The Eastside–comprised of Bellevue, Kirkland, Redmond, Issaquah, Mercer Island, Woodinville, Bothell, Carnation and Duvall—saw a moderate increase in both median and average sales prices. Sales activity increased substantially from 5,883 homes sold in 2011 to 7,226 homes sold in 2012.
Record low inventory has been a challenge on the Eastside with homes listed for sale at the lowest level in the past 15 years (as far back as we have been keeping record). The success of the 2013 real estate market will pivot on the available inventory of homes for sale to meet the demand of serious buyers in the market.
Home seller are sure to embrace the upward movement in sales prices, and, with record low interest rates the current market has been a very favorable to buyers as well. The Annual Monthly Cost Index shows that the monthly interest expense of owning a home—what matters most to the bottom line—is on par with that of 2000. A median priced $327,000 home in 2000 at 8.05% interest costs far more per month than a median priced $500,000 home today at 3.66% interest. Remarkable when you consider that wages have risen considerably since 2000.
Of the year’s home sales, 620 were above $1,000,000—a significant increase from 471 in 2011. Bank-owned and short sales made up 16% of the sales in 2012. The average cost per square foot increased slightly to $227.
Condominium sales jumped 27% in volume from 1,802 units sold in 2011 to 2,295 in 2012. The median sales price increased a whopping 30% from $225,000 last year to $293,800 and the average sales price from $278,576 to $362,160 in 2012. Of note is that many of the sales where of newer and larger units—likely bringing sales prices up as a result.
Homes closest to the Seattle and Bellevue employment hubs will continue to see the greatest levels of appreciation in the coming year. The laws of supply and demand will definitely be a dominating factor in 2013.