Newsletter

Recent news that the National Association of Realtors® (NAR) wishes to settle a series of lawsuits from home sellers has sent ripples through the real estate industry. Allegations of collusion to inflate compensation paid to both buyer and seller agents in transactions prompted this landmark settlement, estimated at a staggering $418M.

While the NAR denies any wrongdoing, the proposed settlement promises significant changes in how business is conducted in the real estate market. Many owners who sold a home between Oct. 31, 2019 and Feb. 1, 2024, could be eligible for a payment, so long as the property was listed on a Multiple Listing Service (MLS) and compensation to a real estate agent/broker was made. Sellers should receive notification if they’re entitled to a payment.

One of the most notable changes expected, particularly in our region, is the likelihood that the Northwest MLS will discontinue publishing compensation details within listing information. This move, while aiming to “decouple” buyer and seller compensation, may inadvertently reduce transparency for consumers when reviewing home-sale listings.

It’s essential to note that cooperative compensation offers between sellers and brokers will still be addressed in purchase and sale agreements. Sellers will retain the option to compensate buyer brokers for their services, whether in part or in full, acknowledging the crucial role they play in finding financially sound consumers to purchase their homes.

Another requirement of the settlement mandates that buyers must enter into a written services agreement with a broker before touring homes – or “as soon as reasonably practical,” according to current Washington law. This agreement, similar to those long established between sellers and listing agents, includes provisions for managing the compensation component with their broker and ensures clarity in negotiations.

While these changes may initially appear daunting, consumers must understand their implications. Here are some key points to consider:

• Re-evaluation of real estate services: Sellers may opt to offer reduced compensation to both listing and buyer agents in response to the settlement. Negotiating compensation terms with agents will become increasingly common and may vary from one transaction to another. At the same time, few – if any – sellers would willingly lower the home price because of lower transaction costs – particularly in today’s seller-favorable market.
• Buyer cost pressures: Buyers, who have historically paid little or nothing for representation through the purchase process, may now be expected to contribute financially. This could add additional costs, potentially ranging from 1% to 2% of the agreed price, to their bottom line (unless they buy a less expensive home than planned).
• Deeper negotiations: Buyers will need to engage in frank conversations with their brokers, not only on price and contingencies but also on compensation terms. Any shortfall in compensation covered by the seller will ultimately come out of the buyer’s budget.
• Under-representation: To mitigate costs, some buyers may consider forgoing exclusive representation and work directly with listing agents. However, this poses its own risks, as listing agents are legally obligated to prioritize their contractual relationship with the seller while potentially opening the door to conflicts of interest.

Veterans using the VA home loan benefit are currently prohibited from directly compensating their real estate broker. If the settlement moves forward unchanged, buyers using a VA loan would be at a significant disadvantage when offers of compensation are not provide by a seller – unless the Veterans Administration rushes through a revision.

Now we wait for reviews by the court, Department of Justice, and perhaps, other federal or state agencies. The settlement can only be approved, however, by the judge assigned to the case and could also be rejected or amended. (A federal appeals court, in a separate – but related – legal case, on April 5 granted the DoJ the right to reopen an investigation into NAR policies even after the government ended the probe in 2020.)

While these changes may pose challenges for both buyers and sellers, it’s essential to remember that Realtors® like me remain committed to guiding consumers through the real estate process. By staying informed and advocating for themselves, consumers can navigate these changes with confidence.

As always, I am here to answer your questions on this or any other residential real estate question.

URGENT CLIMATE ACTION

The climate crisis is no longer a distant threat but a pressing reality affecting communities worldwide. In Seattle/King County, the impact of climate change is already evident, with rising greenhouse gas emissions exacerbating climate hazards and threatening the resilience of our housing stock.

Climate-resilient housing, which is designed and constructed to withstand and adapt to the impacts of climate change, is increasingly recognized as a critical priority for our region. (Climate Pledge Arena, pictured atop the newsletter, features solar panels on its iconic roof and is a great example of a climate-resilient building, recently becoming the largest structure in the world to achieve a Zero Carbon Certification from a prestigious international organization.)

Despite growing awareness, progress toward climate resilience in housing has been hindered by fragmented efforts and competing priorities. Affordable housing initiatives focus not on the climate but on increasing inventory to meet demand, while climate-focused efforts lack integration with housing resilience goals.

As we mark Earth Month, stakeholders should remember to adopt a holistic approach to advancing climate-resilient housing. This includes leveraging federal legislation like the Inflation Reduction Act and the Infrastructure Investment and Jobs Act to invest in sustainable and resilient housing infrastructure. Additionally, stakeholders should prioritize collaboration and coordination to ensure that climate initiatives are integrated into housing policy and planning processes.

Our region will play a crucial role in leading climate action efforts, with ambitious targets to reduce carbon emissions and build sustainable communities. By prioritizing investments in renewable energy, energy efficiency and sustainable building practices, we can create a more resilient housing stock that withstands the challenges of climate change. It’s time for decisive action, so future generations can enjoy a more sustainable future.

For more news on this topic, please visit my Living the Dream blog for an ongoing series to celebrate Earth Month.

INSURANCE FOLLOW-UP

The top item in last month’s newsletter struck a chord with readers. One, who may have a connection to a federal mortgage guarantor named here, enlightened me about some data: The average homeowners insurance premium for a single-family home using a Freddie Mac-backed mortgage paid 41% more in 2022 than in 2018 ($1522 vs. $1081).

Insurance companies may argue, however, that the costs are simply increasing along with home values. The average mortgage holder paid $4.90 in homeowners insurance premiums for every $1000 of their home’s value in 2022. That’s only 20 cents more than in 2018.

A new report from Freddie Mac notes insurance rates are increasing modestly in Washington ($2.30 per $1000 of home value) but soaring elsewhere. Oklahoma, where tiny earthquakes rumble underneath homes regularly, pays $9.80 for every $1000 of a home’s value, and Texas, with its extreme weather events, pays $6.70. Mississippi, walloped nearly every year by a major hurricane, pays the most – $10.60 per $1000 of value.

BY THE NUMBERS

>> Compensation received by a buyer broker affiliated with our local MLS fell an average of four-tenths of a percent each year between 2000 and 2019. However, since the MLS introduced full disclosure of a seller’s offer of compensation to buyer brokers in listings in October 2019 the average has fallen at a rate of 1.5% per year through 2023 (from about 2.75% compensation to 2.55% in roughly the last 4 years), according to a recent legal brief and reported by Inman.

>> Washington ranked 43^rd in the nation for best places to retire, according to a 2024 report from WalletHub, which compared states across 46 indicators of retirement-friendliness. Our highest ranking, 17^th, was for quality of life. Oregon came in 37^th overall, with Florida and Colorado at the top.

>> King County residents love to work from home. Bellevue, at 39% of its employment force, works remotely, the third-highest rate of any U.S. city. Seattle ranks fifth at 36% of all workers, according to a report from SmartAsset. Cary, N.C., has the largest percentage of stay-at-home workers at 41%, with Frisco, Texas, second (40%).

>> This may surprise you but Seattle was recently ranked No. 1 in the U.S. for the most Meetup groups, according to research from Remitly. The international money-transfer company said the Emerald City has 1774 Meetup groups, ranging from art & culture to health & well-being. Boston was ranked 2^nd (1051 groups). Seattle is also No. 1 in the world for groups when based on a per-capita basis (24.5 per every 10,000 people) while London was the global leader with 2618 groups, but only 2.9 per 10,000 people.

>> King County residents have a life expectancy of 81.6 years, according to a University of Wisconsin report issued in March and based on data from 2019-2021. That’s the second highest in Washington behind San Juan County (86.3 years). King ranked No. 1 in the state for fewest smokers (9%) and lowest obesity rate (23%).

APRIL HOUSING UPDATE

Good news! The national economy is growing. Unemployment remains low. Corporate revenues are up.

For housing and mortgage professionals, however, these apparent highlights are persistent nuisances. They signal that the economy is still running hot – or at least more than lukewarm – and inflation may need more cold water from the Federal Reserve to cool it off.

“Cold water” comes from the central bank’s intent to maintain high financing costs for banks that borrow from other financial institutions. In turn, consumers experience the trickle-down effect in the form of costlier lending rates when holding credit card debt or financing cars and homes.

Despite a challenging economic environment, the Seattle/King County housing market is moving forward. That was highlighted by a 30% month-to-month gain in total home sales (single-family, townhome and condos combined) across the county in March and unseasonably low supply for buyers. It was particularly true on the Eastside, where sales surged 52% from February to March and 9% year-on-year (YoY) and inventory narrowed to under a month (29 days before all homes for sale would theoretically be under contract if no others hit the market).

Read a detailed assessment of our housing market in my most recent blog post: Eastside Residential Market Sees Big Gains in Sales, Prices

Housing prices continue to rise at a rate that makes home affordability a greater challenge for many. The Eastside continues to run hotter than the rest of the county, with median prices on a single-family home up as high as 26% YoY, as this monthly chart shows.

CONDO NEWS

Spire is, well, inspiring by the way buyers have embraced this standout luxury new condo project. This 41-story, 343-unit structure where Denny Triangle meets Uptown meets Belltown has been running two years of strong sales since opening in 2021. The high-rise has hit a high mark of more than 75% sold inventory – impressive when you consider urban condos have lagged behind the rush for homes post-pandemic.

There must be something about Spire. Oh, yes! Maybe it’s the top-floor amenities with fitness, lounging, and dining areas. Or that its location guarantees unobstructed views of the Space Needle. Check out my tour of the community as well as a special video feature on the building’s unique auto-park valet system.

Interested in seeing a home or two? Contact me to schedule a visit.

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One half of the great luxury condo community Avenue Bellevue has been open for a few months and the final touches on part deux move forward – but reportedly without a couple of Michelin star chefs.

December’s newsletter touted the forthcoming opening of three top-notch restaurants, however two have them have been 86’d, according to Puget Sound Business Journal. Masaharu Morimoto of “Iron Chef” fame and Robbie Felice have decided not to open their restaurants MM by Morimoto and pastaRAMEN, respectively. PSBJ quoted Montclair Hospitality Group, the planned operators of the restaurants, for its story last month.

The hotel and ground-floor retail area is still expected to feature Joshua Skenes and his Angler restaurant and other high-end shops. Skenes is the first and only American chef to garner three Michelin stars cooking entirely over open flame.

The Residences building – with its 224 homes within 25 stories – opened in the fall, while the ultra-luxe Estates 26-story, 141-unit tower with 208-room InterContinental Hotel plans to open soon after a bit of a delay.

About half of all homes within the twin-tower community have buyers under contract. Interested in learning more? Contact me to provide additional insights or to schedule a visit, just north of Bellevue Square.

LUXURY LIVING

Let’s start our tour at the top, the top of a hill that is. This one stands above the rest: a 5-bedroom, 6.25-bath mansion with outdoor pool and fountain atop Clyde Hill (380 ft. above sea level to be precise). Built in 2018, this place has everything – theater, fitness room, vaulted ceilings, two kitchens and a Nana Wall that only acts as a barrier between indoors and out when you want. A warm, welcoming space in search of new owners. List: $9.75M ($1496/sq. ft.). 

Just a little to the West, this newly constructed home in Medina features everything a buyer would want. It starts with the numbers: 5-beds, 5.25-baths, 6040 sq. ft. on a nearly half-acre. The 2-story home features natural wood, limestone walls and floating staircase. Did I mention the wet bar and wine cellar? Great views. List: $14.89M ($2467/sq. ft.). 

Or how about something new in Seattle? Try this 6-bed, 5.25-bath, 5278 sq. ft. statement home in Washington Park. Completed this year, the residence comes with hardwood floors, marble tile, vaulted ceilings, a 10 ft.-plus quartzite kitchen island and many tasteful accents throughout. Rooms focus on wood elements – very Scandinavian – with contemporary lighting and picture windows that add a sense of openness, while the rear terrace seamlessly blends the indoor space with the outdoors. Top-notch mountain views! List: $6.19M ($1175/sq. ft.), a recent price drop from $6.54M. 

I love Craftsman homes, so much so that I published a blog post about the beginnings of this architectural style in Seattle. Few Craftsmans remain and fewer look like this one, the Polson House, a 6-bed, 5-bath, 7840 sq. ft., 2-story manse with basement in Queen Anne. Check out the rich wood craftsmanship and tile work. This video shows us how the past blends well with the present. And, the south-facing views of the Space Needle and Elliott Bay are captivating. The owners are reportedly former finance execs who put almost $2M into updating the home, including a state-of-the-art kitchen. List price: $6.95M ($886/sq. ft.)

What else is happening in and around your Seattle?

Meeting of the (AI) Minds, Apr. 18
Attend an evening of thought-provoking discussion about the vision for artificial intelligence at the Innovation Exchange. The shared knowledge takes place at MOHAI (860 Terry Ave. N.) Register to attend this free event. 6-9pm.

Tea Party, Apr. 20
A cozy event – Cascadia Spring Tea Festival – features a few local vendors, tastings (bring a cup!) and teaware for sale. It takes place at Brightwater Environmental Education and Community Center (22505 SR-9 SE) in Woodinville. Entry: pay what you want. 11am-6pm. (Bonus: Check out my blog post on Seattle’s favorite tea purveyors.)

Vegetarian Variety, Apr. 20-21
A two-day conference on all things vegan? It’s true! Planted Expo Seattle will host about 200 vegan edible and lifestyle businesses for a weekend of information sharing and inspiration. All are welcome at the Seattle Convention Center (705 Pike St.). Kids under 12 are free. 10am-5pm.

Marking Earth Day, Apr. 20-22
Our region will celebrate Earth Day (officially April 22) with a variety of events. They include, on Apr. 20: Earth Day Run  (Magnuson Park, Seattle) at 10am; a virtual Earth-a-Thon  tech project (9am-5pm); Volunteering at the Washington Park Arboretum (2300 Arboretum Drive E., Seattle) starting at 9am; and, Sammamish Earth Day at Beaver Lake Lodge (25101 SE 24th St., Sammamish), 11am-2pm. Also, national parks are free on Apr. 20 while access to state parks is complimentary on April 22, the same day Seattle U. will hold Earth Talks (12-1:45pm).

Home Sweet Home, Apr. 26-28
The Evergreen Home Show promises 200 booths of “specialized local businesses ready to help you customize, update, or even design the home you have always wanted” at Evergreen State Fairgrounds (14405 179th Ave. SE) in Monroe. Fri., 12-6pm; Sat., 10am-6pm; Sun., 10am-5pm. Ticket info, including a coupon! Separately, on Apr. 27, register online now for a self-guided  Northwest Green Home Tour to see a selection of sustainably focused homes in and around Seattle.  Tour map. Free. 11am-5pm.

Cinco de Mayo Celebration, May 4
Something tells me that all of early May will be a fun time for bars and restaurants to mark the Mexican holiday (May 5). For something more authentic, check out a celebration of food, music, crafts and more at Plaza Roberto Maestas (1660 S. Roberto Maestas Festival St.) in the Beacon Hill neighborhood of Seattle. Free to attend. 12-5pm.

Boating Season, May 4
Seattle marks the start of boating season with a parade and rowing competition. The fun can best be seen along the Montlake Cut near UW. Get there early. Then, cheer crew teams as they row through the cut in the  Windermere Cup. Free. (Try to avoid driving in the area! Montlake Bridge will be closed to traffic, 9:20am-3pm.)

Seattle Film Fest, May 9-19
Enjoy what is one of the largest film events in the country – the Seattle International Film Festival (better known as SIFF) – which is celebrating its 50^th year. Come for the films, of course, as well as hear from some of the directors, actors and critics who attend festival premieres and screenings. Tickets are available for a single screening, an entire event pass or for just the parties! Plus, there are options to watch many of the films online (May 20-27). A full schedule will be released in a couple of days but here’s a sneak peek.

Storm’s Approaching, May 14
The WNBA Storm hit the hardwood for a new campaign with high hopes following a challenging 2023 without their two pillars – Sue Bird (retired) and Brianna Stewart (free agency). Seattle grabbed the offseason headlines by signing two outstanding playmakers – Skylar Diggins-Smith and Nneka Ogwumike – to join superstar Jewel Loyd. The Storm host Minnesota in the May 14 home opener and follow that with games at Climate Pledge Arena (334 1^st Ave. N.) against Indiana (likely with Caitlin Clark after her stunning collegiate career at Iowa) on May 22 and Washington on May 25. Tickets.

Events are subject to change. Please check with venues to confirm times and health-safety recommendations.

In case you missed it….

Every Tuesday (unless it’s a holiday), I publish a new story on my Living the Dream blog. I research and write pretty much all of the articles – many of them focus on local residential real estate, naturally.

However, there are times when I like to stray outside of that wide-ranging topic for something a little more adventurous. For example, check out my video blog (vlog?) on cherry blossoms in our area. That was fun!

On more serious topics, I explain the difference between MIP and PMI in home financing and share a deep look at this year’s housing-related legislation following the short session in the Washington Legislature.

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CORRECTION: In last month’s newsletter, we incorrectly stated at least 48 pieces of housing-related legislation passed either the state’s House or Senate. The correct figure was 23. There were at least 48 pieces of housing-related legislation considered but some proposals did not pass either chamber of the Legislature in Olympia.

Thanks for reading and see you here next month!

Will

When considering housing affordability, the focus often falls on the upfront expenses of buying a home. However, in today’s market, the overlooked costs of running a household have taken center stage, demanding attention and strategic planning from homeowners and prospective buyers alike.

The soaring cost of insurance and energy have dealt a two-pronged blow to homeowners’ wallets, with no relief in sight. What was once a mere detail has now become a significant financial burden in some cases, casting shadows over the dreams of aspiring homeowners and adding strain to the budgets of current owners.

Nationwide, home insurance premiums have surged by an average of 21% year-on-year, as of May 2023, equating to an annual increase of $244 per household. The situation is no better in our state, where premiums have jumped 18% in a year, marking the second-highest rise in the nation. Recent reports paint an even bleaker picture, revealing a nationwide premium surge of 23% in the past year.

Yet, securing insurance coverage is proving to be an increasingly daunting task. Major insurers like State Farm, The Hartford and Allstate are among many withdrawing from markets like California due to escalating risks such as landslides and wildfires. A survey revealed that nine in 10 consumers are anxious about escalating homeowners insurance costs, with 27% contemplating relocation to escape the financial strain. Some are even considering forgoing insurance altogether, risking their financial security once mandated by mortgage lenders.

A myriad of factors contributes to this crisis, including the intensifying impact of severe weather events and the scourge of insurance fraud. Inflation exacerbates the issue further, driving up costs for home replacement and repairs, leaving owners vulnerable to being underinsured.

This predicament is particularly acute in our state and others grappling with escalating risks of earthquakes and rising sea levels. Homeowners must engage in thoughtful discussions with their insurance agents to assess whether additional protection is warranted.

In response to mounting concerns, the state enacted measures in 2023 to enhance transparency in premium increases and grant policyholders more time to adjust. Starting mid-2027, insurers operating in Washington will be mandated to furnish written notices to policyholders facing premium hikes of 10% or more and explain the primary factors driving the change.

The cost to use electricity in a home runs about $104/month in Washington compared to the national average of $131. A typical Washington household spends $79/month on natural gas, which is a dollar less than the national average. (Source) Locally, Puget Sound Energy raised electric rates by 1.7% at the start of 2024 after increasing them by 8.7% last year, and Seattle City Light increased rates by 5.7% this fiscal year after a 4.5% rise in 2022-2023.

For today’s homebuyers, the importance of holistic financial planning cannot be overstated. Beyond the allure of the offer price, it’s imperative to factor in the long-term cost of maintaining a property. This includes diligent inquiries into the current insurance and utility expenses from sellers, alongside documenting the age and expected lifespan of crucial home components, from plumbing and electrical systems to major appliances and roofs.

In the face of mounting challenges, knowledge is power. By embracing a comprehensive understanding of the true cost of homeownership, individuals can navigate the turbulent waters of the housing market with confidence, ensuring a secure and sustainable future for themselves and their families.

ELECTION YEAR EFFECT?

Prospective home sellers are smart people. They sometimes ask questions that have no easy answer … and I don’t like saying “It depends” but that can be the best response.

The question bounding about these days is what effect the presidential elections will have on the economy. I am no economist (hardly!) but I know of a few who are often available for insights.

One, Marci Rossell, offered her thoughts on the impact on our economy in a presidential year. The noted economist has been plying her trade for nearly 30 years, so she has seen a few presidents come and go.

“We want to give a president more credit for the economy than they deserve, and we also want to give them more blame for the economy than they really deserve. The economy does what it’s going to do and it is much bigger than any single actor,” Rossell said.

