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How’s the Market? Q2 Real Estate Review
While Seattle and the Eastside are still considered a seller’s market, buyers experienced some much-needed relief in the second quarter with new listings outpacing the number of homes sold. Rising interest rates have initiated a shift toward a more balanced market. Opportunities abound for both sellers (who are still seeing higher sales prices than this time last year) and buyers (who finally have some breathing room to negotiate price and contingencies). We expect this shift to continue with a stabilization of home prices rather than the steep upward trajectory we saw last year.
Click or scroll down to find your area report:
Seattle | Eastside | Mercer Island | Condos | Waterfront
SEATTLE
The Seattle real estate market for single family homes is holding steady despite rising interest rates and slowdowns elsewhere in King County! The median sale price is up 9% since the end of 2021 (from $910,000 to $1,000,000). Year over year, the median price rose from $895,000 in Q2 2021 to $1,000,000 in Q2 2022 (also roughly 12%).
Anecdotally, we believe that Seattle continues to gain ground because it remains affordable when compared to the cities and neighborhoods to the east. Eastside median prices rose so sharply over the last two years that it left Seattle “in the dust” as the market leader of the region. As we know, slow and steady wins the race, though there is no way to know yet if this particular race is a marathon or a sprint.
Interest rates nearly doubled in Q2, though that seems to leave Seattle home shoppers undeterred. 86% of the sales in Q2 sold in the first 10 days at an average of 110% of list price.
Click here for the full report and neighborhood-by-neighborhood statistics!
EASTSIDE
Relief has finally come to home shoppers on the Eastside! New listings are up 13% year over year. Further, there has been a slide in total number of sales, down 18% year over year. This means there are more choices for anyone who is in the market to buy a home. Price gains remain steady for now, up 22% over Q2 of 2021. This is likely riding the wave of growth in late 2021 and early 2022, but with the higher supply and lower demand this is may be a trend that tapers off in the near future.
Average price per square foot saw its first quarterly drop since Q2 of 2019, down from $713 in Q1 to $685. The overall median price fell from a high of $1,625,000 in Q1 to $1,610,000 in Q2. Even more exciting for home buyers is that (when in competition) the list to sales price ratio is 109%— down from 119% in Q1.
If you’ve thought about selling your home, it’s still a great time. When a home is prepared well and priced right shoppers pay attention. Of the 2177 homes sold in Q2, 84% of those sold in the first 10 days. This isn’t far off of the 90% that was posted in Q1. It is harder to get noticed today than in recent memory—this is where choosing a true professional to partner with is so important! Windermere brokers have their fingers on the pulse and know how to make you stand out in a crowd!
Click here for the full report and neighborhood-by-neighborhood statistics!
MERCER ISLAND
Mercer Island continues to be a fabulous place to be a homeowner. Median prices and price per square foot both saw increases over Q1 2022 numbers (6.5% and 5% respectively). Anecdotally, there has been a pace change. We don’t expect that to reflect in the stats until Q3, and even then the numbers are likely to be favorable as we gained so much ground in Q1 of this year.
The data that supports what we’re all feeling can be found in the relationship between number of new listings and number of homes sold. In Q2, there were 116 new listings and 84 sales compared to the same period in 2021 when we had 124 new listings and 102 sales. So, if you’re feeling like inventory is “up,” it’s not because more homeowners are deciding to sell but rather it appears that demand is down. Another way to look at this is that we sold 82% of the active inventory in spring of 2021 but only 72% in 2022. These are healthy numbers but it’s enough of a drop for us to feel it.
If you’re a buyer trying to break in to the Mercer Island market, it’s getting easier. 83% of the 116 new listings sold within the first 10 days for an average of 111% of the asking price. This is the most favorable these numbers have been since 2019. Working with a local pro will be your biggest advantage to determine which homes will sell at a premium and how to get the best deal!
Click here for the full report and neighborhood-by-neighborhood statistics!
CONDOS – SEATTLE & EASTSIDE
Condo average prices have seen their biggest quarterly rise since Q3 of 2016! As home shoppers adjust expectations amidst rising interest rates, the affordability offered by condos is an exciting place to turn. We are thrilled to see condos be a viable option as we recover from the pandemic and buyers return to more densely populated areas.
North Seattle (up 34%) and Capitol Hill (up 10%) are bright spots in the total number of condos sold year over year for Seattle. This makes perfect sense as both areas offer access to our growing light rail system and new retail opportunities that didn’t exist pre-pandemic. Seattle’s total sales year over year remained flat, literally zero, which means these two neighborhoods carried the entire city.
The same data point on the Eastside saw the entire area’s total number of sales fall 27% year over year. West Bellevue (down 51%) and Mercer Island (down 38%) topped the list. Meanwhile, prices on the Eastside are up an average of 20%.
Check out area-by-area details the full condo report.
