New Construction Homes Blog | Insider Look Into New Homes

Buying a Home in Seattle - Is it Better to Build or Buy?

Written by Rob Shapiro | Nov 14, 2024 7:38:29 PM

Buying a home in Seattle is your ticket to breathtaking waterfronts, energetic arts and culture, and an expanding technology sector. Given the strong state of the Seattle housing market and its booming economy, it's unsurprising that so many young professionals and families are considering moving to Seattle. 

However, if you're considering moving to Seattle and investing in a home, you may wonder whether building or purchasing a home in this vibrant city makes more sense. 

Let's examine the Seattle real estate market, the cost of living in the area, and what to consider before relocating.

The Seattle Housing Market

The Seattle housing market is constantly changing with property values on the rise due to high demand. In 2024, the median home price in Seattle hit around $880,000. This price tag reflects the city’s popularity among tech professionals and families. Even with these rising prices, many consider buying a home in Seattle a smart investment, thanks to its lively lifestyle and abundant job opportunities.

New construction homes in Seattle, especially in trendy neighborhoods like Ballard and South Lake Union, contribute to the housing market’s stability. These areas draw homebuyers with modern developments and their proximity to essential services.

Living in Seattle

One of the best things about living in Seattle is its urban vibe. You get quick access to recreational activities, entertainment, and cultural events, making it perfect for those looking for excitement and a sense of community. 

Living in Seattle offers it all for those seeking a balance between excitement and comfortable city life.

Best Neighborhoods in Seattle:

  • Capitol Hill: Known for its eclectic mix of cafes, boutiques, and nightlife, this neighborhood is a haven for artists and creatives. The place offers many local galleries, music venues, and independent theaters. The median home price in Capitol Hill is about $799,000​.
  • Ballard: Once a Scandinavian fishing community, Ballard retains its maritime roots but has evolved into a trendy neighborhood with breweries, farmers’ markets, and waterfront parks. Median home prices here hover around $882,500.
  • Queen Anne: Offering stunning views of the city and the Space Needle, Queen Anne is a family-friendly neighborhood with historic charm. The median home price in Queen Anne is around $972,500​.
  • West Seattle: Perfect for those who prefer a more relaxed, beach vibe, West Seattle offers stunning waterfront views, access to Alki Beach, and easy proximity to nature trails. The median home price here is around $840,000.

Seattle Food Scene: Seattle's culinary scene is diverse. The city is famous for its fresh seafood, especially salmon, oysters, and Dungeness crab, local favorites at iconic spots like Pike Place Market. For international flavors, Seattle boasts numerous options. The International District is great for exploring authentic Chinese, Japanese, and Vietnamese cuisine. 

Seattle Art Scene: The Seattle art scene offers an exciting range of cultural events from contemporary art to live music with venues like the Neumos and The Crocodile, where many iconic Seattle bands like Pearl Jam, Nirvana and Soundgarden have performed.

The Seattle Art Museum and the Chihuly Garden and Glass exhibit feature the mesmerizing glasswork of Dale Chihuly. For live performances, residents can enjoy the Seattle Symphony and local theater at the 5th Avenue Theatre.

Building a Home in Seattle 

Finding land in Seattle can be challenging. As the city grows and attracts professionals from various industries, open land becomes increasingly scarce, and prices reflect this high demand. However, if building a home in Seattle is what you want, a few strategies can help you navigate the complexities of the local real estate market.

Available land is limited and typically tied to properties that may require significant work or demolition. Here are some essential real estate tips for finding land for building a home in Seattle:

  • Work with a Local Expert: The best way to uncover land opportunities to make living in Seattle a reality is by partnering with a real estate agent who knows the market intimately. A seasoned professional can offer insights into upcoming listings, off-market deals, and unlisted land opportunities. They can also guide you through Seattle's legal and zoning requirements, ensuring your project gets off the ground smoothly.
  • Consider Redevelopment Opportunities: Since undeveloped land in Seattle is rare, one alternative is to purchase a property that can be redeveloped. Older homes on large lots can offer the potential for teardown and rebuild projects, opening up possibilities for new construction in Seattle’s prime locations.
  • Prepare for High Prices: Like any desirable city, building a home in Seattle doesn’t come cheap. Prices for available parcels can be high, especially in highly sought-after areas. Setting a realistic budget and being prepared to act quickly is essential, as competition for land is fierce.