“What matters for most people’s real economic livelihood is what happens at the local level, which is much less about Republicans and Democrats.”

I don’t have evidence to back this up, but I have heard some – prospective buyers and sellers, as well as real estate industry pros – tell me that the housing market may slow down this fall as we wait and watch the outcome of the Nov. 5 vote (and ballot count the days after). On the whole, people should continue to buy and sell when they need and not be guided by who is in the White House come 2025.

I don’t have evidence to back this up, but I have heard some – prospective buyers and sellers, as well as real estate industry pros – tell me that the housing market may slow down this fall as we wait and watch the outcome of the Nov. 5 vote (and ballot count the days after). On the whole, people should continue to buy and sell when they need and not be guided by who is in the White House come 2025.

OLYMPIA HOUSING UPDATE

Despite a short session this year, lawmakers in Olympia were successful in passing 11 known pieces of legislation that serve to help home buyers and sellers as well as landlords and tenants.

Possibly the most notable bill to reach Gov. Inslee’s desk for his signature was a measure that reintroduces into the state a form of co-living housing that was popular here a century or more ago – boarding houses. The new legislation aims to prohibit local government from restricting this form of rental housing while generating more options for people struggling to afford a place to live.

What might be even more newsworthy is the lack of breakthrough legislation to address the shortage of homes overall and affordable ones at that. At least 48 pieces of housing-related legislation passed either the state House or Senate but most of them stalled in the other side of the chamber – in most cases by simply running out of time.

Read more on this year’s legislative session in a blog post, to be published on March 19: Washington Legislators Drive Home More Real Estate Measures in 2024 

BY THE NUMBERS

>> Residents in Seattle metro (King and Pierce counties) need to earn $215K a year to afford a typical home, Axios reports. That’s an 18% increase from the previous year and about $100K more than the U.S. average. The median household income here is $107K. Our area ranks 8^th in the nation for highest earnings/affordability requirements, with California cities representing the top seven led by San Francisco ($404K). 

>> A full 42M U.S. households were cost-burdened in 2022, paying more than one-third of their income for housing, according to research released in January by Harvard’s Joint Center for Housing Studies. This is an increase of 1.5M households from 2021. The result: Nearly one-third of all households are cost-burdened, the highest rate since 2015.

>> Seattle metro has benefitted from 6138 new apartment units in 2023, according to data compiled by John Burns Research and Consulting, which forecasts another 25,687 units in development. The overall total ranks 15^th in the U.S., with Dallas metro at No. 1 with a combined 75,274 units newly completed or being developed. The consultancy noted: “Seattle [area] multifamily permits are down 46% YOY.”

>> Seattle metro enjoyed one of the highest gross profits for 2023 U.S. home sales – an average of $325K per residential transaction – according to an analysis by ATTOM Data Solutions. That’s the highest gross profit outside of California, where San Diego led four of the state’s cities with an average profit of $698K. Overall, the nation experienced a rare year-on-year decrease in average gross profit – down $1.6K to $121K.

>> The portion of Washington homeowners considered equity-rich is decreasing, according to new info from ATTOM. Equity-rich is defined as the combined estimated amount of loan balances secured by property owners that are no more than half of their estimated market value. Our state’s mortgage holders with at least half of their home equity fell from 56.7% in Q3 to 53.5% in Q4. That’s the fourth-sharpest decline of any state, with Missouri suffering the steepest drop (from 41.9% in Q3 to 37.3%).

MARCH HOUSING UPDATE

Mixed economic numbers have turned that smile upside down among interest-rate watchers, as inflation persists and employment stays healthy. This divergence of data put the mortgage market on its heels over the past several weeks and essentially reset rates after trending lower in December and January.

As a result, home buyers and sellers across Seattle/King County saw a mixed bag of activity in February, according to the Northwest Multiple Listing Service. Home sales figures were little changed in the county as a whole year-on-year (YoY) but varied widely by city, while home prices reached double digits amid growing demand.

This return of buyers follows a sluggish late 2023. About two-thirds of all King County listings sold last month at the list price or above, signaling a competitive environment and extending this long-running sellers’ market.

Read a detailed assessment of our housing market in my most recent blog post: Seattle/King County Activity, Prices Show a Monthly Jump

You may want to sit down before browsing this month’s map. Home prices are sharply higher YoY, led by a stupefying 85% surge in Issaquah and a blistering 41% climb in Kirkland. (Figures as of 3/1/24)

This graphic – which you can click to expand – is presented every month, rotating among three home groups. Next month, we will look at single-family-home prices by city.

CONDO NEWS

Great news from Graystone, the newest Seattle high-rise to open its doors. The sales team reports busy opening months, including five closings in January. Another 11 sales were expected to close by the end of February. What a start to the year!

The 31-story, 271-unit, First Hill condo opened in November and is picking up steam. There is more than 20,000 sq. ft. of amenity space, including a top-floor indoor lounge with kitchen and private dining, and an outdoor escape known as the Zen garden.

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Progress on Seattle’s other major condo high-rise project appears to have slowed down a bit. First Light is aiming to complete its epic 48-story, mixed-use luxury tower in lower Belltown sometime in the second half of this year. A report last October quoted developer Westbank as saying the 459-unit, ultra-luxe condo would be ready to open early this year. 

Good things come to those who wait! The final set of top-floor windows should be in place by the end of the month.

Inventory is slowly declining, with less than a third of the homes remaining on the market after much fanfare when the project was unveiled in 2018. Like many other construction projects, First Light confidently confronted issues ranging from the pandemic, supply-chain delays, change in the general contractor and concrete workers’ strike.

The amenities in this glass-and-steel beauty are top-of-the-line, starting on the rooftop – a cantilevered, outdoor, heated infinity pool with spa tub. They also include a wellness/fitness center, residents’ lounge, meeting space, screening room and much more. 

Contact me to schedule a tour of the much-discussed Graystone or a hard-hat visit for qualified buyers to First Light. I’m ready to help!

LUXURY LIVING

If you smell hints of Frappuccino in the air of a certain home on the market, I can explain. Bill Moore, the man who played a significant role in the creation and development of the original coffee beverage that first made a splash in 1995 is selling his Eastside home. (Fun fact: Starbucks employee George Howell invented the signature drink but Moore recognized the global appeal!) Moore and his wife Abby have a beautiful 4-bedroom, 3.25-bathroom, 5566 sq. ft., 2004-built home in the West of Market section of Kirkland, with moorage along 60 ft. of Lake Washington. The wine cellar can hold up to 500 bottles, the kitchen has three ovens, and semi-enclosed terraces provide stunning views of Seattle in the distance. Perfection in every sense of the word. (I love the light fixtures.) Have a look! List price: $14.8M ($2675/sq. ft.). 

Born and raised in Seattle, Ralph Anderson became a premier architect of modernist design for mostly residential buildings. That includes this outstanding work in Issaquah: a 5-bed, 5.5-bath, 11,412 sq. ft. marvel that rests on a plateau within the property’s 10 acres. From ceiling to floor, there is a lot of wood in this Northwest contemporary home built in 1993. The craftsmanship makes the space feel extraordinary and blends well with the Squak Mountain surroundings. You will have a difficult time finding another estate with better mountain views. List: $7.5M ($663/sq. ft.) – a “steal” for high luxury.

Jan Peters – a one-time CEO of MediaOne (which evolved out of US West and Continental Cablevision) – and husband Mike (a former MediaOne exec) are offering their modern Medina manse for sale. This 4-bed, 4.5-bath, 6950 sq. ft., custom-built home (2021) is adjacent to the famed Overlake Golf and Country Club and offers front-row seats to the second hole. The home goes above and beyond with an in-ground pool and spa tub, elevator, smart-tech installations, three fireplaces, and a stunning kitchen (with butler’s pantry) that would make Julia Child proud. Timeless living – a home of a lifetime. List: $13.9M ($2000/sq. ft.). Annual property taxes are, gulp!, about $67K. Oh, and the home is a block East of another notable estate – that of Bill Gates – where he and his former wife Melinda raised their family.

What else is happening in and around your Seattle?

Cherry Blossoms, starting soon
What a magical time to be out in search of cherry trees in full bloom. The peak season varies from year to year and from Seattle neighborhood to Seattle neighborhood – usually sometime between late March and early April – depending on the effects of winter on the growth of the blossoms. The photo atop this month’s newsletter showcases the trees in full bloom (sometime in the past) on the University of Washington campus. You can monitor the live webcam or stop by to catch the beauty. In addition, the Seattle Armory and Fisher Pavilion in Seattle Center (near 2^nd Ave. N. and Lenny Wilkens Way) will host the Cherry Blossom & Japanese Cultural Festival, April 12-14.

Variety at Its Best, Mar. 21-Apr. 14
It’s billed – probably inaccurately so – as the world’s largest comedy variety festival. (I think the folks in Melbourne, Australia would disagree.) The Moisture Festival presents 40 shows at Broadway Performance Hall (1625 Broadway, Seattle). We understand the 3pm and 7:30pm shows are for all ages and burlesque and late-night performances are for people 18 and older. Tickets.

Teen Spirit, Mar. 23
Picture this: Dozens of organizations looking to inspire teenagers to make a difference in their lives and their communities. That’s the aim behind the Teen Action Fair, which includes performing artists, activities and games at the Gates Foundation Discovery Center (440 5^th Ave. N., Seattle). Free. 10am-3pm

Seattle Mariners home opener, Mar. 28
The Mariners are seeking to avenge a difficult end to last season and seek their second visit to the playoffs in the last three campaigns. But first things first! They have to play well, starting with their home series opener against the Boston Red Sox (Mar. 28-31). Seattle also hosts the Guardians, Cubs, Reds, Diamondbacks and Braves in April. T-Mobile Park (1250 1^st Ave. S.) Tickets.

Easter Egg Hunts, Mar. 28-30
Is it Easter already? Apparently so! Children can enjoy running about in search of prizes in the annual egg-hunt tradition. Look for one near you in Seattle and elsewhere. Registration is required in some locations.

Dancing Delight, Mar. 29-Apr. 7
Dance is the language of the soul, spoken through movement. Enjoy the movement, motion and magic at its best during the Seattle International Dance Festival Winter Mini-fest. See the Khambatta Dance Company and Newport Contemporary Ballet of Rhode Island among others perform over the week-plus experience at Erickson Theatre (1524 Harvard Ave., Seattle). Tickets.

The Great Goodall, Mar. 30
Anthropologist Dr. Jane Goodall speaks about her groundbreaking research on chimpanzees in a lecture “inspiring people to take action for a sustainable and compassionate world” at The Moore Theatre (1932 2nd Ave., Seattle). Tickets. 7:30pm.

Tiptoe Through the Tulips, Apr. 1-30
A kaleidoscope of vibrant colors and fragrant dreams await all month at the Skagit Valley Tulip Festival in and around Mt. Vernon. Tulips, daffodils and other early season blooms are on vivid display. It is one of the most awe-inspiring sights one can imagine – row after row of beauty. Also, come for the free Tulip Festival Street Fair (Apr. 19-21).

State Fair, Apr. 11-14, 18-21
It’s time again to do the Puyallup! The Spring Fair is nearly here at the Washington State Fair Events Center (110 9^th Ave. SW, Puyallup) So many different events, food vendors and amusement rides; it’s fun for the entire family.

Events are subject to change. Please check with venues to confirm times and health-safety recommendations.

In case you missed it….

I was fascinated – and admittedly quite concerned – by what I uncovered in researching the latest attempts by cybercriminals to damage the names and bank accounts of home buyers and sellers. The advent of artificial intelligence has changed the landscape in real estate – and not generally in a good way. Check out my blog post on how sophisticated fraudsters are using AI and other methods to make your life a living H-E-you-know-what.

In my Living the Dream blog, I also offer a look at discrimination in Seattle’s real estate past (and some may argue present). I also published a story in February that offers tips to keep your roof in good shape and avoid paying for a new one so soon.

Interested in a different real estate topic and want to learn more? Let me know! I will consider researching and writing about it for a future story.

Thanks for reading and for all of your referrals – an indispensable part of my business!

Will

Seattle is different than other cities in many ways. For one, we tend to live alone – a full 156,000 of us city dwellers have no roommates or live-in partners unless you count your pet (we do love our pets!). The figure is a 20% jump from 2019 and represents 43% of all city households, the sixth-highest total in the nation. It also comes as King County recently experienced its first population decline since the 1970s of people under the age of 18.

This may beg the question: Are Americans – and Seattleites in particular – living a more isolated life? Granted, it’s not exactly a happy question to ponder this Valentine’s week.

U.S. Census research from a decade ago that covers all the way back to pre-Civil War strongly suggests the answer is “Yes.” Unlike a century-plus – or even decades – ago, today’s residents in many cases prefer to live alone, especially in urban areas.

Thanks in large part to the powerful influence of Seattle-based Amazon and the businesses that support the commerce and computer storage colossus, we have helped to create a city of solo dwellers. Why? Many can apparently afford to live on their own; people in Seattle with a college degree earn a median income of $116,000, according to Census data from 2022. Also, we enjoy our solitude with the option to mingle at the gym, outdoors with nature, or simply socialize when we want.

Whether this is a healthy existence is another story. In fact, the U.S. Surgeon General released a report called Our Epidemic of Loneliness and Isolation. To address the issue, Dr. Vivek Murthy developed six pillars that spotlight a need for social connectedness.

It reminds me of the positive impact cohousing has on its members. Cohousing is an affordable option that flourishes from an intentional, socially active living environment for its residents. While most own their homes like traditional residential life, cohousing members also follow a participatory way of being. That can include looking after one another as well as holding social gatherings – meals, games, parties and TV watching in a large community setting – and many seniors are adopting cohousing as a lifestyle choice.

A group of students from SuitUp was asked to express their wishes for more community-oriented housing. One of their suggestions was to create a neighborhood of affordable tiny homes with a range of shared facilities. Residences would include kitchenettes, with larger shared kitchens nearby that would encourage neighbors to cook and eat together while keeping costs lower.

The young students might be onto something, particularly for the 76M Baby Boomers in the U.S. who may be facing greater isolation as they age. Smart kids!

In the evolving landscape of urban existence, embracing community-oriented living options like cohousing and affordable tiny homes could be the key to fostering connections. This is especially true as we navigate the challenges of isolation and seek meaningful social bonds in our rapidly changing world.

SPOTTING TRENDS

Builders are hearing from prospective buyers: Please create stylish and functional homes with little compromise on size and at lower prices.

Designers are helping builders broaden options to create homes that consumers can afford – no easy task. Here are a few trends, according to John Burns Research and Consulting, that started in 2023 and will continue this year:

• Designers are starting to remove entire parts of the home, like the formal dining room, basement and garage to free up more space for the bedroom, kitchen or study.
• Builders are partnering with mortgage lenders to deliver lower interest rates, either through temporary or permanent rate-busting promotions.
• Instead of focusing on multigenerational opportunities, more builders are offering the option to create a rental suite or accessory dwelling unit as part of a new home, assuming that some will rent out the space for additional income.
  

THE YEAR OF HOUSING 2.0

State lawmakers made huge strides last year to help improve the chances of more homes being developed – and affordable ones at that. We have covered this legislative fervor in a previous newsletter in which 23 housing bills became law.

How serious is our housing shortage? The Urban Institute projects the Puget Sound region faces a gap of about 140,000 homes over the next 20 years, even when factoring in the new measures passed in Olympia.

“Our work is not done,” Washington Lt. Gov. Denny Heck told The Urbanist. “The problem is so big, and some of the solutions that were adopted [in 2023] … are going to take quite some time to actually be felt on the ground. It’s not a time to let up.”

The Legislature is back at it – this year meeting for a 60-day session – seeking to build upon (no pun intended) the successes of 2023. Three housing-related topics started this year as a prime focus:

• Lot Splitting – a process that would allow property owners to split part of their lot of land to have a new buildable area of at least 2000 sq. ft. for housing.
• Accessory Dwelling Units – expand permitted use of detached ADUs to include rural portions of the state.
• Transit Oriented Development – redefine TODs to include higher density housing in a wider radius of transit facilities (within a half-mile of rail stations and a quarter-mile of rapid bus stops), require a higher rate of affordable homes in these zones, and permit state funds to support both this type of development and related infrastructure projects.

Sensing this urgency, House lawmakers got to work on Day 1 of the new session and passed a lot-splitting bill, 94-4, that was carried over from last year. We learned this week that the Senate is no longer reviewing the measure. No explanation was immediately available.

The measure to increase the number of ADUs on rural land never made it out of committee. However, a bill passed by Senate lawmakers and now with the House could waive property taxes on ADUs (attached to a single-family home or detached) as a means of incentivizing additional rental housing.

A variation of the TOD legislation is working its way through the Senate after passing the House.

Among other items under discussion:

> The state is weighing proposals to help fund affordable housing efforts that recently came into effect. One option: Raise the excise tax by a percentage point – to 4% – on home sales above $3M never got out of committee. Another option: Appoint the state’s Department of Commerce to provide low-interest loans for eligible organizations to deliver affordable housing to low-income households; it has strong support and is under review by the Senate after passing the House.

> Lawmakers are looking into the idea of co-living housing, which are sleeping units that are independently rented and lockable but whose total occupants would share kitchen facilities. Local governments may also call this congregate living, single-room occupancy or a boarding house. The House approved the legalization of this housing and has sent the measure to the Senate.

At least 27 pieces of housing-related measures passed through one of the House or Senate committees, with 14 of them receiving approval by one of the full chambers so far. The last day of this year’s session is on March 7. Watch this newsletter and my Facebook page for updates.

BY THE NUMBERS

>> Seattle jumped five notches between 2019 and 2022 among big U.S. cities for people living alone, according to the U.S. Census Bureau. Of its 367,000 total households, the Emerald City had 43% single occupants, up from 38%, or 11^th place nationally, three years before. Washington, D.C., was No. 1 at 49%, followed by Atlanta (47%). Our city averages 2.1 people per household.

>> Seattle metro ranks third in the nation on a measurement of factors that combine economic conditions, workforce quality and quality of life. The so-called STEMdex from Real Estate Consulting puts our city behind only Austin and Denver in an annual ranking of markets most likely to see the strongest STEM (Science, Tech, Engineering, Math) job growth.

>> The typical home fix-and-flip in the U.S. reaped a net profit of 30% in Q3 of 2023 for owners, according to information released in December by ATTOM Data Solutions, up from 22% in the same quarter of 2022. The smallest home-flipping rates were in Seattle metro – 3.8% of resold properties.

>> King County’s net new housing need is 308,677 units between 2019 and 2044, according to county planning policy experts. The cost of an affordable home in the county is estimated to be $475,404; that compares with the median price for market-rate sales in January of $760,000.

>> Commercial real estate firm Berkadia projects about 21,700 apartment units will come online in 2024 across King and Pierce counties combined. Rental occupancy rates will end this year at 95%, the research firm forecasts.

FEBRUARY HOUSING UPDATE

The Seattle/King County housing market appears to have come through the worst of times with a slightly stronger showing in January than in previous months. The number of newly listed homes more than doubled from December and increased moderately compared with the same time last year, according to data from the Northwest Multiple Listing Service. Total inventory remains low, however, keeping prices higher on an annual basis.

The final months of 2023 were among the quietest periods in recent memory for residential real estate amid a slow year overall. Annual sales across King County totaled 21,515 homes – down an incredible 24% from the year before and the fewest since 2010 (20,761). The market is now in the process of thawing after a lengthy cool down, as buyers begin anew to seek change in their home dynamics.

Read a detailed assessment of our housing market in my most recent blog post: Mostly Positive Start to 2024 Housing Activity in Seattle/King County

The monthly price map (below) shows a wide range of year-on-year price variations across the King County condo market. Year-on-year price changes include a jump as high as 42% in Sammamish ($900,000) to a decline as low as 16% in Maple Valley ($424,950).

CONDO NEWS

The newer condo buildings around Seattle enjoyed a good sales year in 2023 with hundreds of homes changing hands.

Spire led the way with 57 units sold to new buyers, including nine deals in March. Opened in 2021, the 41-story luxury condo on Denny Way – near the former Elephant Car Wash – offers amazing top-floor amenities and the first auto-valet residential parking system in Seattle. Every remaining luxury home for sale either includes parking or has the option to purchase a space in the automated system (see my story on how it works).

KODA came in second across the region (and city) for annual sales with 28; that’s 14% of the building’s 201-unit inventory. Also opened in 2021, the 17-story condo in the Japantown section of the city’s International District features unobstructed rooftop views of Puget Sound to the west, downtown to the north and the stadiums just to the south.

