Woodinville is a peaceful city with a strong community, plenty of things to do, and a clean and friendly reputation. The area also features a prominent location nearby to things to do, places to see, and places to work, as well as it’s own tourist attractions in the form of wineries, parks, and more. While the market is bound to change before the end of the year, the following includes most of what you need to know about Woodinville’s property investment market in the first and possibly second quarter of 2014.
Home pricing is definitely on the rise, although experts suggest that the 17% rise seen in 2013 was a fluke. Most predictions are pointing to a much smaller 5-6% increase for 2014. Year over year, the median sales price is up by some 22% since 2012, while the average price per square foot is up some 13.6% year over year. While experts do expect sales to level out a bit this year, they’re still on the rise so it’s most likely better to invest sooner rather than latter.
Woodinville has never had a great deal of homes available, but the new housing prices make for slightly higher availability. Sales fell some 10.7% for 2013, meaning more investment opportunities for the area. With an average of 60-105 homes on the market in Woodinville at any given time, that means plenty of pricing options to choose from. The sales drop is the first year over year drop since 2011, but the National Association of Realtors also suggests that new local construction and developments may partially be affecting the decision to hold off on purchasing.
While nearly everything about 2014’s investment profile is positive for investors, mortgage rates could go up by about 1-1.5% at some point through the year. Experts are suggesting that the 4% 30 year fixed rate currently most common in Woodinville might not last, so it’s better to get the fixed rate now. For a $250,000 home with 4% interest and a 30-year fixed rate, the average monthly mortgage payment would hover around $955 per month. If you change the interest rate to 5% it jumps to about $1,074, or just over a 10% increase. Essentially, investors who are planning on buying property should consider doing it sooner in order to lock in the lower interest rate.
While statistics point out that now is definitely the best time to invest in Woodinville property, you should go into any investment with caution. Use logic, and calculate your potential ROI before you make the purchase, so that you can make an informed decision. For example, if you can only make $1,200 a month in rent, it would be a poor decision to pay for a mortgage for that amount or over that amount.
If you do decide to purchase real estate in Woodinville, don’t forget to ask for help with managing it. Contact SJA Property Johnston & Associates to find out more about our Woodinville property management services.