Windermere Real Estate/BI, Inc.
The 2017 market is slowly beginning to take hold, so before it does I wanted to make sure I crafted one of my favorite blog posts, my top 10 homes on the island for 2016. Last year 369 homes sold on the island. I am proud to say I personally toured most of them and these are ten of my favorite homes. The list actually spans the island geographically from north to south and represents the various price ranges. The sales prices have shifted as prices have moved up, however. Although the top sales number on my list is almost $3M, only two on the list are waterfront homes, which shows the value, beauty, and desirability throughout our island; from inland rural settings, to in-town neighborhoods, to views, to waterfront.
The lack of inventory continued to be the dominate theme in 2016, which is why you will see some multiple offers noted below. Last year the multiple offer situation even crept up over the $1M mark, in several cases, which is a bit different from years past.
This is my 9th annual list. To get a feel of the homes I like personally and see all nine of my lists in one place, click here. Enjoy!
Original List Price $528,000
Sale Price $662,500 (multiple offers)
Days on Market – 8
Date Sold 6/30/2016
For #10 we start on the extreme south end of the island on Toe Jam Hill Road. This home came on the market in the frenzy of the summer market and I believe had six offers. The home is perched high above a ravine and the interior style is beautiful, yet simple. Cork floors, Paperstone counters, floating walls, and built-in desks sum up the style. The design style seems to run parallel to Sarah Susanka’s Not So Big House concept. At just over 2,000 square feet the home still lives large, making use of every inch. My clients were the successful buyers in the multiple offer situation and love the unique property they now call home.
Original List Price $749,000
Sale Price $749,000
Days on Market – 5
Date Sold 8/8/2016
For #9 we move into Winslow to Village Circle. In-town homes were in high demand last year (I don’t see that changing in 2017). Price per square foot is highest in Winslow, where you trade lot size for the convenience of walking to Winslow and the ferry. Hillandale (Village Circle) is one of my favorite in-town neighborhoods and this home has some of the best curb appeal in the hood. Fabulous gardens and a meticulously cared for home. The neighborhood was designed by Dick Allen, a developer who put care and thought into building a small community, not just a house. The neighborhood has shared open space and trails that connect to town. This home is also just over 2,ooo square feet and was listed at the end of the summer and quickly acquired one great offer. The timeless Colonial style of all the homes in the neighborhood and the creative weather vanes on each home have made it a favorite for buyers since it was developed back in 1999.
Original List Price $918,000
Sale Price $918,000
Days on Market – 12
Date Sold 1/29/2016
For #8 we move back down south to Rose Avenue in the Eagle Dale Neighborhood of the island. This charming Craftsman struck a cord with me because of the bucolic acre it sits on and because of the stylistic interior the talented home owner created. I loved the Carrera marble counters in the kitchen and the striking wallpaper throughout. I also loved how the owners mixed mid-century modern decor into a Craftsman home. I thought it worked well. The vaulted ceilings upstairs make for interesting spaces for the bedrooms and the guest suite over the garage adds to the package. This home came on early into the new year and a few of us felt it was priced a bit high, but after only 12 days on the market they found a happy buyer.
Original List Price $865,000
Sale Price $962,000 (multiple offers)
Days on Market – 6
Date Sold 3/11/2016
For #7 we stay on the south end, but move over to the west side, to Palomino Drive, which sits above the Crystal Springs Neighborhood. This home was priced low (in my educated opinion) and saw 4 or 5 offers and as you can see escalated almost $100,000. This home has a solid feel with lots of woodwork inside and a classic cedar shingle exterior, but most importantly to me anyway, it has a very nice west facing view of the Sound. Oh those colorful sunsets! The home is over 3,600 square feet, has four bedrooms and a supreme shop in the basement. I thought back to this home a lot in 2016 as one of the better values for the year.
Original List Price $980,000
Sale Price $1,150,000 (multiple offers)
Days on Market – 7
Date Sold 10/31/2016
For #6 we move to the center of the island for Summer Hill Lane. This home oozes charm. It is a rare package in that it is a small home on a large piece of land, 1,715 square feet home on 2.5 flat acres. And the main home is all on one level, plus a guest suite over the garage. The lovely sunny garden setting, vaulted ceilings, exposed beams, Saltillo tiles, and classic white kitchen made me want to move right in – I really do love a white farmhouse. I have said before that charm can be hard to find on the island. When this home was listed said charm brought many buyers looking and five put forth offers. The resulting escalation in price was dramatic at $170,000 over asking price.