Insignia Towers also sold 28 units this past year but that’s a fraction of the total 698 units in the community. The twin high-rises opened in 2015 and 2016 and sold out quickly. Unlike Spire and KODA, Insignia’s sales typically originate from the first owners.

Each year I summarize sales turnover and owner-occupancy rates for Belltown/downtown Seattle condos. It’s helpful for me and my condo clients to chart the trends and understand which buildings have a high percentage of owners living in the building.

The chart below is my handiwork and unofficial. You’ll notice sales rates were mostly lower for buildings in 2023, thanks to the overall housing market slowdown. I expect sales will pick up this year.

Do you have a question about the local condo market or, perhaps, another condo building? Contact me for more information.


LUXURY LIVING

Jeff Bezos is (indirectly) in the news with a new listing of his former Bellevue home. The 1-story, mid-century abode is on the market for the second time in 4-plus years. It’s a 3-bedroom, 1.75-bathroom, 1540 sq. ft. property on a just-shy, 0.2-acre lot (yes, that’s small!). Bezos was renting the vaulted-ceiling residence in 1994 when he converted the garage into the HQ for his fledgling bookselling business Amazon.com. (The West Bellevue home is close to what would become Bezos’ residence in Medina, and he has/had properties in nearby Hunts Point and Yarrow Point.) List price for this piece of local history: $2.28M ($1481/sq. ft.). 

Medina is also home to an 8-bedroom listing that hit the market in January. Built in 2019, the home includes 7.25 baths within its 7650 sq. ft. on 0.6 acres which is a stone’s throw from Lake Washington. The home offers a stately, contemporary design that is warm and inviting. There is a Bezos connection here too: The reported homeowner, Peter Neupert, was recruited by Bezos, a friend and neighbor, to run drugstore.com back in the ‘90s when amazon.com was heavily invested in the online pharmacy. (Neupert would leave the business after about 5 years and join Microsoft for a second stint where he helped to run a new health-solutions group.) List: $10.5M ($1373/sq. ft.) 

Staying in this bedroom community, here’s a 3-bed, 1.5-bath, 2700 sq. ft., multi-level home with a fully furnished daylight basement. This charming mid-century residence – with original wood-beam ceilings and wide-open floor plan – sits within close distance of Meydenbauer Bay and Lake Washington. Loads of natural light inside and spacious enclosed yard. Great location. List: $3.58M ($1326/sq. ft.).

What else is happening in and around your Seattle?

Flower Show, through Feb. 18
Spring comes early at the Northwest Flower & Garden Festival. The annual show features more than 20 garden displays and hundreds of sessions to experience and learn about flora and fauna. Catch the fun at the Seattle Convention Center (705 Pike St.). Tickets. Thurs.-Sat., 9am-8pm; Sun., 9am-6pm.

Complimentary Healthcare, Feb. 15-18
Seattle/King County Clinic offers dental, vision and medical care to anyone for no charge. Tickets will be limited and available from 5:30am in Fisher Pavilion (near the corner of Lenny Wilkens Wy. and 2^nd Ave. N.). No ID is required. Free parking is available in Mercer Street Garage (650 3rd Ave. N.).

Recreational Vehicle Show, Feb. 15-18
Special vehicles and accessories will be showcased at the Seattle RV Show. Come for the RVs, seminars, as well as adult beverages at Lumen Field Event Center (800 Occidental Ave. S.). Free admittance for children. Thurs.-Fri., 11am-6pm; Sat., 10am-7pm; Sun., 10am-5pm.

Free Classical Music, Feb. 21
Seattle Symphony performs with young musicians during Side-by-Side with the Seattle Youth Symphony Orchestra at Benaroya Hall (200 University St.) It’s free but seat reservations are recommended. 7:30pm.

Asian American Film Festival, Feb. 22-25
Seattle Asian American Film Festival features artists who create innovative media. Meet filmmakers and attend Q&A sessions after screenings at Broadway Performance Hall (1625 Broadway Ave.) and Northwest Film Forum (1515 12th Ave.). Can’t make it to the festival? Then bring the festival to you with virtual showings, Feb. 26-Mar. 3.

Home Show, Feb. 22-25
Seattle Home & Garden Show has exhibits about building, remodeling, decorating and landscaping homes. See for yourself at Lumen Field Event Center (800 Occidental Ave. S.) 10am-6pm every day.

Comicon, Feb. 29-Mar. 3
It’s that time again! Emerald City Comic Con returns for another moment of comics, anime, gaming, entertainment and pop culture, where attendees come as they wish. The costumes worn often act as a great show on its own. Actors Chris Evans and Christina Ricci will be among the guests attending. Washington State Convention Center (705 Pike St.). Tickets.

Seattle Sounders home opener, Mar. 3
One of the first signs of spring is the start of the Major League Soccer season. The Sounders kick off their 34-match campaign on Feb. 24 at LA FC, the team that knocked Seattle out of last season’s playoffs. That’s followed by the home opener on Mar. 3 at Lumen Field (800 Occidental Ave. S.) against Austin FC. Messi and his Miami FC squad do not face the Sounders this year. Tickets.

Wearin’ the Green, Mar. 15-17
For most of us, we may have lost the meaning behind St. Patrick and his bringing of Christianity to Ireland. Now it is a day to celebrate Irish culture with festivities beyond simply wearing green on the 17^th.  This year is no different. Mark the occasion on the 15^th with the landing of St. Patrick by boat on South Lake Union at 5pm and the laying of the green stripe at the beginning of the parade route at Jefferson St. and 4^th Ave. in downtown Seattle. 7pm. On the 16^th, the parade will run along 4^th Ave. downtown and feature Irish bands, pipers, dancers and more. 12pm. The Eastside celebrates St. Patrick on the same day at the Kirkland Performance Center (350 Kirkland Ave.). 7pm. And, everyone becomes Irish on the 16^th and 17^th at Seattle Center Armory (305 Harrison St.), showcasing music and dance performances, films, children’s activities and plenty of food. ~12pm both days.

Events are subject to change. Please check with venues to confirm times and health-safety recommendations.

In case you missed it….

Living the Dream, my blog, continues to showcase helpful content week in and week out.

I have researched, written and recently published insightful stories on new state initiatives aimed at improving housing equity and the importance for buyers to have a home inspected before closing the sale.

Lastly, I made the case as to why owning a home is better than renting – even in pricey King County. I have the numbers to back it up!

A final note: Thank you to all of you for reading this newsletter – a labor of love for me. I have been amazed by the uptick in subscribers – closing in on 600 after hitting the 500 mark in October. Consider asking your friends and colleagues to sign up here.

Thanks!

Will

As the clock struck midnight on New Year’s Eve, the nation’s attention may not have been completely fixed on a descending Waterford crystal ball in Times Square. Instead, many eyes may have been captivated by something else dropping – interest rates. 

The Federal Reserve recently updated its forecast, hinting at a potential decrease of about 75 basis points (0.75%) in its short-term lending rate by the year’s end – promising news for borrowers in 2024.

The past year witnessed a financial rollercoaster, with interest rates fluctuating between 5.99% and 8.03% for conventional 30-year mortgages, according to Mortgage News Daily.

The Fed’s revised lending forecast sparked a celebratory mood among investors, particularly those tracking U.S. Treasurys and mortgage-backed securities. This positive shift is expected to bolster consumer confidence and help alleviate cost pressures in numerous aspects of the economy.

The most significant impact of reduced finance costs is the potential for lowering barriers to homeownership, which has reached unprecedented heights in the past two years. At the same time, many homeowners are sitting comfortably with low mortgage rates.

Fully 60% of mortgaged homeowners have lending rates below 4.0% and nearly 90% enjoy rates below 6.0%. This represents about 75M homeowner households, according to a Harvard housing report, out of a total of 85M households nationwide.

The National Association of Realtors® noted an estimated 41% of owners remain in their homes for a duration equal to or exceeding the median tenure of 13 years thanks to today’s higher rates. Harvard researchers suggest that this reduced household mobility can lead to inefficiencies in the labor market, hindering Americans from relocating to more productive or high-demand areas.

This is why the prospect of a substantial drop in interest rates is a cause for optimism. Lower lending costs not only instill hope in more people – particularly renters – for securing a new home but also that more current owners should return to the market. 

As financial barriers ease, the dream of moving to a more desirable location becomes more attainable. It’s a positive shift that could soon reshape the landscape of the housing market, offering hope and opportunities for those eager to embark on a new homeownership journey.

NEW LAWS AFFECT HOME BUYERS

Washington lawmakers last year set out to make our corner of the country one of the most consumer-friendly real estate environments anywhere. They voted to allow up to six dwellings in areas close to transit and up to four in other areas that previously only permitted one home per parcel.

Olympia also established a law, effective Jan. 1, that requires buyers wishing to work with a licensed real estate broker to sign a services contract. The pact clarifies certain terms, including whether they will have an exclusive contract with the broker or non-exclusive, and how brokers will be compensated for their services. (I went into greater detail on this topic in a recent blog post.)

In addition, lawmakers approved a breakthrough down payment assistance program for those who suffered from discriminatory covenants. Those covenants were often seen in bylaws from gated communities or written into property deeds that, in many cases, only allowed white residents. The new program will be funded by an increase in county recording fees. (A blog post will be published on Jan. 16 that includes more about qualifying for the assistance.)

AIR OF OPTIMISM

Glimmers of hope for the heart of Seattle are becoming more frequent, more pronounced. The downtown area has been through a rough spell since doors to offices, schools and shops closed in March 2020 and slowly returned to a form of normalcy over the past two years.

I see those bright spots with the reopening of the former Cinerama, my all-time favorite movie theater, and the large crowds that watched New Year’s Eve fireworks at the Space Needle followed by a rousing experience at the National Hockey League’s Winter Classic in T-Mobile Park. (Even Seattle sunsets – like the one featured near the famed Edgewater Hotel atop this newsletter – are looking better this early 2024!)

It is also assuring to see democracy at work, with the swearing-in of five new members of Seattle City Council (with another soon to be named) – shifting the political mindset to one that’s more centrist and populist. It will be fun to see how Sara Nelson, unanimously elected new council president, directs policy with Mayor Bruce Harrell.

“I believe that if we change the way we operate, starting with coming in to work in person, Seattleites can expect to see a major reset in tone and direction at City Hall,” Nelson wrote this month in a Seattle Times op-ed.

The mayor and past council delivered a strong message with the passage in December of the city budget. Yes, 2024 will be focusing even more resources on investing in affordable housing (32% additional dollars than last year), $100M+ directed to services and shelter for the homeless, and even funding to plant about 1300 trees across our city.

There is hope and optimism within me, my real estate colleagues and the city at-large as we invest in the future of this great city and seek renewed prosperity.

BY THE NUMBERS

>> Seattle metro leads the nation with construction cranes – 45 – according to a Q3 summary from the RLB Crane Index. That includes 36 new cranes since the previous report, and it is more than larger U.S. cities, such as Los Angeles (28), Boston (20) and Chicago (9). As of December, downtown Seattle is second in the nation behind Denver for most residential units under construction (7825).

>> Seattle/Tacoma comes in as the fifth-least affordable among the nation’s 100 largest metros, according to a Business Journals analysis of data from the Bureau of Economic Analysis’ Regional Price Parity Index. Metros with a score above 100 in the index are more expensive than the national average. Seattle metro scored 114.5, rating poorly for housing costs. Portland, Ore., was the 18^th least affordable. The San Francisco Bay Area was rated least affordable (119.8) and McAllen, Texas, came in as most affordable (87.7).

>> Medina – the enclave west of Bellevue along Lake Washington and home to Bill Gates and other billionaires – is the priciest ZIP code in Washington. The median price of a home in 98039 is $4.39M, the ninth-highest ZIP in all of America. Another local community, Mercer Island (98040), came in at No. 68 in the country with a median home price of $2.12M. The priciest ZIP in the U.S. is 94027 in Atherton, Calif., with a median home price of $8.3M, according to research firm PropertyShark.

>> Redmond, Wash., is America’s fastest-growing wealthy suburb, says a report from moveBuddha. Despite an average single-family home value of about $1.36M, the HQ to Microsoft has seen its population grow 18% between 2017 and 2022. Shoreline came in at No. 14 nationally with 5.5% population growth over those five years and a home value today of $783.3K. California has 14 of the top 25 fastest-growing wealthy suburbs, led by Irvine at No. 2 in the nation.

>> Our metropolitan area has the ninth-highest cost of living in the U.S., according to analysis of Q3 data from Axios, which gave this region an index of 145.7. Manhattan, N.Y., was at the top with a 227.8 reading, followed by Honolulu (179.2). A value of 100 would be “average.” Housing and health care drove the Seattle area’s high cost of living.

JANUARY HOUSING UPDATE

December’s housing activity in King County was marked by shriveling supply amid fewer listings hitting the market in what is traditionally a low point of the real estate year. Prices mostly fell from the previous month but were higher year-on-year (YoY).

The 802 new listings last month were a low not seen since records were archived online from 1990. The second-closest monthly total for all home types (single-family, townhome, condo combined) was 887 in December 2022. No other month has fallen below 1000 new listings in more than three decades of online record keeping.

In other words, the housing market was in deep hibernation and the conditions should only improve from here. But by how much? There is little doubt the inventory shortage will continue through 2024 – as mortgage rates remain too high for many consumers – and that means great pressure to push prices higher.

Read a detailed assessment of our housing market in my most recent blog post: Despite Falling Rates, King County Housing Market Flops to End Forgettable Year

This month’s review of median prices (below) focuses on single-family homes across King County. Each city experienced a YoY decline in a range between 3.5% and 7.2%.

CONDO NEWS

Seattle’s most talked about condominium project today is taking place on the south edge of Belltown, right across the street from the former Bed Bath and Beyond. That’s where builders and skilled workers are fitting out the 48-story First Light ultra-luxe condo at 3^rd Avenue and Virginia Street. 

The amenities are one of the project’s hallmarks. They include an Olympic length, cantilevered lap pool and two spa tubs that now rest atop the building. 

Homes are being fitted with stone tile, flooring and cabinets. Contractors have reached floor 33. The sales team tells me the doors will open on this stunning high-end community later this year.

———-

Graystone has extended a special promotion. Through this month, buyers can earn up to $30K in credits applicable for interest-rate buydowns, parking and more. Plus, homeowners’ dues are waived all year for new purchases. The 31-story, 271-unit, First Hill condo opened quietly in November to a few of the building’s first buyers.

(The newest condo in Seattle received some unwanted publicity this month after the surprise actions of two parachute-wearing base jumpers.)

LUXURY LIVING

To no one’s surprise, few high-end homes came on the market in late 2023/early 2024 – typically the quietest time for luxury real estate each year. Here are three of note:

We start the new year in the Innis Arden section of Shoreline, where a newly built property has hit the market. It’s a 5-bedroom, 4.25-bathroom, 5600 sq. ft., 1-story home (with basement) on 1.5 acres. This expansive offering includes smart-home technology, a chef’s kitchen and contemporary folding-glass walls that seamlessly connect the home with outdoor space. The main floor sits well above neighboring homes, giving the spacious veranda an ideal spot to enjoy stunning water views nearby. Plus, the fully finished basement includes a similar outdoor space that features a near-football-field-sized lawn. List price: $6.499M ($1161/sq. ft.).

Climbing the price ladder, we visit the Seattle neighborhood of Leschi. That’s where there is a stunning 5-bed, 3.75-bath, 6430 sq. ft., 2-story (with basement) and 60 ft. of lakefront. The home was reimagined by famed architect Tom Kundig and his signature PNW design – timber beams, slate tile, rich-wood chef’s kitchen. Massive rooms, outdoor pool, Lake Washington dock. Wow! List: $10M ($1555/sq. ft.).

This 5-bed, 6-bath, 9291 sq. ft., 2-story (with basement) is an architectural wonder in Medina. Light and bright, the modern mansion includes walls of windows with views of the Bellevue skyline in the distance and Overlook Golf & Country Club across the road. A theater room, gym, wine cellar and sky lounge round out the fun corners of this tastefully appointed home. Plus, it’s all powered by solar arrays on the roof. Be the first to live in it! List: $23M ($2476/sq. ft.).

What else is happening in and around your Seattle?

Big Time Acrobatics, Jan. 17-20
Cirque du Soleil comes to Climate Pledge Arena (334 1^st Ave. N.) for five performances this week. The show – Corteo – features acrobats, musicians, singers and actors. Tickets.

Soup, Soup and More Soup, Jan. 25-28
More than a dozen restaurants are expected to partake in Fremont Soupocalypse. Everything from gumbo to ramen and chili to chowder is likely to be served hot and ready to enjoy across this friendly haven in Seattle. Collect eight soup stamps at participating restaurants to win a prize from Mischief on Canal!

Basketball at Its Funniest, Jan. 27
The Harlem Globetrotters are synonymous with dazzling basketball entertainment. They bring their world-renowned exhibition team to Climate Pledge Arena for a showcase of basketball wizardry, trick shots and funny bits. Tickets. Alternate performances are scheduled for Kent on Jan. 26 and Everett on Jan. 28.

Celebrating the Lunar New Year, Jan. 27-28
Hoping to celebrate the Year of the Dragon? Our region has options! The Asian Spring Festival Celebration will feature an afternoon of games, gifts, food and Chinese customs at the Overlake Christian Church (9900 Willows Rd. NE, Redmond). Jan. 27, 12-9pm. Tickets. Celebrate Asia honors our region’s Asian-American community through a look at musical traditions at Benaroya Hall (200 University St., Seattle). Jan. 28, 4pm. Tickets. The official Lunar New Year begins on Feb. 10.

Outdoors Show, Jan. 31-Feb. 4
Exhibitors of outdoor gear and their fans congregate every year at this time for the Washington Sportsmen’s Show. (What, are sportswomen not welcome?) It all takes place at the Washington State Fair Events Center (110 9^th Ave. SW, Puyallup). Tickets. Wed.-Fri., 12-8pm; Sat., 10am-8pm; Sun., 10am-4pm.

Remodeling Showcase, Feb. 2-4
Get ideas for your dream home from speakers, vendors and remodeling experts at the Northwest Remodeling Expo. Check it out at the Seattle Convention Center (705 Pike St.). Tickets. Fri., 12-6pm; Sat., 10am-6pm; Sun., 11am-5pm.

Boats Afloat, Feb. 2-10
The Boat Show … The Boat Show … The Big Seattle Boat Show! Yes, it’s that special time of year when many hundreds of boats and watercraft are on display at both the Lumen Field Event Center (800 Occidental Ave. S.) and Bell Harbor Marina (Pier 66, 2203 Alaskan Wy.). Plus, there will be a special panel presentation related to The Boys in the Boat, a tribute to the Olympic men’s rowing champions of 1936 from the University of Washington. Tickets. Open daily at both locations from 10am.

Cultural Classic, Feb. 2-11
The classic ballet Swan Lake returns to Seattle. The story reveals a cursed princess who transforms into a swan by day and can only regain her human form at night. There is love, betrayal and more. See it performed by the Pacific Northwest Ballet at McCaw Hall (321 Mercer St.). Tickets. Various times.

Great Food on the Gridiron, Feb. 3-18
Always wanted to walk on the famed turf of Lumen Field (800 Occidental Ave. S.)? Here’s your chance! Field to Table features a four-course gourmet meal prepared by local chefs in a covered – but outdoor – setting on the field. Two seatings nightly. What a unique idea!

Events are subject to change. Please check with venues to confirm times and health-safety recommendations.

In case you missed it….

My Living the Dream blog enjoyed a brief holiday in December but not before delivering on its sixth annual predictions blog post. Check it out – the most-read article on the blog each year: Expectations for 2024 in Seattle/King County Real Estate.

For those with less time to read my 4000-word opus, I offer a 3 1/2-minute video summary.

And, as mentioned earlier in this newsletter, I reviewed some of the key law changes for 2024 related to residential real estate in Washington.

Thanks for reading! And, if you would, please forward this email to someone who might appreciate receiving an informative piece of content from a 25-year former journalist (wsj.com, scotsman.com, and msnbc.com). Even better: Share a link so that they can sign up to receive their copy of the newsletter beginning next month!

Will

A warm and sincere happy holidays from myself and everyone at John L. Scott Real Estate. We have enjoyed working with many of you this year and providing informative stories and features in this newsletter as well as on the Living the Dream blog and social media platforms. To a happy 2024!

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I wrote in this newsletter 12 months ago about the bumpy – maybe even bruising – housing market of 2022 across Puget Sound and most of the country. It was a year of gyrating mortgage rates and stubbornly high home prices.

Ready to complete another year, the residential real estate market has not improved – some might say it got a little worse. Mortgage rates rose and rose again to more than 8% but have since mercifully fallen by nearly a percentage point. Inventory continues to shrink to levels not seen since the days of disco, shag carpets and pet rocks.

