Bellevue, Washington is a suburb of Seattle best known for being in driving distance to the home of Microsoft, Redmond. It is thus another Pacific Northwest city where the property market is propelled by high tech. But is Bellevue a good place to invest in real estate? Let’s learn more about Bellevue before we list the factors that determine whether or not you should consider to invest in the Bellevue housing market.
Bellevue’s real estate prices have skyrocketed in the last several years. The skyrocketing appreciation stalled out in 2018 and the market remained neutral in the whole of 2019. Bellevue is currently a balanced real estate market. Home prices are likely to remain stable, or grow at a steady pace in 2020.
Bellevue, Washington is home to roughly 150,000 people. However, the Bellevue real estate market can best be understood in relation to the Seattle housing market. Bellevue and Seattle are the neighboring Northwest Cities – just a few miles apart and separated by a lake and a few floating bridges. Bellevue is the third largest city in the Seattle area and an upscale suburb of Seattle proper. For example, it has the second largest downtown in the Seattle area. Bellevue is a bit quieter than Seattle, but it is also quite a happening place, especially for families.
It can be a great choice to live in as the traffic is medium, public schools and colleges are very near to the public transportation, and there are many great parks and playgrounds, such as Crossroads Park Water Playground. If you're moving to Seattle to look for a job, either city works well as you can commute to several Fortune 500 companies from both Seattle and Bellevue. Is it going to be one of the hottest real estate markets for investors in 2020? The Bellevue real estate appreciation rate in the last quarter was around 1.3%.
However, it is quite unclear whether it would remain steady or not. Looking at the positive forecast, the annual appreciation rate is predicted to be between 5.2% to 6%. You can either choose to invest in your future, or market your home to potential buyers. Let’s find out more about it. Please note that there are many variables that can potentially impact the value of a home in Bellevue (or any other market) and some of these variables are impossible to predict in advance.
Bellevue Real Estate Market Forecast 2020
What are the Bellevue real estate market predictions for 2020? Let us look at the price trends recorded by Zillow over the past few years. Since 2015, the median home price in Bellevue have appreciated by 54.6% from $662,000 to $962,537. In the past year, the Bellevue real estate market cooled off, the prices increased by only 0.9%. The latest Bellevue real estate market forecast is that home prices will increase by 4.5% in the next twelve months.
The latest real estate data from Zillow shows that the current median home value in Bellevue is $962,537. Bellevue is currently a buyer’s real estate market – which refers to a situation in which supply exceeds demand, giving purchasers an advantage over sellers in price negotiations.
Here is the Bellevue, WA real estate price appreciation graph by Zillow. It shows us the current home price appreciation forecast of 4.5% till Jan 2021.
The median list price per square foot in Bellevue is $474, which is higher than the Seattle-Tacoma-Bellevue Metro average of $285. Zillow reports that 5% of the listings in Bellevue had a price cut in Jan 2020, which is a good thing for buyers. The median price of current listings in Bellevue is $998,000 and the median price of homes that have been sold is $991,500. The sale to list price ratio is 99.34%. The median rent price in Bellevue is $2,945, which is higher than the Seattle-Tacoma-Bellevue Metro median of $2,295.
Bellevue Real Estate Market Trends
We shall now discuss some of the most recent housing trends in the Bellevue area and compare it with past couple of years. We shall mainly discuss about median home prices, inventory, economy, growth and neighborhoods, which will help you understand the way the local real estate market moves in this region. Bellevue has been one of the hottest real estate markets in the country for many years.
Trulia has currently 144 resale and new homes for sale in Bellevue including open houses, and homes in the pre-foreclosure, auction, or bank-owned stages of the foreclosure process. The median price of sold homes in Bellevue housing market is $912,500 and homes are selling for about $484/sqft.
Following the housing market decline in 2007, single family rental properties became favorable options for investors, saving in construction or refurbishment prices. The quick turnaround for an owner to rent out their property means cash flow is almost immediate. Single family rental homes have grown up to 30% within the last three years. Almost all the housing demand in the US in recent years has been filled by single family rental units.
