Crash course in Seattle housing market
June 24, 2015 2:36 PM   Subscribe

I'm ready to dip a toe into the madness of the Seattle housing market. I'm looking for a 3br anything (condo or house) in North Seattle. I've been stalking Zillow, it looks maybe kinda sorta possible to find something we could afford. I have no idea what to do next.

I feel like I would like to have a low pressure chat with a good agent familiar with the market, and I think I probably need to talk to the bank about how much money they will loan me. But I'm not ready to search in earnest, I just want to get a realistic handle on my options. What is my order if operations here? Who do I talk to first? I would love recommendations for both agents and banks if you have them. I do belong to a local credit union, and am assuming that's my best option for financing? We do have access to a decent down payment, good credit, and very limited existing debt (less than $10k student loan) so I think generally we are OK in that regard, but I am generally unfamiliar with home buying finance and what would get us the most bang for the buck without shackling is to an unsustainable level of debt. I'm also interested in general thoughts on buying a home.. Things you wish you knew. Especially Seattle specific things. I'm familiar with buildings and construction issues in general, but not a residential expert by any means.

Note: I have heard all the horror stories about all cash buyers and bidding wars... Would really like to ask for more positive comments as I think I have a pretty good handle on the negatives.
posted by annie o to Home & Garden (9 answers total) 3 users marked this as a favorite
 
Your first step is to get pre-approved for a mortgage, either through your current bank or a new one. USAA, as always, is great for this if you are eligible. If not, consider using Lending Tree just to get an idea of rates, etc.

Once you are pre-approved, you can take that info to an agent who can give you a better feel for the market in your price range.
posted by Flamingo at 3:00 PM on June 24, 2015 [1 favorite]


I can hook you up with the agent we used in the North Seattle market. He knew tons about the market and we really liked him. If that's something you'd like, please shoot me a MeMail.

Your best option for financing will be the best loan terms; your mortgage will probably be sold and/or you'll refinance, so my advice is to choose the best rate/terms you can get and just go with that. It doesn't sound like you're in any kind of weird situation. We used HomeStreet and it beat out USAA by a bunch. We later refinanced.

I've owned two homes in North Seattle and there's nothing peculiar to Seattle that I wish I knew beforehand, but I was really familiar with the neighborhoods before buying there. Water and garbage is expensive as hell. If your house is older, find out ahead of time whether you may need to replace the sewer line. Most houses do not have air conditioning and the summers have gotten noticeably hotter since we moved here in 2001. There's lots of property crime so you might want to factor in the expense of a security system. Check to see if your place once had oil heat and if it did and no longer does, whether the tank has been decommissioned.

I'd first go about getting approved for a loan and finding out how much you are willing to spend. As you know you may be competing against people paying in cash so you will want to be sure your financing has been approved and you won't be in a position where the deal will fall through due to the house not appraising at the price you're willing to pay if you get caught up in a bidding war. Also, Zillow is sort of a mess. You might want to check out RedFin and see what prices houses have sold for in the past few months to give yourself some additional data. Once you know what you're willing to spend that can help you refine the neighborhoods that you can buy in and you can take it from there.

The only other advice I'd have is to think deeply about the neighborhood where you want to live: "North Seattle" covers a lot of places, and while most of those places are pretty great, there are some things you might want to know about each place, like: how long is it really going to take to get to downtown if you have to drive east to west; what is bus service like; will you rely on the buses that go up and down Aurora (formerly the sketchy as hell 358); will you be surrounded by students; will your neighborhood likely be taken over by townhouses in the next decade, etc. I've owned and/or rented in Crown Hill, Broadview, Green Lake, and the U-District so if you were considering those places I could maybe answer some questions.
posted by MoonOrb at 3:09 PM on June 24, 2015 [1 favorite]