Just for Fun: In December 2022, the National Association of Realtors® projected mortgage interest rates would be 5.7% at this time in 2023 (quite optimistic!). A year ago, realtor.com believed rates would end this year at 7.1% (pretty darn close).

Prospective buyers this year have mostly watched the housing market pass from the sidelines. They are sitting comfortably with a mortgage rate on their existing home of about 4%, while renters seeking to buy are taking more time to build savings as affordability becomes a greater challenge.

What does 2024 look like for the national housing scene and across Seattle/King County? I offer two observations gleaned from a lot of reading and speaking with experts:

• Mortgage rates, falling for roughly the past two months, will likely start with a “6” in the first half of 2024. That, in turn, will finally move the market forward with additional sellers and buyers. This will happen slowly, like a dimmer rather than an on/off switch.
• Prices, sadly for buyers, will likely continue their trend higher. Amid unusually low inventory and an anticipated growing buyer pool, the median price of a single-family home will climb beyond $1M in Seattle’s summer months.

I am finishing up my annual blog post that looks back at 2023 and takes a glimpse ahead at the full picture – housing, economy, jobs and new technology. The story will be added to my Living the Dream blog on Tuesday (Dec. 19) at 10am PT. Here is the scheduled link to the story – Expectations for 2024 in Seattle/King County Real Estate.

THE VALUE OF PARKING

The humble parking space is often overlooked and unappreciated – until you need one. The seemingly mundane asphalt-covered piece of real estate silently champions the ebb and flow of modern living.

In congested landscapes like Seattle, a parking spot should be a coveted asset – a testament to the delicate dance of space optimization. Yet, many new home projects across King County (and, honestly, in most urban areas) are brushing aside parking as an extravagance and a burden to include in residential planning.

Lawmakers in Olympia this year, while rightly addressing our shortage of homes, also waived the need for off-street parking on a selection of residential projects. Two recent laws in Washington reduce or eliminate the need for parking if the properties are in proximity to a transit hub. (Interestingly, dozens of state Legislatures reviewed similar proposals this year to reduce parking requirements for residential projects but very few became law. Even Congress introduced a national “people over parking” proposal – without success.)

I learned first-hand this summer the value of parking in Seattle. In representing a buyer of a First Hill condo with a garage parking space, the on-site building manager indicated the lease value of that 9-foot x 18-foot area was $300/month to a resident or about $50,000 if sold separately. Having that knowledge, we then saw a steal of a deal on a 1-bedroom home with a coveted garage parking space. (My buyer has no plans to own a car and would be happy to accept $3600 in annual revenue from one of the neighbors.)

Let’s applaud those Seattleites who forgo the four-wheel convenience of a car, truck or SUV and instead enjoy the two-wheel options of a bike, public transit or simply walking. For me, however, I love getting in my SUV and driving clients across King and Snohomish counties to browse homes before making an offer.

This dynamic of private vehicle vs. public transportation will play out first in dense areas – like Seattle, Bellevue, Federal Way – and will be interesting to watch.


POLLUTED PIPES

We cap this month’s news with yet another “P” story. From predictions and parking, this one focuses on contaminated drinking water in city pipes – from the treatment plant to your property.

The 2021 infrastructure law provides $15B to replace lead pipes across the U.S. That may sound like a lot of money to address a serious issue that can damage brain development in children. But, apparently, it’s not enough and some states are rejecting the offer.

Washington is among a handful of states that have turned down most of the federal funds in Year 1 of a 5-year offer. The main reason, according to Associated Press reporting, is the state doesn’t have the financial and human capital to identify all the aging pipes. The federal government is offering to cover the costs of ripping out and replacing the lead pipes – buried deep in soil, concrete or asphalt – but not for locating them. It’s apparently too tall of a task.

Our state accepted $85K of the $63M it could have taken this year and said the decision was based on the limited number of municipal water systems that wanted loans to begin the process of searching for pipes, the AP said. The Environmental Protection Agency (EPA) estimates the state has 22,000 lead pipes.

Portland, Ore., has struggled with high lead levels for years, although recent tests have been better and officials reportedly say the issue isn’t lead pipes, but household plumbing. Oregon turned down $37M from the federal government, AP reported. The state, which the EPA projects has 3530 lead pipes, said it will spend the first year identifying their location.

The Biden administration, showing frustration with the lack of state action, in recent weeks announced additional proposals to help local governments eliminate the contaminated pipes within 10 years. The EPA is accepting comments on the new proposals and will hold a public hearing on Jan. 16.

My question to our governor and other state leaders: Have we forgotten about Flint? The Michigan city experienced record-high levels of lead from the aging pipe system, exposing thousands of unsuspecting children to tainted drinking water and triggering hundreds of lawsuits.

Are we ignoring the past because we don’t have the economic and staffing infrastructure to fix our water infrastructure? Where is the accountability in our states and why are the cost and complexity of this initiative seemingly more important than the potential human toll?


BY THE NUMBERS

>> Seattle is ranked among the best places on the planet, according to World’s Best Cities and its 2024 ranking. More than 270 cities were analyzed in three main areas – livability, lovability and prosperity. Our city came in at No. 34 overall and seventh best among U.S. cities, up a notch from the 2023 report. Seattle received high marks (No. 4) for the availability and quality of universities. London earned the overall top ranking and New York City led this county’s best places to live, according to the report.

>> Seattle is the most future-ready city in the country, according to a report from Point2 Homes. The online real estate firm reviewed the 100 largest U.S. cities to determine which are most ready for the future based on five categories – business & technology, internet connectivity, environment & sustainability, transit & mobility, and economy & demographics. The report noted the city ranks “particularly high” for the number of startups, invention patents, annual median income, the influx of population with a bachelor’s degree, and bikeability. San Jose, Calif., came in second.

>> A survey of the largest 50 cities determined Redmond is the 10^th-most active for new apartment construction. The report from RentCafe said there are now 15,011 apartment units in ZIP code 98052, an increase of 5211 – or 52% – since 2017. Washington, D.C., had the top two areas (ZIPs 20002 and 20003) for apartment growth by volume, with 14,603 – or 48% – more units combined in the past 5 years.

>> The number of new multi-family units added to the Seattle metro supply in 2023 has been a disappointing 5853, according to research through Q3 from commercial real estate firm Berkadia, which forecast at the start of the year 17,975 new units for our area. Multi-family homes include apartments and condos and the metro area covers King and Pierce counties.

>> Washington ranks 45^th in the U.S. for foreclosure filings, according to Q3 research by ATTOM Data Solutions. Default notices, scheduled auctions or bank repossessions collectively rose 28% from Q2 and 34% from a year ago to 124,539 foreclosure-related actions in the U.S. Only 1092 took place in our state, up 32% from Q2 and 27% from 12 months ago. California (14,230) led the nation in Q3 filings and Vermont (19) had the fewest.

>> Seattle ranked fifth – at $331,938 – for cities with the largest raw profit on a median priced home sale, according to Q3 research by ATTOM. California held the top four spots, led by San Jose, Calif. ($718,000). U.S. homes averaged a 59% profit margin on sales in the last quarter.

DECEMBER HOUSING UPDATE

The Seattle area housing market right now reads like a mystery novel with half the pages missing. So far, the narrative has included a mix of suspense, a hint of optimism and a whole lot of uncertainty.

The year in residential real estate nears its end amid twists and turns like a good book but it’s waiting for the storyline to improve as we fill out the empty pages in 2024.

Suspense has centered on the Federal Reserve and its decision to raise, maintain or lower its short-term interest rate. The optimism comes from signals in economic data that show improving conditions and a likely end to rising mortgage rates – a story that we are all looking forward to reading.

November featured a sharp drop in activity and mixed home prices across King County. Only 1513 listings hit the market in the month for all home types, a devastating 30% decline in one month. The Eastside led the way with a 33% drop-off in new listings (420) and Seattle fell 31% (586).

Read a detailed assessment of our housing market in my most recent blog post: Seattle Area Housing Market Remains Not for the Faint of Heart.

The monthly price map (below) shows a sharp year-on-year increase in most submarkets across King County for all home sales combined (single-family, townhome, condo). The greatest gain was found in Kirkland, up 25% from November 2022, with Issaquah a close second (23%). Maple Valley was the only area with a price drop, down 11% from a year ago.

This graphic – which you can click to expand – is presented every month, rotating among three home groups. Next month, we will look at single-family home prices by city.


CONDO NEWS

There are big doings on the Eastside. Avenue Bellevue has started to welcome new homeowners to the Residences building, which is part of a vast two-tower luxury condo, hotel and retail district. Located just north of Bellevue Square, Avenue Bellevue emphasizes style and substance with its beautiful architecture and bespoke shops.

When fully completed in early 2024, the $1B-plus Avenue Bellevue project will feature the Pacific Northwest’s first InterContinental Hotel. The 208-room hotel opens in January and will include a $7200/night two-bedroom Presidential Suite with living, dining and entertainment areas.

The hotel and ground-floor retail area will feature a host of culinary geniuses:

• Joshua Skenes is the first and only American chef to garner three Michelin stars cooking entirely over open flame. He will bring Angler, a new concept, fine dining experience to Avenue Bellevue.
• Masaharu Morimoto of “Iron Chef” fame will deliver intense excitement and exquisite technique to his Japanese-American menu at MM by Morimoto.
• And, Robbie Felice has many years of success at legendary Babbo in New York City and B&B Ristorante in Las Vegas. Now, the Michelin-star chef will bring his extraordinary talents to Bellevue with pastaRAMEN.

The second tower – the ultra-luxe Estates – will likely begin to accept occupants in February. Estates includes the hotel and high-end perks such as a Rolls-Royce car service and access to a luxury yacht.

You can learn more about Avenue Bellevue here and then contact me when you’re ready to take a tour.

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The luxury boutique condo Infinity Shore Club Residences announced it has slashed prices on select homes. The new project facing Elliott Bay near Duwamish Point in West Seattle is cutting prices by up to 20% for the first six buyers who take up the offer by the end of this month and close on the purchase by Jan. 31.

Major price cuts, while not unprecedented for this market, are typically a last-ditch promotion to generate sales, which have been waning at Infinity Shore Club. At last count, 11 of the 37 units have gone Pending or Sold. The community officially opened in June and features a stunning upper-floor infinity pool with unobstructed views of the bay just across the road.

A 1-bedroom, plus-den residence with 1471 interior sq. ft. is priced for this limited time at $1.285M ($874/sq. ft.), or 20% off the previous figure. A 2469 sq. ft., 3-bedroom penthouse that was originally priced at about $4.4M is now at just under $3.6M, an 18% discount. In addition to the lower sales price, homeowners’ dues will be waived in 2024.

“It’s a sign of the times for developers right now, but we need to do what it takes to meet the market,” says James Wong, CEO of the project’s developer Vibrant Cities. Wong suggested the new prices put those select homes well below replacement costs.

Infinity Shore Club is the only new concrete-and-steel product in the city that is not sited in downtown Seattle. It’s also the only waterfront project. Interested in taking a tour? Contact me today!

LUXURY LIVING

I am scratching my head (figuratively) as more stunning homes hit the market in what is traditionally a quiet time in the luxury real estate market. Starting with the least expensive, here are several amazing abodes available for purchase.

Clyde Hill is the home to some of Puget Sound’s wealthiest Americans with properties often valued in the eight digits. Here’s a “steal” – a new-build, white-brick 2-story beauty with 5-bedrooms, 5-bathrooms and 7058 sq. ft. (with basement). John Buchan Homes authored the biophilic design, which seamlessly blends outdoor space and indoor beauty with a floating staircase. One of the finest custom homes I have seen this year. List price: $8.98M ($1273/sq. ft.)

The Four Seasons is one of the elite hotels in Seattle and Four Seasons Residences – the top 10 floors within the 20-story hotel – is one of the pre-eminent condo communities in our city. The latest Residences home to hit the market features 2-beds and 2.25-baths within a massive 4339 sq. ft. expanse. This 16^th-floor home is special for its private deck and firepit that faces Northwest and Elliott Bay. Each home comes with hotel-style amenities – fitness center, spa tub, outdoor pool and room service. List: $10.25M ($2362/sq. ft.)

Introducing a modern, steel, glass and concrete residence in Seattle’s Washington Park neighborhood. This 3-bed, 3.75-bath, 6930 sq. ft., 2-story (with basement) is a contemporary classic. Designed by Seattle architect Tom Kundig, the open-plan home comes with a chef’s kitchen, two fireplaces, wet bar (behind a secret door), and 60 ft. of Lake Washington waterfront. Grand and grandiose! The video alone is worth a look just to see all of the marvelous art (presumably not for sale … but we can ask!) List: $19.5M ($2814/sq. ft.)

We cap this month’s luxury tour with one of the highest-priced listings of the year. This 5-bed, 6.25-bath, 10,300 sq. ft. Mercer Island mansion sits on 1.25 acres. The video shows a grand, private entrance and it only gets better from there. Wood is prominently featured – from the floors to shiplap walls and large ceiling beams. Wood columns frame the rear patio that leads to an outdoor pool/spa tub combination, a stunning 210 ft. waterfront and a dock that extends 185 ft. for your yacht or seaplane (no joke!). From putting green to billiard room, there is so much to see and do in this 2001-built traditional home. List: $33.9M ($3291/sq. ft.)

What else is happening in and around your Seattle?

Holiday Music, Dec. 16, 21, 22, 23
Seattle Men’s Chorus sings seasonal favorites and leads a sing-along in their show A TREEmendous Holiday at Benaroya Hall (200 University St.). Tickets. Various times.

Bubble Show, Dec. 29-30
Looking for some family fun with a touch of science? Check out Louis Pearl, aka the Amazing Bubble Man, for just the right recipe. Pearl combines comedy and artistry for an interesting look at bubbles that will leave you and your kids mesmerized. Kirkland Performance Center (350 Kirkland Ave.) Tickets. Friday, 2pm; Saturday, 11:30am; Sunday, 2pm

New Year’s Eve at Seattle Center, Dec. 31
Get ready for a night of fireworks and an amazing drone light show at the Space Needle. The midnight show caps a night of fun entertainment around Seattle Center that begins with the band Groove Nation in the Seattle Armory (305 Harrison St.; 8pm) and a DJ playing music with projected videos on the International Fountain (10pm). Free. Just a few more feet away, Heart gets the band back together for a rare performance, at Climate Pledge Arena. Tickets. 8pm.

Cold Water Plunge, Jan. 1
Run, jump – and shiver – into the water to celebrate the new year. Some events have fees and/or limited parking. Here are a few options for the 2024 Polar Bear Plunge (if you dare!):

• Des Moines (Des Moines Beach Park)
• Issaquah (Lake Sammamish State Park)
• Renton (Coulon Park)
• Seattle (Mathews Beach Park)
  
  

Outdoor Hockey, Jan. 1
Following the baseball All-Star Game last July, the North American sports spotlight will again be placed on Seattle for a special New Year’s Day event. The Vegas Golden Knights and our Kraken – the two newest franchises in the NHL – square off at T-Mobile Park (1250 1st Ave. S.) for the annual outdoor Winter Classic. Tickets. 12pm

Short Film Fest, Jan. 3-14
The Sundance Film Festival Short Film Tour comes to Northwest Film Forum (1515 12^th Ave., Seattle) for a special highlights package of selected shorts from the 2023 Sundance festival. The 95-minute program will feature films on fiction, animation and documentary from around the world. Tickets. Various times.

Board Game Convention, Jan. 5-7
Board games are big in the PNW. OrcaCon features board and card games, as well as panel discussions, workshops and merchants in an inclusive environment at the Hilton Bellevue (300 112^th Ave. SE). Registration. Various times.

Home and Garden Show, Jan. 5-7
The annual Home & Garden Show is back at the Washington State Fair Events Center (110 9^th Ave. SW, Puyallup). Thinking of a home remodel, landscaping project or redecorating the interior? Visit and learn with product demos, panel discussions and hundreds of vendors on all those topics and more. Friday, Saturday, 10am-6pm; Sunday, 10am-5pm.

Martin Luther King Jr. Day Events, Jan. 15
In addition to being a National Day of Service, MLK Day offers an opportunity to celebrate the civil rights leader through a variety of events. They include morning workshops – details to be confirmed – at Garfield High School (400 23^rd Ave., Seattle; 8:30am) followed by a march to city hall (12:30pm). There are also tentative plans for a breakfast and community conversation at South Seattle College (6000 16^th Ave. SW) on Jan. 12 at 10:30am. Other events can be found here.

Events are subject to change. Please check with venues to confirm times and health-safety recommendations.

In case you missed it….

The month of November on my Living the Dream blog offered a variety of stories.

We started with a look at home financing options for servicemen and women and veterans. The blog also explained the seldom-used option for buyers known as the wraparound mortgage.

And we finished the month with a fun look at a handful of tea purveyors in Seattle. They include the oldest independently owned tea room in America and other great places to sit and sip or browse and buy your favorite loose tea, tea pots and gifts. (Let me know if I missed one of your favorite places!)

Thanks for reading and please enjoy your holiday! We will catch up again in 2024!!

Will

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More than 2.3M, or 31%, of Washingtonians live in a community governed by a Homeowners Association. That’s the fourth-highest number of residents of any state and it’s only expected to grow as HOAs become increasingly common.

Roughly 84% of newly built, single-family homes sold in 2022 were part of an association, according to U.S. Census data. The figure was 70% only 10 years ago.

These private, rule-setting associations – of which there are more than 350,000 in the nation – are growing in number but they should also be a waving caution flag to Fair Housing watchdogs.

We can look back to post-World War II when HOAs helped to create the initial segregation of the suburbs with planned developments – such as Levittown in New York – and gated communities. Essentially, white residents used these associations to prevent Blacks from moving into their neighborhoods through explicit race-based covenant language written into property deeds.

Only recently have states taken action to remove the language from these registered documents. While having no basis in law since the passing of the 1968 Fair Housing Act, the covenants were ugly reminders about our past in King County and elsewhere. In addition, our state is establishing the Covenant Homeownership Program, which aims to help people who faced discrimination to receive financial assistance with their closing costs or down payment. There is also a new proposal by a King County Council member to consider reparations for those impacted by discriminatory real estate practices.

Even today, white and Asian residents disproportionately inhabit HOAs compared with non-HOA areas. This may be because “demand for HOAs is driven at least in part by a desire for exclusion,” as University of Illinois-Chicago scholar Evan McKenzie wrote in his 1994 book, Privatopia: Homeowner Associations and the Rise of Residential Private Government.

Knowingly or not, associations can discriminate against potential home buyers by enforcing a community’s established rules that have the potential to limit people of certain classifications from purchasing a property. It can be particularly true when the HOA is managed without outside oversight from property management companies.

Largely unregulated, associations overseeing condos, co-operatives and townhome communities may seek to conduct credit or background checks as part of their screening process – very questionable behavior no matter how nice the neighbors appear. Or they may charge high monthly dues or move-in fees to financially limit some from making an offer on a home that they otherwise could afford.

Even “Last Week Tonight” host John Oliver scrutinized the financial activities of HOAs and their property management companies. In a colorful April 2023 segment, Oliver said: “When you introduce for-profit companies to find problems in your neighborhood, things can change fast. Many of these management companies have people whose job it is to drive around neighborhoods looking for infractions. … [and] at worst, they are glorified debt collectors.”

As Seattle and most of Washington face hard questions about increasing housing density, the government is often exempting communities with established association rules and bylaws. This is not to suggest we are spiraling back decades to segregated housing. It is simply an early wake-up call to state and local leaders exploring more zoning changes that communities and buyers may be gearing up for a fight if they feel shunned from where they want to live.

Clarence Stone, from American Political Science Review, offered this after reading Privatopia: “For those genuinely concerned with the moral fiber of modern America, they might well heed McKenzie’s warning about uncritically accepting the privatization of citizenship in an income-segregated society.”


BENEFITS OF BUYING NEW

Are you thinking of buying a home but can’t afford the high-interest payments? New home builders have an answer. It’s called a buydown. That’s when the building developer offers to “buy down” the mortgage interest rate as part of a promotion to keep homes selling in this less-than-friendly housing environment.

It’s working well for both builders and buyers. Six out of 10 builders in the U.S. are offering the buydown, which can lower the mortgage interest by about one or two percentage points for lengths ranging from one year to the full term of the loan. A third of those builders offering the promotion are giving full-term buydowns, according to a recent survey by John Burns Research and Consulting.

Buyers must qualify for the mortgage at the highest rate in the offer. The deal varies for each builder and the amount of the buyer’s down payment.

