Builders see little letup

Published 9:00 pm Saturday, January 21, 2006

Snohomish County’s growing population, relatively good mortgage rates and economic rebound pushed a boom in home construction last year.

The number of building permits issued for new residential developments in unincorporated Snohomish County reached 4,280 in 2005, up 26 percent from 2004, which was a busy year itself.

Compared with 2003, residential development was up nearly 40 percent last year, according to county records.

“This is one of the more significant jumps, if not the most significant jump, in our history,” said Craig Ladiser, director of Snohomish County Planning and Development Services. He said residential building activity last year was probably at its highest level since at least the early 1990s.

Even though thousands of new houses are going up across the county, don’t expect prices to flatten out in response. Demand for new homes is as strong as the growth in supply, according to the Master Builders Association of King and Snohomish Counties

“There is a very strong demand for housing in Snohomish County,” said Allison Butcher, public policy manager for the organization “The county is seen as a great place to live, and we see that continuing.”

Prices continued to rise for all homes in the county in December, with the median price for condominiums and single-family houses hitting $299,000, up nearly 20 percent from a year ago.

Roberta Keith, manager of the Keller Williams Realty office in Lynnwood, said the rapidly increasing home values are helping to spur sales of new homes. Now, homeowners aren’t having to wait as long to build equity and then trade up to a bigger house.

“I’d say it’s still brisk,” said Keith, who has sold several homes in recent months in the new 30-lot Pilchuck Terrace development in Lake Stevens.

The majority of Snohomish County’s residential development in 2005 was in single-family homes. More than 3,900 permits were issued for single-family homes in unincorporated areas last year, equaling more than 10 new homes a day. That total has soared by more than 50 percent since 2003.

The trend isn’t just a local one. Last year saw an all-time record 1.7 million single-family homes built across the country, up 6.4 percent from 2004, according to the U.S. Department of Commerce.

Zak Parpia, president of Lake Stevens-based Himalaya Homes, agreed that demand for new homes is likely to stay strong locally. That means that finding suitable land zoned for residential development could get even more difficult, a situation that keeps home prices on the rise, he said.

“At the end of the day, it isn’t the builders who are struggling with the prices. It ends up being the consumer,” he said.

Butcher said the rising value of land has encouraged more property owners to sell undeveloped tracts.

Eric Fetters / The Herald Jake Dittenber of Lake Stevens works on the foundation of a house being built by Himalaya Homes between Lake Stevens and Marysville.

“There are literally bidding wars out there for the land,” she said.

Ladiser said developers have a point: Finding land for detached single-family homes is getting harder. But the county is also trying to encourage the development of other types of housing as well.

He agreed that, considering the new permit applications coming in, home builders aren’t likely to slow down much this year.

“I don’t think it will take another jump up like it did from 2004 to 2005, but it should be about equivalent to this past year,” Ladiser said.

Reporter Eric Fetters: 425-339-3453 or fetters@heraldnet.com.