Original List Price $1,289,000
Sale Price $1,289,000
Days on Market – 6
Date Sold 7/7/2016
For #5 we move to the northeast side of the island on Point Monroe Drive, commonly known here on the island as the Sand Spit. This waterfront home indeed sits on a narrow spit of land that juts out from Fay Bainbridge Park. Here’s a link to a good aerial image of the spit. This particular home is at the beginning of the U, closer to Fay Bainbridge. The lot spans the entire spit and has waterfront on both side – one side the lagoon on the inside of the loop and the other the open waters of the Sound. The views of Mt. Baker and Seattle are crisp and stunning. This home is bathed in beachy white tones and coastal coolness. This home is also the rare low bank waterfront home – think sand and driftwood – available for sale under $1.5M. Wow. Not, a large house at just under 2,300 square feet but it has all the required spaces, three bedrooms and open concept living spaces. My favorite room is the large master suite upstairs that captures the primo views.
Original List Price $1,450,000
Sale Price $1,360,000
Days on Market – 30
Date Sold 6/24/2016
For #4 we stop at Watch Hill Drive on the very south end of the island above South Beach Drive. This unique home wowed me from the photos and I was not disappointed in person. I was also not surprised to learn that this home was once on the island’s garden tour, Bainbridge In Bloom. Lovely landscaping and traditional beds all overlook a southwest vista of Puget Sound and the Olympic Mountains. Plus terrific sun! It is no wonder a wedding has been hosted here. The large 4,700 square foot home is separated into a master suite wing and a “kid” wing. With two older kids I loved that, but some clients I showed it to with younger kids did not love that separation. James Cutler designed the classic northwest style of the home. I love the wood beams and rich, yet comfortable feel of the entire home. I still think about this one a lot . . .
Original List Price $1,425,000
Sale Price $1,385,000
Days on Market – 7
Date Sold 10/31/2016
For #3 we go back up north to Knight Road where this home makes its second appearance on my list. This home was built by popular home builder Jefferson Fine Homes and designed by the highly sought after architect Peter Brachvogel. Sited on over three private acres, this 3,700 square foot home exudes high quality craftsmanship inside and out. Walls of windows, tall ceilings, and an open floor plan piqued the interest of many buyers again in 2016, just like it did in 2013. The architect, Peter Brachvogel, created thoughtful spaces like a cozy media room set just off the kitchen, a large mudroom/laundry room with built-in lockers (my favorite space), and a remote full guest suite on the main level plus convenient bonus space over the garage. The current owners fenced and defined the garden spaces and appeared to have taken fantastic care of the home. It remains in excellent condition and sold for $283,000 more than it did in 2013.
Original List Price $1,598,000
Sale Price $1,750,000 (multiple offers)
Days on Market – 6
Date Sold 6/14/2016
For #2 we go back to the the south end and back to Watch Hill Drive. There are only five homes on Watch Hill Drive and two of them sold last year and they both made my list. This second home was designed by architect Bob Maloney and its classic Colonial style is not one you see too often here on our island – although there seem to be a few on my list. So, it too saw multiple offers. Five. The 4,300 square foot floorplan with all bedrooms upstairs, open living spaces on the main level and a guest suite and family room in the walk out basement made so much sense for so many buyers. Not to mention that it has a striking view of Puget Sound and the Olympics, lightly filtered by interesting Madrona trees all on over 2.6 acres of gated property. My clients were thrilled to prevail in this multiple offer situation and have already made some fantastic improvements to make this fine house their home.
Original List Price $2,995,000
Sale Price $2,900,000
Days on Market – 31
Date Sold 5/3/2016
For #1 we don’t go far, just down to South Beach Drive. I love a home built by Jerry Reese and I seem to sell a few of his every year. This one is indeed one of my very favorites. I love the light on the south end and I love the walking trails along the water in Fort Ward Park. This home is right in the heart of the good things on the south end – one of my favorite stretches of the island for walking and jogging and taking in Mt. Rainer views. The 3,900 square foot home is reminiscent of homes in the Hamptons. Again, not something you see a lot of here in the Pacific Northwest, so very appealing to buyers when available. A large white kitchen is sited to take in the best views and a detached guest house is almost more charming than the main home. The entire package is on low bank waterfront on the south end, a pretty amazing find for my lucky buyers who are now thrilled to be calling this home.
Again, to get a feel of the homes I like personally and see all nine of my lists in one place, click here.
Today much of our world (the island) went back to work and school after the two week winter holiday season. We put the 2016 real estate market to bed only last week and jumped into the 2017 market today at out first office meeting. Last year seemed fast and furious, although as you can see below the volume of sales, overall, was on par, if not slightly less than 2015. The lower inventory with the steady stream of buyers meant more multiple offer situations, hence the frenzy I am still feeling from 2016.
Many buyers were downsizing out of higher priced markets (California, Vancouver BC, Manhattan, even Bellevue) into our island’s luxury homes, sometimes at half the price. The fact that the Pacific Northwest and Bainbridge Island, specifically, is still a relative bargain over places like California will keep the market going strong into 2017, I predict.