The builder prepays the interest due to the mortgage company, which is typically a bank or credit union partnering with the construction company on the project. John Burns reports some builders are spending 6.5% or more of the home’s sales price to help incentivize buyers to purchase.

Don’t feel sorry for the builder. Many of the bigger companies are publicly traded giants and do quite well when tallying up the score. Below is a summary of gross margins – 25% in Q2 – from the top eight national home builders, such as D.R. Horton, Lennar and Toll Brothers:

National builders comprise 41% of the new home market; D.R. Horton leads the way with a 12% share. The overall total was only 19% in 2000. Locally, Horton has 11% of new home sales and Lennar is at 9%.

This helps explain why new home sales have taken a bigger slice of the pie this year. While existing home sales across the U.S. are down 15% year-on-year, new home sales are up 34% since September 2022. New homes represent 19% of total sales across the U.S. today.


SEATTLE HOUSING LEVY

Voters in Seattle delivered a strong message this month when they overwhelmingly showed support for a measure to further address our housing crisis. With 69% approval, the Seattle Housing Levy will boost funding for initiatives to help the unsheltered get off the streets and into a home.

Proposition 1, starting in 2024, will tax property owners approximately 45 cents per $1,000 of assessed value. Seniors, veterans with disabilities and some others would be exempt from paying the tax.

The levy hopes to raise about $970M over seven years and create or preserve about 3500 affordable homes throughout Seattle. It will cost the owner of an $800,000 home in Seattle about $360 in 2024, or more than triple the expiring housing levy of $115.

The 3500 homes are only a fraction of what is needed. The King County Council estimates Seattle will need roughly 112,000 additional places to live over the next 20 years, including 44,000 for people making less than 30% of the region’s median income.


BY THE NUMBERS

>> Seattle metro is near the top of yet another survey – this one for full-time parents raising children. CoworkingCafe ranked U.S. cities with more than 200K residents based on education, work, share of remote-eligible jobs and other factors. Our market earned a score of 57.1, third best in the nation behind Washington, D.C. (64.5), and Arlington, Va. (59.4). More than a fifth of the population in the Puget Sound area works remotely, the third-highest region in the country, and we have the fifth-highest rating of workplaces that allow hybrid work (79%).

>> The Emerald City ranks 7^th among the top 200 cities for the most relaxed places to live. That’s according to research by LawnStarter, which reviewed 42 stress factors and stress relievers – like depression rates, the average length of a workday, and access to spas and massage therapists – to develop the scores. Sunnyvale, Calif. (68.83), was ranked the most-chill city followed by San Francisco (68.36). Bellevue, Wash., came in at No. 9.

>> Seattle ranks 6^th out of 182 U.S. cities for best places to live for women, according to WalletHub, which compared data on 15 key metrics to determine its list. Our city came in at No. 1 for “women’s preventive health care” and within the top 31 cities for six more categories. Columbia, Md., came out No. 1 overall. Tacoma ranked 31^st.

>> Redmond, Wash., received top marks in the annual survey of best small cities to live in from WalletHub. The Eastside city earned a 68.63 score to finish within the top 1% of the 1300+ cities with populations between 25,000 and 100,000. It finished 3^rd in the U.S. for best “economic health.” Only 12 other cities scored higher overall, with Carmel, Ind., at the top (71.16). Sammamish had the second-highest score among Washington cities (66.67).

>> The portion of average wages required for major homeowner expenses stands at 48% for residential owners in King County, according to a Q3 report from ATTOM Data Solutions. The latest number is considered unaffordable by common lending standards, which call for a 28% debt-to-income ratio. The report said year-on-year median home prices grew a barely noticeable 0.6% ($800K), as of Oct. 1, while annual wages were unchanged at $115.8K.

>> Seattle has the smallest home-flipping rate as a portion of all home sales among U.S. metros, according to ATTOM. Only 3.7% of Seattle area sales were flipped in Q2, followed by Santa Rose, Calif. (4.0%), with the second-fewest. Eight percent of all sales were flipped nationally in the quarter, led by Macon, Ga. (17%), and Columbus, Ga. (15%).


NOVEMBER HOUSING UPDATE

From health-care and auto workers – even Hollywood actors – Americans hit the picket lines in greater numbers in 2023. At least 453,000 workers participated in strikes in the first nine months of the year, according to one tracker. Beyond labor strife, America’s home buyers and sellers appear to be on strike as well.

Worsening affordability issues and lower-than-usual inventory have prompted many consumers to watch this housing market from the sidelines – without the picket lines. Compounding the financial squeeze, home prices have risen in many cities outside Seattle.

October figures from the Northwest Multiple Listing Service (MLS) strongly suggest prospective buyers and sellers are taking a wait-and-see approach. Sales activity across the county is at historic lows; no October has experienced fewer listings in King County – not even close – since at least 1992 when records were first archived online.

Read a detailed assessment of our housing market in my most recent blog post: Affordability Woes Prompt Historic Housing Slowdown

Condo prices (mapped below) are mostly higher year-on-year. Median prices in Shoreline and Kirkland are 20% or more above this time last year but they are down 7.0% in Redmond.

This graphic – which you can click to expand – is presented every month, rotating among three pricing groups. Next month, we will look at the median prices of single-family and condo homes combined by city.

CONDO NEWS

The City of Seattle this month approved temporary occupancy of Graystone as the First Hill high-rise moves toward its grand opening. The 31-story, 271-unit luxury condo is now being fitted out with model homes, common area furnishings and artwork.

Buyers will likely begin taking occupancy in December/January. They have been patiently awaiting the opening of this special community along leafy 8^th Avenue and Columbia Street. Like other construction projects that started around the beginning of the Covid outbreak, Graystone faced many obstacles – supply-chain issues, concrete workers strike and changes in contractors – before getting to the finish line.

Glancing at new Seattle condos listed on the MLS, Graystone represents about half of them priced below $550K even while the median market list price is $847.5K. Homes at Graystone start at $419.9K, or about $669/sq. ft., according to a press release from the building’s sales team.

Need an incentive to buy? Anyone who contracts to purchase by the end of November will receive a bonus of between $10K and $30K toward the new home (depending on the number of bedrooms). Buyers, for example, can choose to use the bonus to reduce financing costs.

Want to take a tour? Contact me to schedule a time to visit the only new high-rise condo to hit the city this year.

The Graystone release also shared some interesting data points about Seattle’s condo scene:

There were four new projects introduced to our city between 2019 and 2022 – Nexus, The Emerald, KODA and Spire – totaling 1194 units. So far, 930 of them, or 78%, have been sold to happy buyers.

Only two buildings are coming online in the next several months – Graystone and First Light – representing 730 units, of which 346 have been presold to pending buyers. That leaves about 648 unsold new construction condo units for the 100K+ residents in the greater downtown area of Seattle.

First Light recently completed pouring concrete on its 48^th and final story. The top-off on Oct. 18 of the 459-unit, ultra-luxe condo marks the next important step toward completion in 2024. The community – at 3^rd Avenue and Virginia Street – is 80% sold and features three floors of amenity space as well as a cantilevered pool on its rooftop garden.

The Veil will be installed by the end of November on the 3^rd Street façade. The art piece will be comprised of about 10,000 individual glass discs, strung vertically to wrap the building’s podium levels.

Contact me if you are interested in learning more about any of these great new residences.


LUXURY LIVING

The luxury housing season is still going strong – a bit of a surprise when a seasonal wind-down is more common in October/November. Here is a look at some of the newer high-priced homes on the market in our area.

Check out this 5-bedroom, 4.5-bathroom, 6390 sq. ft., 2-story home (plus a 1-bedroom accessory dwelling unit) in the Lakemont section of Bellevue. Completed in 1996, this custom-built Craftsman offers traditional space for living and dining, as well as a fresh-looking kitchen and baths, office and theater. The spacious veranda delivers dramatic views of treetops in the distance. A lot of home – perfect for a big family. List price: $3.89M ($610/sq. ft.).

Our region offers thousands of mid-century modern homes but not many as spectacular as this Clyde Hill gem. It’s a 5-bed, 3.75-bath, 4250 sq. ft., 1-story home (with basement) built in 1967. The open-plan layout provides plenty of room for versatile use. The wall of windows offers peeks of the Seattle skyline in a room with a Scandinavian feel. List: $4.98M ($1172/sq. ft.).

Or how about this Lake Sammamish stunner? It’s a 4-bed, 4-bath, 4680 sq. ft., 2-story home with 81 ft. of private waterfront. The ceilings are standouts – some vaulted, some with slatted wood for a farmhouse feel, and others featuring skylights. The deck faces west and includes a fire pit and outstanding views. Such a warm feeling throughout. List: $6.5M ($1389/sq. ft.).

We cap our monthly rundown with a tour of this waterfront opportunity in Fauntleroy/West Seattle. Two homes share adjacent parcels totaling one acre. The main home, built in 1905, rests on a bluff and includes 3-beds, 1.5-baths and 2170 sq. ft. on 1 ½-stories (with basement). A beach house includes 65 ft. of waterfront. Admittedly, the homes have seen better days … but think of the possibilities! List: $2.8M ($1290/sq. ft.), recently cut from $3M.


What else is happening in and around your Seattle?

Auto Show, Nov. 16-19
See hundreds of the latest cars and trucks – plus rare classics – at the Seattle International Auto Show. The annual event takes place at Lumen Field Event Center (800 Occidental Ave. S.). Thursday, 12-9pm; Friday, 10am-9pm; Saturday, 10am-9pm; and, Sunday, 10am-6pm.

Christmas Tree Displays, from Nov. 18
Is it that time of year?! Oh yes! Let’s start with the Festival of Trees in the lobby and driveway of the Fairmont Olympic Hotel (411 University St., Seattle). The tree lighting on Nov. 24 up the road at Westlake Park (401 Pine St.) is also family fun, starting at 3pm with entertainment, followed by the lighting of the tree and giant star at 5pm, and capped by a post-show concert. Other holiday-lighting celebrations (times vary):

• Nov. 24 – Bellevue at Bellevue Square
• Nov. 25 – Seattle at Phinney Center and Pike Place Market
• Dec. 1 – Kenmore at City Hall
• Dec. 1 – Renton at Gene Coulon Park
• Dec. 1 – SeaTac at Community Center
• Dec. 1 – Mercer Island at Mercerdale Park
• Dec. 2 – Auburn at City Hall
• Dec. 2 – Ballard at Marvin’s Garden Park
• Dec. 2 – Bellevue at Kelsey Creek Park
• Dec. 2 – Kent at Town Square Park
• Dec. 2 – Kirkland at Marina Park
• Dec. 2 – Snoqualmie at Railroad Park
• Dec. 2 – Woodinville in DeYoung Park
• Dec. 9 – West Seattle at West Seattle Junction
• Dec. 15 – Sammamish at Central Washington University-Sammamish

Thanksgiving Run/Walk, Nov. 18, 23
Burn calories before that big turkey feast by participating in a special run or walk event. There are many to choose from (various times):

• Nov. 18 – Fairwood Turkey Trot at Fairwood Firs Park, Renton
• Nov. 18 – Tacky Turkey Sweater at Green Lake, Seattle
• Nov. 18 – Trailhead Trot at Brooks Trailhead, Fremont, Seattle
• Nov. 23 – Auburn Turkey Trot at Sunset Park
• Nov. 23 – Issaquah Turkey Trot at Front Street Shopping Center, Issaquah
• Nov. 23 – Thanksgiving Day in Magnuson Park, Seattle
• Nov. 23 – Montlake Turkey Trot around Washington Park Arboretum, Seattle
• Nov. 23 – Thanksgiving Day Apple Cup at Green Lake, Seattle

The Nutcracker, Nov. 19-Dec. 27
The timeless ballet, The Nutcracker, takes us on a Christmas story between young Marie and her enchanted prince as they journey through a magical realm filled with wondrous characters. Perfect for the whole family … and available to see nearly everywhere (times vary):

• Nov. 19 The Paramount Theatre, downtown Seattle
• Nov. 24-Dec. 27 Pacific Northwest Ballet, Seattle Center
• Dec. 1-3 Ensemble Ballet Theatre, Renton
• Dec. 1-28 Cabaret Nutcracker, downtown Seattle
• Dec. 2 ARC School of Ballet, Seattle Center
• Dec. 2 Momentum Dance, Burien
• Dec. 8-10 ARC School of Ballet, Crown Hill, Seattle
• Dec. 8-10 Evergreen City Ballet, Auburn
• Dec. 8-23 International Ballet Theatre, Meydenbauer Theatre, Bellevue
• Dec. 15-17 Evergreen City Ballet, Renton
• Dec. 16 ARC School of Ballet, Shoreline
• Dec. 22-23 Body Language Studio, Renton

Holiday Lights, Nov. 24-Dec. 31
Brighten the night with holiday festivals of music, lights, food, warm drinks and … possibly … a Santa sighting. More than a half-million colorful lights will be on display at Garden d’Lights in Bellevue Botanical Garden (12001 Main St.) starting on Nov. 25. Enjoy a 20-minute show of lights, falling snow, young dancers and drummers on Snowflake Lane (Bellevue Way Northeast, between Northeast 4^th and NE 8^th streets, Bellevue). Redmond Lights comes to Downtown Park (16101 Redmond Way) starting on Dec. 2. And, Seattleites can rely on Winterfest to provide top entertainment – musicians, model trains, ice sculptors and lights – in and around the Armory at Seattle Center (305 Harrison St.) beginning on Nov. 24. Various times.

Craft Market, Dec. 1-2
Support great causes by shopping from more than two dozen gift vendors at Giving Marketplace, with craft-making and live music. Check it out at the Bill & Melinda Gates Foundation Discovery Center (440 5th Avenue North, Seattle). 10am-5pm.

New Year’s Eve Concert, Dec. 31
Ring in 2024 with Beethoven’s Ninth Symphony and enjoy the splendor of the “Ode to Joy” chorus with the Seattle Symphony at Benaroya Hall (200 University Street). The night includes a countdown to midnight and post-concert party with dancing and champagne. Tickets. 9pm-till

Events are subject to change. Please check with venues to confirm times and health-safety recommendations.

In case you missed it….

This was the year of housing for state lawmakers. Olympia passed dozens of bills that address housing affordability and shortages, including laws to increase accessory dwelling units on parcels that were once exclusively zoned for single-family homes.

My Living the Dream blog dove deep into the topic: Washington ADU Laws Aim to Open New Doors to Housing. On the affordability front, I shared details about down payment assistance programs: 3 Payment-Assistance Avenues Available on Path to Homeownership.

I love my Seattle! In fact, that’s a hashtag I use often on my Instagram feed to showcase fun places to visit. It’s no different on my blog, where I recently shared a video story on our city’s history with street clocks and a historic anniversary for Historic Seattle.

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CORRECTION: In last month’s newsletter, we incorrectly stated Bellevue had a 35,000 housing-unit shortfall to make up by 2024. The correct target is 2044.

Thanks for reading and Happy Thanksgiving!

Will

Entry is free on Nov. 11 at Mt. Rainier and other national parks on this special day. Since Veterans Day falls on a Saturday this year, you can expect far more people and far less available parking.

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Zoning laws in the U.S. are a bit like that one quirky relative at family gatherings – they have their benefits, they have their drawbacks, and sometimes, they just leave you scratching your head in bewilderment.

The benefits of zoning are innumerable. Suburban residents can be almost assured of the peaceful enjoyment of their home without worrying about a neighbor constructing a rollercoaster or baseball stadium next door. This helps to maintain consistent property values without the highs and lows of that amusement park ride next door.

The laws also play a role in community planning. Zoning helps cities and towns allocate space for essential services like schools, parks and hospitals. Without zoning, your kid’s school might be next to a toxic-waste dump or the nearest park may be an hour’s drive away.

For the most part, we can celebrate the standards established by state and local governments as they evolve into the second century. The first successful zoning laws were established in 1916 to determine building heights in New York City, soon followed by the zoning of residential and business districts. The effort was led by lawyer Edward Bassett, who went on to develop freeways and parkways.

Also thank Herbert Hoover, as Secretary of Commerce, for promoting the model laws to authorize local zoning and comprehensive planning that led to widespread adoption across the country. In the 1920s, about a century ago, Hoover directed the drafting of the first zoning laws for municipalities to use as guideposts. By 1927, a year after the Supreme Court upheld zoning to protect the health and safety of people, more than half of the states had adopted some form of Hoover’s ideals. (Hoover’s Commerce Department was also the first to track housing data.)

The laws can be a double-edged sword. Hoover surely did not anticipate the loopholes and redefining of the law through the decades – not to mention the whopping 30,000 zoning districts in the U.S. While zoning is applauded by most, people also must know that it is a vehicle for perpetuating segregation through exclusionary land use laws and threatening the supply of affordable housing. This, in turn, can lead to shortcomings on many levels – equitability, economic and environmental to name a few.

Zoning also helped lead to the coining of the phrase “McMansion,” a suburban epidemic of oversized, cookie-cutter homes that often look like family sized storage boxes with playground sets or pools in the backyard. Creativity and individuality were often tossed aside by these mass-built developments.

Scholars have called zoning laws a “straitjacket” on housing growth, an impediment to improving our personal and public economic health. Constraints on housing creation, especially among so-called starter homes, arguably limit the number of workers who can access high-producing jobs.

Economists believe that instead of increasing local employment and providing housing, strictly zoned cities push up home prices and curtail opportunities for many. Fortunately, state and local governments are seeing the errors of their ways and moving toward a more flexible zoning concept to help address our housing shortage, particularly when it comes to affordability when living near public transit.

The City of Seattle, for example, has renamed its single-family zoned areas to “neighborhood residential.” That simple act has allowed for more accessory dwelling units as well as four- and six-plex structures on land that was once zoned for one detached house. It has also helped, in many cases, to eliminate off-street parking and owner-occupancy requirements in parts of our region.

Like that quirky relative, zoning laws can be both endearing and exasperating. They are an imperfect solution to the complex challenge of balancing individual property rights with the collective well-being of a community.

We can be hopeful that local governments are addressing the inequalities of the past and attempting to welcome a broader spectrum of residences that will further enrich our cities and towns – not to mention our souls.


AFFORDABLE HOUSING INITIATIVES

The Seattle City Council passed two bills that take significant steps to remove red tape and help push for more affordable housing developments. The first makes permanent a pandemic-related policy that exempts affordable housing from the design review process.

The permanent exemption will apply to rental developments where at least 40% of homes are affordable to people making 60% of our area’s median income ($57,550 for a single person or $65,750 for a couple). It will also apply to for-sale housing projects where at least 40% of the homes are affordable to people making 80% of the area median income ($70,650 for an individual and $80,750 for a two-person household).

The city expects about eight projects to qualify for the exemption each year, with a total of about 725 units of new housing.

Seattle will also temporarily offer the same exemption to certain projects through the city’s Mandatory Housing Affordability program. MHA requires developers building market-rate apartments, townhomes and other developments to either include affordable units on-site or pay fees. Those fees are used to fund affordable housing in the city.

Meantime, Seattle voters will decide this November whether to extend for another seven years a property levy to finance low-income housing and provide accommodation for other lower-income people. Proposition 1 would tax property owners approximately 45 cents per $1,000 of assessed value. Seniors, veterans with disabilities and some others would be exempt from paying the tax.

The levy, if approved by voters on Nov. 7, would raise some $970M and could create about 3100 new affordable homes throughout Seattle. In addition, it will fund the preservation of 635 affordable rental units. It would cost the owner of an $800,000 home in Seattle about $360 in 2024, or more than triple the expiring housing levy of $115.

The King County Council estimates Seattle will need roughly 112,000 additional homes over the next 20 years, including 44,000 for people making less than 30% of the region’s median income. Bellevue has the second-greatest need, according to council forecasts, with a shortfall of 35,000 to make up by 2024. Redmond (20,000) and Renton (17,000) are next.



BY THE NUMBERS

>> Eighty-five percent of people who prepared a wedding registry said they would have preferred to receive money towards a down payment or other home-buying costs. Realtor.com and Censuswide said 82% of the 2291 respondents said they felt obligated to list traditional items – such as furnishings – and 88% reported they registered gifts they really did not want.

>> A typical single-family home is 2191 sq. ft., according to research compiled by the Census Bureau and National Association of Home Builders. That median figure is the smallest measure for a home since 2010 and marks a reversal after a brief increase during the post-Covid building boom.  

>> One-third of all homes in the Seattle area are worth $1M+, as of June, according to Axios. That’s down from 39% a year ago. In addition, 7% of all homes sold in King County this year have had a price tag of $2M+.The typical home in the U.S. today sells for $430K.

