I originally wrote this blog post about buying real estate on Eastside in March 2017 – exactly four years ago today. There was a general feeling back then that the market will slow down. About a year ago, when Covid19 hit us like a tsunami, there was a great deal of uncertainty about what was in store. Given all the restrictions and limitations, it appeared to be likely that things will slow down. That did not happen. We saw solid numbers in 2020, and buying real estate on Eastside became even more challenging. The first three months have seen that trend continue. It is not just buying real estate on Eastside. Now it is exceptionally competitive just about everywhere. From Tacoma to Bellingham and Spokane, at the eastern edge of Washington State, just about every new home on the market sells quickly and fetches more than the asking price. Thus I am reposting this blog.
Eastside Real Estate Market
I have been showing homes to prospective buyers regularly in recent weeks. Every open house every weekend gets 100+ visitors. Parked cars line the streets on each side, and the home holding the open house has a constant flow of folks moving through it. It is not unusual to see several cars lined up outside the home well before the open house starts. Expectations and demands of sellers have become increasingly unreasonable, yet each listing receives numerous offers.
After showing numerous homes and then carefully crafting and presenting 17 offers on different properties, two of my clients succeeded in acquiring a home. Each time, buyers paid substantially higher than the list price and competed with as many as 21 offers. However, in each case, I assisted the buyer in locating and acquiring a home that matched their desires and fulfilled their needs.
Potential Buyers
Clients and other potential buyers repeatedly ask me, “how long can this frenzied pace of the real estate market on the Eastside keep up like this?” Some folks expressed concerns about a ‘market bubble’ and artificially inflated home prices. On the surface, these concerns may sound reasonable. But when you examine the Greater Seattle area’s economic activity, especially on the Eastside, solid reasons for this boom emerge. It becomes evident that the market is reacting to the rapid business growth and accelerated demand for homes on the Eastside.
Real Estate brokers have a sense that “if you build it, they will come.” They base this on the fact that new listings can barely keep pace with pending sales (listings that are off the market and waiting for closing.) Eastside’s median home price moved from below $600,000 in early 2016 to about $700,000 in January 2017. This number is now closer to one million dollars.
These are substantial numbers!
Let’s take just one example of economic growth on the Eastside. There are three new Bellevue office buildings that are hubs for tech companies. The estimates are that between 3400 and 4700 tech employees will be working in these buildings. That is almost a ten percent increase in tech jobs since 2014. This substantial growth in the skilled workforce, a segment that tends to be on the higher end of earning power, is a significant housing demand factor.
How Long will this market continue like this?
A completely accurate answer to that question will require a fully operational Crystal ball. Mine needs a software update:-)
The fact is those well-established industries and global operations fuel the growth resulting in buying real estate on Eastside. This growth is nothing like the one that took place in the early 2000s. These industries and businesses have long ways to go before they slow down. Furthermore, as expensive as things might appear, there is still a long way to go before catching up with other world-class cities like new York, London, Hong Kong, and others.
It is reasonable to take the position that this growth will go on for several more years.
Comments (0)