Is it another Bubble? Local Home Prices Change from ‘How Low can they Go’ to ‘How High can they Go?’

Who would have thought that housing prices would have come back so quickly and hit levels over the peak in 2007? Especially considering how far those prices fell during the depths of the recession.

Houses in the Snoqualmie Valley are always a bit slower to recover than some of the Eastside communities perceived as closer to the core, but according Snoqualmie resident and John L. Scott realtor Nancy Backman, “We are back.”

Backman explained as prices in areas deemed “closer in” have become unattainable for many buyers, they are coming to the Snoqualmie Valley – where you can still find a single family home in the $500-$600k range.

According to a recent Seattle Times article, the median price of a King County home jumped by 12.5 percent to $540,000 in April, Just a year ago it was $480,000. In Seattle, that April media price was $637,000 – up $85,000 in one year. The result is a transformation in what buyers searchiing for more affordable homes will consider ‘the suburbs.’

One House Tells the Story

How dramatically different the market is from early 2008, which was the  last time our family bought and sold a home. Today, the number of available Snoqualmie Valley homes is at historically low levels and the average price per square foot has even surpassed 2008.

My own former Snoqualmie Ridge home, one we built in 2001, shows just what a rebound the market has experienced. Where it took us three long months to sell our former home in March 2008 for $10,000 under its $525,000 asking price – and where just a few short years ago during the recession that home was most likely valued as low as $425,000 – earlier this month it sold again. This time it was gone in just one short day – with multiple offers for its asking price of $584,000.

Another Bubble?

Backman said some people feel we are in another bubble, but she says with employers like Amazon, Google, Facebook and Microsoft bringing a steady stream of highly paid employees to the area, there doesn’t seem to be an end in sight to the pressure on the local housing market.

She also pointed to another positive for the real estate market – that the mortgage default rate is well under 1% – which she says has a strong impact on housing.

Snoqualmie Valley Real Estate Snapshot for the past 6 months

  • 12 active Snoqualmie Ridge listings and 115 sales, which sold at an average of 100.77% of the list price
  • 29 active North Bend listings and 120 sales, which sold at an average of 100.55% of the list price
  • 12 active Fall City listings and 20 sales at an average of 98.42% of list price
  • Snoqualmie Ridge has had two sales over $2 million this year, which is a record.

So… Nancy says if you are thinking of selling your home in the Snoqualmie Valley, the time has never been better. 

  • Home values are up and inventory is down
  • Mount Si High School once again ranked in one of the top schools in the country according to U.S. News and World Report Best High Schools List – and in the top 20 for Washington State. SVSD is also in the process of rebuilding MSHS, as well as adding other needed schools, due a recent school bond passage. Most buyers, at least with kids, usually put schools on the top of the criteria list.
  • The Snoqualmie Valley is one of the  most beautiful and desirable areas of the Puget Sound – and still close to Bellevue, Redmond and Seattle
  • The Valley offers a great environment for first time buyers and relocating buyers who are moving from areas that frequently are much more affordable

Buying a Home is Hard

If you’re looking to buy a home – well, unfortunately, the picture isn’t quite as rosy and patience will be needed. Redfin notes, “In hot markets like Seattle, Portland and Minneapolis, which saw double-digit sales growth in 2015, sales are now falling for the first time since mid-2014 as a result of inventory declines greater than 30 percent in some places.”

Whether that declining number of sales will eventually have an impact on sales prices in the Puget Sound region is anyone’s best guess. But in San Francisco, the number of sales dropped by 22% recently, and prices dipped by almost 2% on a year over year basis.

Then again, the median home price in the San Francisco area is $1,042,500 according to Redfin – and we’re NOWHERE near those crazy home prices in the Snoqualmie Valley.

Fall City, North Bend, Snoqualmie Home Sales

Homes Sold, listed

Fall City, North Bend, Snoqualmie Homes Average Price Per Square Foot

Valley home PSF

 

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