>> Seattle remains a top destination for technology talent, according to a report from global real estate services firm CBRE. Our city has a 15% in-migration rate for tech grads of up to 3 years experience; that’s No. 1 in the nation in front of Austin, Texas, at 9.7%. Across all experience levels, Seattle was second (12%) behind Austin (15%).

>> A full 19,396 apartment units are under construction in Seattle metro, according to a Q2 report from Berkadia, a U.S. commercial lender and sales broker. Another 26,028 units are in the planning stages and have received approval from permit offices and zoning authorities. A report by RentCafe claims Seattle metro added 36,952 units to the rental market between 2020 and 2022.

>> The rate of homelessness in the U.S. rose 11% this year, according to The Wall Street Journal (paywall), as housing costs and evictions triggered people to lose their homes despite record funding to combat the issue. King County acknowledged receiving a little under $1B in federal aid for homelessness and housing since 2019, yet the local homeless rate rose 14% this past year.


OCTOBER HOUSING UPDATE

Autumn marks a change – shorter days, cooler temperatures, falling leaves … and falling home prices. This is the season when buyers can take advantage of homeowners wishing to sell before the holidays and who show a willingness to budge on price or make other concessions.

We are starting to see all those signs following the release of September housing data from the Northwest Multiple Listing Service (MLS). Unfortunately for buyers, a combination of the typical seasonal trend and higher borrowing costs has shifted housing market activity to an excruciatingly slow pace – and there are concerning signs ahead.

First a look at September’s numbers: A wave of last-chance listings for the year hit the market after Labor Day. That increased new listings by 7.5% (2884 units) and available homes on the market by 12% (3602) from Sept. 1 to Oct. 1 on all home types in King County. Seattle alone saw a 29% (1213) monthly increase in new listings.

Even with the increasing numbers, the total available homes for sale in King are the fewest for any September since at least 1993 when records were first archived online.

Read a detailed assessment of our housing market in my most recent blog post: King County Home Sales Cool as Interest Rates Inch Toward 8%

CONDO NEWS

A survey found that 73% of people who manage condos, homeowners’ associations and co-ops are planning to increase the fees they charge residents to address rising prices. A full 91% surveyed noted their associations have faced surprise expenses in the past year.

The biggest areas where these costs have risen are building management fees (92% of survey respondents), insurance (91%) and maintenance (85%). But raising fees isn’t the only solution people are thinking about. Some are planning to cut costs (41%), defer maintenance work (40%) or reduce how much they spend on landscaping (31%). (Deferred maintenance was believed to be one of the causes of the tragic Florida condo collapse in 2021.)

People are also looking into other options like renegotiating contracts, deciding which projects are most important, making their buildings more energy-efficient, and using money they’ve saved up just for emergencies. Some associations are planning to obtain a loan to cover the rising costs.

This survey was conducted in early 2023 by the Foundation for Community Association Research, which helps us understand what’s going on in these communities. There are about 358,000 of these communities in the U.S., and they’re home to more than 74M people.

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Queen Anne has a new neighbor that blends elements of the past with modern design. The Fitzgerald is a 5-story, 13-unit boutique condo that opened this summer and is already turning heads for its thoughtful design.

Sales information describes the effort as New Traditional and it is delivered through elegant lighting and high-end appliances. What stands out to this observer is the warm color that exudes through the home, everything from oak cabinetry to the countertops and tile that feature veins of brown.

For those who have lived in New York City, you might think this standout structure should be located on the Upper West Side. The exterior follows the same uncomplicated lines, loft-style windows and balconies that adorn only the best pre-World War II classic apartment buildings back East.

Located on the top of the hill at 3rd Avenue West, The Fitzgerald (pictured) offers spacious, 1- and 2-bedroom homes plus a den with more than 1150 total sq. ft. Prices so far are listed from the high $900,000s at a rate of about $1000/sq. ft. and homes come with garage parking and A/C. Contact me to learn more or to schedule a visit.

LUXURY LIVING

We start with a Queen Anne classic and its unparalleled views. This 5-bedroom, 7.25-bath, 9970 sq. ft. mansion delivers delight in every way. Perched atop our city’s highest peak, this 1902-built standout provides never-ending views of the Space Needle, Elliott Bay and Cascades – so picturesque that the 1990 Goodwill Games in Seattle captured the vista from the home’s third floor to create a canvas backdrop shown on the broadcast. A witness to more than a century of history in Seattle, the home includes nine fireplaces, 21 Italian chandeliers, an eight-seat theater, three kitchens(!) and a laundry on each of the three floors. The original stained-glass windows and Corinthian columns are the icing on the cake. The home, which has only had three owners, has been on and off the market since May 2019 when it was first listed at $11M. Now you can get it for a “steal” at $7.3M ($732/sq. ft.).

Looking for a water view in a contemporary setting? Check out this fully updated mid-century modern West of Market home in Kirkland. This 3-bed, 2.5-bath, 2800 sq. ft. home offers windows that usher in splashes of light from everywhere you stand. Vaulted ceilings with skylights, French doors and an electric charging station help blend the charm of old with the needs of today. List: $3.175M ($1134/sq. ft.), recently reduced from $3.249M.

Straddling Seattle’s Denny Blaine-Washington Park boundary, this 5-bed, 4.25-bath, 5546 sq. ft. is an architectural masterpiece nestled among trees on three parcels of land – a true accomplishment that curates color and contemporary styling. Every room has its own palette and personality. Known as 505 Art Häus, the 2006-built, 2-story with basement is a museum piece within an oasis. Solid wood flooring, lighted glass walkways, one-of-a-kind light fixtures, Corian countertops and radiant heat on all levels tell you this is not just any ordinary luxury home. My goodness! List: $5.5M ($992/sq. ft.).

Let’s cap this month’s exploration with a road trip to the San Juans. Check out this 3-bed, 4-bath, 6327 sq. ft., 1-story estate on 8+ acres in Friday Harbor. Resting atop a rocky ledge, this stunner includes refined interior touches but it’s what is outside that captures your attention: spacious front and back areas with enormous terrace views and 136 ft. of west-facing waterfront within a sheltered cove. The home is reportedly being sold by a retired exec from Visa International. List: $6.995M ($1106/sq. ft.), just marked down from $7.5M.

What else is happening in and around your Seattle?

Pumpkins and Much More, through Oct. 31
Enjoy the season with pumpkin patches, hayrides, corn mazes, apple cider and more for Halloween. Here is a selection of events and locations: Snohomish County, Eastside, Greater Puget Sound, as well as a day of pumpkins and animals during Pumpkin Bash at Woodland Park Zoo (5500 Phinney Ave. N., Seattle) on Oct. 28-29, 9:30am-3pm

Release the Kraken, starting Oct. 17
The National Hockey League is back for another year of high speed, high tension and high expectations for the Seattle Kraken. The franchise set a league record by adding 40 points in the regular-season standings from their inaugural season to their second campaign. Can they continue on the path of success and Stanley Cups? The home opener at Climate Pledge Arena (334 1^st Ave. N.) is on Tuesday (7pm) against the Colorado Avalanche and continues with memorable regular-season matches against Vegas at T-Mobile Park on New Year’s Day and a Presidents’ Day arena matinee against Detroit. Various times. Tickets

Home Show, Oct. 20-22
The Evergreen Home Show promises 200 booths of “specialized local businesses ready to help you customize, update, or even design the home you have always wanted” at Evergreen State Fairgrounds (14405 179th Ave. SE, Monroe). Friday, 12-6pm; Saturday, 10am-6pm; Sunday, 10am-5pm.

Pancake Breakfast, Nov. 5 and Dec. 3
The Swedish Cultural Club (1920 Dexter Ave. N.) opens its doors to the public every first Sunday of the month for a delicious – and filling – pancake breakfast. Servings include three Swedish pancakes with your choice of lingonberries or strawberries, along with two pieces of ham, juice or milk, and coffee. (Whipped cream, powdered sugar, butter and syrup are available.) All for $14.33! Kids pay $12.13. 8am-1pm.

Lights at the Zoo, Nov. 10-Jan. 14, 2024
WildLanterns is back! The popular event features “large-scale animal and nature scape lanterns representing wild places from around the globe.” The outdoor fun takes place at Woodland Park Zoo (5500 Phinney Ave. N.) 4-8:30pm. Last entry: 7pm. (Closed Nov. 23, Dec. 24, 25 and most Mondays.)

Lights of India, Nov. 11
Celebrate the victory of light over darkness, good over evil, and knowledge over ignorance at Diwali: Lights of India. The event features classical and folk dances, henna and face painting, Indian food, an art gallery and craft-making at Seattle Center Armory (305 Harrison St.). Free. 12-6pm.

Veterans Day, Nov. 11
First known as Armistice Day, Nov. 11 was chosen as a day of memorial to mark the end of fighting in World War I – on the 11th hour of the 11th day of the 11th month in 1918. We continue to remember those who paid the ultimate price so we can enjoy the freedoms of today. Bellevue will hold a solemn event at Sunset Hills Memorial Park (1215 145^th Place SE) at 11am, and Auburn will mark the day with an observance (9:45am at  411 E St. SE), parade (11am at E Main St., from E St. to A St.), marching band competition (1-10pm, 801 Fourth St. NE) and other activities.

Free National Park Day, Nov. 11
Entry is free at Mt. Rainier and Olympic national parks on this special day. Since Veterans Day falls on a Saturday this year, you can expect far more people and far less available parking. (Did you see those amazing colors on Paradise at Mt. Rainier atop the newsletter? Wow!)

Events are subject to change. Please check with venues to confirm times and health-safety recommendations.

In case you missed it….

My Living the Dream blog has been educating readers for five years now. At least one story is published every week. The blog has recently focused on helping home buyers. Here are three of the latest examples of how we work to educate you:

• Mortgage Insights: Intricacies of the Buydown
• How to Check for Flood Risk During Home Buying
• Covenant Homeownership Program of Washington

Thank you for reading this self-written newsletter. Please tell your friends about this important resource and suggest they subscribe to my monthly update.

During an otherwise mundane annual physical, my doctor includes the usual reminders: Watch what you eat and drink, hit the gym and go for a walk every other day or so. He said something interesting at the end of his rinse & repeat suggestions about moving my feet: “This is a walking city, you know.”

Like most doctors when talking about medicine and healthcare, he’s right. Seattle is a good walking city.

A report from Smart Growth America and real estate info services firm Places Platform named Seattle one of the top five walkable cities in the nation. Portland was right behind us, with New York City at No. 1.

“The so-called ‘death of the city’ has been overstated … despite impacts from the pandemic,” said Christopher Leinberger, managing director at Places Platform, referring to the report. “These findings provide a strong economic base and cement walkable urban places and development as the wave of the future, as we move toward a more connected, environmentally sustainable way of life.”

The report found that 6.8% of the U.S. population is in walkable urban places – not as much as I thought. That represents just 1.2% of the total landmass of the top 35 U.S. metros studied. Just think if cities took positive steps to increase urban land use to, say, 6%. The report says cities that connect even more people to the benefits of urban living would “hold the keys to becoming a wealthier, more socially equitable society.”

Despite facing serious challenges – homelessness, drug addiction, gun crime – the Emerald City is starting to show areas of progress to boost urban appeal. City planners believe urban life works better when people, places and things are interconnected.

A century ago, the Denny Regrade flattened the hills between 1^st Avenue in Belltown and Denny Triangle – a project that delivered huge benefits to getting around our city. A modern version of the regrade is taking place along the downtown waterfront (pictured above) with the addition of Overlook Walk, a breathtaking pedestrian bridge and viewing deck that will soon connect with Pike Place Market and other attractions downtown. (Here’s a blog post on the topic from last summer.)

In addition, discussions are well underway between city leadership, neighborhood advocates and developers to consider placing a “lid” over I-5. A concrete and steel cover connecting First Hill to downtown, for example, would reduce traffic noise, potentially add more parkland and encourage the construction of new housing. Philadelphia is in the process of widening an existing “cap” over the interstate that slices through the eastern edge of the city with amazing results so far.

It has been discussed in this newsletter the sharp decline in Seattle office occupancy; most recent stats show weekday worker foot traffic in downtown at 55% of July 2019 traffic, a figure that will likely increase – but by how much more? It only makes sense to seriously consider converting underserved office buildings with residential options. The benefits are innumerable, including:

It is not abandonment by workers of the cities that is of concern but affordability for potential residents. A report from the Brookings Institute described the issue as a lack of “shared prosperity,” as historically marginalized communities have been left behind during years of success and growth for many cities. The term “gentrification” connotes an improvement over the past, but the introduction of more expensive housing comes with the sad displacement of those who lived there for generations and runs counter to a city’s mission.

Steps to reverse this trend are moving forward to keep people of all stripes in their favorite areas of the city. Seattle’s  Equitable Development Initiative is a good example. EDI funnels grant dollars to neighborhoods at high risk of displacement to empower local projects and improve educational opportunities.

The city this year awarded more than $13M through EDI to help support property ownership for more people. The funds invest in community organizations that will develop capital projects and permanent spaces for those in need.

Seattle also recently introduced a vision for south downtown, a historic area left behind compared with stunning growth elsewhere in the city. The vision includes a breadth of bold ideas:

• Prioritizing residential space over office use to cultivate more livable, vibrant neighborhoods
• Focusing on community connections between downtown and Pioneer Square, waterfront and Chinatown-International District
• Centering on equity and inclusivity to provide housing for all income levels
• Capitalizing on King County’s master planning process and relocating government facilities to free up city blocks for redevelopment
• And, closing off 3rd Avenue from motorized vehicles and repurposing it into a pedestrian/bicycle plaza that could feature retail, restaurants and entertainment.

Even faced with the most significant obstacle to progress this world has ever seen – the great pandemic – cities have, for the most part, endured and are now rebounding. Amid the societal challenges of today, it’s also vital to envision urban areas that are welcoming and better connected. Seattle is at least thinking and planning toward that goal.

BY THE NUMBERS

>> A survey of 2000 adults across the 50 largest U.S. metros showed 78% would be willing to pay more for a home in a walkable community. The National Association of Realtors® survey, published in July, noted 65% of respondents thought having public transport nearby would be “very” or “somewhat” important when looking for a home.

>> One in every 2044 Washington homes entered into foreclosure proceedings in the first half of this year, an increase of 16% from 12 months ago, according to information from ATTOM Data Solutions. That ranks 44^th among U.S. states and the District of Columbia. Illinois was tops on the list, with one in every 397 homes experiencing foreclosure proceedings, a surprising 3.3% decline from a year ago.

>> Profit margins – the percent difference between median purchase and resale prices – on homes sold in Q2 rose to 48% in the U.S., a jump from 44% in Q1, according to ATTOM research. San Jose, Calif., enjoyed the largest raw profits on median-priced sales in the latest quarter, with a $600K average profit. Seattle was fourth in the nation with a profit of $285K.

>> Seattle is rated one of the most educated cities in the nation, according to a report from personal finance company WalletHub, which reviewed data from the U.S. Census Bureau and greatschools.org to reach its findings. The Emerald City is rated 9^th in the nation for educational attainment and quality of education combined. Ann Arbor, Mich., and San Jose, Calif. were Nos. 1 and 2. Portland came in 16^th and Spokane was 54^th.

>> Seattle sits 10^th among big U.S. cities for first-year homeownership costs, according to real estate site Point2Homes. New owners here spend an average of $232.5K on first-year costs, including a 20% down payment, closing costs, monthly mortgage, insurance and property taxes. San Francisco is the most expensive city for a first-timer, with total initial-year costs of $389.9K, with Fremont, Calif., only a few hundred dollars shy of that. Detroit has the lowest first-year ownership costs, averaging $25.1K.

>> Tacoma is one of the best places to live and move to, according to a study from Bankrate, which looked at criteria such as well-being, affordability, diversity and migration. T-Town ranks 3^rd and offers low unemployment and affordable homes for our area. Austin, Texas, and Sarasota, Fla., topped the list.


SEPTEMBER HOUSING UPDATE

There is a feeling of Halloween in the real estate world because this housing market is a bit scary these days. At least that’s what some economists have expressed.

The market is spooking many potential buyers and sellers thanks to stubbornly high mortgage interest rates. The inability to loosen rates – and therefore reduce monthly payments on future home purchases – has put a stranglehold on sales activity in our area and elsewhere. Only buyers and sellers who must move are doing so.

Despite the “haunted house” vibe, prices are rising again and homes are only on the market for about a week across King County. What in the “pumpkin spiced latte” is going on here?!

“The number of shoppers out there is lower than there were over the last couple of years – but [the housing] supply has come down even more. It’s making the market feel hotter than it is,” said Ali Wolf, chief economist of U.S. building consultancy Zonda. “The few homes that are available are selling quickly and at or above list price.”

August’s figures in King County were in a narrowly mixed range compared with July. While there were 5.8% fewer new listings, the number of sales rose 1.7% against the previous month. Prices were flat to slightly higher since July.

Read a detailed assessment of our housing market in my most recent blog post: High Financing Hurdles Lead to Low Housing Activity in Seattle/King County

Looking at the county’s price map (below), the median value of all homes sold in August was (pardon the pun) all over the map. The typical price of a Bellevue home jumped 14% year-on-year while the price of a home in Seattle fell more than 4%.

This graphic – which you can click to expand – is presented every month, rotating among three home groups. Next month, we will look at single-family home prices by city.


CONDO NEWS

Turn your head toward the top of the high-rise project at 3^rd Avenue and Virginia Street in Seattle’s Belltown neighborhood and you may find yourself unable to look away. The stray pieces of steel beams poking out by about a dozen feet over the streets appear to be a contemporary piece of art or possibly the beginnings of a massive bird’s nest.

What is it? It’s the beginnings of a residential first for the aptly named First Light. Atop the 47^th floor tower, the super-luxe condo will feature a heated, outdoor, cantilevered pool. No other residential high-rise in the U.S. is believed to have one.

Among the other amenities: a fitness center, residents’ lounge, spa tub, meeting space, screening lounge, apple orchard, bike clubhouse with repair shop, and bike-share area, among other items. Wow, right?!

About 80% of the 459 units are Pending/Sold and the project is expected to open in stages starting early next year (timing TBC). Looking to tour the presentation gallery? Give me a call to arrange a meeting. (Pro tip: Always bring a buyer broker to represent you to a new construction site. The sales team represents the seller/builder.)

LUXURY LIVING

With autumn just around the corner, it’s not surprising to see fewer homes coming on the market. That’s especially true for luxury properties, which are typically the first segment of the market to hibernate as we near the end of the year. And that’s the case today, with only a few homes grabbing my attention.

We have this 6-bedroom, 5-bathroom, 6418 sq. ft., 1 ½-story home with basement in Redmond. I think you will love how this estate not only brushes up to Lake Sammamish with 94 ft. of beachfront, but also overlooks the expansive Marymoor Park. (I know, right?!) The seller reportedly describes the home as “Cape Cod meets the Northwest.” Hardwood floors, farmhouse-inspired chef’s kitchen, outdoor terrace, waterfront balcony off the main bedroom, wine cellar and much more – everything one would need to live a splendid life. List price: $8M ($1246/sq. ft.).

Further afield, introducing a 4-bed, 3.25-bath, 7581 sq. ft., 2-story log home with basement in Seabeck, Kitsap County. The living space with 38 ft. ceilings and rock fireplace is jaw-dropping. The theater with stadium seating is big and comfy. The 4000 sq. ft. shop includes space for all types of pursuits and pleasures. The inspiring video touts all of the property’s beauty. List: $6.85M ($904/sq. ft.) – a bargain compared to King County luxury homes.

We wrap up this month’s tour of standouts with a one-of-a-kind condo in West Seattle. This 3-bed, 2.5-bath, 5652 sq. ft. residence offers forever views from its second-floor perch looking northwest onto Elliott Bay. If owners don’t wish to work in their chef’s kitchen, then perhaps they will walk to the ground-floor Cactus restaurant. The home comes with a thousand-bottle wine room, back garden and massive 2500 sq. ft. patio with expansive water views. The light-filled residence was once home to Seattle lawyer, opera singer and UW sports fan Melvyn Poll. Shoreline meets sophistication in this hidden jewel on the Alki coast. List: $3.995M ($707/sq. ft.).

What else is happening in and around your Seattle?

Wine Not!, Sept. 17
Twenty restaurants are featured along with a beer garden at Bite of PhinneyWood – a blend of Phinney Ridge and Greenwood (but you probably already knew that!). The fun, which was a sell-out in 2022, takes place at Phinney Center (6532 Phinney Avenue North). 1-5pm

Oktoberfest, Sept. 22-24
Seattle and the Eastside offer a take on a fall classic. Fremont Oktoberfest  is expected to have one hundred types of beer and cider, along with food and bands at Bold Hat Productions (3503 Phinney Ave.). Friday, 5-11pm; Saturday, 12-11pm; Sunday, 12-5pm (the day when your pooch is welcome for Dogtoberfest). And, Kirkland Oktoberfest  will offer beer, sauerkraut, bratwurst, costume contests, games, live music (Friday, 4-11pm; Saturday, 12-11pm; Sunday, 12-6pm), and a  wiener dog race  (Sunday, 1pm) at Marina Park (25 Lakeshore Plaza). Except for the wiener race, both venues are for 21+ only.

