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In the aftermath of the housing collapse which affected much of the US in 2008, Seattle’s property market held surprisingly firm. Home prices, which had reached record levels during the housing boom a few years earlier, dipped only slightly in the city just as real estate sales elsewhere struggled.
Prosperous and economically diverse, Seattle’s housing boom had been relatively restrained, leaving some economists and real estate professionals to consider the city in Washington state immune to a severe downturn.
Yet, as other property markets in the US began to recover in 2010, buoyed by the country’s strengthening economy, Seattle’s real estate market remained weak. By early 2011, the city’s housing market had all but collapsed with prices 30 per cent down from the mid-2007 peak, according to Zillow, a Seattle-based real estate database firm.
“At the time, we kept thinking the market couldn’t go any lower,” says Jim Conlan, an agent at Century 21 North Homes Realty, who has been selling homes in Seattle for more than 30 years. “But prices just kept falling.” After a long and painful slide, the city’s property market began rebounding in late 2012. And by last year, home values had returned to pre-bust levels.
The median price of a home in Seattle rose 13.11 per cent in February compared with a year earlier, from $377,500 to $427,000, according to Northwest Multiple Listing Service, a real estate data and research provider.
A thriving local economy is driving the city’s property resurgence, says Glenn Kelman, chief executive of Seattle-based Redfin, a national real estate brokerage. “Unemployment is near record lows and the city has essentially recouped its job losses during the recession,” Kelman says.
Business at corporate behemoths such as online retailer Amazon, coffee company Starbucks and software giant Microsoft – all with headquarters in the Seattle area – is flourishing. Stronger earnings, rising stock prices and an influx of high-paying jobs are also boosting home sales at the upper end of the market.
In 2013, a total of 263 homes sold in the Seattle region for $2m or more, up 37.7 per cent from 2012, according to DataQuick, a real estate information services firm. A five-bedroom waterfront estate that fetched $9.75m was the most expensive home sale of 2013. Last year’s tally of $2m-plus sales was the highest for any year since 2007, when 383 homes sold for at least $2m, says DataQuick.
“Wealthier buyers now have more confidence in the market,” says Dean Jones, principal and owner of Realogics Sotheby’s International Realty, who focuses on high-end home sales. “Luxury real estate is again seen as a safe place to invest.”
Foreign buyers are also helping to accelerate sales at the higher end of the market, says LisaJo Chard, a property agent with RE/MAX All City. Buyers from China, she says, who have historically been drawn to San Francisco and Los Angeles, are now buying property in greater numbers in Seattle than before.
Chard estimates that more than half of the buyers seeking upmarket waterfront properties in the city at present are from China.
Seattle’s prime properties can be found near Puget Sound to the west of downtown and Lake Washington to the east. Medina, Bellevue and Mercer Island face Lake Washington and are dotted with sprawling waterfront estates which carry some of the city’s most expensive price tags. Jeff Bezos, chief executive of Amazon, owns a five-acre property in Medina, while Microsoft founder Bill Gates’ mansion sits on Mercer Island.
Windermere Real Estate is selling a four-bedroom, six-bathroom property in Medina for $8.8m. The contemporary home was designed by Wendell Lovett, a noted architect of stylish, modern residences throughout Seattle and the Pacific Northwest which are often sought-after by buyers drawn to mid-century aesthetics. The two-storey home on Lake Washington has a sauna, a wet bar, a four-car garage, as well as 125ft of waterfront with a private jetty.
The area north of downtown, which includes densely populated districts such as Capitol Hill, Queen Anne and Broadview, is popular with younger, affluent residents, says John Stewart, an agent at Coldwell Banker Bain. “You’ll find a much [more] diverse population in these areas,” he says. “Lots of younger people drawn to the nightlife and culture.”
A four-bedroom, 7,140 sq ft residence is on sale in the Broadview district for $4.49m. Called the Studio House, it was designed by Tom Kundig, a principal at Seattle-based Olson Kundig Architects and winner of several National Institute of Architects awards. The glass-and-concrete home was built in 1998 and sits on 0.8 acres of land featuring landscaped gardens and a swimming pool. The property is listed with Realogics Sotheby’s International Realty.
Meanwhile, downtown Seattle is enjoying a surge in condominium developments. Insignia, Escala, and Four Seasons are among several new projects under construction. A 5,100 sq ft condo at the Escala sold for $6.2m last year, which ranks as the highest sum ever paid for a condominium in the city.
In all, developers are projected to deliver 8,100 new condo units in Seattle this year, according to a survey released by commercial real estate brokerage Marcus & Millichap.
The median sales price of a condo in Seattle rose 24.5 per cent in February compared with February last year and stands at $322,500 from $259,000, according to Northwest Multiple Listing Service. Overall, Seattle saw more than $863m in condominium sales volume in 2013, a 17 per cent increase from 2012.
● Seattle is the largest city in the Pacific Northwest, with 635,000 residents. The wider metro area has a total population of 3.5m
● The city is about 115 miles south of the Canadian-US border
● Seattle has a wet climate, with about 37in of precipitation per year. By comparison, London receives about 24in of rain annually
● Real estate commission is typically 6 per cent of the sale price
● Washington is one of seven US states with no income tax
What you can buy for …
$3m A 2,500 sq ft, three-bedroom home in the Queen Anne district
$5m A 3,000 sq ft, new-build house with a garden and pool in Kirkland
$10m A waterfront property with four bedrooms and four bathrooms on Mercer Island