It’s approaching $200,000, among the many highest within the nation.
Seattle, WA, is thought for its pure magnificence, outside recreation, scrumptious delicacies, and tech-focused corporations. And along with being an interesting and distinctive place to dwell, Seattle can also be house to a extremely aggressive actual property market that’s seen massive modifications over the previous few years.
For a lot of, shopping for a house in Seattle is a dream come true, but it surely’s additionally necessary to know the way it will affect your funds. From down funds to month-to-month mortgage funds, there’s quite a bit to grasp earlier than shopping for your first house
So whether or not you already dwell within the Emerald Metropolis or need to relocate to the world, right here’s a breakdown of the revenue you’ll must buy your first house in Seattle.
Take a look at our authentic report for an in depth nationwide evaluation.
How a lot revenue do it’s essential purchase a starter house in Seattle?
The median sale value of a starter house in Seattle is $535,000. With a view to afford this, first-time homebuyers in Seattle ought to make $173,378 per 12 months, up 8.4% from 2023. The median revenue in Seattle is $126,647, that means the standard resident can’t afford a starter house.
Solely California metros require the next annual revenue to afford a starter house. Anaheim, Los Angeles, Oakland, San Diego, San Francisco, and San Jose all prime $175,000.
As anticipated, starter properties in Seattle are extra inexpensive than the typical house (all value brackets mixed; see methodology for particulars). With a view to afford any median-priced house within the space, you’ll must make $214,904 (as of October 2023).
Nationwide, you want an revenue of $75,849 to afford a typical starter house, which prices a median of $240,000. The typical U.S. family earns an estimated $84,072.
First-time homebuyers’ information to the Seattle housing market
Seattle has skilled a rising however combined market over the previous few years. Home costs have risen by 12.5% since January 2021, however the space additionally noticed sharp will increase and drops.
Like most different metros within the U.S., Seattle’s housing market exploded in early 2022, with costs rising 17.4% in simply three months from January ($734,950) to March ($888,844). They’ve settled again down just a little however are nonetheless elevated above pre-pandemic costs.
The pandemic-driven housing migration increase additionally affected Seattle just like many different coastal metros; extra individuals appeared to go away than keep, with patrons trying to find solar and affordability. Whereas this diminished the variety of homebuyers within the space, Seattle nonetheless grew by 17,750 individuals from 2021-2022, a continuation of years of progress. Almost 9,000 individuals left town from 2020-2021, however this turned out to be a blip.
If you happen to’re trying to transfer to Seattle, the world is house to loads of facilities and sights all through its distinctive neighborhoods. The House Needle, Pike Place Market, and the Washington Park Arboretum are among the most well-known spots, providing beautiful views and enjoyable experiences for individuals of all ages.
Common neighborhoods in Seattle embrace Ballard, Columbia Metropolis, Inexperienced Lake, and West Seattle.
What does a typical down fee appear like for a starter house in Seattle?
Listed here are some frequent down fee quantities for a typical $535,000 starter house in Seattle:
Down fee proportion | Down fee quantity |
3% down fee | $16,050 |
3.5% down fee | $18,725 |
5% down fee | $26,750 |
10% down fee | $53,500 |
15% down fee | $80,250 |
20% down fee | $107,000 |
Down funds can vary from 0% to 100% of the whole home value, relying in your funds, mortgage sort, and long-term priorities. Whereas specialists have traditionally beneficial budgeting for a 20% down fee, the rising value of properties and continued sluggish wage will increase has led to a 15% down fee changing into extra frequent.
Some mortgage sorts permit for decrease down fee quantities. For instance, a Federal Housing Administration (FHA) mortgage requires simply 3.5% down, whereas the bottom attainable down fee for a typical mortgage is 3%. These quantities usually rely in your credit score scores, so patrons with larger credit score scores could qualify for decrease down funds.
What’s the typical mortgage fee for a starter house in Seattle?
The standard month-to-month mortgage fee for a starter house in Seattle is $4,334. This assumes you set 3.5% down and have round a 7% rate of interest.
If this fee sounds too excessive, you can contemplate renting an condo in Seattle. The median hire value is $1,990, below half the standard mortgage fee. It’s also possible to use an affordability calculator to see what you’ll be able to afford based mostly in your revenue and down fee.
What do you have to do subsequent?
If you happen to’re available in the market in your first house in Seattle, it’s necessary to grasp how a lot home you’ll be able to afford. Take your annual revenue, credit score rating, the present mortgage charges, and native market developments to decide that works finest for you.
From there, a Seattle agent may also help you navigate all the house shopping for course of and supply invaluable native experience. To study extra about the right way to purchase a house, take a look at Redfin’s First-Time Homebuyer’s Information.
Methodology
Redfin divides all U.S. properties into 5 buckets based mostly on Redfin Estimates of properties’ market values. There are three equal-sized tiers, in addition to tiers for the underside 5% and prime 5% of the market. Redfin defines “starter properties” as properties whose sale value fell into the Fifth-Thirty fifth percentile of the Redfin Estimate tier.
We calculated the annual revenue wanted to afford a starter house by assuming a purchaser spends not more than 30% of their revenue on housing funds. Housing funds are calculated assuming the customer made a 3.5% down fee and in addition take a month’s median sale value and common mortgage-interest charge under consideration.
The nationwide revenue knowledge is adjusted for inflation utilizing the Shopper Worth Index. 2024 revenue is estimated based mostly on projections from the U.S. Census Bureau’s (ACS) 2022 median family revenue utilizing the 12-month transferring common nominal wage progress charge. The speed was compiled from the Present Inhabitants Survey and reported by the Federal Reserve Financial institution of Atlanta.
We assume housing funds embrace the mortgage principal, curiosity, property taxes, owners insurance coverage, and mortgage insurance coverage (when relevant).
All knowledge sourced February 2024 until in any other case said.