Halloween Festivities, Sept. 22-Nov. 4
Spooky fun is just around the corner at Seattle’s popular haunted house – the Georgetown Morgue  (5000 E. Marginal Way S.) And, Stalker Farms  (8705 Marsh Rd., Snohomish) has two walk-through haunts (voted top fan favorite in the state), a zombie shooting gallery, nighttime corn maze and beer garden. Sept. 30-Oct. 29 only. Recommended for 12+. Various times.

Lantern Parade, Sept. 23
Celebrate the equinox with lanterns, glowing costumes and music at the  Luminata  parade of lights. Begin at Green Lake Aqua Theater on West Green Lake Way N. at the south end of the lake, and then walk with the parade to the Bath House to the north. Free. 7:30-9pm.

Free Day at the Park, Sept. 23
Entry is free at Mount Rainier, Olympic and other national parks, as well as for any of the 140 Washington state parks on this day when daylight and darkness are exactly 12 hours in length. Get out and enjoy!

Tea Party, Sept. 23-24
Sample fine tea, attend presentations by tea authors and experts, and shop for the finest aromatic leaves at the  Northwest Tea Festival.  It’s all brewing (Did you see what I did there?) in Seattle Center Exhibition Hall (301 Mercer St.). Free for children under 12. Saturday, 10am-6pm; Sunday, 10am-4pm.

Mariners Postseason Push, Sept. 25-Oct. 1
Local baseball fans are watching intently as the Mariners inch toward their second straight postseason appearance – we hope! Seattle hosts a pair of division foes, the Astros and Rangers, to wrap up the regular season and with everything on the line. Tickets. The M’s, Seahawks and next month the Kraken: What a time to be a sports fan in Seattle!

All That Jazz, Oct. 4-Nov. 5
If jazz is your jam, then you will be in heaven over four weeks with two music celebrations. Top national and regional jazz musicians – including Pearl Django with Gail Pettis – will appear at the  Bellevue Jazz & Blues Music Series (Oct. 4-8). Among the venues: Meydenbauer Center (11100 NE 6th St.). The event overlaps with the Earshot Jazz Festival, which will  feature dozens of concerts, plus films on jazz at various Seattle venues.

Film Festivals, Oct. 12-29
We love our film fests! Two take place in the coming weeks. Seattle Queer Film Festival  (Oct. 12-29) begins with a reception and after-party on opening night and will showcase feature films and shorts in seven theaters and online. The Seattle Polish Film Festival (Oct. 13-22)  screens more than a dozen titles at SIFF Cinema Uptown (511 Queen Anne Ave. N.).

Going Green, Oct. 14
Green Building Slam  has 10 brief lectures by innovative architects and builders, followed by networking at Town Hall Seattle (1119 8th Ave.). 6-10pm

Events are subject to change. Please check with venues to confirm times and health-safety recommendations.

In case you missed it….

The Living the Dream blog over the last several weeks dove into two areas of homeownership that are at the opposite ends of the spectrum – preparing to finance a home and the potential for losing the property over a failure to pay the mortgage.

Here are the headlines:

What Information Will My Mortgage Lender Need?

Down Payments: Bigger Isn’t Always Better

Short Sales – Rules of the Road

Foreclosures and Sheriff Sales in King County – What You Need to Know

As you can see, I love to educate my readers to make them smarter as they embark on a home purchase or sale. Let me know if there is a topic that you wish to learn more about. I will consider researching it for the blog.

Do you enjoy reading my monthly newsletter? You must if you’re all the way down here! Please consider forwarding this email to friends or family members. Or share this link to have them sign up to receive the mailing each month.

Thanks for reading!

Will

Is the dream of homeownership going the way of the dodo? While that may seem like a silly question to ask – especially from a residential real estate pro whose business relies on the purchase and sale of homes – it’s something I have been studying, with some eye-opening findings.

First, let’s set the scene: Housing inventory is shrinking year to year in most parts of the country and there are no signs of significant replenishment over the horizon. It may take decades to backfill stock, which is said to be roughly 4.5M homes shy of what’s needed today.

All this, while we prepare to experience in a few years the largest wave of potential home-purchase demand in our nation’s history. As the chart shows, a historically large segment of Millennials is inching toward 36, the median age of a first-time home buyer in the U.S. – also the oldest age of a first-timer ever recorded by the National Association of Realtors® (NAR). For context, a full 40% of Baby Boomers and Gen Xers were homeowners by the time they reached 36.

(Click to expand any image or graphic from my newsletters and blog posts.)

Housing shortages have helped keep home prices and rents high across the country. The share of vacant units for sale, at just 0.8%, is the lowest dating back to the 1950s. Meanwhile, the vacancy rate for rental units, at 6.5%, is lower than it has been since the 1980s, according to Harvard research. With so few available places to live, the competition for those homes is making housing much less affordable for many.

Real estate pros – some of the most optimistic bunch in any industry – acknowledge this is a housing dilemma.

“Buyers have faced a trifecta: historically low housing inventory, home prices that have risen for over a decade and higher interest rates today than a year ago,” says Jessica Lautz, deputy chief economist and VP of research at NAR. “The share of first-time buyers has dropped to a 41-year low [26%], the racial divide in homeownership has grown to the widest point in a decade and the share of single women entering [the market] has declined.”

If finding a home isn’t enough of a challenge, affording one can make the purchase experience doubly “exciting.” NAR’s Housing Affordability Index is a good measure of whether a household earns enough to qualify for a mortgage on a typical home. An index score of 100 means that a buyer with a median U.S. income can qualify for financing on a median-priced home. In 2022, the index fell off the cliff:

Homeownership remains a great way to build wealth, especially for the middle class and people of color, who may have few investments. Some experts estimate owning a home can account for two-thirds of the typical family’s total assets.

But many Americans – including Washingtonians – are finding themselves stuck in a cycle of renting, a growingly expensive proposition. A resident in King County reportedly needs to make $40/hour, or $84K a year, to afford a one-bedroom rental while still comfortably covering other living costs.

Forget saving for a home. For many, the question is how to simply survive in one of the costliest places to live. A survey in late July by CBS News showed 35% of Americans are “falling behind” financially, as potential buyers face the prospect of costly rents, car payments and student-loan debt that is again coming due.

In addition, America is taking on more credit card debt, with balances nationwide this summer surpassing the $1T mark for the first time. Can consumers still balance their budget when facing credit card interest rates of 22% on average?

“Something’s got to give,” Mason Virant, associate director at the Washington Center for Real Estate Research at the University of Washington, told The Seattle Times. “Or only the ultra-wealthy are going to be able to afford homes.”

Acknowledging this financial reality, some pockets of Western Washington (and likely elsewhere) are focusing on boosting rental production. The City of Renton reported in June that 92% of the 7800 new units in the permitting pipeline are expected to be market-rate rentals. This follows a decade of producing rentals over traditional for-sale homes in the city by a 3:1 ratio.

Some developers are delivering smaller homes in the form of four- and six-plex townhomes on a parcel of land that once featured a single-family house. Others are specializing in the design and construction of accessory dwelling units (ADUs) as detached backyard homes (also known as “mother-in-laws”).

Among the places getting the housing mix right is Kirkland, a city that features single-family homes with a median sales price today of $1.43M. The Eastside community has introduced something called “gentle density” to the area that includes so-called ADU Alleys which feature affordable garage apartments or some other form of separate home on grounds that are shared with a traditional house.

Redmond, as well, has recently seen a dozen small homes built around a shared open space in what the city calls a cottage neighborhood, making it possible to increase home density without sacrificing the character of a community.

The national trend for new construction, however, is generally moving in the opposite direction. In the 1990s, one-third of new homes were smaller than 1800 sq. ft. Today, that ratio is one in five, as builders target consumers seeking larger homes.

Enough buyers appear to be willing to pay a premium for extra space to include a home office and bigger backyard for their garden – evolving from a “want” to a “need” since the pandemic changed how we live and work. The price of new construction has jumped, too; the National Association of Home Builders estimates costs have risen about 35% since 2019.

Fortunately, we have neighbors helping neighbors at all price points when possible. And for those not willing to embrace affordable housing in their immediate area, consider this: A 2022 study shows the value of homes near affordable housing increases.

Ah, yes, the pandemic. It can be blamed, rightly, for millions of lives lost, families altered forever and, as we are witnessing, an evolutionary time in our housing world.

After peaking in 2004 at 69%, this country’s homeownership rate has slipped to 66%. Yes, owning a home is still a goal of many – at least for two-thirds of the country – but there are signs of cracks in that thinking.

Change can be hard and painful. It can also be beautiful and refreshing – or many combinations of emotions. We need to take an approach to the housing crisis that embraces change, is inclusive and extremely productive.


BY THE NUMBERS

>> The West has suffered the greatest from the housing-market downturn over the past year, according to ATTOM Data Solutions, which indicated 23 of the 50 worse-off U.S. counties are in our region. That included seven counties in Oregon, mostly in or near Eugene, and five in Washington – Skagit, Clark, Cowlitz, Spokane and Yakima counties. The research examined median home prices, the percentage of homes facing possible foreclosure, the percentage of average local wages needed to pay for major home-ownership expenses, and the portion of homes with mortgage balances that exceeded property values. None of the Seattle-area counties were on the list.

>> Bellevue is rated No. 3 as the best medium-sized city for tech workers to live, according to research from virtual learning company Forage. In reviewing the top 94 cities with populations between 100K and 150K, Forage looked at nine categories – from average pay for software developers to broadband availability and cost-of-living factors – to rank the areas. Bellevue has an average hourly wage for developers of $74.85. Renton ranked 5^th in the nation, with Santa Clara, Calif., and Palm Bay, Fla., leading the list.

>> Seattle ranked second in the nation for best places to start a career, according to Bankrate.com, which looked at affordability, employment opportunities, long-term career potential and overall quality of life. The Emerald City was first for employment opportunities. Austin, Texas, earned the overall top spot from the personal finance website.

>> In an analysis by Axios, it takes the typical Seattle resident 13 years to save up for a 10% down payment on a home. Using home valuations and area median household income data, the report notes the average time required across the U.S. is 8.9 years, assuming prospective buyers save 5% of their household income each month. With a median household income of $106K and a typical home value of $703,600, Seattleites can expect to spend a “baker’s dozen” years to reach the 10% down payment threshold. The average time across Washington is 12 years and it takes 12.7 years in Portland metro. Conversely, it requires Iowa residents only 5.2 years to reach the 10% mark.

>> Newly built homes (excluding resales), at an average price of $635,131 in Washington, are out of reach for an estimated 81% of state households. That’s according to the Housing Affordability Index released by the Building Industry Association of Washington. About 97M U.S. households cannot afford a median-priced home.

>> The Emerald City ranks 5^th in the country when it comes to housing development over the past 10 years, according to a report from StorageCafe, which used data from the Census Bureau. The report found that 91.3K building permits were granted in Seattle between 2013 and 2022, with 85K of them for multi-family construction. New York City saw the most development over the past decade, with 98% of its 242K permits comprised of multi-family units.


AUGUST HOUSING UPDATE

The local market appears to be sleep-walking through a year that will be best known for near-record-low activity and prices higher than at the start of the year. The season has been shaped by slumping new listings, a slowly climbing number of homes sitting on the market from previous months, fewer closed sales compared to last year and prices moving plus/minus five percentage points year-on-year (YoY).

The single-family housing market is sluggish, as many prospective buyers and sellers have chosen to focus on enjoying the many weeks of beautiful weather. King County new listings fell 13% from June to July (2158), led by a 20% slide in Seattle (690). The county has not seen a July figure this low since records have been archived for brokers in the early 2000s; the previous low of 2512 single-family new listings in July occurred in 2012.

Read a detailed assessment of our housing market in my most recent blog post: King County Home Buyers and Sellers in ‘Re-Evaluation’ Mode

CONDO NEWS

Graystone, the next big condo unveiling in Seattle, has had a strong response to the offer of on-site tours inside the building project. The sales team has now added a second day to their schedule. In addition to Saturday hard-hat tours, which have been a big hit, the agents are making more available on Wednesdays. (Contact me for sign-up details.)

Buyers have been energized after the sales team announced in May a reset on pricing – now starting in the low $400,000s – and incentives to help reduce the buyers’ bottom line. Depending on the size of the home, buyers will receive up to $25K off to help defray the cost of the parking space, lower the mortgage interest rate, reduce closing costs or simply to further reduce the price. Wow!

The building developers, Seattle-based Daniels Real Estate, is preparing to announce a delay in opening the grand 31-story condo on First Hill. It is now expected to open in Q1 of 2024 to allow a few construction delays to be ironed out. The 271-unit high-rise was expected to open this summer but – like other condo projects in recent years – various issues crop up to delay the final product. I am told there are no major issues but Daniels wishes to wait until the building is fully ready for its close-up!

Coincidentally, Q1 of 2024 is the last known date of completion on another major project – First Light, on the south edge of Belltown. According to a July message from the sales team, concrete for 44 of the 47 stories has been poured and the topping off of the project should be forthcoming. Project updates have been few and far between for this 459-unit, super-luxe, mixed-use condo tower. The amenities include a roof-top infinity pool.

————

The civil complaint filed by homeowners of Insignia Towers against building developers continues to move toward a Nov. 16 trial date at King County Superior Court. However, we have learned that more than half of the issues raised in the complaint have been resolved against about a dozen subcontractors of Bosa Development Washington.

In legal filings, Insignia homeowners claim Bosa and its subcontractors are responsible for defects or deficiencies in a range of materials, design and construction. Bosa developed the twin, 41-story, 698-unit community in 2015-2016. The homes sold out quickly and remain a popular destination with outstanding amenities.

People looking to buy a home at Insignia will need to pay cash or work with a specialist lender such as WaFd Bank. Traditional lenders generally do not underwrite mortgage loans on multi-family home purchases linked to active litigation.


LUXURY LIVING

The $85M Hunts Point estate that we reported here in May 2022 is back on the market at a steep discount – relatively speaking. The 5-bedroom, 7.75-bath, 11,150 sq. ft. mansion with three additional buildings was the highest-priced listing ever at the time. New price: $70M ($3978/sq. ft.). The property sits on 4.3 acres and includes 327 ft. of waterfront. The 2-story residence was built in 1995 and features wide-plank wood flooring, impeccably designed interiors, radiant floors, HEPA air filtration and eight fireplaces. The grounds have a tennis court and outdoor pool. Other buildings include a 4545 sq. ft. staff quarters, 1500 sq. ft. cabana and 400 sq. ft. beach house for a total living space of 17,599 sq. ft. Go big and go home! The Seattle Times and others report telecom magnate Bruce McCaw is the owner and that he purchased the estate from world-renowned saxophonist Kenny G. The 18% discount from last year’s price dropped the Hunts Point residence into second place for priciest listing in our area behind a $75M estate for sale in Friday Harbor.

While we’re in the neighborhood, here is an opportunity to build your own lake house. The existing 6-bed, 2.5-bath, 3560 sq. ft., 2-story, Yarrow Point home (with basement) is lovely for its 95 years, but, as you can perhaps see from the layout, the 0.6-acre grounds would certainly look fetching with something brand new. And the sellers don’t disagree. They were going through the permitting process on a new home with detached guest house/garage but, instead, are moving on. What an opportunity to benefit from the vision of the current owners or to create something from scratch along the 55 ft. of waterfront! List: $11.2M ($3146/sq. ft.)

A beautiful home in Renton caught my eye. It’s a 4-bed, 3.5-bath, 4550 sq. ft., multi-level, custom-built beauty. The home offers plenty of water – an in-ground pool, outdoor spa tub and 67 ft. of Lake Washington shorefront. (The listing video may make you a little seasick, however!) This place has everything … and it comes with everything. The sale includes all home furnishings, such as furniture, player piano, custom murals and ski boat. Don’t forget the boat house and helipad! List: $5M ($1099/sq. ft.)

A lot of time and creativity were invested in a very special Seattle home. There is a sense of symmetry and precision with the layout of this 2-bed, 1.75-bath, 2610 sq. ft. residence at Continental Place, one of the city’s first purpose-built, high-rise condos (1981). The home was reimagined by local architect Garret Cord Werner and features tray ceilings with recessed lighting, heated limestone flooring, window benches, red-leather-floor entry, Murphy bed in the second bedroom/library, ventless fireplace and three deeded parking spaces with room for four vehicles. There are 270-degree views of Mt. Rainier, Elliott Bay and the Space Needle. Building amenities include a two-bedroom guest suite, indoor pool, spa tub, fitness center and parklet. A masterpiece awaits! List: $3.78M ($1448/sq. ft.)

And we cap this month’s look at luxury listings on Lake Sammamish – which is pictured atop this month’s newsletter. This 4-bed, 5.25-bath, 4727 sq. ft., 2-story (with basement) includes 75 ft. of north-facing lakefront in beautiful Issaquah. A perfect open-plan home in an idyllic setting: granite counters accent the rich-wood flooring in the chef’s kitchen, French doors from the casual eating space open to a patio with an unobstructed water view. Add in the sports court, spa tub and dock and you have everything you need for years of fun outdoors and in. It has to be seen to be appreciated. List: $6.3M ($1333/sq. ft.).


What else is happening in and around your Seattle?

Lighted Art Show, Aug. 18-19
Come to Kent and see 30 art installations that blend light and sound into family friendly fun. Lusio Lights is free at Mary Olson Farm (28728 Green River Rd.). No dogs, food or drink on site. 7-11pm

Railroad Fest … and More, Aug. 19
Snoqualmie Days has a pancake breakfast (7-11am), 5K run (8am), train rides (11am, 1pm, 3pm), parade (11am), music (12:15-10pm), vendors and entertainment on car-free streets surrounding Northwest Railway Museum (38625 SE King St., Snoqualmie). Speaking from personal experience, the pancake breakfast is yummy!

Party in the Park, Aug. 25
Seattle Art Museum presents SAM Remix. The event promises “light and sound installations, live music, and art making” with food for sale and a no-host bar at Olympic Sculpture Park (2901 Western Ave., Belltown/Seattle) 21+ with ID. 8pm-midnight

Rodeo, Aug. 25-27
Watch cowboys and cowgirls compete in bull riding, buckin’ broncs and steer wrestling at the Enumclaw Rodeo. The professional rodeo was established in 2012, returning a 70-year tradition to this southeastern King County city. Check it out at Enumclaw Expo Center (45224 284th Ave. SE). Various times.

Princess Picnic, Aug. 27
Your child can meet princesses Beauty and Rapunzel, hear them sing and read stories, and eat a Princess Picnic in this one-hour event at Lake Wilderness Arboretum (22520 SE 248th St., Maple Valley). 12pm

Video Game Convention, Sept. 1-4
Play pre-release video games, attend interactive panel discussions, watch game competitions and admire gamers in costume at PAX West. One of the nation’s biggest gaming confabs of the year takes place at Washington State Convention Center (705 Pike St. in Seattle).

Do the Puyallup, Sept. 1-24
Take part in the annual pilgrimage to Puyallup for the family friendly event of the year – the Washington State Fair, the largest and oldest in the state. Plus, catch a concert or two; some of the headliners: Chicago (Sept. 1), Kane Brown (Sept. 3), Zac Brown Band (Sept. 13), Pentatonix (Sept. 16) and Babyface (Sept. 23). Washington State Fair Events Center (110 9th Ave. SW). Various times. Closed Tuesdays.

Free Seattle Concerts, Sept. 2-14
Did somebody say free music? Yep! See – and listen – for yourself – Ballard Locks (Sept. 2-4, 2pm); Bell Street Park (Sept. 8, 5pm), Downtown (Sept. 5-7, 12pm and Sept. 8, 5pm) and Pier 62 (live DJ, Thurs., 4:30pm)

Mexican Market, Sept. 9
Festival Xopantla Tianquiztli features arts & crafts vendors, street-style Mexican food, tequila-inspired drinks and traditional dance at Pier 62 (1951 Alaskan Way in Seattle). Free entry. 1pm

Seattle Seahawks 2023 Kickoff
The Seahawks open their 47^th NFL campaign at home on Sept. 10 against the L.A. Rams (1:25pm). There is great promise for this year’s team, led by quarterback Geno Smith and returning linebacker Bobby Wagner. The Hawks – like most teams this season – will play on Christmas Eve (at Tennessee) and New Year’s Eve (vs. Pittsburgh). Tickets

Tour Modern Homes, Sept. 16
Seattle Modern Home Tour is a self-drive exploration of six contemporary houses in Seattle and the Eastside. You may even get a chance to meet the homeowners and architects. 10am-4pm

Events are subject to change. Please check with venues to confirm times and health-safety recommendations.

