The lack of new construction closings in 2017 combined with increasing demand for home ownership drove the median home price of downtown Seattle condominiums to $625,000, an increase of $100,000 or 19-percent for the year. That’s significantly higher than the broader perspective offered by S&P/Case-Shiller Home Price Index, which reported the tri-county metro area spiked by 12.7-percent as of October 2017, leading the country in property value appreciation all year. It should be noted that the index doesn’t include new construction or resale properties.
“No new condominiums were delivered in downtown Seattle during 2017,” said Dean Jones, President & CEO, Realogics Sotheby’s International Realty (RSIR). “Buyers have struggled with anemic inventory all year and this imbalance of supply has led to higher prices, especially at lower price points.”
Jones notes the shrinking affordability in downtown Seattle. The number of home sales priced below $500,000 dropped by 50-percent from 2016 to 2017, to just 126 units sold, while resales over $1 million increased by 44-percent.
To be sure, new construction condominiums are being developed but they are mostly sold. The 107-unit Gridiron Condominiums in Pioneer Square is expected to deliver in the next month with approximately 38 units remaining available. Likewise, the 389-unit NEXUS Condominium Tower being built at the corner of Stewart Street and Minor Avenue is already 90-percent presold even though homes won’t be completed until mid-2019. Just 35 units remain available at NEXUS with pricing starting at $1.2 million.
A look at available resale properties offers only two homes listed below $500,000 in downtown Seattle; in fact, just five resales are available below $1 million. The median asking price of in-city condominiums is now $1,747,500.
Several new developments are in the pipeline but won’t deliver until 2020 or beyond.