Although the Seattle area has long been home to many tech industry giants and high profile entrepreneurs, it has so far avoided the astronomical increases in home prices and rents that the industry’s epicentre, the San Francisco Bay Area, has experienced in recent years.
But it’s these relatively affordable home prices that are driving some of Silicon Valley’s biggest names to look north to find affordable housing for its employees who are struggling to keep up with prices in the Bay Area.
While dozens of huge tech companies like Amazon, Microsoft, Juno Therapeutics, Zillow and Adobe have called Seattle home for years, companies like Chinese e-commerce site Alibaba and HBO have recently made efforts to move more operations to the Seattle area. The creation of new offices and IT centers promises hundreds if not thousands of people who are now looking to buy or rent.
Indeed, the boom in tech is reflected in census data. According to the Wall Street Journal, over 40,000 new Seattle residents arrived in the city between 2010 and 2013.
Opening up shop in Seattle also benefits Bay Area tech companies because talent is not hard to find. The University of Washington is consistently ranked among the top 10 universities for computer engineering degrees in the country.
Many major tech companies with offices in Seattle are located in or near the downtown center which allows new home buyers to pick and choose their neighborhoods. Fremont, Queen Anne, Capitol Hill, and yes, even Beacon Hill, are all less than five miles away from the downtown corridors of Seattle.
Along with new business, the California tech crowd are also bringing serious cash to the table, causing a stir among first time buyers who are no longer able to compete.
Seattle’s luxury home market has seen a recent spike in homes priced at $1.5 million and higher. Properties valued over $1.5 million and located near the downtown area are experiencing a 10 percent increase in price per square foot.
And for the first time in recent memory, buyers are having to consider escalation clauses during their offer phase. This allows buyers’ agents to automatically raise their offer when a bidding war begins.
In 2015, the west coast way of life may start to include more vignettes of overcast days, kayaking instead of surfing, and a legendary yet equally controversial real estate market. But the real question is, will Seattle become the next San Francisco and what do current residents think about it? If recent opinions are any indication, the Seattle real estate market is entering an interesting period.