WATERFRONT
Waterfront season is heating up. As expected, inventory is up from Q1 (32 total sales in Q2 v 17 in Q1), but what hasn’t changed is an average of only 6 listings for sale at any one time across all shorelines! Of all of the waterfront shorelines, Mercer Island boasted the lowest days on market with an average of just THREE days. Seattle had the highest days on market, with an average of 41 days.
The most affordable place to buy waterfront this quarter was Beach Dr in West Seattle at a closed sale price of $1,800,000 for 25’ of waterfront on a 17,000 sq. ft. lot. The largest piece of shoreline overall was 177 feet in Issaquah on Lake Sammamish, which commanded a sales price of $11,600,000.
This brief overview of the entire Seattle-Eastside private waterfront market, including Mercer Island and Lake Sammamish, illustrates the trends occurring in our region over time. This data is interesting and insightful but cannot replace an in-depth waterfront analysis provided by a savvy broker with years of local waterfront experience.
We earn the trust and loyalty of our brokers and clients by doing real estate exceptionally well. The leader in our market, we deliver client-focused service in an authentic, collaborative, and transparent manner and with the unmatched knowledge and expertise that comes from decades of experience.
© Copyright 2022, Windermere Real Estate/Mercer Island. Information and statistics derived from Northwest Multiple Listing Service and deemed accurate but not guaranteed.
10 Tips for Sustainable Gardening
Sunny days are finally here, the flowers are in bloom, and the timing is perfect to give your garden some love. Having a healthy garden is one of the best ways to create a sustainable home and reduce your household’s carbon footprint. Below are some eco-friendly tips that will help to make your garden even more sustainable…
1. Compost Your Waste
Composting, which puts your natural waste to good use, is the cornerstone of any sustainable garden. All grass clippings, dead leaves, plants, flowers, and the like are rich in nutrients. By composting, you provide your garden with a natural fertilizer, free of contaminants. Not only will this provide nourishment, but it will also help to produce healthier and tastier food. Here’s how to do it.
2. Try Mulching
If having a sustainable garden is your goal, it’s important to treat your soil with care. Laying down a couple of inches of mulch in mid- to late spring (think: grass clippings, wood chips or chopped leaves) enriches the soil and ensures it’s as healthy as can be. Mulch also conserves soil moisture, reduces weed growth and naturally moderates the temperature of the soil. You can cover either bare dirt or freshly planted food and flowers. Find more tips here.
3. Optimize Your Garden Design
It’s natural to want to accentuate the beauty of your garden when designing it, but the sustainable gardener will prioritize giving plants what they need. Take into consideration which plants need direct access to sunlight, which need the most space in the garden, and any special requirements a plant may need to inhabit optimal growing conditions.
Companion planting (choosing plants that benefit each other) will attract pollinators and deter pests. For example, peas & beans feed the soil with nitrogen, and nasturtiums can lure aphids away from other plants. Plant basil and tomatoes together, too–basil boosts the flavor of the tomatoes while scaring away pests.
4. Use Natural Weed Killers
One of the pillars of organic gardening is to reduce the use of chemicals whenever and wherever possible. Preventing weeds naturally by using landscape cloth, mulch or corn gluten meal is a great way to start. You can also make your own DIY weed killer from household items like vinegar or even boiling water as an effective substitute for harmful, chemical-based weed killers. Whichever method you choose, it’s important to weed by hand often.
5. Water Wisely
Substantial watering is critical to keeping your garden healthy, but overwatering is a common practice and leads to an unsustainable garden. Research the amount of water your plants and flowers need to make sure you aren’t overwatering. In our rainy climate, rain barrels are a useful tool as their function is to catch and conserve the water from your downspouts. Here’s a charming Canadian video on how to make and install a rain barrel.
6. Repurpose Poop
It’s time to get down and dirty. For a more sustainable garden and even healthier soil, consider adding animal manure. Chicken, sheep, and cow manure are all popular choices. Rich in nutrients, it can be used both as a fertilizer and as a soil conditioner. Make sure the manure you purchase is free of pathogens and ask about the recommended window of time from application to harvest before you begin using it.
7. Go Local
Planting natively is a fast ticket to sustainable gardening. Native plants are innately acclimated to local climate conditions, making them easier to grow and maintain. Native plants often require less water to grow due to their familiarity with the soil and rainfall in your region, which cuts down on your garden’s total water intake.
8. Collect Dried Seeds
YES, you can save your seeds and sow them next year. Wait until the seed is fully ripe before you collect it. It’s important to gather seeds when the weather is dry and to store them in a dry place. To produce healthy plants in the future, the seed must be completely dry. Here are some great tips on collecting & storing seeds.
9. Stop Garden Slugs
Slugs love wreaking havoc on gardens, eating through leaves and fruit, leaving a trail of destruction. Fortunately, there are also many things they hate…coffee grounds, for example. Chickens. Rosemary. Fennel. Drowning in beer traps. Check out these awesome tricks for making eco-friendly slug repellant…you can use these to replace traditional slug baits, which contain chemicals that are highly toxic to other animals.
