SEATTLE HOUSING MARKET FORECAST
Home Prices, Interest Rates, Real Estate Statistics, Video and Charts
Seattle Housing Market
Heading Toward Normalcy in May 2022
This article will be about the current and future state of the Seattle area housing market. Refer to the table of contents to skip to your interest.
We start with our 60 second video discussing the 3 key indicators and how they affect the market. Then an infographic and a highlight of what stood out the most this month and some quick stats we think are important.
We deep dive into what story the statistics are telling us. Next we will hear from the 24th most influential person in real estate, Lennox Scott and what he sees happing in the Seattle market. We will do a short breakdown on Sales Activity, Days on Market, Price, Interest Rates, Timing and Job and Population Growth. A complete list of the MLS Infospark stats for Seattle housing market trends.
Lastly, don't forget to check out the newest Seattle homes for sale.
The Seattle Housing Market At a Glance
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SEATTLE REAL ESTATE MARKET
QUICKSTATS
- Average Sales Price INCREASED by $13k total to $1.024mil
- New Listings INCREASED to 1,544
- Sold Homes INCREASED to 1,164
- Pending Sales DECREASED to 1,243
- Percentage of Sold Price to List Price INCREASED to 109.5%
- Interest Rates INCREASED to a Solid 5.55%
- Home Inventory INCREASED to .6 Months of Supply
The Seattle Housing Market Analysis For MAY 2022
Every month we gather all the facts, data and statistics about the Seattle Housing Market and share them with you. We will discuss the 3 major factors in determining the strength of the market.
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- Monthly Inventory Level
- Percentage of Homes That Go Pending In First 30 Days
- Current Interest Rates
The data tells a story about the current state of our local residential real estate market.
We are seeing signs that the market is starting to normalize to it's more predictable patterns.
After a year and a spring where we have seen some of the lowest inventory levels ever for an extended period of time and interest rates hitting their lowest marks of all time, both are starting to relent.
Interest rates are at a more normal 5.55% and we had 300 more new listings than pendings last month giving the inventory a bump and putting the number of homes for sale in Seattle over 1,000 for the first time since October of last year.
According to Lawrence Yun, Chief Economist for the National Association of Realtors, “Higher mortgage rates will inevitably pull home sales down in the coming months and slow home price appreciation”.
While we are seeing the inventory levels start to slowly increase we have not seen it affect the average price of homes, yet. We actually saw the average sales price and the percentage of sold price to list price increase slightly last month.
We are on a similar trajectory as we were on in 2018 where after an extended period with extremely low inventory and low interest rates, the interest rates increased and the sales intensity decreased. In 2018 this was most noticeable starting in June and going through the winter.
Expect to see "premium pricing" start to fade away as the summer nears and that leaving us feeling like prices have dropped. We should stay in a market meaning that 40-50% of homes sell in the first 30 days.
This should result in the market stabalizeing and prices staying about the same but with less competition on each new listing. Meaning less multi-bid scenarios and bidding up prices into that "premium pricing" range.
We will have to see what this does to the astronomically high rents in Seattle.
According to ApartmentList.com Seattle's median 3-bedroom rent for an apartment is $4,629 month. Which equates to approximately a $800K home with 20% down on a 30 year fixed 5.55% interest rate loan.
The Bureau of Labor Statistics recently reported the US inflation rate rose to 6.8% the highest it has been since 1982. The best hedge for inflation is real estate. As we are seeing public figures like Bill Gates and Jeff Bezos buy real estate at an extraordinary rate.
As we have been talking about for a few months Seattle has the 2nd highest percentage of tech workers in the country. Tech jobs bring people in from all over the world and tend to be come with an above average salary. So what do tons of new people with above average salaries need when they get to Seattle, a place to live.
When you add the large number of high income tech workers with the low interest rates and the desire for people to move into larger homes that accommodate all the at home activities that people have gotten used to along with crazy high rents and a desire to counter inflation with real estate we should steer clear of any kind of bubble bursting.
Despite WA being fully open we will continue to offer a full suite of Virtual Real Estate Services.
HOUSING MARKET HEADING TOWARD NORMALCYIn April, the Seattle housing market shifted down several levels of hotness from March as we move toward the strong market we saw pre-pandemic. This intensity adjustment means multiple offers will not be as commonplace as they’ve been in the last two years. Additionally, premium pricing, which is the amount a home sells for above list price, is softening as well.
