The one-bedroom Everett condominium had just come on the market, but it was kind of beat up, and didn’t have carpets, so Carl Shram passed on it.
Within a week, someone else had swooped in to accept the $90,000 seller’s asking price.
That’s the way things are going right now, said Barbara Shelton-Gogh, the real estate agent Shram is working with.
“It’s crazy – very crazy right now,” she said. “The condo market has just gone nuts.”
New figures compiled by the Northwest Multiple Listing Service show that condominiums are among the hottest of properties. The median price for Snohomish county condos jumped more than 8 percent over the past year, while the amount of time it took to sell one dropped 18 percent.
Condos are now selling faster than single-family houses, said Shelton-Gogh, the owner of John L. Scott office in Lynnwood.
The reason – simple supply and demand, according to her and other real estate agents. Single-family homes have become so expensive, that many would-be home buyers have shifted their sights on condominiums, but problems in the construction industry have kept contractors from building enough condos to keep pace.
It’s happening all across the county, said Rich Williamson, an agent with John L. Scott in Arlington.
“Condos are looking more attractive, because they’re more affordable,” he said. “The condo market in the last two years has gotten better. Prior to two years ago, it was a niche market.”
Increases in house prices are driving the condo market, agents said. The typical Snohomish County house now sells for $262,500, according to September figures from the Multiple Listing Service.
The median price for condos – meaning half sold for more and half for less – was $175,000.
For that money, you can get into a three-bedroom, two-bath, 1,500-square-foot townhouse in Smokey Point, Williamson said.
A house that big in that area would go for over $200,000, he said, adding, “You can’t get a house that big.”
At the same time, more people are trying to capitalize on low interest rates to buy a home, Shelton-Gough said. Shram is one, but, he notes, “as a single person with a single income, I can’t afford a house.” That’s led him to the condo market.
Yet while demand is up, the supply isn’t. Condo construction has slowed, Shelton-Gough said, because of problems builders are having getting insurance.
There has been a dramatic upsurge in the number of lawsuits filed by homeowner associations against the builders of condominiums. That’s made it hard for contractors to get liability insurance to build them.
“Insurance has been a major deterrent for many owners and builders,” said Jon Morris, an agent with Keller Williams Realty who is selling new-built condos on behalf of a builder who is pushing forward.
The contractor on that project had to spend $200,000 to get the insurance, he said. The issue also complicated the process of hiring subcontractors, he said – only large subcontractors can afford the insurance.
The result – a tight market that very much benefits sellers.
Sellers aren’t having to negotiate down on price, or make much in the way of concessions, Shelton-Gough said.
According to the Multiple Listing Service, over the past six months, sellers have received 99.76 percent of their asking prices.
And units sell fast. The MLS reports that average time on market for a condo was 51 days in September. Single-family houses took 52 days to sell.
Top-shelf condos will go even faster, Shelton-Gough said. One place she’s listing in Lynnwood had 40 potential buyers visit it in the first 10 days it was on the market. She said Tuesday that she expected someone to make an offer on it by this weekend.
Condo owners are “going to start getting multiple offers,” she said. “I can see it coming.”
Morris said he’s seeing the same thing at the Westlake Pointe project he represents. They’ve pre-sold a big chunk of the 44 units they’re building on 91st Avenue Southeast, between Everett and Lake Stevens.
The units are going for between $175,000 and $208,000, he said, and they’re attracting all kinds of buyers, from empty nesters moving down to first-time homebuyers.
As long as interest rates remain low and house prices remain high, there will be good demand for condos, Shelton-Gough said.
“We have a lot of condo customers that we’re looking for right now,” she said. “I don’t see the condominium market slowing down for quite a while.”
Reporter Bryan Corliss: 425-339-3454 or corliss@heraldnet.com.
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