As per the real estate company called Neigborhoodscout.com, the median house price in Bellevue is $904,533, which indicates that home prices in Bellevue are well above the national average for all cities and towns in the United States. One and two bedroom single-family detached are the most common housing units in Bellevue. Other types of housing that are prevalent in Bellevue include large apartment complexes, duplexes, row houses and homes converted to apartments.
Currently, there are 65 single family homes for sale in Bellevue, WA on Zillow. Additionally, there are 81 single family homes for rent in Bellevue, WA. Under potential listings, there are about 0 Foreclosed and 11 Pre-Foreclosure homes. These are the delinquent properties that may be coming to the market soon but are not yet found on a multiple listing service (MLS).
In the past month, 858 homes have been sold in Bellevue, WA on Redfin.com. In addition to houses in Bellevue, there were also 62 condos, 22 townhouses, and 2 multi-family units for sale in Bellevue last month. The median listing price is around $1,250,000. According their statistics, The Bellevue housing market is very competitive. Homes in Bellevue receive 2 offers on average and sell in around 22.5 days.
The average sale price of a home in Bellevue was $835K last month, down 2.3% since last year. The average sale price per square foot in Bellevue is $448, up 3.7% since last year. A hot listing in Bellevue can sell for around list price and go pending in around 6 days.
Here is the latest Bellevue housing market data for the month of Jan 2020 from Redfin.com. The sale to list price ratio shows us that it was a trending more like a seller’s real estate market in the past month.
Bellevue Housing Market Trends |
|
| Median List Price | $1.3M |
| Avg. Sale / List | 98.1% |
| Median List $/Sq Ft | $496 |
| Median Sale Price | $835,000 |
| Median Sale $/Sq Ft | $448 |
Analyzing real estate data from multiple sources gives us a much broader perspective of the direction in which a market is moving. There are currently 252 homes for sale in Bellevue on Realtor.com. The asking price of single family homes can start from $525,000 and can go up to $9.5M for a luxury property located in Sammamish-East Lake Hills neighborhood in the city of Bellevue, WA. Sammamish-East Lake Hills is a popular neighborhood with the median price of $1.34M. Yarrow Point has a median listing price of $4.3M, making it the most expensive neighborhood in Bellevue. Crossroads is the most affordable neighborhood, with a median listing price of $455,000.
Bellevue has a mixture of owner-occupied and renter-occupied housing. There are currently 147 rental properties in Bellevue and their rent prices range from $610 to $12K per month. The median rent price in Bellevue is $2,900. According to Realtor.com, 38 homes were newly listed on the market within the last week. There are 54 new construction single family homes for sale in Bellevue within a price range of $695,000 to $5.5M. You can find affordable new construction homes in Eastgate-Cougar Mountain neighborhood. This neighborhood has low crime risk and a median price of $1.34M.
According to their data, in January 2020, Bellevue housing market was a balanced market, which means there was a healthy balance of buyers and sellers in the market. If a region's housing market is balanced it means that there is enough demand from buyers to equal the supply from sellers. It also means that the market is not very competitive. Ideally a buyer would prefer a sale to asking price ratio that’s closer to 90%. Despite being a balanced real estate market, the sellers have managed to hold good leverage in these negotiations in the past month. On an average, they could sell homes for 98.56% of the asking price. A seller would always prefer scenarios which can yield a ratio of 100% or higher.
In January 2020, the median list price of homes in Bellevue, WA was $1.2M, trending up 18.9% year-over-year. The median listing price per square foot was $487. The median sale price was $1M. Months of supply is a factor that determines how long it would take for all listed homes on the market to sell. In a healthy, balanced market, it would take about six months for the supply to dwindle to zero. In terms of months of supply, the Bellevue market can tip to favor sellers if the supply drops to below six months of inventory. As per Zillow's forecast, the prices may rise by 4.2% in the next 12 months. That can happen because when inventory drops, buyers start competing and enter into a bidding wars. The homes move quickly on the market.
