New Seattle Condos, Video and Graphics
Did you guys catch this article in the Seattle Times this morning? It’s titled, “A wave of condos is coming to Seattle and Bellevue for the first time since the housing bust”.
I was interviewed by the Seattle Times early last week and made a number contributions to the article. The storyline is simple – there is a huge wave of new condo developments coming to Seattle. There a number of reasons for it. Just to name a few:
An Abundance Of Apartment Supply
Over the last 7-8 years multi-family developers spent more time focusing on apartments and less on condos. The math was simple. Amazon starting expanding heavily into the Downtown Seattle core. The Fed had a rate policy that made it relatively cheap to borrow money and builders saw an opportunity for a rising rent environment primed for success. A number of developers built, sold and booked huge profits. Unfortunately, everyone raced to get apartments out of the ground. Now Seattle has surplus of apartments and rents have stabilized.
Dollars and Cents
Building condos really comes down to just one key factor…..Can a developer make enough money on a cost per square foot basis to justify the build. Seattle had been on a record price appreciation run and the average cost per square foot for a downtown Seattle condo is $844psf. We typically see 20-30% premiums in new construction pricing. So with the blended cost per square foot over $1,200 for downtown condo product, it creates the perfect environment for condo developers to re-enter the market.
Historically Low Condo Supply
Less than a year ago, Seattle had just 5 condos priced less than $500,000. In addition to that, as we reported in January the median sales price rose 93% since the bottom of the market. Even though we have seen a rise in inventory, in all of Downtown Seattle there are just 170 units for sale. From a supply perspective, these numbers are pretty dismal. This creates a window of opportunity for condo developers. In the last 9 years, we have delivered less than 1,500 new condominiums. Meanwhile, the downtown Seattle population grew in excess of 20% since 2010.
A new wave of condos is certainly upon us. I wanted to create some value for you guys by building a timeline of new Seattle condo projects coming to market. As you can see in the infographic below, we have dedicated a new page on the blog specifically to track the new condominiums developments coming to Seattle. You can check it out here.
Have questions, get in touch!
