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Mercer Island September Single Family Home Sales Highest Since 2005

Sales closed on 31 single-family homes last month— the highest number sold in September since 2005

Home sales typically slow down at the end of the summer, but local realtors closed the books on one of the busiest Septembers in nearly a decade as 31 single-family homes and one condo were sold on Mercer Island.

The median home price of a single-family home actually increased month-to-month 18.5 percent from $825,000 to $1,012,000 and rose 35.4 percent higher than the same month a last year.

The last time Mercer Island saw as strong a September for home sales was in 2005 — before the Great Recession — when 42 single-family homes sold.

It was the second time this year the median price of a single-family home sold on Mercer Island rose above $1 million in 2012.

The strong sales are keeping local sales on-track for their highest number since the start of the recession.

Pending sales, where an offer was accepted by the homeowner but the title has not yet been signed over to the buyer, were 36.6 percent higher than last year. Pending sales are generally seen as a good indicator of market activity but in recent years are far less predictive of closed sales due mainly to more restrictive lending practices.

A low inventory of homes — and very few, affordable condos — for sale and an increased number of closed sales seems to be helping stoke a gradual median price rise over the course of the year with demand at its highest in summer months. This June, for example saw 11.9 percent fewer homes for sale from a total of 119 properties; there were 135 homes on the market in 2011.

According to Redfin.com the mean value of local homes sold was 95 percent of asking price, and a increasing number of homes (39 percent) that are sold had offered a price reduction.

The most expensive home sold on Mercer Island was a 3-acre estate called “Harmony at Proctor” at 3221 Proctor Lane in the East Seattle neighborhood. A 11,000 square-foot waterfront mansion with 3 bedrooms and 4.75 bathrooms, which sold for $21,600,000 on Sept. 20, is the largest of a handful of houses on the property and includes several hundred feet of shoreline and a dock.

The least expensive home that sold was a modest, 1950s two-bedroom, one-bathroom house on 1/4 acre, sold for $359,000 on Sept. 27. The house, located in the Mid-Island area at 4702 88th Ave. SE., is 1,170 square-feet in size.

As of Oct. 9, there were 113 residential properties on Mercer Island were listed for sale, according to Redfin.com. Only eight properties for sale are condominiums, ranging in price from $152,000 to $389,950. Single-family homes range in price from $475,000 to just under $9.99 million.

Marty Gale October 10, 2012 at 04:59 PM
Does this mean that since the high property sales with the resulting REIT (Real Estate Excise Tax) assessed on Mercer Island home sales, the proposed property tax increase by some councilmembers will not need to be imposed? Marty Gale
Kendall Watson October 10, 2012 at 05:20 PM
Good question Marty. The Real Estate Excise Tax is a dedicated tax, meaning the State Legislature has created legal rules about how those taxes are spent. For REET, the state mandated that those funds be spent only on "growth-mitigating" capital projects such as streets, sidewalks, ect. Mercer Island's policy is to dedicate all REET funds to its street fund, pedestrian and bicycle improvements. http://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=4&cad=rja&ved=0CDEQFjAD&url=http%3A%2F%2Fwww.mercergov.org%2Ffiles%2Fsec-i-2.pdf&ei=_Kx1UM6vMMSfiQK_0IG4Cg&usg=AFQjCNHMjatY-2jS0r6lvWv7Ab43NdY1zA
Kendall Watson October 10, 2012 at 05:23 PM
So in other words, to answer your question: not really. But the good news is the city can replenish their street fund, which was significantly depleted during the Great Recession. At least, that's what City Hall is saying.
Ira B. Appelman October 10, 2012 at 05:48 PM
According to the City's recent budget message (AB 4773, p.26), "The Real Estate Excise Tax (REET) is the main revenue source to the Street Fund and the Capital Improvement Fund." The REET financed much of the community center development. Finance Director Corder has forecast increasing REET funds. The City gets approx. 0.5% REET on all real estate sales. On the approx. $31M in sales mentioned in this article, the City gets approx. $150,000 in REET, which is projected to bring in millions of dollars each year. We can either spend the REET on updating fire stations and buying "essential life-saving" fire fighting and emergency equipment, OR we can manipulate voters by putting high priority items on the ballot and use the REET for spending Islanders have rejected in every poll taken, such as the "road diet." Note: The claim that funds like the REET are restricted turns out to be mainly false IN PRACTICE because Public Finance 101 teaches how to move money between "restricted" funds. For example, in the current budget cycle the City is moving street sweeping responsibility from the Street Fund to the Stormwater Fund, claiming that the purpose of street sweeping is to keep stormwater clean. The General Fund, Capital Reserve Fund, and Beautification Fund are essentially unrestricted.
Kendall Watson October 10, 2012 at 06:27 PM
Great point Ira. Wasn't the money saved from the Sewer Lake Line project a mix of REET and general funds, which then allowed the city to come back after the project came in below their estimated cost and pulled the "general fund" money out to repurpose as we say earlier this year?

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