It is worthwhile to work with an agent, but when you're starting out it can be helpful to spend some Sunday afternoons going to open houses. You'll get a feel for what you can get for a certain price, find areas that you have a preference for, and features that you do or don't want in a house.
posted by ShooBoo at 3:40 PM on June 24, 2015


Thoughts on neighborhoods is also appreciated. I grew up in Seattle in the 90s, and moved back last year after more than a decade away so while I know the north Seattle neighborhoods pretty well, some of my impressions are out of date. Frankly, I'm fairly pessimistic about this whole house thing, so am trying to keep from fixating on any specific area. I'm generally familiar with the reputations of the schools and transportation, but I would appreciate hearing about hidden gems or surprise changes, or even upcoming changes (thoughts on the impact of the light rail for example)
posted by annie o at 3:42 PM on June 24, 2015


Check your mefi-mail.
posted by justalisteningman at 3:49 PM on June 24, 2015


We closed on our house in West Seattle on April 15 after losing 5 offers in Ballard. A typical sale price was 15 to 30% over list price, waiving inspection is pretty much assumed (which means you need to pay for an inspector to pre-inspect every time you're making an offer, at $350 a pop, and inspectors are booked so it's hard to get one if the house is listed on Thursday and they're reviewing offers the following Monday). The buyers who won the offer were often offering cash. Buyers with financing were having escalator clauses with a $10K step, and if they didn't have 20% down, putting down earnest money of $30K and waiving their financing contingency. Anything in North Seattle is going to be super-competitive if it's in a good neighborhood, unless you're willing to go somewhere rural like Broadview or Haller Lake. Sorry I can't say anything more positive than that.

You're going to want to look at the Seattle Bubble blog to see how crazy the market is right now.

In any case, I will me-mail you the info on the agent we worked with (whom we love) and our financing guy from HomeStreet bank.
posted by matildaben at 3:56 PM on June 24, 2015 [2 favorites]


There's some good advice above, especially from MoonOrb. I would add that if you grew up in Seattle in the 90s some of your assumptions about neighborhoods, schools, and transportation routes may be inaccurate.
posted by stowaway at 4:58 PM on June 24, 2015 [2 favorites]


Seattle, especially North/Northeast Seattle, is a crazy market right now. We bought our current home in late 2013 after a short bidding war with one other buyer (five days after the house went on the market, btw). Now, in June 2015, I am sure there'd have been more offers and we'd have lost that bidding war big time, since we maxed out in 2013. What won it for us then was our relationship with our agent, who'd sold us our previous home in 1999, and had been helping me look this time for almost two years. I'd say the first thing you need is a good, established agent. I can give you the names of two, both with Windermere, if you want.

A big part depends on your budget too - if you're looking at $400K or under, you'll be competing against developers who are buying strictly for the property, AND if you do get a property at that price, you'll end up needing to put $100K of work into it. I have a friend who just went through this, and she did get in a house with the help of a really good agent, but much further north than she'd been originally looking, though still in Seattle.

Find an agent you like. Get your budget in order. Get pre-approved on your mortgage, and have all your paperwork in good order.

For some reference, there's this development going up. I've been told the detached houses there - with no real yard, but a green common area - will list for about $900K.
posted by Lulu's Pink Converse at 8:58 PM on June 24, 2015


I think the best time to shop for houses in Seattle is during the cold, dark, rainy months. (October-February) That way, you get a better feel for how much natural light the house gets at a minimum. You also get to see how the property handles drainage, and if it has a basement, you'll be able to more easily tell if there are mold issues.

Also be sure to get the sewer line scoped. Turns out mine was blocked, (damage from the 2001 Nisqually earthquake) and because it was a buyer's market I was able to get the sellers to foot the large bill to fix it.

Since you are looking at North Seattle, an important consideration is the property's proximity to the light rail, which is scheduled to reach UW next year, and Northgate soon after that.

Seconding matildaben's suggestion to read Seattle Bubble. Tons of good info there.
posted by oxisos at 10:37 PM on June 24, 2015


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