There’s something about putting raw data into a chart form that resonates with me. Maybe it’s just how my mind works. When you put data into a different format, you start to see trajectories, you start to see sequences, and most importantly, you start to see a story formulate.
So, then, what is Seattle’s Real Estate story? Let’s look at some historical data that will shed some light on where we’ve been and where we are now.
Price per Square Foot.
Where we were in April 2014: $215/sq ft
Where we are now in January 2017: $326/sq ft
Just 2.5 years ago, we were $111 per sq foot less expensive than in today’s market.
Let’s do some 2014 math: 2500 sq ft home at $215/sq ft = $537,500.
Let’s do some 2017 math: 2500 sq ft home at $326/sq ft = $815,000.
That’s a $278,000 difference from 2014 to 2017. Let me say that in a different way. In this scenario, it costs $287,000 more to buy the same house in 2017 than in did in 2014. This basic equation shows a very shocking, if not mind-blowing difference in what has happened to the real estate market in Seattle over the past 2.5 years.
Although this chart shows an overall, upward trajectory – interestingly there’s another very important story this chart conveys. Pay attention to the rise and falls of the pricing each month. You will notice that historically, the least expensive price per square foot is in the October to January time frames. Then, pricing peaks in the summer months, and begins to decline through fall and winter. Seattle’s Real Estate Story is a seasonal, cyclical housing market.
Inventory of Homes for Sale.
Where we were in April 2014: 1200 Homes on the Market to Sell
Where we are now in January 2017: 500 Homes on the Market to Sell
Just 2.5 years ago, there were 700 more homes on the market.
Although this chart shows an overall, downward trajectory – there is still more to learn from the data being presented to you. You will notice that historically, there are more homes on the market from March to October, with a general decrease in homes available in the winter months. Year over year, you can see the same scenario. Seattle’s real estate story is a seasonal, cyclical housing market.
So, putting the data together, you have a classic case of supply and demand. There were more houses on the market 2 years ago, and they cost less then. Now, there are fewer homes on the market, and the price has increased.
But, the biggest take-away here is that this historical data has demonstrated that the Seattle Real Estate Market is cyclical, and therefore more predictable.
Of course, there is no magical looking glass. This data is not an all-encompassing method to strategize how to price a home if you are a seller or how much you should put in an offer for if you are a buyer. But knowing Seattle’s real estate story, will give you a huge advantage in the market place. Coupled with this information, an experienced Real Estate Broker will be able to provide a multi-faceted approach to provide the best solutions for their clients.
Content by Kristin Bushnell. Kristin Bushnell is a Managing Broker for RE/MAX Pacific Realty in Bellevue, WA.
Data Source: Altos Research