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Tacoma House Market Previews

To learn more about buying a home in Tacoma, Washington as an investment, read this article. Seattle has long overshadowed Tacoma. Outsiders knew it as a remote Seattle suburb. Nonetheless, this is one of the reasons to invest in Tacoma. Before going over the ten reasons to invest in Tacoma, let’s review the market facts.

Demand is strong, but not so high that investors fear being priced out of the market or caught in a bubble. Tacoma is Washington’s third-largest city. Tacoma has been a good place for short-term investors. Tacoma’s housing supply remains significantly below typical. This has been the case for years.

The 2020 census estimates Tacoma’s population at 220,000. Tacoma’s population has grown by 11.52 percent since the last census, or 0.78 percent yearly. Tacoma is a rising satellite city at the southern end of the Seattle metro region, expanding around Puget Sound. It is also the regional centre for the southern Puget Sound region, which has a million residents. Let’s look at Tacoma real estate trends for 2021.

2021–2022 Tacoma Housing Market Trends

According to recent Realtor.com data, Tacoma is a seller’s market, with more buyers than available houses. For the previous 6–7 years, a lack of availability has driven up Tacoma home prices as purchasers battled for a limited supply. Tacoma has a history of being a great long-term investment.

Also, Tacoma-Lakewood, WA is placed #11 in the FHFA HPI® Top 100 Metro Area Rankings for 2021 Q2. House prices in Tacoma-Lakewood, WA grew 22.9 percent year on year and 3.2 percent quarter on quarter (FHFA HPI®). Since 2007, housing prices have risen by 75.1%.

The Tacoma Housing Market

Homes in Tacoma, WA sold for $450K on average in October 2021, an increase of 16.9%. The median listing price was $292/sqft. The median sale price was $450,000. In October, the sale-to-list price ratio was 100.55 percent, meaning Tacoma properties sold for the asking amount.

Tacoma, WA properties typically sell in 41 days.
Median days on market in Tacoma, WA are up from last month but down from last year.
North End has the most costly median listing price at $6222,500.
Eastside has the lowest median listing price at $382,500.
Rent in Tacoma is $1,900.
According to Redfin, the Tacoma housing market is the most competitive. In January 2021, Tacoma had the nation’s fastest-selling housing market. Tacoma homes get 4 offers on average and sell in 7 days.

Tacoma home prices rose 23.3 percent year-over-year in October 2021, to a median of $450K.
Tacoma homes sell in 8 days on average, up from 6 days last year.
In October, 484 residences were sold, up from 475 last year.
The average home sells for 2% over list price and closes in 7 days.
Hot properties sell for 6% above list price and close in 4 days.

Tacoma Rent 2021

On November 26, 2021, a 1-bedroom apartment in Tacoma, WA rents for $1,445. This is a 10% rise over last year. The average monthly rent for a studio unit in Tacoma rose 5% to $1,400. The average rent for a 1-bedroom apartment fell 3% to $1,445, and for a 2-bedroom apartment down 2% to $1,666.

A two-bedroom apartment in Tacoma, WA presently costs $1,666. This is a 10% rise over last year.
A three-bedroom apartment in Tacoma, WA presently costs $2,173. This is a 17% rise from last year.
A 4-bedroom apartment in Tacoma, WA presently costs $2,425. This is a 1% rise over last year.

PIH Housing Market Trends for 2021

The Northwest Multiple Listing Service’s October home sales data showed a 9.42 percent increase in total active listings for single-family houses. In October 2021, the typical closed sale price for existing single-family houses in Pierce County was $520,000, up from $430,000 in October 2020. Pierce County’s median closed condo sale price was $352,475, up 20% year-on-year. Agents in the area believe that 75 percent of properties sold in Pierce County in the last six months sold in a week or less. There is only two weeks’ worth of inventory left.

Single-family house inventory is 0.63 months.
Months’ supply for condos is 0.81.
2021–2022 Tacoma Real Estate Forecast
Tacoma home values have risen roughly 176% since 2012 – Zillow Home Value Index. As shown in the graph below, property values climbed steadily from spring 2012 to 2021. Tacoma’s median home value is $467,392. ZHVI represents the entire housing supply, not only those that sell or list each month. It shows that half of the housing stock in the area is worth over $467,392 and half is worth less (adjusting for seasonal fluctuations).

