Mill Creek riding high on the wave of economic indicators
Last updated 6/15/2017 at Noon
Realtors and retailers in Mill Creek are at the forefront of positive economic numbers released this month by the Economic Alliance of Snohomish County.
While the latest findings from the county indicated strength across the board in Mill Creek, the reality of the individual situation is a matter of perspective.
The price for single family homes and condominiums jumped by almost 17 percent across the county for the year that ended on April 30 compared to the same period one year earlier, according to the Economic Alliance. Taxable retail income in the city has surged by more than 11 percent compared to the first quarter of 2016.
The increases for both indicators for the city were among the most positive recorded in the county. Increases in population, employment and total wages have all contributed to the positive numbers. The population in Snohomish County grew by more than 2 percent, from 757,600 in 2015 to 772,860 by the end of December.
The average price of a home in Snohomish County pushed past the half-million dollar mark in May, according to the Multiple Listing Service (MLS). Prices continue to climb, but the pace of sales has slowed as buyers cope with the new reality of the real estate market.
Realtor Cassy Reichelt has lived in Mill Creek for the past 20 years. She said buyers are taken an unusual approach to the purchase of a new home.
“Last month, for the first time in more than a year, I had a new listing in Mill Creek without multiple offers in the first weekend,” Reichelt told The Beacon. “In fact, there were three new listings in the same neighborhood and not a single offer.”
The Windermere agent who operates out of the office in Alderwood said she has observed buyers who have grown tired of the frenzied market who have apparently made the decision to “sit on the fence” over the summer months. The busiest time of the year in Real Estate, she said, take place in the spring and then again just before school starts in August.
“Buyers have grown tired of the concessions that sellers are demanding, including the requirement that buyers wave all contingencies and reviews,” Reichelt said. “Demand will remain high because inventory remains low. Buyers seem to be willing to take a ‘wait-and-see’ attitude.”
Reichelt shared numbers published by the MLS for May that showed the average price of a home (single family or condominium) in Mill Creek increased 10.2 percent compared to the same month in 2016. The average price, said Reichelt, jumped past the $600,000 threshold this spring to $610,000. The average price in May of 2016 was $590,000.
The numbers for Mill Creek are a reflection of Snohomish County, said Karim Khoury, the broker/owner of the ReMax office in Town Center. The double-digit increase for Mill Creek is what is expected based on the higher prices in the city.
“We have been at less than one month’s inventory since last October,” Khoury said. “The inventory was up to 2.8 months as recently as 2015. But anything below six months is considered a seller’s market.”
Khoury said the number of listings “actually increased by a nominal figure,” according to the findings released by Infographics. There were a total of 33 homes for sale in Mill Creek during the month of May.
“The prices will continue to climb as long as demand remains high and the supply is limited,” said Khoury.
While the purchase price of residential real estate continues to go up, reduced availability has created the opposite situation in the commercial real estate market. The cost to rent or lease commercial office space in the county over the last year dropped by about under 1 percent, while the vacancy rate for industrial space fell by more than 2 percent. The vacancy rate for retail space in Snohomish County showed a fractional increase (.03 percent).
Taxable retail sales for the first three months of the year in Mill Creek increased from $68,547 to more than $76,315 compared to the first quarter of 2016. Business owners interpret more customers on the street as more potential sales for their stores.
“Definitely,” said Lisa Quall, owner of the Elegant Details Boutique in the Mill Creek Town Center. “There are more people shopping. And more people who like to shop local. People are always happy to see local businesses thrive.”
Quall said she opened her Mill Creek store during the depth of the Recession nine years ago. She estimated that her year-to-year business has increased at a rate that is at least equal to the 11 percent growth reported in the county.
Shane Sommerville, the operations manager at Paddywack pet supply store said her customers prefer the personal service they receive from store owners in Town Center.
“I think people are coming back to the idea that small stores are invested in creating a great atmosphere to shop. That's something you simply can't replicate through e-commerce or big box shopping experiences” Sommerville said.
“Mill Creek residents are part of a small tight-knit community who definitely value the opportunity to do a lot of their shopping close to home with family-owned, unique businesses like ours."
The positive outlook was not unanimous among retailers.
Candis Parker, the owner of deVine Wines, said traffic has actually dropped off at her shop this year, but she laid the blame for the lack of walk-in customers on the unusually wet spring.
“Our discretionary buyers still want their bottles of wine,” Parker said. “But we’re seeing fewer people coming in after a hair appointment or stopping in before going out to a restaurant for dinner to look at our selection of bottles in the $20 range.”
She had one other possible explanation for fewer spontaneous buyers wandering into her place of business, “Part of that could be the increased sales tax of 10.4 percent.”