The Emerald City is home to plenty of high-profile tech companies, a fact that has sent real estate prices soaring. What opportunities does Seattle hold for investors in both commercial and residential real estate?
Situated between Puget Sound and Lake Washington, Seattle is the 15th largest city in the United States. Seattle's population is among one of the fastest-growing in the country and the city is home to nearly four million people. The city has also made a name for itself as a major center for technological innovation. The combination of industry and population growth makes this city a solid choice for investors looking to expand their portfolios.
Seattle has a very low inventory of homes for sale, which has pushed prices up. Home prices have sold to a median of $627,000 up 14 percent year-over-year. Both single-family and multi-family housing permits are up, which may ease some of the low inventory burden. Many cities saw people leaving during the COVID-19 pandemic.
Seattle's rental vacancy rose 0.1 percent on a year-over-year basis, which is good news for landlords. The 4.4 percent rental vacancy rate is much lower than the national average of 6.5 percent. Both the delinquency rate and foreclosure rate are also below the national average. Seattle's delinquency rate of 3.6 percent is just over half the national average of six percent. At just 0.1 percent, Seattle's foreclosures are much lower than the national average of 0.3 percent.
Part of Seattle's strength as a real estate market comes from its robust economy. Some of the major companies in the area include: Boeing, Amazon, Microsoft, Redfin, and Zillow. If you're interested in investing in student housing, Seattle is a great choice. There are several large local universities include the University of Washington, Seattle University, and Seattle Pacific University.
Seattle is home to quite a few thriving neighborhoods. So nailing one down as the best place to invest can get tricky. Here are three neighborhoods worth considering, depending on which type of investment you want to make.
If you're looking for an up-and-coming neighborhood, look no further than Delridge. In recent years, the Delridge Neighborhoods Development Association has played a key role in making the neighborhood a safe place to live. Residential and commercial investors alike should look at this neighborhood for its appreciation potential.
Situated on the north end of Seattle, Shoreline should be a good fit for investors looking to buy single-family homes. The area is made up of more residential communities. Its easy access to downtown makes it a top pick among renters who may work in the city center.
Formerly known as China Town, the International District is located just south of the downtown business district and is home to a thriving culture as well as plenty of amenities. In addition, it's walkable and connected to other parts of the city by public transportation. As with any centrally located neighborhood, investors who are looking to buy in this area should expect higher-price points.
Like any investment, investors should be sure to do their research before they jump into the Seattle real estate market. However, all indicators point to the fact that despite many ups and downs during the pandemic, the Emerald City is ready to make a comeback. As a vaccine roll-out continues and the economy takes further steps to open back up, we should start to see strong growth in the real estate sector.