King County Real Estate Market Update | October 2024

Hey y’all. Zach McDonald, your real estate agent with Real Property Associates, and this is my King County real Estate market update for October, 2024. Well, just when we thought interest rates were going to start coming down, they have been going up. And I think the question is why are interest rates going up right now when the Fed just dropped the Fed funds rate? And if you’re new to the channel, please subscribe, but also go back and listen to some of the videos. Over the past few weeks and even the last few months, we’ve been talking about interest rates quite a bit. And the big picture is that the Fed funds rate and the mortgage rates are not directly linked. And so the mortgage rates were going down in anticipation of a Fed rate cut, but also some other economic news, bad job reports, et cetera. And more recently, we have seen a good jobs report.

We had the Fed rate cut, but indications that maybe we weren’t going to see those rates continue to come down. And as a result, among other things, maybe some news of wars and other things, we’re thinking maybe, maybe this isn’t going to keep going down as much as we thought. And so now we’re seeing a bounce in rates. Rates are actually almost a half percent up from where they were since the half a percent drop crazy, but rates already had baked in that drop over the year. Rates were actually well over 7% earlier in the year. And on Mortgage News Daily here as of today, 6.62 was their daily rate survey, so still well below where they were, but approaching a couple month highs here. So that has an effect on the housing market. And I think last month when we saw rates come down from the fed rate level, there was this expectation or hope that yes, okay, now finally we’re going to have some relief.

We’re going to see rates coming down and how is that going to impact the housing market? And in fact, the housing market was already experiencing some of those effects a month earlier, two months earlier before those cuts as rates were starting to come down. And now that they are not continuing think the reality is setting in that maybe we’re in this even for a little bit longer and still looking at next year for rates to really start coming down. At least that’s still a hope. Now as we look at the jump or the difference from August to September as this is our monthly update, we’re seeing that homes listed in King County, we’re seeing more so about 300 more houses listed in King County in September versus August. A relatively normal trend we saw jump last year as well, month over month, but year over year is pretty big.

25.3% more listings this year than we saw last year. And if anybody remembers last year, we were down significantly in new listings. Listing activity was super low in 2023 and 2024 most of the year. And it’s been picking up in the second half of this year. So it’s good to see that that year over year jump is there, but it’s also encouraging to see the month over month jump too. So more inventory, more house selection for buyers, but still not where we were as far as new listings a few years ago. But approaching that at least as far as the listing activity is concerned, pending sales month over month, more pending sales in King County. And also year over year, the change is 35.8%. So a pretty big jump here. Now last year pending sales went down in September, not up. So this year we’re seeing an uptick in pending sales as the amount of listings coming on increases, which is good, right?

If we’re seeing an uptick in listings and a decline in the pending sales, that would be a massive buildup of inventory here, which is helpful for buyers for sure. But I think sellers aren’t looking to see a huge amount of new inventory building up on the market, and we are seeing a little bit of that. So inventory of homes for sale has increased, and I think that is why we’re seeing an uptick in days on market 23 this month versus 19 last month. In fact, those days are identical. Last year in August, 19 days on market, and 19 in August 23 last year in September 23 in this September. So those numbers have remained relatively similar year over year, 6.7% increase in median sales price, nine 60 versus 900. So a $60,000 jump year over year in King County for residential homes. And last year in August, it was also a 6.7% jump up to nine 70.

So now we saw a little bit of a drop off October to September, again, not abnormal to see a little drop off in the median sales price, but again, year over year, 6.7 last month and this month, interesting trend, average sales price remains almost the same as last month, and it’s 9.1% up year over year. 1,225,000 9 72 is that number for average sales price in King County last year we were 1.123 million. So more than a hundred thousand dollars jump in the average sales price across King County percentage of list price homes are still on average selling over asking price in King County, but barely only 0.2% above asking price. And that’s almost the same as last year 0.1% above asking price. The inventory of homes though, that’s a big number in comparison to last year, 28.3% jump again. So we’ve seen a lot more houses coming on the market.

We’ve seen more homes building up on the market. We’ve seen more sales coming off the market, we’ve seen more houses selling. So all of those things are encouraging signs for the housing market. Number one, more people are selling, right? And also more people are buying. So you have the exchange of property, which opens up opportunities for people. We’re seeing the supply numbers are starting to build 2.2 months of supply in King County. Last year we had 1.8 months of supply last month, 2.1. So just a little bit of a jump in the month over month numbers. But that does start to affect the competition and the time it takes to sell a house. So now seeing 23 days on market as an average across King County, that’s three weeks to sell a house. Now, historically speaking, that’s not a long time. Three weeks, four weeks, five weeks, six weeks, all that is relatively normal.

But we have in the Seattle area experience that that seems to be a long time, at least given previous history of six days, five days, three days, selling the first day on the market, three to 4, 5, 6 weeks is all very normal, a couple months to sell a house. So we’ve been spoiled. I guess if you’re a seller, that would be my thoughts for you. We’ve been spoiled over the past probably 10 years if we look back that far or so. And seeing houses sell relatively quickly with some maybe small little pockets of time where we haven’t seen that, we’ve been in a little more prolonged time of, hey, a house doesn’t always sell immediately. There’s no guarantee. I think for buyers that are considering a purchase, there’s always this in the back of your mind, okay, what if we wait a little bit? We see rates come down, maybe that’s the time to jump in.

Maybe there’s more houses coming on the market now other people aren’t buying. Is this the time? Should we be holding off too? And I think as a buyer, you want to think differently than everybody else. And I think you would hear people talk about this in the stock market. I think you’d hear this from other people in real estate when you’re thinking exactly the same way you are the one that’s paying, and I saw this the other day, this is crazy. It was a good reminder of how hot the market was in 2022. But a client and I were discussing this house that was on the market for, I think it was 1.4, is the current asking price. The seller of this house, it was listed for just under 1.2 in 2022, they paid 1.5, almost 1.6, it was just under one six, I believe.

And they had listed it for 1 5, 5, it didn’t sell. They dropped the price, now they’re at one four. So they’re looking at almost $200,000 delta in the direction for this house that they bought two years ago when the market was really hot. And they, in their excitement, paid 35% over the asking price for this house to get it and compete with other people, and they got it, but now they’re trying to get rid of it, and they’re having a hard time and they’re having a hard time getting anything near what they paid. So the market is not back. If you’re a buyer, the market is not back. But this is the time where you’re not the one doing that. You’re the one getting a lower price. You’re the one having the opportunities. And yes, the rates are higher, and that’s a huge part of it, but this is that time to be doing it, not waiting until the next time.

It’s really hot like it was when that other buyer paid 35.7% above the asking price and is currently underwater. They won’t be eventually, but in their case, they’re trying to sell right now when the market’s lower. And I think for anybody that did buy in 2022 when it was really hot, you got a great interest rate. That’s amazing. And so holding onto that, as long as you’re holding onto that, even if you did pay more than what it’s worth now, is not a big deal. It’s when you’re trying to sell and the market’s not recovered, that’s the big deal. So having a longer time horizon, five to seven years is kind of the ideal time horizon for real estate. If you have a longer time horizon with your purchase, you’re going to see ups and downs in the market. But in that five to seven year window, it’s going to have gone through those different real estate cycles. So just some thoughts here for today on the King County housing market. If you have questions about the housing market here in King County and you want to connect, feel free to reach out. And as always, if you know somebody who could benefit from this video, please consider sharing it with them.