Home prices are up. Way up. Central Seattle and Beacon Hill both saw their median home price climb nearly 40 percent last year. In parts of North Seattle, the median home price leapt 42 percent.
Forty-two percent. That’s absurd.
The Seattle-wide median home price isn’t as bad. That measure only jumped 24 percent last year, to a city-wide median home price of $644,950. For all of King County, the median price is lower, still (at $514,975). But even that is an all-time high for the county.
This reminds many people of the months that led up to the 2007 housing bubble burst. Our current situation is a bit different for a few reasons:
- Many buyers are paying with cash this time around, and overall there’s more money behind the sales.
- Lenders are screening borrowers more thoroughly.
- Seattle has a seemingly inexhaustible influx of new high-income workers who keep buying homes. Amazon won’t stop hiring any time soon, and Expedia and Weyerhaeuser are moving their headquarters to Seattle. Facebook and Apple’s satellite offices also pull other highly paid workers to the city.
The near future looks rough. Lots of bidding wars, tiny inventory, and high, high prices.
However—and this is key—this isn’t the new normal. The current state of the market is unsustainable. Prices will go down. We aren’t expecting a bubble burst like 2007, but the market will adjust itself.
In the meantime, don’t panic. Don’t ruin your future. Don’t go out and spend all your equity on one of those houses whose price increased 42 percent this year. Think ahead of the current trends, and look to the neighborhoods that will be the hot places in the 2020s. Places like:
- Rainier Valley
- Rainier Beach
- Shorewood
- Burien
- White Center
- Highland Park
And most importantly, find a real estate agent you trust. A good agent matters more than ever in this market. We’ve seen these decade-long up-and-down cycles before. We’ll keep you from making a rash decision, and we’ll help you navigate this turbulent market safely. Here’s our number: 555-425-8585.
