You’ve decided to make the move to North Tacoma. As one of the most desirable areas in the Greater Tacoma region, the median home price in North Tacoma is just over $600K (March 2022) and there is only about .4 months (less than two weeks) of available homes for homebuyers to choose from. If you want to successfully buy a home in this neighborhood you’ll need to come prepared. Rest assured, we’ll break it down for you on how to buy a home in North Tacoma.
Financing:
Step one on buying a home in North Tacoma (or a home anywhere) is to get fully pre-approved by your lender. There are a variety of loan programs and your local lender will be able to guide you through the process to determine what options are best for you. Click here for more information on various loan types
Purchasing a home for your primary residence:
When purchasing a home you will use as your primary residence, you’ll have far more options and your local lender will be able to help determine which is the best for you based on your savings, credit score and future goals. Keep in mind the strength of your financing (AKA: how large your down payment is) plays a large role in your offer being accepted by the seller. The larger your down payment, the stronger your offer. If you are looking for a home that would be considered unusual or have unique features (view, architecture, historic significance, etc.) even at higher price points, you are likely going to be competing with other buyers and your type of financing matters.
Purchasing an investment home:
If you are buying an investment property (one you won’t live in as your primary residence) the financing requirements are more restrictive. You’ll need at least 25% down payment if using a conventional loan. Do you want to learn more about purchasing an investment property in Pierce County?
Types of Homes:
Buying a home in North Tacoma typically means buying an older home. The majority of homes built in North Tacoma were originally built between 1910 and 1940. Familiarize yourself with “old house stuff” – like heating, plumbing and wiring. Knob and tube wiring was the standard for homes built between 1880 and 1940. Nowadays, knob and tube is considered obsolete and a safety hazard. Watch the short video below to learn about knob and tube wiring.
What is the Real Estate Market like in North Tacoma?
The real estate market in North Tacoma is competitive. We have been in a very strong Sellers Market for years because of growing demand and lack of available homes. However, homes that are priced over $900K are slightly less competitive than those that are priced under $800K. You may be lucky enough to be the only offer on a higher priced home, but don’t count on it. Inventory levels are still extremely low (the lowest levels we’ve seen since 1970) and interest rates remain low as well. Currently, demand outweighs supply drastically.
Some good news: Windermere’s Chief Economist, Matthew Gardner, expects interest rates will rise 0.5% by August of 2022. When interests rates rise, the market for affordable homes will become even more restricted. But, we’ll likely see a softening of higher priced homes.
UPDATE: Interest rates are now just over 5% and have leveled after a surprisingly quick climb in March and April 2022. Windermere Chief Economist Matthew Gardener and many other tenured Economists, predicted our interest rates would hover at 5% by the end of the year. It is expected that after the rapid climb, they will (slowly!) climb until the end of August of this year. Check out our quarterly market update and follow us to get regular updates on the House Market in the greater Tacoma area.
Work With The Right Realtor:
Working with a Realtor who specializes in North Tacoma will serve you well when purchasing or selling your home. Finding an agent who has renovated multiple homes and investment properties in North Tacoma will give you an advantage (and a little peace of mind!) when touring homes. As a buyer, you’ll be able to lean on their expertise, experiences, and be connected with all the best contractors in the area.
Watch Realtor Jenny Wetzel’s investment property renovation series!