The median list price in Bellevue is $1,470,000 on Movoto.com. The median list price in Bellevue went up 8% from January to February. Bellevue's home resale inventories is 130, which increased 2 percent since January 2020. The median list price per square foot in Bellevue is $539.
As you can see in the graph, the median price per sq ft in Bellevue rose to its peak value in Dec 2019, when it was $502. In January 2020 it was $519. Distressed properties such as foreclosures and short sales remained the same as a percentage of the total market in February
Bellevue is a minimally walkable city in King County with a population of approximately 122,061 people. If you are looking to invest in the Bellevue real estate, you should that three most important factors when buying a real estate anywhere are location, location, and location. Location creates desirability. Desirability brings demand. There should be a natural and upcoming high demand for rental properties. Demand would raise the price of your Bellevue investment real estate and you should be able flip it for a lump sum profit.
The neighborhoods in Bellevue must be safe to live in and should have a low crime rate. The neighborhoods should be close to basic amenities, public services, schools and shopping malls. Some of the popular neighborhoods in Bellevue are Lake Hills, Factoria, Vuecrest, Overlake, Woodridge, Eastgate, West Lake-Sammamish, Newport Shores, Enatai, Crossroads, Cougar Mountain-Lakemont, Lakemont, Bridle Trails, Somerset and West Bellevue.
Here is a snapshot that shows the median home values in the some of the popular neighborhoods of Bellevue.
Bellevue, WA Foreclosures And Bank Owned Homes Statistic
According to Zillow’s data, in Bellevue 0.2 homes are foreclosed (per 10,000). This is lower than the Seattle-Tacoma-Bellevue Metro value of 0.8 and also lower than the national value of 1.2. The percent of delinquent mortgages in Bellevue is 0.2%, which is lower than the national value of 1.1%.
With U.S. home values having fallen by more than 20% nationally from their peak in 2007 until their trough in late 2011, many homeowners are now underwater on their mortgages, meaning they owe more than their home is worth. The percent of Bellevue homeowners underwater on their mortgage is 3.8%, which is lower than Seattle-Tacoma-Bellevue Metro at 4.2%.
| Total No. of Foreclosures in Bellevue | 19 (RealtyTrac) |
| Homes for Sale in Bellevue | 65 |
| Recently Sold | 1000 |
| Median List Price | $900,000 (12% drop vs Nov 2018) |
There are currently 19 properties in Bellevue, WA that are in some stage of foreclosure (default, auction or bank owned) while the number of homes listed for sale on RealtyTrac is 65. In January 2020, the number of properties that received a foreclosure filing in Bellevue, WA was 60% lower than the previous month and 0% higher than the same time last year.
In Bellevue, the zip code with the highest foreclosure rate is 98005, where 1 in every 8273 housing units is foreclosed. 98006 zip code has the lowest foreclosure rate, where 1 in every 13938 housing units becomes delinquent.
Is Bellevue a Good Place to Invest In Real Estate?
Now that you know where Bellevue is, you probably want to know why we’re recommending it to real estate investors. Investing in real estate is touted as a great way to become wealthy. Many real estate investors have asked themselves if buying a property in Bellevue is good investment? You need to drill deeper into local trends if you want to know what the market holds for the real estate investors and buyers in 2020..
If you are looking to make a profit, you don’t want to buy the most expensive property on the Bellevue real estate market and expect to make a good profit on rents. Perhaps you are looking for a slightly different hold-over, an investment property in Bellevue that you might move into or sell at retirement in the future. Either way, knowing your profit potential and purpose is the first thing to consider.
Let’s look at the state of the Bellevue real estate market and the factors driving the property market short and long term.