In case you missed it….

The Living the Dream blog enjoyed a two-week break in July and returned with two stories related to housing and aging:

Preparing a Home to Safely Age in Place

Eight Home Renovations to Make Before Retirement

I appreciate your readership and kindly ask that you forward this monthly report as a special gift to one of your friends or colleagues. They can sign-up for future missives here. Thanks and see you in September!

Will

Office vacancies in U.S. urban centers remain mostly higher than in 2019 and transit ridership continues to struggle to regain consistent levels. If we are supposed to be back in the office, you can be forgiven if you don’t believe it.

The national office vacancy rate stands at 16% through March, up from 11% at the end of 2019 – just before life changed for you, me and the world. That figure is a whopping 24% today across Seattle/Puget Sound, triple from pre-pandemic levels. Yes, essentially one in every four Seattle office buildings sits vacant. [Data courtesy global services and investment company Colliers.]

The work-from-home lifestyle has changed the way we go about our lives. In Seattle, 62% of workers come into the greater downtown area at least three days a week. That’s according to an April survey of 221 city businesses tabulated for Seattle Metropolitan Chamber of Commerce before Amazon employees returned to the office on May 1 for at least three days a week. Measured differently, monthly worker foot traffic in downtown is 48% of 2019 levels, the highest rate of activity since the start of the pandemic.

Downtown Seattle – which includes a workforce of about 340K – has been far slower to recover from the health crisis than most U.S. cities. Our area’s predominantly tech-centric businesses adapted quickly to the pandemic and employees became comfortable working from home while leaving the city looking somewhat desolate. Credit city leadership for taking positive steps this year, with Seattle Mayor Bruce Harrell announcing a so-called activation plan that aims to boost numbers in downtown – though, like all grand visions, they come with detractors.

“I don’t care what mayors say,” Marci Rossell, noted economist, commented about the changing urban work dynamic. “You are not going to get people to come back into the office to the same degree as they did before 2020.

“Workers are in the driver’s seat now because they are in such short supply,” said Rossell, speaking to an international group of real estate professionals. Rossell also expects “significant” losses to occur for commercial real estate holders and that the issue of low office vacancies could drag on for decades.

Moody’s Investors Service noted that banks hold approximately half of the $6T in commercial real estate debt, with the largest share maturing within the next three years, according to Reuters. Data from the Federal Reserve indicates Goldman Sachs has the highest exposure to commercial loan losses at 16% of its lending total due within the next two years, followed by Morgan Stanley (14%) and Citizens (12%).

Ridership on King County Metro public transit, meanwhile, remains down 26% between May 2020 and this past May. That’s as much as 125,000 fewer rides every weekday – a serious blow to commuter hotspots.

Our urban area accounts for about half of the city’s economic activity, and the Seattle Chamber noted that rising office vacancies coupled with less construction could lead to $2B in decreased revenue. In fact, the cost of office space on the Eastside surpassed downtown Seattle in Q1 (now at $57/sq. ft. on average vs. $54), according to CBRE, a global commercial real estate services company. Meantime, getting workers to feel good about returning to the office is a stiff challenge.

“For this to work, employees must feel that in-person days are intentional, purposeful and focused,” said Amy Coleman, Corporate VP of Human Resources at Microsoft. When it comes to “intentional,” Coleman said: “Employees really want to know the ‘why.’ What’s the research on when in-person [attendance] matters.”

The Seattle branch of CBRE recently moved into a new office on the 38^th and 39^th floors of U.S. Bank Centre. Instead of assigning cubicles and offices for each of its 300 staffers, CRBE now offers seating for up to 233 people – apparently without assigned desks. Even the company’s top executive for the Pacific Northwest comes into the office reportedly not knowing where he will sit.

The leading barrier to getting people back into the office is the commute and how to make it more flexible for workers, said Keena Kaye from the Bill & Melinda Gates Foundation. “No one likes a long commute or, worse, attending virtual meetings while still stuck on the road.

“Workers are finding that, since the pandemic, the challenges of daily life are greater – childcare, tutoring and other needs for school-age kids, multi-generational areas of focus, mental health needs [and] the commute. Flexibility and empathy are now core requirements,” added Kaye, a Sr. Program Manager with the foundation’s Cross Cutting Programs.

Coleman and Kaye spoke to members of the Seattle Chamber, whose president, Rachel Smith, offered her three biggest asks as the city and its people continue to rebound:

• City leaders: Make a plan for progress on homelessness, public safety and affordability – and partner with the business community. [See activation plan, above]
• Voters: Hold leaders accountable, ask the candidates where they are on the issues and cast votes in the August and November elections.
• Everyone: Keep advocating for sensible policies, keep patronizing favorite businesses and keep investing in the community.

To help address the housing-office mismatch, the city recently held a competition of sorts. Architects, contractors and building owners were challenged to reimagine a dozen stately structures. First place went to the team behind the Mutual Life Building, which opened in 1895 on the corner of Yesler Way and 1^st Avenue in Pioneer Square. The proposal would convert upper floors into co-living spaces with 80 sleeping quarters and shared kitchens and bathrooms to help make residential living truly affordable.

Mayor Harrell did not announce any formal projects based on the proposals but gave hope that it will happen. “We’ll advance this based on this vision that you’re helping us form together – future legislation and regulatory modification to code changes and the permitting processes. We’ll have new incentives, and quite frankly, this will inform our budget,” he said.

We are charting new territory and success will be measured by creativity and collaboration. Local government, developers, architects and others will need to step up and take responsibility for the sake of our city.

“This is a time for leadership and for action,” Smith said. Her comments came before the senseless shooting death of a Seattle restaurant owner on a downtown street that also took the life of the woman’s unborn child and injured her husband – a tragic incident that further hinders Seattle’s return to normalcy … and possible return to the office.


SHORTAGES AND DELAYS

Supply and demand. That’s how our world rolls … or at least it tries. Without feeding one, we cannot quench the thirst of the other.

We certainly see that in all forms of residential real estate – from new construction to finding items for the home. The brighter news is that labor shortages and supply-chain disruptions are improving but it’s hardly “back to normal.”

In a recent survey by Houzz, 79% of construction and design businesses reported experiencing moderate to severe labor shortages. That’s an improvement from a year ago when the figure was 91%.

Supply-side struggles are at the root of the housing shortage, noted Robert Dietz, chief economist for the National Association of Home Builders. “I refer to these challenges as the 5 L’s. It is lack of labor, land/lots, lumber/materials, lending for builders and land developers and ever-costly legal/regulatory costs,” he said.

Dietz estimates 400K construction industry jobs are unfilled, with the biggest need for carpenters and framers. Because of an increasing number of retirements, Dietz believes there is a need for about 740K new construction workers every year to keep up with demand.

Skilled labor isn’t the only thing in short supply. Nearly half (49%) of businesses report moderate to severe shortages of products and materials, most notably copper and brass, followed by lumber and plywood.

In addition, 63% of businesses told Houzz that there remains moderate to severe delays in shipment of those materials once purchased. As this chart shows, products from cabinetry to furniture remain slow in reaching their final destination:

BY THE NUMBERS

>> A survey released in May by the Seattle Chamber shows 83% of city businesses have gone to a hybrid work model, with 34% requiring workers to show up in person at least three days a week. The survey, conducted in April, noted 9% of Seattle businesses are fully remote and 8% are fully in-person.

>> Seattle has fallen 28 spots in a year to No. 34 in a key index that ranks best-performing U.S. cities. The non-partisan Milken Institute believes Seattle is now a “Tier 2” city based on index criteria of job growth, wage gains and housing affordability. The city was No. 8 in 2020. An economist from the institute suggested the city needs to diversify from its tech-sector focus, which is about 30% of the region’s gross domestic product. Provo-Orem, Utah, earned the top ranking this year.

>> A report from ATTOM Data Solutions reveals that 311,508 residential properties in the U.S. are in the process of foreclosure, as of Q2, up 4.3% from Q1 and 20% higher from this time last year. A growing number of mortgage holders have faced possible foreclosure since a pandemic-related moratorium on lenders pursuing delinquent homeowners was lifted in mid-2021.

>> There were 1.25M mortgages created in Q1 – conventional, refinanced and home-equity loans combined – marking the eighth consecutive quarterly decline and lowest reading since Q4 of 2000, according to ATTOM. The ongoing decline in residential lending has been fueled by higher mortgage interest rates and consumer price inflation.

>> Seattle is rated the 11^th-best place to raise a family in the U.S., according to an intensive report produced by WalletHub. The personal-finance site compared about 180 metro areas on 45 metrics that put family first, such as the cost of housing, quality of schools and health-care systems. Our area registered a score of 64.4, including a Top 10 ranking for “education and childcare.” Fremont, Calif., (73.71) finished first. Cities in California and Arizona took seven of the top 10 spots.

>> Seattle is No. 8 in the nation for the best urban parks system, according to the Trust for Public Land’s ParkScore Index. Parks in Washington, D.C., topped the list. Our city earned a perfect score for investment; Seattle injects $329 per resident a year toward its parks system. We have an array of places to enjoy the outdoors – lush forests (Seward Park), waterfront vistas (Golden Gardens), dog-friendly expanses (Magnuson Park) and simple – yet simply beautiful – historic greenspaces (Denny Park). Check out my blog post on the topic.


JULY HOUSING UPDATE

The Seattle/King County housing market inched forward – and a little sideways – as the number of new and unsold listings continued to expand in June while fresh signs of a slowdown approached. Home prices continued to confound buyers by climbing toward record highs as summer began.

The county saw the combined number of single-family, townhome and condo listings increase in June by 4.4% from May to 3242 units – the highest monthly figure since last September. While that percentage may appear strong, it’s nothing compared to the April-to-May rise of 18%, signaling a probable cooling of new listings going forward. Meantime, unsold listings rose a solid 12% for the month to 3013, including 11% (1344) higher in Seattle and 10% (815) stronger on the Eastside.

New single-family-home listings rose 3.8% month-to-month (2491) – a much slower rate increase than the 19% monthly surge in May – and climbed 13% for units unsold at the end of June (2181). Seattle (12%) and the Eastside (11%) drove the increase in single-family units sitting on the market as of July 1.

Read a detailed assessment of our housing market in my most recent blog post: Home Prices Rising Toward Record Highs – Again

CONDO NEWS

Seattle leads the nation in construction cranes. They’re seemingly everywhere but very few are building condominiums. Only three for-sale towers have opened in the city since the start of the pandemic in March 2020 and only one high-rise condo – Graystone – is slated to open this year in Seattle.

It begs the question: Where are all the new for-sale, high-rise homes in our city?

There’s a multi-layered explanation but the main answer is that it doesn’t “pencil.” In other words, it’s too difficult to make it work financially in today’s economy even with good demand amid a severe shortage of housing.

Multi-family construction is still moving forward but most of the residential buildings will become apartments. Some 15K rental units are expected to come online this year across Seattle metro and roughly 4K in the city itself. This may help lower monthly rents but the overall construction industry continues to face challenges.

All projects start with financing. This year’s banking crisis – where three U.S. financial institutions failed – and lingering economic unsteadiness has led some financing to dry up for construction projects.

Banks are concerned about what may lie ahead. Many of them hold mortgages from commercial/office landlords who are struggling through low occupancy rates in urban zones (see story above). We have seen shopping centers and some office buildings go into receivership which can burden financial institutions with unwanted property.

Developers are also facing the constraints of local government and their constituents. Zoning restrictions, strict building code regulations, NIMBYism and onerous environmental laws have damaged the flow of new housing. Builders also remain cautious about condominium construction liability which can keep many insurance companies from writing building-defect policies.

State legislators helped smooth out some of the bumpy building regulations with a series of laws this year. That includes lifting restrictions on converting structures for residential purposes, streamlining development regulations as well as the permitting review process, and allowing contractors the right to fix construction issues before facing litigation – all significant steps forward.

This last item should help reduce concerns from developers about defect liability and prompt more construction of market-rate condos of all sizes and price ranges. Lobbyists in Olympia tell us this so-called right-to-cure law will be a game-changer for condo development across the state.

In addition, the City of Seattle agreed to modify stifling environmental reviews for downtown projects that include no more than 200 units. The idea is to convince owners of underutilized buildings to consider conversions to housing.

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Good news from West Seattle: Condo homes are now closing at Infinity Shore Club Residences, The first to sell was on June 12 – a 2-bedroom, 2-bath, 1244 sq. ft., fourth-floor home for $1.72M ($1387/sq. ft.). Another sale followed 11 days later and six others are under contract preparing to close.

The 37-unit condo near Alki Point has been through the wringer with delays: the pandemic, concrete workers strike, supply-chain constraints and, most recently, liens from building contracts. All matters slowed the six-story project from reaching the finish line until now.

We toured this stunning beachfront community earlier in the year and I would be delighted to give you the grand tour. Just give me a call.

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The highest price ever paid in Washington for a condo home reportedly took place recently at Avenue Bellevue. A local buyer in the finance industry is the apparent new owner of a 3-bedroom, 4-bath penthouse with nearly 1000 sq. ft. of deck space on the 26^th (top) floor of the Estates tower. The sales price: $14.35M, according to Puget Sound Business Journal.

Estates will also be home to an InterContinental Hotel, the first of its kind in the PNW. The community will include the Residences tower next door and in total deliver 365 homes as well as 208 luxury hotel rooms. Residences will likely open first in late summer followed about a month later by Estates.

LUXURY LIVING

This is the time of year when a residence could benefit from having a pool – and this month’s luxury real estate living segment includes an ideal option in leafy Clyde Hill. It’s a 4-bedroom, 2.75-bath, 3620 sq. ft., 1-story with basement – and in-ground pool. Sitting high on a ridge with lake and mountain views, the home is landscaped with flora and fauna as well as majestic Douglas firs. It’s the first time the residence has been on the market in 45 years. List price: $3.89M ($1076/sq. ft.), after a recent drop from $4.1M.

North to Kirkland, check out this 4-bed, 3.25-bath, 4430 sq. ft. 1 ½-story with basement – and 77 ft. of outdoor “pool” in the form of Lake Washington waterfront. This Northwest contemporary home seamlessly blends vaulted wood ceilings, walls of windows with Mt. Rainier views and stone fireplace with a covered patio overlooking a dock and water. A masterpiece, once owned by former Seahawks defensive end Grant Wistrom. List: $6.895M ($1556/sq. ft.)

On the opposite side of the lake and this 4-bed, 3-bath, 3650 sq. ft., 2-story, mid-century modern home in the Laurelhurst neighborhood of Seattle. The living room will take your breath away, along with the 50 ft of waterfront. Making this residence stand out is a 2-bed lake house accessible via a small funicular. Must be seen! List: $6.95M ($1904/sq. ft., excluding lake house sq. ft.).

The water theme continues with this small Pine Lake/Sammamish 2-story home, featuring 3 bedrooms, 1.75 baths, 1820 sq. ft. and 50 ft. of waterfront. The home was built in 1943 and appears to be well-loved – including wood beam ceilings – but the seller is willing to include floor plans and renderings of a potential new home on the just-shy half-acre lot. Not a lot of privacy with your neighbors, however. List: $2.7M ($1484/sq. ft.)

We finish with a Redmond stunner along West Lake Sammamish. This 4-bed, 4-bath, 6640 sq. ft., 2-story contemporary home with basement comes with 160 ft. of waterfront. Big. Bold. Beautiful. Rich hardwood flooring. Cathedral ceilings in a spacious living area. So much to appreciate: wine cellar, theater, music room, sauna, steam room … and sandy beach. One of my favorite listings this year. List: $6.8M ($1024/sq. ft.)

What else is happening in and around your Seattle?

Summer Outdoor Movies, through Aug. 25
This time of year is special with comfortable weather and outdoor activities, including free movie nights. Bellevue hosts screenings on Tuesday nights at Downtown Park (10201 NE 4th St.) and Thursday nights at Crossroads Park (16140 NE 8^th St.). Watch your favorite family films on a 40-foot screen and pre-show entertainment from 7pm through August. Details. Movies at the Mural returns to Seattle Center (305 Harrison St.) on Friday nights through August. Bring your low-back chairs, blankets or bean bags. Details

Renton River Days, July 21-23
Come one, come all to a special weekend of family fun in Renton. River Days has food vendors, a beer & wine garden, entertainment, children’s activities, drone show (July 21, 9:30pm), parade (July 22, 10am), pancake breakfast and fun run (July 22) and car show (July 23). Free.

Bite of Seattle, July 21-23
Food, drink and tunes – a perfect combination for summer fun. About 200 vendors will showcase fantastic food at Bite of Seattle as the event returns after a pandemic break. Come to Seattle Center (305 Harrison St.) near the International Fountain and check out cooking demos, a beer & spirits garden and dozens of performances, including from Sir Mix-a-Lot and Polyrhythmics. Free to attend.

Capitol Hill Rocks, July 21-23
Sofi Tukker, Denzel Curry and Louis the Child headline the Capitol Hill Block Party. The annual music festival is expected to feature 80 bands, as well as DJs, craft booths, food trucks and beer gardens. Enter at 12th Ave. and E Pike St. Tickets.

Chinatown Parade, July 23
Chinatown Seafair Parade features lion and dragon dances, martial arts and the Chinese Girls Drill Team in the international district. The parade passes by Hing Hay Park (423 Maynard Ave. S.) 7-9pm.

Art Fairs, July 28-30
Two art fairs take place on the same weekend. The Seattle Art Fair showcases works from 77 galleries around the world at Lumen Field Event Center (800 Occidental Ave. S.) (Tickets) and The Bellevue Arts Museum Arts Fair includes free projects for children (11am-5pm). Bellevue Square mall hosts the top curated artists in its west parking garage and offers two entertainment stages – in the mall and outdoors at the east entrance. (575 Bellevue Square). Free.

Torchlight Parade, July 29
Colorful floats, drill teams and pirates move south on 4th Ave. (from Seattle Center to Westlake Park) in the Seafair Torchlight Parade. Free or buy a reserved seat. Note this year’s early start: 3pm

Ships, Sailors and Seattle, Aug. 1-6
Seafair Fleet Week  includes free ship tours, displays, demonstrations and entertainment on the Seattle waterfront. Tours are at Pier 66 on Aug. 3 and Piers 46 and 69, Aug. 3-6.

Bike Festival, Aug. 4-5
Gigantic Bicycle Festival has live music, hand-built bikes, art, food, workshops, Friday night films and Saturday rides at Centennial Fields Park (39903 SE Park St.) in Snoqualmie.

Seafair, Aug. 4-6
Seafair Weekend Festival  features hydroplane racing on Lake Washington, the Blue Angels air show and classic cars parked on the lakeshore at Stan Sayres Memorial Park (3808 Lake Washington Blvd. S.), Plus, the Museum of Flight  (9404 E Marginal Way S.) will host Jet Blast Bash (Sat.-Sun.) with “fast planes, music, food vendors, and a beer garden with the closest seats to the thunder of the Blue Angels’ takeoffs and landings.”

Professional Golf Tournament, Aug. 11-13
Seventy-eight Champions (Seniors) Tour pros compete for $2M in the Boeing Classic men’s tournament at The Club at Snoqualmie Ridge (36005 SE Ridge St.). Opening and closing ceremonies include a jet flyover, weather permitting (Fri., 11:15am and Sun., ~4pm).

Events are subject to change. Please check with venues to confirm times and health-safety recommendations.


In case you missed it….

We touched on a wide variety of topics in the past few weeks on my Living the Dream blog.

To mark Pride Month, we examined the trends in LGBTQ+ homeownership and how the community is facing greater challenges – including accommodation – across our divided nation.

I also researched a topic near and dear to me – smart-home technology – and tips on how to get started. Plus, the article links to a booklet that covers the many facets of smart tech in the home.

And, I spent a sunny day visiting a storied landmark in Seattle. No, not the Space Needle or Pike Place Market. I walked throughout our city’s longest-operating burial ground to see the names from our storied past – Yesler, Renton, Denny, Bell – and some of our heroes from recent decades, including Lee and Russell. Check out my video blog post to see for yourself.

Please forward this newsletter to someone you think will enjoy reading news and insights from a former Wall Street Journal editor and now full-time real estate professional – or share a link for them to sign up for this monthly update. Thank you!

Will