyperLocal, HyperFast Real Estate Agent”

8. ‘People will always need a place to live.’

“There’s an opportunity for greater and more consistent returns with real estate than with other investments. When a property is built, it’s because a group of people see a population large enough to justify it.

“The sheer number of new properties each year is a testament to the growing real estate market. Supply follows demand, and demand is continuing to rise. Populations almost never decrease, which is why the need for housing increases year over year.

The market for multifamily apartments in particular is growing. As apartments become more attractive, people are less likely to buy houses. With multifamily apartments, you continue to generate increasing income over time.

Once the property stabilizes, you can collect returns for your investors until you decide to sell. There’s also demand year-round wherever you go.”

—Robert Martinez, founder and CEO of Rockstar Capital, a real estate investment firm with over $330 million in assets under management, host of “The Apartment Rockstar” podcast. Follow him on YouTube and Instagram

9. ‘You can invest in land that produces income.’

“Many businesses come and go, but there’s one thing we’ll always need: land.

There’s an inherent demand for real estate, whether the land produces a product like coffee or is home to an apartment or retail space; so it will always be a good investment. No matter what kind of business you run, you need land.

Investing in real estate allows you to protect yourself and your wealth. While the real estate market has gone up and down, it has never declined over time. Compare that to when Wall Street collapsed or currencies that aren’t backed by anything tangible.

Over time, you will always get value from real estate that produces income — like a coffee farm, for example. Even better if you choose property with inherent value, such as a location in Times Square.”

—Marcello Arrambide, founder of Day Trading Academy, co-founder of SpeedUpTrader, a funding company for aspiring day traders. Follow him on LinkedIn

Join The Oracles, a mastermind group of the world’s leading entrepreneurs who share their success strategies to help others grow their businesses and build better lives. For more, follow The Oracles on Facebook and LinkedIn.

Snoqualmie gets safest city nod…Ranks safest in state according to website’s matrix.

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Snoqualmie was recently named safest city in Washington State by backgroundchecks.org.

The city took first place on the company’s 2019 safest cities to live in Washington list, which is based off of property crime and violent crime data.

Other cities on the list, in order from 2nd to 5th place, include Enumclaw, West Richland, Sunnyside and Oak Harbor.

Snoqualmie received a safety index score of 0.59.

Backgroundchecks.org says in the methodology section of its website that they used recent FBI crime statistics to rank the state’s cities. That data set contained 7,430 cities, which was narrowed down to 2,929 cities with a population smaller than 10,000.

They also explained how they used their math to create the safety index scores.

“We then calculated violent crime rates and property crime rates by dividing the crime numbers by the population to get rates per 1,000. We also calculated the ratio of law enforcement workers to per 1,000,” the website says. “These were weighted with -50 percent for the violent crime rate, -25 percent for the property crime rate, and +25 percent for the law enforcement rate. The resulting metric gave us the safety index score. The higher this number, the (safer) the city is.”

That website also states that Washington has a lower-than-average violent crime rate but high levels of property crime, such as automobile theft.

This recognition comes after other recent nods. Snoqualmie also was recognized as safest city in Washington by the National Council for Home Safety and Security as well as by SafeWise.

“We are pleased to be recognized by multiple organizations as one of the safest communities in Washington,” Police Chief Perry Phipps said in a press release. “Our belief and commitment to ‘No call too small’ combined with a community effort of residents and city personnel help keep our city a safe place to live, work and visit.”

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