Bellevue Real Estate Prices
The Seattle area has seen a slight cooling. Home prices dipped about one percent in 2019. That’s a slight market correction after several years of roughly ten percent property appreciation since the 2008 Great Recession. Yet the Bellevue real estate market remains expensive. The median home value in the Bellevue real estate market is just over nine hundred thousand dollars. That’s roughly 150,000 dollars more than the average Seattle home. Because the average Bellevue home is out of reach of the first time home buyer, this creates an opportunity for those who can afford Bellevue real estate investment.
The median rent for Bellevue real estate investment properties is 2800 dollars a month, while the average rent in the broader metro area is 2200 dollars a month. Rent is almost two dollars a square foot. This is probably a good time for Bellevue real estate investment, because of the slight lull in prices. The Bellevue housing market has also somewhat cooled, with demand balanced with supply. However, the strong job market and continued influx of people to the Seattle metro area is why home prices are expected to resume their rise in 2020. A conservative estimate is that home prices will rise 5 percent in 2020.
We’ll say that there are relatively few opportunities for bargains when shopping for a Bellevue real estate investment property. The percentage of homes that are underwater is half the national average, and the mortgage delinquency rate is one quarter the national average. It is rare for a property to get a price cut, unless it is in a dangerous neighborhood or in need of major renovations. The other option is searching for the seven percent of units that are empty and trying to buy them. Another factor to consider is the demand for relatively affordable homes in the Bellevue housing market. There is still rapid appreciation in the 400-600,000 dollar price tier and properties less than 400K.
People relocating to the area are competing for the few half million dollar condos and starter homes in the Bellevue real estate market. That is why the price of million dollar homes fell 2-3 percent whereas 300K and 600K homes in the Bellevue real estate market are still rising double digits. Yet this makes today a good time to buy Bellevue real estate investment property at the luxury end of the market or buy large properties to convert into several smaller units. That’s why the Bellevue housing market is increasingly being called divided; the upper price tier is “cooling” while the affordable housing market remains highly competitive.
Job Growth in Bellevue
The Bellevue real estate market’s high property prices are due to the booming, high-tech job market. The average Bellevue resident earns a little over fifty thousand dollars a year, twenty thousand dollars higher than the national average. Median household income is over ninety thousand dollars a year. More importantly, unemployment in the area is half to one full percent point below the national average, and future job growth is expected to be well above the national average.
It is this combination of high wages, wage growth and job growth that has led to the expensive (but not over-priced) Bellevue housing market. An interesting trend going on is the shift of jobs from Silicon Valley to Washington State for its relatively affordable real estate. And this trend will continue to drive the higher price tier of the Bellevue housing market. We can also be sure that this will fuel long-term growth of the Bellevue real estate market, because students are attracted to local colleges for the hope of interning at Big Tech firms and stay after graduation for the high paying jobs.
Quality of Life
Bellevue gets points for quality of life. It received an A plus from Niche.com. And it has an excellent balance of attractions for single adults and families. It is safer than Seattle, which is important to everyone. Yet it has top tier schools and a great nightlife. For example, Bellevue has the third best public school district in the United States.
The Legal Climate
Around sixty percent of residents of the Bellevue housing market rent, while around forty percent own. Washington State is tenant friendly. However, it isn’t as hostile to property owners as Oregon. For example, Oregon passed statewide rent control in 2019. In contrast, Washington State has a state level law prohibiting rent control. There are people in Seattle trying to fight for indirect rent control, such as requiring affordable units be built whenever others are torn down or charging fees on new construction to pay for new affordable housing units.
Washington State limit security deposits. The state does require you to return deposits within 14 days in most cases. You don’t have to pay interest on rental deposits. And you can start the eviction process the day after the rent is late. There is no state law regarding rent grace periods. One point in favor of Bellevue real estate investment is that it is less hostile to landlords than Seattle. Seattle has strict noise codes and a lot of other ordinances you have to follow.
