Issaquah Highlands Homes Still Appreciating in Value

Written by: rebecca and filed Under Blog, Buyers, Issaquah Highlands, Real Estate |

Over at the Issaquah Highlands Community Forum (must be a resident to gain access), there continues to be much debate and concern as to wether or not it is a good time to buy a home. In fact, a fellow Issaquah Highlands resident recently inquired about the Year of Year median home price change. I feel this question is worthy of an entire post outlining all the data from 2006 and 2007 and comparing both YTD sales as well as November only sales.

Issaquah Highlands single family homes saw the median home price increase 19% Year To Date, from $549,950 to $652,616, Year over Year. However, the number of units sold are down and days on market have increased indicating that the market has slowed down.

Issaquah Highlands single family homes saw the median home price increase 5% during November 2007 compared to November 2006, $581,800 to $610,000. Still, units sold are down and days on market have increased still supporting that the market has slowed in this area.

I have gone so far as to state in previous posts to say that I do think buyers can make a sound investment at this time. Despite the fact the market has slowed down and inventory is building, home prices have continued to appreciate in certain areas. Even though this market can be challenging for some, if not most, if you can afford it and you find the right home in the right location, investing in real estate in the Puget Sound area can still be a smart move.

While we are not seeing the kind of gains we used to, we have still seen gains over this past year. I agree that the unabashed crazy increases that we have seen in the past is over for now and that it is not a good time to flip homes, but I still believe in real estate as a long term investment.

If you have any other questions or would like to see any other stats, please let me know.

Comments

14 Responses to “Issaquah Highlands Homes Still Appreciating in Value”

Shaq on December 12th, 2007 8:37 am

Rebecca - I’m a little confused by the graphs. What exactly are the November graphs showing us? Because I can’t 13 homes transacted in all of 2007, with all 13 coming in November?!?!

Also, if the claim is that homes in IH are up 19% YoY, yet we aren’t “seeing the kinds of gains we are used to” - then I don’t get it.

I would appreciate it if you could just flesh it out a bit more.
Shaq on December 12th, 2007 11:04 am

should say “count” not “can’t”
rebecca on December 12th, 2007 11:10 am

Thanks for catching that Shaq! I accidentally posted the wrong graph for YTD numbers. Actual homes sold YTD were 381 for 2006 compared to 236 for 2007. Apologies for the mix-up.

As for the data and the claims I am making, the only thing I said is that we aren’t seeing the kind of gains we used to. I am not claiming that homes are UP 19% in IH YoY; merely stating that if you look at YTD homes sold in 2007 and compare it with YTD homes sold in 2006, you get a median sales price that is 19% higher.

When I first moved here, around 25% was the norm. Close to 19% but still higher. Significantly higher than 5%.

I don’t necessarily think 19% is a good measure of reality because that number accounts for home sales in January and February when the market was still relatively strong. I also don’t think 5% is reality either. I think the truth lies somewhere in between; probably closer to 5% than 19% though.
Shaq on December 12th, 2007 4:15 pm

Thank you for the update! I’m looking at the new annual graph you put up there, and I think it tells the tale that I would have guessed based on the new median numbers; i.e. the distribution of the transactions for 2007 has really shifted to the right (higher end) from 2006.

Now, obviously it’s theoretically possible that that’s entirely due to appreciation, but common sense would say that there’s no way that’s the case. Based on what I see here, I’m willing to bet that the $300 - 600 range houses are actually unchanged or even down on the year.

Do you know of any houses in IH that have changed hands more than once this year, or at least changed hands and then are on the market again? That would be the best way to find out the real story.

Also, how complicated are the statistics by the fact that now, “incentives” (often large) are likely to accompany any sale? Meaning, that Dahlia Park sale you posted about earlier in the year - would the $50K Bennett incentive show up in the sale price? My understanding is that it does not, which means that the numbers could potentially have a baked-in increase in them which is completely phantom.

Thanks!
jeremy on December 12th, 2007 6:19 pm

It would be interesting to look at an analysis of what would be considered an average home here in the Issaquah Highlands; represented by lot size, square feet, bedrooms and bathrooms; and look at what the price curve looks like Year over Year. I think if you were to do this you would see the movement of homes through the different price bands.
rebecca on December 12th, 2007 11:37 pm

It is difficult to extrapolate any concessions that are “baked in” to the sales price, but in all fairness, I have seen large concessions built in to sales prices consistently over the past 8 years. I try to account and adjust for these concessions when possible when putting together a detailed market analysis for my clients. It is much more difficult to account for these concessions when comparing large numbers of home sales.

As for doing a more detailed analysis - I am intrigued as well and will tackle that upon returning from my vacation.
Shaq on December 19th, 2007 10:06 am

Have fun!
rebecca on January 2nd, 2008 9:05 pm

Shaq,

What do you feel is appropriate to use as an average home here in the Issaquah Highlands?

If I look at all units (homes and condos) available for sale either now or at one point in time, I get the following results:

Average
Bedrooms - 3
Bathrooms - 2.47
Square Feet - 2,206

Median
Bedrooms - 3
Bathrooms - 2.50
Square Feet - 1,868

Maximum
Bedrooms - 6
Bathrooms - 6.50
Square Feet - 7,400

My initial thought is looking at data for homes that are 3-4 bedrooms, 2 to 2.5 bathrooms and square footage between 2000 and 2500 is probably a good range.

What do you think?
Shaq on January 3rd, 2008 8:10 am

That sounds pretty fair. Since the median and average are so close to each other, it’s a lot easier than it might have been.
rebecca on January 3rd, 2008 12:26 pm

What about for the monthly comparison? Is that still useful or would looking at Q4 be more relevant. I am thinking all of Q4 would probably be more relevant.
Shaq on January 3rd, 2008 3:39 pm

Hey Rebecca, welcome back. I’m not sure I understand your question here.
rebecca on January 3rd, 2008 6:27 pm

Thanks Shaq. Yeah, I didn’t phrase the question very well. In this post I did two comparisons; a YTD for 2006 vs YTD for 2007 and a November 2006 vs November 2007.

For the purposes of the analysis, I am planning on comparing all of 2006 to all of 2007 for the yearly comparison. The question was does it still make sense just to do a November comparison as well? I am thinking that I might just do a Q4 comparison since that incorporates more data post “mortgage mess”.

Does that make a little more sense?
Shaq on January 3rd, 2008 8:33 pm

Hmm. All of 2006 vs all of 2007 should be interesting to look at. That will show the volume drop off very well. The November comparison doesn’t seem as timely anymore. Q4 is probably better.

I’m headed out of town in the morning, but I look forward to seeing what you put together!
Issaquah Highlands Homes Still Appreciating in Value - Part 2 | Red Brick Blog on January 6th, 2008 8:57 pm

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