With Covid 19 hitting us all hard in 2020, people have been more focused on family and friends. But people have also been focused on where they spend their money.
The Audit Connection Blog focuses on taking a look at the annual reports that Washington cities and towns recently submitted to the state to see how the COVID-19 pandemic affected their operations. They focused on how the pandemic affects sales tax collections? FIT Data Stories explains that many cities’ sales tax collections have decreased, however not all...
the decrease in total sales tax collections by the 272 cities included in our analysis. That's a $76.7 million reduction.
However, 167 of 272 cities (that's over 60%) saw an increase in their sales tax collections over pre-pandemic 2019.
They go on to say that each city probably has its own story assuming not any one reason or another is responsible for changes that would likely explain why there was an increase or decrease. However, that was not the focus. The focus was, which city saw the largest decrease or increase? As well as which saw the largest change? In the FIT Data Stories they show a chart of the “city" “2019 Sales Tax Revenue”, “2020 Sales Tax Revenue”, “The Percentage Change” as well as the “Dollar Change”
From 2019 to 2020, this small subsection of cities (Including Monroe) further out from the population centers chart shows that consumers have spent more money near where they live (likely). Now there may not be a huge difference in numbers from 2019 to 2020 for some, but it still shows that people are staying further out and spending their money on restaurants, shopping, etc. Monroe shows an increase of over $14,000 in sales tax receipts year over year.
Bothell as well. The city saw an increase in sales tax.
In just one year, Bothell saw an increase in sales tax of 2.5%. That is a $396,343 increase in the amount of consumer spending. That’s huge!
So, Where is the sales tax drain coming from?
Let’s look to the big cities for answers. Where do most people like to spend their money? Certainly less so in Seattle and SeaTac than they did in the past....
In a matter of just one year, Seattle saw a huge drop in consumer spending. This chart shows that Seattle dropped over $46 MILLION in sales tax year over year.
Lets look at Bellevue
Here, you see that in 2019, Bellevue had one of the highest sales tax revenues. $96,337,845, to be exact. However, in 2020 consumers didn’t spend nearly as much there. In fact, sales went down by 19.7% that’s over 19 million dollars!
What does this say?
It is clear that people are choosing to go (or stay) further out to spend their money. As time goes on, it’s becoming more and more clear that consumers are getting more attracted to staying (or moving) further out from the large population centers. I look forward to this trend continuing.
If you want to check out your city or town, click on THIS LINK and look it up!
The trend of moving (and staying) a little further out from the large cities is a long-term play. Brought on by the pandemic, the ability for many to work from home and the relative strength that your dollar has in the suburban real estate markets will continue to pay dividends for people in years to come. The eastern parts of the eastside, Snohomish County, and other less populated areas are offering great values for large properties with amenities still close at hand.
OR if you have any questions, please don’t hesitate to call or text me at 206 819 5137. I’d love to answer your questions about current matters in the real estate market or what might be available to you in one of the locations that I’ve discussed here.