Keller Williams Greater Seattle, Ben Kakimoto, Seattle Condo Agent

Selling a Luxury Condo is About to Get More Expensive

By on April 28, 2019 in Condo Selling, Real Estate with 0 Comments

Lawmakers in the 2019 Washington State Legislative session just made selling a home or condo in Washington more expensive for high-end homeowners.

Passing both the House and Senate this past week, the state’s real estate excise tax will be adjusting in 2020, which is expected to raise $243.5 million for the state’s coffers.

Washington State will be moving from a single rate for all home sales to a tiered rate based on the selling price of the property. Currently, the statewide rate is 1.28%. However, individual counties and municipalities can tack on their own tax.

For example, there is an additional 0.5% in King, Snohomish and Pierce counties resulting in a total rate of 1.78%.

Fortunately, the excise tax rate adjustment won’t affect the average homeowner as the increased rates apply to home sales over $1,500,000. For homes and condos under $1,500,000 the rate either decreases or stay the same.

Effective January 1, 2020 the new excise tax for home sales paid by the seller will be (plus a 0.5% county tax for King, Snohomish & Pierce counties) :

Home Sale PriceOld Tax Rate (with county tax)New State Tax RateNew Tax Rate with county tax
Up tp $500,0001.28% (1.78%)1.1%1.6%
$500,001 to $1,500,0001.28% (1.78%)1.28%1.78%
$1,500,001 to $3,000,0001.28% (1.78%)2.75%3.25%
Over $3,000,0001.28% (1.78%)3.0%3.5%

If your home sells for $500,000 or less, you’ll see a little break. But, if it sells for more than $1,500,001 then you’ll see a significant increase in the excise tax, nearly doubling.

Here are some examples for a Seattle area home or condo with the county tax included:

Home Sales PriceOld Tax AmountNew Tax AmountDifference
$350,000$6,230$5,600- 10.1%
$500,000$8,900$8,000- 10.1%
$500,001$8,900$8,9000%
$1,500,000$26,700$26,7000%
$1,500,001$26,700$48,750+ 82.6%
$3,000,000$53,400$97,500+ 82.6%
$3,000,001$53,400$105,000+ 96.7%

Homeowners should keep in mind the large shift in taxes around the three threshold levels ($500,000, $1,500,000 and $3,000,000) as a relatively small change in price could cost thousands extra in taxes.

If you own a luxury condo and have contemplated selling in the next year or so, then you should seriously consider selling this year.

Got questions about the Washington state real estate excise tax, the cost of selling or would like to know more about selling your condo? Our team of experienced condo specialists are here to help. Just drop us message.

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About the Author

About the Author: Ben Kakimoto is a Seattle condo and urban real estate marketing & listing specialist. Contact Ben to learn more about the Seattle condo and loft real estate market or about buying or selling a Seattle area condo. Find Ben on Google+, Twitter and Facebook. .

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