In October 2020, the median house value in Seattle was $379,000. Home values have risen by 23.1% in the last year. It suggests Tacoma is a hot seller’s market. NeighborhoodScout.com has seen similar growth. According to their data, Tacoma’s real estate has risen 119.18 percent in the last ten years, with an average yearly appreciation rate of 8.16 percent, placing Tacoma in the top 10% nationally.

The Tacoma appreciation rate has been 12.57 percent over the last year, and 3.87 percent for the last quarter, annualizing to 16.39 percent. This figure corroborates Zillow’s bullish estimate, indicating that home values in this area will rise over the next year. Demand surpasses supply, providing sellers an advantage over buyers in pricing discussions. That’s how a region’s house prices rise. In 2021, the highest price increase will occur during peak buying season, like in 2020.

Pierce County’s median home value is $514,593, up 23.2 percent year-on-year.
Tacoma home values have risen 23.1 percent in the last year and will continue to grow.
Seattle-Tacoma-Bellevue Metro home values rose 21.8 percent last year, and Zillow projects a 13.7% increase in the following year.

Bellevue’s median home value is $1,279,662, up 20.2 percent year-on-year.

Where To Buy In Tacoma, WA?

Tacoma has 201 schools. There are 83 public schools, 36 private and charter schools. Tacoma has 21 neighborhoods. South End, North End, and Eastside are some of Tacoma’s nicest neighborhoods. Here are Tacoma’s ten most appreciating areas since 2000. (List by Neigborhoodscout.com).

City Core
S Sprague Ave/12th St
S 12th / S Union
UW-Tacoma Campus / Tacoma Ave Mckinley Ave / E 48th St S Fife St / S 56th St S Pine St / S 74th St
Tacoma Investing in Real Estate
A house in Tacoma, WA worth buying? Real estate is regarded as a terrific way to get rich. Is it wise to buy a Tacoma apartment? Many investors wonder if buying a home in Tacoma is a wise investment. To predict the market for the coming year, you need to dig deeper into local trends. We’ve already covered the hot Tacoma home market trends and forecasts.

Although this article does not cover all aspects of investing in Tacoma real estate, we have included ten evidence-based benefits for those interested in doing so. Single-family detached homes make up 62.24 percent of Tacoma’s housing units. Large apartment complexes or high-rise apartments (26.50%), duplexes, homes converted to apartments or other small apartment buildings (7.36%), and a few row houses and other attached residences (7.36%) are also common in Tacoma ( 3.20 percent ).

Three- and four-bedroom homes are the most common construction size and type in Tacoma. Owners and renters make up 50.37 percent of the city’s population. Long term, investing in Tacoma real estate will yield significant returns due to the city’s rising housing prices. Let us examine the many favorable developments in the Tacoma real estate market that can assist investors seeking to buy property in this area.

The Perks of Being a Seattle Suburb

One incentive to explore Tacoma investment properties is that it is a Seattle satellite city. You profit from Seattle’s expansion by buying Tacoma investment properties before they rise in value. Moving to the suburbs saves you money over the 800,000 median home price in Seattle and the 600,000 median home price in King County. Property values in the Puget Sound region are rising as businesses and residents relocate from San Francisco’s exorbitant housing market.

There are several advantages to consider buying a home in Tacoma, including being close to Seattle’s job market without having to deal with its frequently chaotic politics. Homelessness is not a problem in Tacoma. Seattle’s impending head tax has firms fleeing to Tacoma. Seattle tried to impose an income tax, but Tacoma residents will be exempt.

In 2018, the median home value in Tacoma was little under $300,000. Tacoma’s lower cost of living attracts people from Seattle, driving up Tacoma’s house values. Because a 300K starter home in Seattle costs half as much. Tacoma property values have already surpassed $450,000, up 24% year-on-year, and are expected to continue rising in the coming year. Investors will enjoy getting two properties in Tacoma for the price of one in Seattle.

Better Housing Market

Because their economies are so different, Tacoma is recognized as a separate entity from Seattle. For example, Microsoft and Boeing’s home cities have unemployment rates around 3%, whereas Tacoma’s is at 6%. Businesses relocate from Seattle and San Francisco to Tacoma, adding jobs. That’s helping Tacoma’s job growth of 2%. This will raise Tacoma home values but not cause a housing bubble.

Tacoma, WA unemployment rate is at 4.5 percent, down from 5.60 percent last month and 9.80 percent last year. The long-term average is 7.42 percent. Tacoma’s job market grew 1.8% last year. Over the next 10 years, 39.9% of new jobs will be created, compared to 33.5 percent in the US (bestplaces.net).

