We recently enjoyed an adventure in Edgewood. We stayed in one of the latest developments. Just driving to Edgewood and then touring Puyallup, Milton, Federal Way, and Fife we saw new building going on in both housing and business work space. As the major corporations in Seattle and the East side expand, their local populations are becoming our new neighbors. We need to keep up with the times. As pastures, green space, and fertile growing fields disappear, they are replaced with new homes, businesses, warehouses, and office space, we need to consider how this affects our taxes, new expenses, and our property values. Everything is related.
New apartment buildings in Tacoma’s Proctor District leaves virtually no parking spaces, which means the new owners of the apartments shop and dine within easy walking distance. What we see is construction with shops and business space on the first level with living space in the higher floors. The new restaurants and shops that move in to these new commercial spots, means competition for older established businesses. Change happens all around us.
A drive through Tacoma’s Hilltop area, a long time community with many homes in disrepair just a year or two ago, now shows houses being rehabbed, and placed on the market. This means new people and a new vitality, but it also means higher potential costs for home owners and renters. People living there currently will end up soon paying higher rents, and higher taxes on higher property values. With higher values, owners will need to increase their insurance coverage to keep pace with the market values. The same is true of each local business as well. Hilltop is just one example. This explosion of people will affect home owners, renters, as well as commercial property holders from Fife and Edgewood to Lakewood and Tillicum as well as the constantly expanding areas of Parkland, Spanaway, Elk Plain, Graham and beyond.
The Counselors of Real Estate have identified current and emerging issues affecting real estate:
2019-20 Top Ten Issues Affecting Real Estate™
- Infrastructure
- Housing In America
- Weather And Climate-Related Risks
- The Technology Effect
- End-Of-Cycle Economics
- Political Division
- Capital Market Risk
- Population Migration
- Volatility and Confidence
- Public & Private Indebtedness
If you live in Pierce County, you can easily see that we are affected by eight to ten of those issues.
“A review of 2019’s housing market for Western Washington shows buyers priced out of King County continuing to drive up prices in the surrounding counties, including Pierce, Kitsap and Thurston . . . According to the Northwest Multiple Listing Service’s review for 2019, Pierce County ended the year with its 2019 median closed sale price for single-family homes at $369,998, up 7.25 percent from 2018’s $345,000.” – Pierce County home prices and million-dollar property sales up in 2019 – Debbie Cockrell – The News Tribune
Real estate affects where you live, where you work, and your future. There is no in-between.
If you have questions about what is happening in your area, here are four reliable people to ask:
Puyallup/Tacoma with Keller-Williams Realty
Veronica Bonar – 253-223-8292
Eatonville/Spanaway/Parkland with Calhoun Real Estate LLC
Cassandra Day – 253-307-4677
Tacoma/University Place/Lakewood with REUSA Northwest
Dan Engell – 855-999-7975
Commercial Real Estate Appraiser – King, Pierce, King, Thurston, Mason, Lewis, and Kitsap Counties – GPA Valuation
Rick Pinkley – 253-564-1342
The lack of parking spaces is deliberate. Once upon a time there were parking minimums for development to accommodate resident automobiles. That has been changing to where there are now parking maximums for development which are intended to get people out of automobiles and into public transportation.
On the issue of appreciation: over time typical real estate appreciation is around 4% per annum. That’s just above inflation and accounts for population growth. However the housing market “giveth and taketh away”! During periods of high appreciation, double digit in the early 2000’s, you can bet there will be a “taketh away” drop back down to reality as we saw post 2008. Indeed if you look at all the volatility between 2000 and 2020 the average appreciation still comes in around 4%. Given the huge jump in property values since the bottom of the market in 2013-2015, I think you can expect another correction in the next few years. Hold onto your hats! It’s going to be a bumpy ride….again!
John,
Thanks for reading and commenting.
You’re probably dead on about corrections, but if we figure in the fear factor of virus right now it might come sooner. Wearing masks and hording. On the bright side, people can stay in their cars and tour the fronts and back of homes and business locations without getting close to people. Purchase by proxy, anyone?
Thanks for sharing.
Don
It is a great time to be a seller in Tacoma/Pierce County, but not so good for the buyers. Prices have increased and there is a shortage of inventory. Multiple offers are very common on nearly every listing. Personally, I am fixing and selling rental homes that I have owned for many years. Retirement is here and very secure thanks to the real estate market.
Daniel,
Thanks for writing.
I agree . . . the market is fantastic . . . a long way from when we got killed with interest rates in the early 1980s. Great time for sellers . . . we get post cards and calls every week, but we’re not ready to sell yet. Don’t sell all your houses. Hold on to some. You never know about tomorrow.
Thanks, again for sharing.
Don