A buyer working with two printouts side by side is the moment this piece is for. One listing is a 1928 Craftsman bungalow on 24th Avenue NW, roughly 1,500 square feet, asking somewhere in the $900,000s. The other is a new-construction infill home two blocks over, similar square footage, similar price, built in the last two years with quartz counters and a garage. The buyer does the math both listings invite: price divided by square feet. The bungalow comes out cheaper per foot. The instinct is to read that as a better deal on the same thing.
It isn't the same thing. And treating it that way is the single most common mistake I see buyers make when they're comparing homes in Loyal Heights against each other, or against similar listings in Ballard proper.
Two Different Assets Wearing the Same Metric
Price per square foot was built to compare structures. It tells you almost nothing about the lot underneath, and in a neighborhood like Loyal Heights, where a good share of the housing stock is 1920s through 1940s Craftsman bungalows and Tudor-style cottages sitting on standard-sized lots, the lot is doing more of the pricing work than the metric admits.
Here's the comparison stripped down to what actually matters:
| Older bungalow | New-construction infill | |
|---|---|---|
| Structure | Smaller footprint, dated systems, real land underneath | Larger footprint relative to lot, systems and finishes already new |
| What the price reflects | Structure value plus land that's mostly unused | Structure value plus land that's already built to capacity |
| Redevelopment room | Often significant, depending on lot size and zoning | Usually none, the lot is already maximized |
A lower price per square foot on the bungalow isn't a discount. It's the market pricing a smaller structure while leaving the lot's actual capacity mostly untouched. A buyer who only compares the two numbers is comparing a house to a house plus an option, and paying attention to the house.
What Changed Underneath the Older House
That option is not hypothetical anymore, and it's recent enough that a lot of buyers touring Loyal Heights this year haven't caught up to it. Seattle's neighborhood residential zoning overhaul, driven by the state's HB 1110 and HB 1337 mandates, took effect in 2025 and rewrote what a standard single-family lot in a neighborhood like this is legally allowed to hold. A lot that used to support one primary home plus a single backyard cottage can now support up to four homes total, in any mix of attached townhomes, stacked units, or detached cottages, as long as height, setback, and building code requirements are met.
The old 1,000-square-foot size cap on detached accessory units is gone too. Unit size is now governed by floor-area-ratio and lot-coverage limits rather than a flat number, and the owner-occupancy requirement that used to apply to backyard units was eliminated. On larger parcels, owners who opt into the city's affordability program can qualify for even more density, roughly one unit per 1,250 square feet of lot area for lots over 5,000 square feet.
None of that changes what the bungalow looks like from the sidewalk. It changes what the lot is worth to the next owner, and it does so in a neighborhood where standard lots and generous setbacks are the norm rather than the exception. A buyer who wants to check what a specific address is actually zoned to hold can run it through the city's own ADUniverse tool before making an offer, which is a better use of five minutes than trusting a listing description.
The Numbers Are Already Showing the Split
You can see this mismatch starting to show up in the aggregate Ballard-area data, even though the data is reported at a level too broad to isolate Loyal Heights on its own. Over the three months ending July 2026, Northwest MLS-sourced figures for the Ballard area put the median sale price at $952,000, up just 0.4 percent from the same period the year before. Over that same window, the median sale price per square foot came in at $528, down 14 percent year over year.
Those two numbers should move together if the market were pricing a stable mix of similar homes. They didn't, because the mix wasn't stable. When more of what's closing in a given quarter is larger new construction on already-maximized lots, price per square foot compresses even as total sale prices hold, because the metric is diluted by structure size without any land story attached to it. When more of what's closing is smaller older homes on land-rich lots, the reverse happens. Neither number, taken alone, tells a buyer which kind of home they're actually looking at.
This is also part of why quoted medians for Loyal Heights specifically have been all over the place this year, with different data providers showing figures anywhere from the mid-$800,000s to just over $1 million within the same few months. Loyal Heights is a small enough market that a handful of high-lot-value teardown candidates closing alongside a handful of finished new builds can swing the median without anything in the neighborhood actually changing in value. A single number from a single month is not a fact you can build a comparison on here. It's a snapshot of whatever happened to close.
Before You Compare Two Listings on Price Per Foot
A few checks turn the comparison from a guess into an actual decision:
- Pull the lot size and zoning designation for both properties, not just the square footage of the structure.
- Check whether the existing structure already uses most of the lot's allowed floor area, or whether there's meaningful unused capacity.
- Ask what the current owner has done with any DADU or additional-unit rights, since an unused right is worth more than a used one.
- Confirm whether the property has already opted into any affordability program that could unlock additional density beyond the base four-unit allowance.
- Factor in that unlocking a lot's potential means construction cost, financing, permitting time, and holding cost, none of which shows up in a comparison of two asking prices.
That last point matters. Land optionality is worth something to a buyer who might use it eventually, and worth considerably less to a buyer who just wants to move into a finished home and never think about permits again. The right read on a bungalow's lower price per foot depends on which of those two buyers is doing the reading.
The Builders Already Making This Bet
Local infill builders have already priced this in. DIMA Homes NW currently has more than one new detached cottage on the market on Loyal Heights lots, each marketed around quiet, tree-lined streets close to the neighborhood's core. ID Construction Group has done the same with a new contemporary home on a lot within walking distance of the water and of Ballard's restaurants and shops. These are builders identifying underused lots in a bungalow-heavy neighborhood and converting the land value directly into new product, which is the clearest evidence available that the option embedded in an older home's lot is being taken seriously by people who build for a living, even when it isn't being priced in correctly by buyers comparing two listings on a spreadsheet.
Working With Someone Who Reads the Lot, Not Just the Listing
A comparison built on price per square foot alone will lead a buyer to the wrong conclusion in Loyal Heights more often than it leads them to the right one, simply because the neighborhood's housing stock spans two very different kinds of assets wearing the same metric. Reading a listing here means reading the lot size, the zoning capacity, and what's already been built on it, not just the number the listing agent put in the headline.
If you're comparing homes in Loyal Heights, or trying to figure out what a specific lot's redevelopment capacity is actually worth before you write an offer, that's the kind of analysis worth getting right before you're under contract, not after. For a broader sense of what day-to-day ownership here involves once the numbers make sense, this guide to living in Loyal Heights covers the practical side of the neighborhood.
Adam Bradley brings investor-level lot analysis and Realogics Sotheby's International Realty's marketing reach to every Loyal Heights transaction, whether you're comparing two listings on paper or trying to understand what your own lot could support. Schedule a Strategic Consultation to walk through the numbers on a specific property before you decide what it's actually worth to you.
FAQ
Does a lower price per square foot always mean I'm overpaying for the newer home? Not necessarily. It means you're paying for finished construction and zero remaining land optionality. Whether that's worth the premium depends on whether you'd ever use the older home's development rights or simply want a finished house.
Do I need to actually build four units to benefit from this zoning change? No. The benefit exists as an option even if you never exercise it. A lot with unused density potential is worth more to a future buyer or lender than one that's already fully built out, whether or not you personally add anything.
How do I find out what a specific Loyal Heights lot is actually allowed to hold? Start with the city's ADUniverse tool, which lets you check zoning and basic capacity for a specific parcel. From there, a land-use professional or architect can confirm what's feasible given slope, access, and tree cover, since the zoning code sets the ceiling but site conditions often set the real limit.
