Seattle Housing Market Watch 09/27/2024

Hey, I’m Zach McDonald, your real estate agent with Real Property Associates, and this is my Seattle Housing Market Watch for September 27th, 2024. Well, we are going to dive into the stats here for King and Snohomish Counties housing markets here over the past week. But before we do that, I want to point out that mortgage rates have not gone down over the past week. In fact, they’ve gone up over the past week. Last week I recorded my video and waited till after the Fed dropped the rates a half percent, and we talked about how the mortgage market was already baking in a Fed rate drop. And now that we’ve seen the economy and the markets responding to this, we’re actually seeing the bond market be weaker, not better as a result. And that’s why we’re seeing mortgage rates up now, they’re not up much. Last week we saw mortgage rates at 6.17% this week here, 6.21% according to the same survey that Mortgage News Daily does every single day.

So nothing drastic, but mortgage rates have not gone down as a result of the Fed rate drop, they’ve actually gone up. Now, if we see more rate drops as different data comes out, we will likely see rates continue to drop. But at the moment, at the moment, rates are remaining right around six and a quarter, which is still considerably better than where we were at seven and a quarter and even eight and a quarter last year. But we’re still not into that range where everybody’s really stoked to refinance their mortgage if they maybe have a higher one. I have a higher rate right now a little over, actually, I think my rate’s just at 7%, maybe 6, 9, 9 or something like that. So I have not refinanced yet. And there are also many people who have really low rates that haven’t decided this rate’s close enough to swap out for another house.

We are seeing more buyers entering the market. That’s something we’ve seen over the past few weeks. If we look at the data here, we’re going to see that trend. Last week we had a lot of new listings, 924 new listings in King in Snohomish County this week, 695, massive drop off, and I mentioned we’re having a log jam the last couple of weeks. We’ve had a whole bunch of houses coming on the market following the holiday weekend. And now as we’re entering the fall, we’re still seeing more listings coming on the market and we will for the next month or so, but it’s starting to slow down a little bit, the log jam from the summer waiting until after the holiday that’s passed, and now we’re going to start to see a steady decline, probably starting mid-October in the listings. I would say the big stat, and this is the one I want to focus on today, is the pending listings, 865 pending listings versus 695 new listings.

That’s a huge difference, and we’ve been talking about for a while, maybe the last couple months, how we’ve been seeing more buyers coming into the market, and we’re certainly seeing the result of more buyers in the market, more pending sales. Last week we had 916, so a little bit more substantially more listings though, but even with fewer listings, that buyer activities keeping up, which just means we’re going to see the amount of houses available start to shrink, which puts pressure on the houses that are available. So last month’s Seattle market update. We went through some of the data. We were talking about prices. We always do this every month where we talk about prices and we talk about percentages over asking price, and we get really granular with the data. In this case, we’re looking more at the market and the factors affecting the market, specifically in the Seattle area, king in Snohomish County.

What we’re primarily looking at in these videos is the amount of houses coming on the market. How long are they sitting on the market? Are they having price reductions? What’s happening with the inventory and how quickly is it selling? Right? And so as we’re looking at a few of these other stats, I think these ones are also worth noting. 27 contingent purchases up from 20 last week, and we haven’t seen that many in a while. And part of that is because we’re seeing houses sitting. Last week, we had 523 price reductions this week, 519. So there’s still this seesaw, I would say, where we have some houses selling really quickly and some selling over asking price. But we also have a subset of houses in King and Salish County that are not selling immediately, having a price reduction, maybe two. And so we’re not seeing the days on market skyrocketing necessarily, but we’re seeing that not everything is selling right away.

And so as we look at the homes available, there are going to be less and less of those homes available, the ones that have been on the market for a little while are going to sell, right? Especially if we have way more pending sales than we have new listings. But at some point we’re going to start to see a transition from the houses that are having the price reductions and sitting on the market. We’re going to start to see, wow, there’s not a lot of houses available and people are going to be competing over what’s available. And again, we’re still waiting, or some people are still waiting for mortgage rates to drop more and there’s no guarantee that they’re going to get much lower. But a lot of people are predicting they’re going to get into the fives at some point and stabilize whether that’s towards the end of this year, early next year.

But the lower the rates get, the more buyers we’re going to have in the market, and we’re already starting to see the effects of those more buyers. And so I can only imagine what that looks like as we get into the fives for mortgages. So what does that mean for buyers? I think for buyers, that means right now there are enough houses on the market where you’re not necessarily competing with other buyers for the same houses. There’s going to be competition for the few. There are certain houses that everybody always wants to buy, right? They’re always in demand. There will be competition for those, but there are plenty that are not experiencing that same level of competition and rates aren’t down all the way to where they probably will end up yet. But there are opportunities for buyers, I think, to make a purchase without as much of that competition.

While there still is inventory, while there still are options, what will happen as the year goes on and we get towards 2025 is there will just be very few options left. And then as people start fulfilling their New Year’s goals and they come into the market, if rates come down, there’s going to be a lot of pent up demand from buyers, but there won’t be anything to buy. And that will be, well, we’ve seen that the past few years anyway, even with higher rates. So I can only imagine what that looks like if rates do come down a little bit. And for sellers, you are entering into the holidays. If you have your house on the market, I think you have a great chance of selling your house before the holidays based on the amount of buyer activity at the right price, your house is going to sell.

And you may even see a little bit of competition. It’s not as hot as it was earlier in the year. It just isn’t. And that’s normal for the fall. But if you’re somebody who’s thinking, yeah, I want to list my house sometime in the next three, four months, your house is not on the market and you don’t have any type of a deadline, maybe I would consider doing it right now before you get to Thanksgiving time. And if you get to Thanksgiving time, we could always reassess, right? I think the idea with listing is you are seeing what’s happening, right? Then. Sometimes you have to list because you need to get your house on the market. You can’t afford the payments. Maybe it just needs to sell for whatever reason. But there will be other times where we can assess in the moment, does it make sense to put the house on now or wait just a little bit longer?

And again, the next month or so should be relatively strong for buyer activity. And so if you’re somebody thinking about selling, this is when you would do it. Otherwise, you’d probably wait until after the new year to put your house on the market and hopefully capitalize on some new buyers coming in, but also the pent up activity that we might see for less inventory. So some quick thoughts here as we wrap up today. If you have questions about your situation individually, maybe you’re thinking about buying a house or selling a house, or maybe buying a rental property, I’d love to be a resource for you. Feel free to reach out anytime.