Land volume was down in 2016, but several large parcels acquired in 2015 are now being developed into neighborhoods like the DR Horton neighborhoods on Wyatt and Weaver. Those developments will help relieve the inventory shortage a bit.
The market is always changing. Whether you are a buyer or seller there are strategies to consider for your success. We are a very seasonal market (most activity in the summer). Depending on your goal knowing the ins and outs of timing and preparation as you enter the market (as buyer or seller) can translate into thousands of dollars saved or earned. Being a buyer or seller in the slower shoulder market can be advatageous for some, although waiting until peak summer market could be better for others. If you are thinking about jumping into the market in 2017, let’s chat.
All data taken from the NWMLS as of 1/3/2017.
It’s election season, which means we hear assertions from candidates that sometimes warrant a bit of fact-checking. The same rules apply to real estate. At Windermere Bainbridge, we’ve heard a lot of mis-perceptions and embellishments about the state of our local market. “The bubble is bursting!” “Prices are being slashed!” “Prices are going up!” “Our market has peaked!” “Our market has gone crazy!” We’ve heard all this and more. So we’re here to set the record straight. Think of us as your real estate fact checkers. The fact is we are in the midst of a very healthy (not crazy) market that is moving in a manner we have been predicting for some time. Let’s explore the specifics.
ASSERTION: “Sales are down compared to last year and we are moving downward!”
FACTS: We have said for some time that the lack of inventory was holding our sales in check. When we started the 2016 business year (on January 4th to be exact), there were 53 houses available on all of Bainbridge Island. The first quarter ended with only 47 homes available. This lack of choices crippled sales and reflected a 21% drop from first quarter 2015 sales. But this lack of inventory also helped push prices up, bringing more sellers into the market. Consequently, our inventory began to grow, which meant sales did too. By the end of the second quarter, inventory had grown to 92 homes. (Still low compared to Q2 2008 when we had 291 homes available, or to 2012 when the recovery had set in and we had 189 homes available.) Our year-to-date sales number also dropped from 21% down to 15% by the end of the second quarter. Now, with the third quarter wrapped up, our available inventory is 98 homes (compared to 77 last year at this time) and the number of third-quarter sales rose by almost 5%. Hardly a sign of a decreasing market.
ASSERTION: “Prices are being slashed!”
FACTS: It’s true we are experiencing price reductions. This is a normal phenomenon created by sellers being unrealistically optimistic and buyers being informed and disciplined. The demographics of our marketplace bring more experienced buyers than many other markets. They are informed, know the risks of overpaying, seek professional advice and are careful. It’s like the old expression, “It’s the seller’s job to ask and the buyer’s job to say no.” Here also, sellers who seek (and listen to) competent professional advice in pricing will often experience less disappointment, along with a quicker and often more profitable experience. (There are reams of data showing that properly priced homes net more than overpriced homes that adjust downward.) Prices are still rising. The median price is up 17% from last year. The median price of homes sold during the third quarter this year was $765K, compared to $648K last year. This strength is reflected in the shift of sales in specific price ranges. There were 47 sales below $600K in the third quarter last year, but only 35 this year. Conversely, sales over $600K grew from 61 in 2015 to 78 this year! This indicates a shift upward in the prices of all homes. Hardly a sign of falling prices.
ASSERTION: “Prospects for new inventory are stagnant!”
FACTS: Developers from all over the nation are eagerly investing in our market, which is also a signal of strength. Two new home projects are currently being marketed in Wing Point and a project by DR Horton is under construction on Wyatt Way. The “Roost,” Grow Village Phase 3 and another DR Horton project at Torvanger/Sunrise are coming out of the ground. The long anticipated project at Pleasant Beach Village will start next month and another neighborhood at Weaver and Finch are in the planning/design phase. These projects will continue to bolster inventory and provide our healthy buyer pool even more choices. Hardly a sign of stagnation.
ASSERTION: “The condo segment is too limited to grow!”
FACTS: Our condominium market is experiencing similar strong activity. At the end of the third quarter last year there were 5 active condominium listings; this year there were 26 available. Last year, 25 condos sold during the third quarter; this year 42. And prices are up over 8%. As home prices continue to rise, condos provide attractive alternatives. Pleasant Beach and Grow Phase 3 are both great examples of single family home alternatives in areas where services and amenities are concentrated. They are both examples of our comprehensive plan to enable growth while maintaining our rural feel. Hardly a sign of a weak market segment.
We are very happy with our current conditions and don’t see anything on the horizon that would likely disrupt the trend in the near future. Crystal balls are dangerous (we certainly learned that in 2007/2008) but our region shows every indication of continued strength. Seattle is strong and more and more people are trying to escape from the challenges of its growth. Kitsap is also strong, with sales up and growing. Barring some big surprise, we see strength continuing at least through next year. The Bainbridge real estate market is looking good, and that’s a fact!
