Market Monday’s: Mercer Island

Aerial view of Mercer Island, the large island surrounded by Lake Washington. The smaller forested peninsula jutting into the lake from the Seattle mainland is Seward Park.

Mercer Island, with a population of about 23,000 people is a beautiful island city located on the southern tip of Lake Washington with Seattle located to its west and Bellevue to the east.

Who (which demographic) lives on Mercer Island?

“Urban Power Families” – High-income couples with children.Six-figure salaried couples with children who live an upscale life in a metro center. Highly educated professionals working in finance, medical, and high-tech fields.

“Corporate Climbers” – High-income, high-expense urban singles.Urban singles with an up-and-coming income, but with higher-than-average living costs. Most have college educations and are employed in mid-management professions.

“Suburban Retirees” – Seniors over 65 who live in the suburbs.These seniors are living out their retirement years in suburbia. Most own their homes, and some have college degrees.

“Suburban Elite” – Suburban super-rich couples with children.Middle-aged married couples with a luxurious lifestyle in the suburbs. More than 15% have a family income of $200,000 or more. The majority have a college or graduate school degree, and most own their homes.

“Multi-lingual Urbanites” – Urban dwellers who speak more than one language.Some have a high school or college education, and they work in a variety of occupations. Moderate to upper-scale earning potential.

Mercer Island has 71 active listings as of October 20, 2014 ranging from $250,000- $26.8 million! The median listing price is $2.1 million.  In the last 90 days, 87 residential homes and condos have been sold between $169,000-$7.5 million with a median sale price of $995,000.  Currently, Mercer Island has 2.4 months supply of inventory based on sold homes in the last 90 days.  However, only 15 homes were listed below one million dollars, the lowest number in nearly TWO DECADES! More inventory will be essential to creating a balanced market.

Buyers are also cautious of paying too much, the average sale price was up a modest 2% year-over-year while median sale price fell almost 9%.  This reflects more sales in the lower price range than during the same time last year.  The condo market, however, has seen a 47% increase in sale price when compared to 3rd quarter of 2013.  Perhaps we are seeing more “Corporate Climbers” moving into the area, seeing that the commute to Seattle and Bellevue are a breeze.

The graph above demonstrates the number of homes for sale/sold and pending monthly over the past year.

Months of inventory is down slightly for the month of October, however, like I mentioned earlier, many of the homes currently on the market are well above the $1 million mark and have been sitting on the market for significantly longer than the lower priced homes or condos.  Mercer Island is a beautiful place to live and no doubt a desirable location which consequently results in a smaller pool of buyers with the financial ability and lifestyle preferences Mercer Island provides!

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