Looking ahead, although we anticipate the number of unsold homes on the market will increase on a seasonal basis, there will still be elevated buyer focus on each new listing. Despite higher interest rates, there is still a significant backlog of buyers looking to purchase a home, underscoring the strength of the market.J Lennox Scott
LENNOX SCOTT
CEO of John L. Scott Real Estate
Seattle Real Estate GRAPHS AND Data
With only .6 months of supply if no other homes were listed in the next 18 days we would run out of houses to buy.
There were 1,544 new listings in April.
If you are looking for homes 2 million plus you are seeing slightly more inventory than $500k-$1million.
As you can see from the table above anything below 5 months of inventory is considered low. Low inventory means higher demand. Higher demand drives the price up.
1,164 homes were sold in Seattle last month. That is up 27 from the previous month, down 164 from last year, and up 262 from 5 years ago.
In the Seattle housing market homes in the 500k-1m+ price range typically sell the fastest.
DAYS ON MARKET
87.1% of homes are selling in less than 30 days in the Seattle housing market. That number is usually closer to 30%.
Houses in the 1-1.5mil price range are selling 89.3% of the time in the first 30 days.
Because there are less homes for sale and there are still many buyers trying to buy… the homes that do list are usually selling very fast.
PRICE
AVERAGE SALE PRICE: $1,024,415
SINGLE FAMILY RESIDENTIAL: $1,185,171
CONDOS: $615,059
We have already seen where a low inventory should drive up prices. The average sale price for Seattle homes is $1,024,415. In comparison 5 years ago the average sales price was $729,360 a 40% increase in equity.
Listings are selling at 109.5% of their list price on average.
INTEREST RATES
MORTGAGE INTEREST RATE OUTLOOK
Mortgage interest rates are a hot topic after bumping up over the last few months. National Association of REALTORS national economist Lawrence Yun predicts the 30-year fixed-rate mortgage will average 5.5% by the end of 2022.
Today’s home mortgage interest rates have already baked in the projected Fed Funds rate increases from the U.S. Federal Reserve for the remainder of 2022.
TIMING
As you can see from the John L. Scott 6 phases to a yearly house cycle chart we are in the middle of the busy season.
If you’re a buyer you will want to position yourself to create a buyer advantage when competing with other buyers and walk in confidence when making an offer. We can consult with you to be up-to-date with current market intensity and pricing, get pre-approved or fully underwritten through a lender, and receive email/text notification of newly listed properties.
In today’s instant-response market, it’s key to ensure you’re ready to act when the timing is right and make sure you are Buyer Ready Day One.
Sellers should be Market Ready Day One.
JOB AND POPULATION GROWTH
WHILE WE ARE NOT SURE HOW THE EMPLOYMENT NUMBERS WILL END UP HERE IS THE CURRENT UNEMPLOYMENT SITUATION
CURRENT UNEMPLOYMENT RATES
WA Employment Security Department
[Source: U.S. Census Bureau]
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"King County lost population last year for the first time in almost 50 years", according to the Seattle Times.
Seattle Market Stats
STATS PROVIDED BY: INFOSPARK
- $1,024,415 was the average sold price for listings in Seattle.
- 1,544 new listings went on the market this month.
- 1,013 homes were for sale during the month.
- 1,243 homes went pending in Seattle.
- 1,164 homes sold this month
- .6 months of inventory available in Seattle
- 13 was the average days on market for a home to sell in Seattle
- 109.5% was the average listing price vs. sales price percentage
- $624 was the average price per square foot in Seattle
- $1,192,418,600 was the total closed sales volume for Seattle
- 5.55% was the interest rate
- 87% of homes sold in the first 30 days in Seattle
SEATTLE HOUSING MARKET Summary
The Seattle Housing Market saw 1,544 new listings, 1,013 homes were for sale, while 1,164 homes sold in April in Seattle.
The average days on market decreased to 13 days, the percentage of sale price to listing price increased to 109.5%, and the average sales price increased. The percentage of homes that sold in the first 30 days is 87% indicating an Extreme Frenzy Market. Inventory is at .6 months of supply indicating a Extreme Shortage.
Despite interest rates jumping in the last couple months the pool of buyers remains strong.
We should continue to see a strong to surging market through the Summer of 2022.
Now is still a good time to sell your home as we are still seeing low inventory and historically high prices.
If you are considering a move up, a move down, or just want to sell your home… Months of inventory is still at well below average. Homes are selling at a rapid pace, the Interest Rates are still at average rates.
The Seattle job market has remained strong powered by the tech sector.
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