The Media’s Real Estate Swing

The media has done an excellent job of getting people worried about the health of the real estate industry these days. From one day to the next there is good news there is bad news spattered across the many media outlets and it is no wonder consumers get worried and/or confused about what is actually taking place. The confusion the media is stems from a biased opinion to one of the two market extremes, boom or bust.

So what is really going on in the housing market?

Housing prices, yes they are high, but there are not unreasonable considering the factors that fuel economic upturns and how it affects the surrounding areas. Housing prices of years past are history and the Snohomish County area will probably never see prices like in the early to late 90s.

August 2006, according to the Northwest Multiple Listing Service, the average closed sales price for a residential home in Snohomish County was $373,653 and in August 2007 the average closed sales price for a residential home is $414,406, an increase of 10.91%. From a buyer’s perspective this may seem like to much of increase in one year but from an investor’s standpoint it constitutes an above average rate of return.

So what are the economical factors making Washington a economical hot spot?

Washington’s Unemployment Rate: 4.6 as of August 2007

In a New York Times article, No Housing Woes In Booming Washington State, the author points to Paul Allen and Microsoft as one of the major driving forces behind Washington’s strong employment. The article says “The outlook for Washington’s economy is bright because so many people are moving there in response to help-wanted advertisements. Seattle…is an especially hot job market, boosting confidence of sustained growth”.

But that is all find and dandy but the question is: Is Snohomish County feeling the same sort of strength which is fueling the Seattle area? The answer is: Yes.

Boeing has also been providing many jobs Snohomish County’s aerospace industry but this is not just limited to jobs directly provided by Boeing. As Snohomish County residents know, as Boeing obtains more orders it has to increase its level of outsourcing to the many manufacturing vendors which are located in Everett and Arlington.

So What can people expect in the future?

Governor Chris Gregoire has been doing Trade Missions across the globe with the goal to attract more businesses into Washington. Here are some of the highlights from Governor Gregoire’s Trade Missions.

1. 1.5 million in new business from Europe for Washington companies
2. Expansion or relocation of five European aerospace supplier operations to Washington
3. $300,000 in new sales to China and Japan for Washington companies
4. Agreements with British Columbia, Canada to expand cross-border trade and tourism
5. Agreements with Queensland, Australia to share bio-tech information and research

So what does this all boil down too?

The citizens of Washington can expect growth to continue because the job and economical forecasts look promising and this will affect the housing prices. Why? Demand, as more people move into Washington there will be more competition for housing and in Snohomish County it will be an increase demand for affordable housing.