Tuesday, October 25, 2016

Transit Oriented Development

Given I just received my ballot for voting, I thought I’d revisit one of the measures affecting Seattle real estate that I’m most passionate about:  Sound Transit 3

Sound Transit has increased ridership and fandom with the opening of the Capitol Hill and Husky Stadium stations.  Personally, as someone who works in Northgate, I can’t wait for it open up here.  The convenience and speed of the light rail is amazing - already I can get to a Seahawks game within 10 minutes from the Husky Stadium station DURING RUSH HOUR, and don’t even have to deal with parking!!!   I don’t know who had the master plan, but the vote for Sound Transit’s next growth phase (Sound Transit 3) couldn’t come at a better time.  Sound Transit 3 will cost the average Puget Sound adult about $14 per month; will potentially expand light rail to Everett, Redmond, Issaquah, Ballard, West Seattle, and through to Tacoma; and will set the Tri-County area up for transit-success as the population is expected to grow by another 800,000 to 1.4m residents in the next 25 years.  But what isn’t being talked about as much is the rapid appreciation rates for homes located within a mile of each Sound Transit station.  Seattle based real estate firm Estately crunched the data, and the results were clear:  Homes near the Capitol Hill station are selling for $35,000 more than the rest of the neighborhood; Beacon Hill homes are selling for $61,000 more than the rest of the neighborhood; and you’d have to pay $88,000 more for a home near the Tukwila station! 

Yes, the typical Seattleite will have to pay $14 more per month in taxes, but consider this:  The median income for a Seattleite in 2014 was $71,273.  If that’s based on a 40 hour work-week, than that translates into a median hourly rate of $34.27 per hour.  Thus, if Sound Transit saves the average income-earner 24 minutes per month in commute time, then ST3 is a net-positive for the region.  I’m all for ST3, and if I could vote 1,000 times over to approve the plan, I would.  Not only does Sound Transit increase property values around the region, it straight up saves EVERYONE money in the long run by reducing the opportunity cost [of sitting in traffic].

Today's blog courtesy of Kyle Bergquist, Guild Mortgage

Any opposing points of view?

Happy Investing!

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