Investing in Bellevue Real Estate or Not: The Conclusion
Maybe you have done a bit of real estate investing in Bellevue but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. In any property investment, cash flow is gold. The Bellevue real estate market has a number of points in its favor. It has strong market fundamentals that justify its high prices. The question is whether you can afford to buy property in the Bellevue real estate market and can get a high enough return on the investment.
A good cash flow from Bellevue investment properties means the investment is, needless to say, profitable. A bad cash flow, on the other hand, means you won’t have money on hand to repay your debt. Therefore, finding a good Bellevue real estate investment opportunity would be a key to your success. If you invest wisely in the Bellevue real estate, you could secure your future.
As with any real estate purchase, act wisely. Evaluate the specifics of the Bellevue housing market at the time you intend to purchase. Hiring a local property management company can help in finding tenants for your investment property in Bellevue. If it is your first time to invest in Bellevue real estate, then you would have to be aware of common beginner’s mistakes. Beginners would usually follow the media, buy a property and wait for its value to increase. This could be risky. Real estate investing requires research. We recommend doing your own research or hiring a real estate investment specialist for guidance.
Buying or selling real estate, for a majority of investors, is one of the most important decisions they will make. If housing supply meets housing demand, real estate investors should not miss the opportunity since entry prices of homes remain affordable. Choosing a real estate professional/counselor continues to be a vital part of this process. They are well-informed about critical factors that affect your specific market area, such as changes in market conditions, market forecasts, consumer attitudes, best locations, timing and interest rates.
NORADA REAL ESTATE INVESTMENTS strives to set the standard for our industry and inspire others by raising the bar on providing exceptional real estate investment opportunities in the U.S. growth markets. We can help you succeed by minimizing risk and maximizing profitability.
The aim of this article was to educate investors who are keen to invest in Bellevue real estate in 2020. Purchasing an investment property requires a lot of studies, planning, and budgeting. Not all deals are solid investments. We always recommend to do your own research and take help of a real estate investment counselor.
Other Good Markets To Invest in Real Estate in 2020
The other good place for real estate investment is Naperville in Illinois. The Naperville housing market is one of the best options should you choose to invest in the state of Illinois. On the other hand, we advise against investing in Chicago real estate on the whole, with the Naperville real estate market being the only exception.
Kirkland is another hot market to choose for real estate investing. The Kirkland real estate market saw a minor adjustment in housing prices in 2019. However, the Kirkland area is going to resume slow, steady appreciation for the next few years thanks to its expanding high-tech sector. It is also a better housing market for investors than other high-tech hubs.
Remember, caveat emptor still applies when buying a property anywhere. Some of the information contained in this article was pulled from third party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, the Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
References:
Overview of Bellevue
https://en.wikipedia.org/wiki/Bellevue,_Washington
Property prices
https://www.neighborhoodscout.com/wa/bellevue/real-estate
https://www.seattletimes.com/business/real-estate/the-markets-chilled-out-but-seattle-home-prices-still-too-hot-for-many-first-time-buyers/
Job market
https://www.bestplaces.net/economy/city/washington/bellevue
https://www.cnbc.com/2017/03/17/ spacetopasscopyscape silicon-valley-tech-talent-fleeing-to-seattle.html
Quality of life
https://www.niche.com/places-to-live/bellevue-king-wa/
Legal climate
https://www.nolo.com/legal-encyclopedia/overview-landlord-tenant-laws-washington.html
https://www.avail.co/education/laws/washington-landlord-tenant-law
http://www.seattlemag.com/article/it-time-bring-back-rent-control-seattle-0
Latest Market Prices, Trends & Forecasts
https://www.zillow.com/bellevue-wa/home-values/
https://www.redfin.com/city/1387/WA/Bellevue/housing-market
https://www.realtor.com/realestateandhomes-search/Bellevue_WA/overview
Map
https://www.google.com/maps/place/bellevue
Foreclosures
https://www.realtytrac.com/statsandtrends/wa/king-county/bellevue/