Geography’s Long-Term Impact

Tacoma is on Puget Sound’s southern tip, straddling Commencement Bay It is a huge port town surrounded by smaller cities and mountains. In order to avoid having to pay for expensive renovation of existing assets, the city cannot simply grow outward. As long as the job market is robust, Tacoma real estate values will remain high. With only 0.66 months of inventory available, it obviously limits the capacity to swiftly add new supply.

Tacoma is ten miles from the Lewis-McChord joint base. This joint Army-Air Force base employs around 60,000 people in the area. This floods the Tacoma housing market with renters who won’t buy when interest rates fall or their personal finances improve.

Large Student Market

Tacoma’s housing market is suitable for college students. Many universities allow investors to diversify their interests rather than being dependent on a single school’s reputation or enrolment. Many universities and colleges exist in Tacoma, including the University of Puget Sound and the University of Washington Tacoma Campus. If fewer students want to rent it, you can rent it to the other half of the population who leases it.

Landlord-Friendliness

Not the most landlord-friendly state, Washington beats both California and Oregon. More crucially, Tacoma’s rental market is more landlord-friendly than Seattle’s. In Seattle, landlords cannot filter qualified tenants. Landlords would be required to rent on a first-come, first-served basis. You can’t pick the tenant who pays on time and causes the least disruption.

You can’t even choose someone with a better credit score and references. Note how the state is going to extremities to help tenants. A recent Tacoma ordinance requires two months notice for no-cause evictions, compared to the state’s three weeks. You must also offer four months notice if you intend to modify or repurpose the property.

The Tax Climate Is Favorable

Washington ranked 28th out of 50 states for state and municipal taxes. That makes it a stronger investment option than California. No individual or corporate income tax. The hefty sales taxes don’t hurt Tacoma real estate investors. The state’s property tax rates are average. The lower home values in Tacoma mean you pay 0.85% property taxes on half the assessed value of a comparable home in Seattle.

Finally, Washington State will lower property taxes in 2019. Furthermore, the city can only increase property tax receipts by 1% per year, so even if property values rise by 10% per year, your property tax payment won’t skyrocket. For instance, Texas allows a ten percent annual growth in assessed property values and property tax rates.

Conclusion

Maybe you’ve dabbled in Tacoma real estate investing but want to take it to the next level. It is prudent to consider how you can and should invest your money. If you are a house buyer or an investor, Tacoma real estate has one of the strongest long-term returns in the US during the previous ten years. A sensible Tacoma real estate investment could guarantee your future. If you are new to cash flow real estate investing, it is critical that you read good real estate books.

Most investors gravitate towards residential property. The finest real estate investments are in markets with substantial population and employment growth. Both equate to significant home demand. If housing supply meets demand, real estate investors should take advantage of low entry prices.

You must also learn from experienced real estate investors who have retired early by investing in hot real estate markets like Tacoma, WA. Demand and supply are driving up rents and property values in Tacoma. Now is the time to buy. Investing in Tacoma real estate has many advantages over adjacent homes and condos.

Buying an investment property is unlike buying a primary residence. Whether you are a novice or a seasoned veteran, you know that finding outstanding real estate investments in Tacoma, Washington is crucial to your success.

Experts say that buying in a hot market with cheap loan rates and minimal supply demands a different strategy than buying in a cooler market. We want to inspire people by delivering great real estate investment possibilities in U.S. growing markets. We can help you reduce risk and increase profit.

Spokane is the second best place to invest in Washington. Spokane is an inexpensive West Coast real estate market. As a result, it is a safe place to invest in real estate. Skip Seattle and Silicon Valley and invest in Spokane’s future. Spokane’s higher unemployment rate was one cause for its extended lag. Seattle has a 3% unemployment rate, compared to Spokane’s 5%. But higher-paying employment are flooding Spokane’s economy.

The bulk of the tens of thousands of new employment generated since 2010 pay higher than the average county wage. Pay raises will draw many people to Spokane, boosting demand for Spokane real estate. Seattle is another attractive real estate market in Washington. Seattle is a hot market making news all year. Its robust economy, diversified population, and better regulatory climate are attracting Californians and migrants from all over the country and world.

Regardless of the weather, the Seattle property market has a bright future. Seattle is consistently ranked as one of the best places for real estate investors to sell. Property values have risen steadily. Rental prices are high and rising, ensuring a profit for investors. So whether you purchase and hold or buy and flip in Seattle, you may profit from the big rental market.

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