10. Replace Your Gas Mower
How else can you reduce your garden’s carbon footprint? Replace your gas mower with a more sustainable alternative. Electric mowers and push mowers are functional and more eco-friendly replacements. They’re also quieter and you never have to mess with those stinky gas cans again. For added sustainability, consider replacing your other gas-powered equipment, such as trimmers and leaf blowers.
Pssst…Need a bigger yard for the garden of your dreams? I can help with that.
We earn the trust and loyalty of our brokers and clients by doing real estate exceptionally well. The leader in our market, we deliver client-focused service in an authentic, collaborative, and transparent manner and with the unmatched knowledge and expertise that comes from decades of experience.
2737 77th Ave SE, Mercer Island, WA 98040 | (206) 232-0446
mercerisland@windermere.com
© Copyright 2022, Windermere Real Estate/Mercer Island.
Adapted from an article that originally appeared on the Windermere blog April 14th, 2021. Written by: Sandy Dodge.
How to Avoid Overpaying for a Home in a Transitioning Market
Look Carefully at the Home Itself
Here are four home attributes beyond the number of bedrooms and baths that you should have your eye on…
Home (building) quality: Very well-built homes are a rare find and typically worth every penny of their price. Don’t confuse them with so-so homes that just measure up to the city inspector’s threshold. Lesser quality homes will cost you more in upkeep and replacement as systems and components wear out. If you purchase a lesser quality home for less, the differential might just cover the added maintenance expense. But, if you purchase a fair quality home at the going rate of higher quality homes, you might likely be overpaying.
Deferred maintenance: Different than home quality, deferred maintenance includes the to-do list of items that need to be done to maintain a home’s integrity. A home that has been well maintained over its life typically is a better investment than one that hasn’t. The true cost of deferred maintenance often adds up to more than the cost of the repairs themselves. Don’t forget to factor in the reduced life span of other components—like replacement of damaged wood beneath peeling paint or mold remediation in a damp basement caused by a clogged foundation drain.
Setting: The saying “location, location, location” didn’t get its fame from out of nowhere. A home with an ideal setting on its lot and in the neighborhood—away from busy roads and utility poles/boxes, with adequate privacy, good topography, best positioned to capture views if available, and not adjacent to undesirable elements (poorly maintained homes, water towers or other unsightly public structures, high traffic facilities, etc.) will have more value than a less-ideally sited home. When deciding what to pay for a property it is critical that you evaluate these aspects and any others relevant to a specific neighborhood to determine the +/- effect on value.
Floor plan: How a home lives—flow from room to room, size of rooms, open/closed-off spaces, and below ground vs. above ground living are every bit as important as the total home square footage. You can change a lot of things about a home, but it is very difficult to change a bad floor plan. When you are deciding how high to make that multiple offer bid, consider factoring in the added value or take-away of the floor plan.
Beyond the Four Walls
Interest Rates: In addition to being more selective about the home itself, it pays off to understand how interest rates impact your monthly housing cost. It’s a bigger deal than you might think. Every 1% increase in interest rate equates to roughly a 10% decrease in buying power. Said differently, a 10% drop in home sale price would be wiped out by a subtle 1% increase in mortgage interest rate. This means you can obtain a much more expensive home when rates are low, whereas higher rates get you less home—even though you still pay the same monthly payment.
If you have $5,000 a month to budget for a house payment (before taxes and insurance), you could purchase a $931,000 house at a 5% mortgage rate. If rates went up to 6%, the same monthly payment would only get you an $834,000 home. Your buying power diminishes considerably with each bump up in rates.
This second chart below shows how interest rates impact monthly payments. If you’re purchasing a $950,000 house at a 5% interest rate, you’ll be paying $596 less every month than if rates were 6%. That adds up quick…$7,152 in one year alone!
Job and Location Stability: Like nearly any investment vehicle, being able to buy and sell on your own time allows you take advantage of ideal market conditions or hold until a more favorable market returns. In an uncertain market, you should plan to be able to stay put for a minimum of 5-7 years if needed. If relocation or job loss is a distinct possibility, waiting to buy might avoid loss as a result of an untimely sale.
Homeownership Lifestyle: For many, homeownership represents a life accomplishment, independence, and financial security. For others, one more thing requiring maintenance and upkeep. Knowing where you stand (at this moment in time anyway) when it comes to evaluating the pros and cons of homeownership as a lifestyle choice is a better first step than an afterthought.
Final Thoughts
Want to know how you can best protect yourself in a changing real estate market? Reach out to us for help evaluating whether it would make financial sense to buy now or wait.
We earn the trust and loyalty of our brokers and clients by doing real estate exceptionally well. The leader in our market, we deliver client-focused service in an authentic, collaborative, and transparent manner and with the unmatched knowledge and expertise that comes from decades of experience.
2737 77th Ave SE, Mercer Island, WA 98040 | (206) 232-0446
mercerisland@windermere.com
© Copyright 2022, Windermere Real Estate/Mercer Island.