Even with the challenges of high costs and limited availability, patience and a strategic approach can help you secure a piece of land for building a home in  Seattle.

The Cost of Buying a Home in Seattle

If you’re considering buying a home in Seattle, you’ll quickly notice that sales data shows that prices have risen sharply in recent years. Despite challenges such as rising mortgage rates, Seattle remains a highly competitive market, especially in sought-after areas where multiple offers on homes are common. 

Seattle is in demand thanks to the tech boom and the city's desirability. Currently, the median home price in Seattle is approximately $880,000, which reflects a significant increase over the past few years.

 Why the high prices? Seattle is a desirable housing market, known for its beautiful views, vibrant culture, and proximity to major employers like Amazon and Microsoft.

To put things into perspective, here’s a snapshot of home prices in nearby neighborhoods:

  • Seattle: $880,000
  • Kirkland: $1.3 million
  • Bellevue: $1.5 million
  • Redmond: $1.3 million
  • Bothell: $850,000

 

Buying a home in Seattle is costly but aligned with most major U.S. cities. Due to the cost, many people opt to live in nearby cities and make the commute. The median household income in Seattle is around $112,000, which is relatively solid. On the other hand, the national median household income, as of 2023, stands at approximately $80,610 while Washington state's median income is about $93,440. This places Seattle’s income level well above the national and state average. 

Seattle's rising home prices and high cost of living mean that careful budgeting is still necessary to make homeownership feasible in the city.

 

The Cost of Building a House in Seattle

Thinking about building a house in Seattle? It’s undoubtedly a more significant investment than buying resale, but it’s worth it for some. Be prepared, though—expenses can add up quickly between the cost of land, labor, and materials.

On average, construction costs in Seattle range from $350 to $500 per square foot, depending on your design, materials, and other variables. For a 2,000-square-foot home, you’re looking at approximately $600,000 to $1 million just for the build. Don’t forget—you still have to factor in land, permits, and architectural design costs.

Building a home in Seattle allows you to get precisely what you want, but keep in mind that additional regulations and zoning rules can slow the process. Despite the challenges, many say a home tailored to your preferences in one of the best neighborhoods in Seattle is worth the effort and will provide a strong return on investment.

Cost of Building vs. Buying in Seattle

Should you build or buy a home in Seattle? It depends on your budget, timeline, and how much control you want over the design.

Let’s break it down:

Land in Seattle is expensive, and finding an empty lot in a prime location is tricky. Even a tiny house near downtown can cost over $1 million. Once you’ve secured the land, you’ll need to budget roughly another $600,000 to $1 million for building your home. If you opt to tear down an older home, you will have to pay for demolition in addition to the construction of the new house, taxes, fees and other costs.

Buying a Resale Home in Seattle:

Buying a resale home in Seattle is less stressful than building, but you still pay a premium. The median home price is $880,000, but you must be prepared to pay for these additional costs: 

  • Home Inspection: This usually costs between $400 and $700 to ensure that the property has no hidden issues which may lead to expensive repairs.
  • Repair and Renovation: Depending on the condition of the resale home, you might need to budget for immediate repairs or renovations. From replacing outdated plumbing or electrical systems to renovating the kitchen or bathrooms, the costs can vary but often range from several thousand dollars to tens of thousands.
  • Title Insurance: It can cost between 0.5% to 1% of your home sale price.
  • Pest Inspection: A pest inspection is critical, especially in older homes, and typically costs between $100 and $300.
  • Closing Costs: Loan processing, attorney, and recording fee ranges from 2% to 5% of the home's price. For a $880,000 home, this could add up to anywhere from $17,600 to $44,000 in additional costs.
  • HOA Fees: If the resale home is governed by a Homeowner's Association the budget for ongoing HOA fees can vary, depending on the community and amenities.

