Seattle Housing Market Watch – February 25, 2025

By Zach McDonald, Real Property Associates

The last week of February brings a notable shift in the Seattle housing market: mortgage rates are finally trending downward, inventory is building, and competition is gradually intensifying—especially for single-family homes across King and Snohomish counties. As we head toward the spring real estate season, both buyers and sellers should be aware of the changing dynamics shaping the next few months.

Mortgage Rates Drop Below 7%

After weeks of stagnation, mortgage rates finally moved downward. According to Mortgage News Daily, the average 30-year fixed rate slid from 7.02% last week to 6.8%. While this drop isn’t dramatic, it is meaningful—any downward shift increases affordability and boosts buyer confidence heading into spring.

Rates continue to fluctuate daily, but the general trend over the past week favors buyers. With the spring market approaching, even small movements matter when demand begins building.

Inventory Growth Continues Into Early Spring

Across King and Snohomish counties, 446 new listings came onto the market this week, slightly fewer than last week’s 478, but still consistent with the seasonal upswing. Price reductions increased, rising to 204, up from 166 the previous week. This pattern often reflects strategic mispricing—homes listed too high tend to sit, while competitively priced homes draw immediate interest and multiple offers.

Pricing remains one of the most critical factors as we enter the spring housing market. Listing too high can cause a home to linger and ultimately sell for less. Listing too low may attract multiple offers but can still risk leaving money on the table if not managed properly. The sweet spot remains pricing at true market value, particularly when competition is growing.

Pending and Closed Sales Rise as Buyer Activity Picks Up

Buyer activity accelerated again this week:

• Pending sales: 691, up from 603 last week

• Closed sales: 422, up from 400

These increases are typical as we approach month-end, but they also signal rising momentum. With each week, more buyers are re-entering the market after the winter slowdown.

I continue to anticipate an earlier-than-usual market peak in 2025. Inventory is growing faster than in recent years, and buyer numbers don’t appear to be increasing at the same pace. If new listings continue building, the hottest point of the market may arrive in late spring rather than early summer.

New MLS Insights: How Competitive Is the Market?

For the second week, we’re incorporating detailed MLS data showing how buyers are structuring offers. These insights provide a clear picture of competitiveness by tracking multiple offers, contingencies, sale-to-list price ratios, and escalation clauses.

Snohomish County Offer Trends

• Median sales price: $799,950

• Average sale-to-list price: 100%

• Multiple offers: 37% (up 7%)

• Inspection contingencies: Down 14%

• Financing contingencies: Down 10%

• Escalation addendums: 12% of offers

This data shows rising competition without dramatic price escalations. Many buyers are strengthening offers by removing inspection or financing contingencies instead of bidding substantially over list price.

King County Offer Trends

• Median sales price: $940,000

• Average sale-to-list price: 102%

• Multiple offers: 43% (up slightly from last week)

• Inspection contingencies: 37%

• Financing contingencies: 62%

• Escalation addendums: 17% of offers

King County continues to be more competitive overall, with stronger sale-to-list performance and higher multiple-offer frequency. As spring approaches, these numbers may tighten further.

Single-Family Homes Strong, Condos Continued to Lag

While single-family homes in both counties are experiencing increasing competition, condos remain a different story. Condo inventory is currently about double that of single-family homes, and units are taking longer to sell—sometimes twice as long or more.

Many condos are selling below asking price, a lingering trend rooted in post-COVID buyer behavior, when demand shifted heavily toward single-family homes. Although more buyers are now open to condos, the market imbalance has not corrected yet.

Spring 2025 Outlook: Competitive but Not Overheated

So far, 2025 is shaping up similarly to last year:

• A competitive but manageable spring

• More inventory than previous years

• A potential early peak in late spring

• A slower summer as listings outpace buyer demand

Interest rates are moving slightly but not enough to dramatically change buyer or seller behavior. Unless rates fall significantly, we should expect a steady but not frenzied spring real estate market.