The one constant in our real estate market is change. Ten years ago (yes, it has been 10 years!), we were in a very competitive market. Inventory was tight and prices were going through the proverbial roof, setting new highs. Then, in September 2007, that came to an abrupt end and we began a downward trend toward the largest correction since the 1980s. It took until 2012 for the market to shift yet again and gradually pick up speed toward recovery. By 2015, we returned to familiar territory: an extremely competitive market with record low inventories and rapidly rising prices. On July 1, 2015, there were 58 active listings on the island. Now, just one year later, data suggests a potential market transition with inventories rising and price reductions becoming increasingly common.
We in the industry do not view this as a repeat of 2007. There are too many positive factors in our financing infrastructure and regional market that separate this climate from its predecessors. (Indeed, the financing environment is so much more conservative now that securing funding can actually be a hurdle in some transactions.) We are still in a very competitive market and the statistics bear this out. While we may be slowly moving towards a more “balanced” market, we are not there yet. Let’s look at some of the leading indicators that give a glimpse at where we are.
One year ago, there were 112 home listings, 54 of which were under contract. For a market the size of Bainbridge, 58 active listings in the middle of summer is a crazy small number. On July 15th of this year, inventory had ballooned to 162 listings, 64 of which were under contract (leaving 98 active). Yes, this was a substantial improvement from last year. But when compared to the absolute top of our last market peak in July 2007, the 162/64 stat still looks very tight compared to the 2007 numbers, which were 289 listings with 62 under contract. The percentage of pendings to listings is 40% today compared to 21% in 2007. This year’s second quarter median cumulative days on the market is still a brisk 11 days, equal to what it was for the same period in 2015. (In 2007, it was 52 days.) It is still a very competitive market. Our inventory is growing because our price levels are finally bringing in more people from the sidelines. When you look at the history of the sold listings, there are scant few people who are “flipping” or who have bought recently and rapidly selling for a profit. Instead, many of the homes that recently sold were last sold in 2001, 2004, or even 2007 and 2008. It’s also interesting to note that people who have held onto their homes for a more extended period of time (since before the boom years) are realizing very healthy increases over what they paid.
We have finally drawn even with and are even beginning to pass our peak prices of 2006/2007. When we checked the history of all the homes sold in the second quarter, all those that sold in 2006/2007 did better this year. Our year-to-date median is $755,000, a 14.4% increase over last year. This number is exacerbated by the price ranges of the homes sold. Overall, sales were down almost 17% and almost all of the decrease came in homes below the $600K price point. This phenomenon can be partly explained by our old nemesis: lack of inventory. On July 15th, there were 13 homes available on the whole island for less than $600K. Not many choices.
However, we are now seeing more price reductions than even in the first quarter. This is another indication of a healthier market. Pricing still matters, as sellers can’t just ask for anything. As we mentioned in our last newsletter, this is one of many areas where professionals can really help. Overpriced homes usually end up selling for less than properly priced homes, a statistic that has been borne out in all types of markets. This becomes especially important when a market is going through a gradual shift. The bottom line is that prices are rising and healthy. True, the rate may change and is very neighborhood and property specific. But the competitive nature of our current market will help bolster prices.
Interestingly, the increase in inventory has not yet been felt in the residential condominium market. Due to low inventory the volume of condominium sales are down almost 21% from last year. Prices are up 8% from 2015, but the median price is still 13.7% lower than in 2007. In addition to the shortage of available condominiums buyers face potential financing challenges specific to that type of property. In the land segment, sales are down more than 30%! Median price for land is also off 6.5%, which is 47% of the 2007 median. This is perplexing as land sales improved quite a lot between 2014 and 2015.
So our changes are subtle at this time, but in process. On the residential side, the greater inventory gives buyers more choices and potentially more sales. Sellers are seeing price levels that entice people to return to the market-place and support a competitive environment. The regional economy outlook continues to impress and our position in that marketplace remains strong. (What other community can still claim the same commute time to downtown as twenty years ago?) The outlook ahead is all very positive!
This summer, our office is opening a satellite office on Olympic Drive and Winslow Way. There our agents will be able to greet ferry passengers as they first arrive to the island. Our goal is to give our clients more exposure to pedestrian and vehicle ferry traffic and have agents on hand to answer questions. We hope to have our doors open before Labor Day, so please stop by.
EXCITING NEWS! The Seattle Seahawks and Windermere Real Estate have joined in an exclusive partnership that will make Windermere the Official Real Estate Company of the Seattle Seahawks. At the center of this partnership is a new campaign entitled #tacklehomelessness in which Windermere will donate $100 for every Seahawks tackle at home during the 2016 season. On the receiving end of these donations is YouthCare, a Seattle-based non-profit organization that has been providing services and support to homeless youth from across Puget Sound for more than 40 years.