While buying a resale home offers quicker availability and a lower cost than building a new home in Seattle, these additional fees and the potential for repairs should be considered when calculating the total expense.

Should You Build or Buy in Seattle?

Now for the big question: should you build or buy a home in Seattle? Let’s weigh the options:

Benefits of Building a Home in Seattle:

  • Customization: Building allows you to design everything to your exact preferences.
  • Modern Features: New homes tend to come with the latest energy-efficient systems and smart-home technology.
  • Potential Value: A custom-built home in Seattle should appreciate significantly over time, making it a solid investment.
  • Lower Maintenance Cost: As the home will be built from scratch, you won’t have to worry as much about maintenance, plumbing issues and wear and tear. This can help you enjoy your new home without unexpected repairs or upkeep.

Drawbacks of Building a Home in Seattle:

  • Higher Initial Costs: Between the cost of land and construction, the total price of a home can be steep.
  • Time-Consuming: From securing permits to completing the build, constructing a house can take months or even years.
  • Unpredictable Costs: You never know what might happen during construction—everything from material shortages to unexpected design changes can drive the price and cause delays.

Benefits of Buying a Home in Seattle:

  • Faster Process: You can move into a pre-built home as soon as the sale is final—no waiting months for construction to complete.
  • Prime Locations: Many homes in Seattle’s best neighborhoods are already built, so you don’t have to worry about finding land in a crowded and desirable area.
  • Less Stress: No need to deal with contractors, permits, or zoning laws—just find the right house and make an offer.

Drawbacks of Buying a Home in Seattle:

  • High Purchase Prices: It might be cheaper than building but buying a home in Seattle still isn’t cheap—especially in sought-after areas.
  • Limited Customization: Unless you can afford expensive renovations, you’ll have to settle for the existing layout and design.

Ultimately, whether you decide to build or buy a home in Seattle comes down to your priorities. Building might be the way to go if you’ve got the budget and want a custom space. But if you’re looking for a quicker and potentially less stressful option, buying might make more sense. 

Either way, Seattle is a competitive real estate market, so make sure to work with experts who understand the ins and outs of the area.

Is Living in Seattle For You?

If you want to live in Seattle or move within the city, the decision to build or buy a home comes down to your budget and what matters most to you. 

With its mix of tech-driven growth and community feel, buying a home in Seattle is a solid investment. Remember, whether you’re creating a dream house from the ground up or buying an existing one, having a knowledgeable team on your side can make all the difference in navigating the competitive Seattle real estate market.

 

 

FAQs

What are the best neighborhoods in Seattle?

Popular neighborhoods include Capitol Hill, Ballard, and West Seattle. Each offers a variety of perks, from vibrant nightlife and access to green spaces to family-friendly communities.

Where should I live if I work in Seattle?

If you’re looking for a place to live while working in Seattle, consider Capitol Hill for its urban vibe or Ballard for a laid-back feel with easy access to downtown.

What is living in Seattle Like?

Seattle is known for its vibrant cultural scene, popular music venues, theaters, and museums. It is also surrounded by mountains and water, which provide endless outdoor activities like hiking, kayaking, and skiing. The city has a thriving tech, healthcare, and aerospace job market. Though the cost of living is high, many find that Seattle’s lifestyle, diverse neighborhoods, and a strong sense of community make it an appealing place to live.

What is the cost of living in Seattle?

The cost of living in Seattle is high, with housing being the biggest expense. However, the city’s excellent schools, job opportunities, and cultural offerings make it worthwhile.

What are some fun things to do in Seattle?

There are plenty of fun things to do in Seattle, from exploring Pike Place Market and the Space Needle to enjoying outdoor activities at Discovery Park or dining at top-notch restaurants like Canlis.