What’s a Normal Home Price on Mercer Island?

Three things recently brought this question to mind.

1. I noticed a proliferation of high-end real estate porn: 10 homes for sale on Mercer Island at more than $5 million. Some have been listed for a while:
mercer-island-mansion-3
4737 Forest Ave SE, $7.75 million, has been on the market 320 days.

Some are newer:
mercer-island-mansion-2
9022 N Mercer Way just came on the market 12 days ago. It’s only $5.5 million.

2. The Seattle Times writes about “How One Couple Got an Affordable Mercer Island Home.” The title implies that “Mercer Island” and “affordable” are terms with opposite meanings.

3. I came across the account of a scooterist (?) who recently circumnavigated the Island. He says: Mercer Island is a place for rich folks…Mercer Island’s landscape features McMansions with killer views. Paul Allen lives here. This was not always the case, however. There used to be quite a few modest homes, but during the Gilded Age just ended, everything on Mercer Island became a potential teardown.

I have to admit, I used to think Mercer Island was all waterfront mansions selling for $5 million or more. But the Island does have a plenty of moderate homes.

The scooterist also takes a dig at all the homes for sale on West Mercer Way. Easy to do in the middle of a financial crisis– but unfair to dig at the owners. When homes aren’t selling normally, people’s lives are still changing. They change jobs, retire, have another baby, and need to move. So inventory builds.

High Price, But What About Value?

We looked in the city about a year and a half ago, and found better value here. By value I’m talking about lot size, home size, and home quality. People with kids get even better value from the great school system. Commute times are short to most everywhere, which is a quality of life issue. The character of the Island doesn’t feel mega-rich.

Redfin says the median price of houses (not condos) sold on the Island in the past year is just over $1 million ($1,010,000). I’ve done quantitative posts in the past, but this time I’m asking a different question. Is Mercer Island a place for rich people? How does home value here stack up to homes elsewhere? We bought here a year ago, so I answered with my feet. What do you think?

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10 responses to “What’s a Normal Home Price on Mercer Island?

  1. I would be the scooterist, and no, I wasn’t taking a dig… merely making an observation. There are nowhere near as many ‘For Sale’ signs per mile in, say, West Seattle (where I live) as there were on West and East Mercer Way.

    You say the median home price on MI is $1 million; it used to be about half a mil in Seattle, but I’m sure it’s dropped like a rock. And to be fair, it may well have decreased since the figures you cite were compiled.

    But lots of perfectly nice, modest homes got bulldozed during the last decade or so to make way for ginormous McMansions, not just on Mercer Island, but in places like Hunts Point and Medina.

    I look at real estate listings and see everything on Mercer Island is way, way out of my price range. And way out of most other peoples’ price range as well.

    I conclude by saying if you like Mercer Island and can afford a place there, more power to you. I can’t, so I’ll only be passing through on my scooter…

    Orin O’Neill
    Scootin’ Old Skool

  2. @orin: I think the number of signs you see on West Mercer (and East Mercer) is misleading – most homes on these streets are on private lanes, so you’re actually seeing 1 driveway for every maybe 8 houses. You really can’t compare this “sign density” with West Seattle (or any other urban locale).

  3. @Keith: Why not? Even if we assume that one house in eight on any given driveway is for sale, that’s still way more than on any arterial street (let’s say 35th Ave SW) in any neighborhood in Seattle. And there’s always a chance of more than one house for sale on a private lane that has listed with the same agent.

    As I said, I’d be willing to be that most of the houses for sale on Mercer Island are owned by people who can’t afford them (though they might have been able to before the current economic nosedive)…

    __Orin
    Scootin’ Old Skool

  4. 35the Ave SW? Why didn’t you use your Beach Drive for comparison? Or Lake Sammamish Parkway? Or Lake Washington Boulevard? I think the Mercer Ways are better compared with those streets. Regardless, your point about houses for sale likely being owned by people who can’t afford them is plausible, but again this has nothing to do with Mercer Island. You have to ask yourself – why would _anybody_ choose to sell a house in the current market? Relocation? Estate sales ? Moving up? All possible, but not likely. Or changed financial circumstances? Honestly, I think that might be a common reason _everywhere_. IMHO, the major factor affecting all of Mercer Island (and many other desirable communities) is the scarcity of “jumbo” financing.

  5. Pingback: West vs. East Seattle Homes for Sale « Surrounded By Water: A Mercer Island Blog

  6. mercerislandblogger

    @Orin: Yes, a bunch of nice homes have been bulldozed for McMansions. Agreed that it’s a shame and a blight on aesthetic sensibilities; I’ve lamented their invasion before in this blog.

    Re: your discussion, I just looked up some data and posted it:
    https://mercerislandblogger.wordpress.com/2009/02/18/west-vs-east-seattle-homes-for-sale/

    And a note on sign density on East Mercer and West Mercer Way: most real estate agents post on those streets even if the home is off-street, since they’re the roads with traffic.

  7. Also, FWIW looking at Redfin for all properties for sale on Mercer Island doesn’t appear to show any visually significant concentration along the water, at least to my eye.

  8. I’m amazed at how defensive you people are… and FWIW, Beach Drive and Lake Washington Blvd. have far fewer “For Sale” signs per mile than West/East Mercer Way. And I know this because I ride on the former very frequently, and on the latter recently. But why does that matter? Is it because you paid way too much for your Mercer Island McMansion, and now you can’t afford it? Or is it because you’re thinking about selling and you won’t be able to get the grossly inflated price you believe (in your dreams) your McMansion is worth?

    __Orin
    Scootin’ Old Skool

  9. mercerislandblogger

    Take it easy, Orin. We’re not casting aspersions at West Seattleites here. I must admit the subject is sensitive because we have a condo in Cap Hill that we want to sell. We’ve been renting it for over a year. I loved my condo, loved my neighbors, loved Cap Hill, and wasn’t a speculator. I moved out because I got married and the condo just didn’t work for two people, two cats, and two commutes. And by the way, it’s plenty ABOVE water and we’re doing fine by renting it. I just get tired of folks assuming that all sales are distressed sales when in fact sometimes life just moves on.

    And all houses on the MI are not McMansions. We’ve got an invasion problem, but look around the Island. There are plenty of bungalows, craftsmen, architect-designed homes and others.

  10. Defensive? Must be a matter of our different perspectives. I live (on East Mercer Way!) about 5 blocks down from the house I grew up in – this was actually my paper route 35 years ago. Heck, my house is about 500 sqft smaller than my parents house – hardly a McMansion.

    I’m not sure where your rant about “grossly inflated” prices is coming from. Do you really think that the free market somehow operates differently on Mercer Island than in…West Seattle? That there’s some secret Ponzi scheme to raise prices just on Mercer Island? It must have been going on a long time – Mercer Island was expensive when my parents first moved here 40+ years ago.

    Oh, and I’ll take our bridge over yours any day. (grin)

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