Seattle Real Estate Market Watch 2/22/23

Hey y’all, Zach McDonald, your real estate agent with Real Property Associates, and this is my Seattle Real Estate Market Watch for February 22nd, 2023.

Well, the housing market has been heating up here as we start 2023 and right as everything starting to build a little bit of momentum, we have interest rates for mortgages jumping, and simultaneously we have all this excitement about maybe getting in, maybe getting a deal. But we’ve also seen over the past few weeks, mortgage rates go from hovering around six, six and a quarter all the way up to almost 7% over the past couple weeks. And that’s where mortgage rates were back in the fall. October, November, we were up over 7% for a time and then they dropped back down towards the low sixes, even down below six a couple weeks ago. But now over the past few weeks, there’s been a lot of uncertainty around when the fed’s gonna stop adjusting the rates and inflationary data wasn’t very good. So again, some of that concern and Uncertainty’s been returning to the market and again, that’s been a big driver for mortgage rates going up.

So again, what does that mean for us here? And I think our housing market still is in a place where we’re seeing very few listings coming on the market. Abnormally low amounts of listings. I would say we have a little bit of a problem in one sense, right? Because there aren’t as many houses coming on the market, but that’s keeping things propped up. We’ve seen prices adjust quite a bit from the peaks last year, but if we look at the most recent Seattle real estate market update and or if you were to filed at King County or Snohomish County updates that I do as well, you’ll see that housing prices are right around where they were at the same time last year. If you factor out the massive jumps in the spring. So what does that mean for us here as we head into the peak season, the time where we typically have the highest prices of the year?

Well, we’re still in a low inventory environment, so new listings were down from last week we had 301 new listings in Kingston, Hammish County together again, the Seattle metro area. Last week we had 355, so that’s quite a big drop off. I would say back on the market we had 54. Again, those would’ve been from either canceled or expired listings that came back on, which is pretty much all of them. We had 39 canceled and 24 listings expired. And well, we had just a couple fewer than that come back on the market. So most of those are back list price reductions about this same as we saw last week, 171 versus 172. And again, those numbers are significantly lower than they were back in the spring. And again, we’re having fewer listings too, but a lot more houses are selling for the asking price. Some are even seeing multiple offers and selling for more.

There’s just enough data for people to know, Hey, the housing prices have adjusted and we need to adjust pricing contingent purchases. Last week we only had five contingent purchases in King and Snohomish County this week’s 17. So big jump there in the contingent purchases. I mentioned last week that the window of time for contingent purchases has been narrowing. And this week we saw a pretty big jump there in the contingent purchases. And that just means by no means has it closed, but I think that as the market continues to tighten, unless inventory really increases a lot, sellers will have enough choice between buyers to decide not to accept a contingent purchase. But for those houses that have been sitting on the market for a little while, that’s usually where the opportunities are. But if you are somebody in that situation where you just know, Hey, I can’t buy without selling, that might be your way to do both at the same time without having to move out of your house or rent somewhere.

It’s a very nice convenient way to purchase and upgrade your house if you can. Expired listings, 24 expireds, not a lot. Same as last week actually. Pending listings though, and this is something we’ve been talking about, 734 pending listings, 743 from last week, so slightly down, but 734 pending listings compared to 301 new listings. So we had more than double the amount of houses go pending or sell in the last week versus the houses that came on. So again, not every single one of those is going to sell. Some of them are going to have inspections and come back on the market, some are gonna fall through. But even if a hundred of those fell through, we still had twice as many houses come off the market than go on. So what we’re seeing is we’re just continuing to see that inventory level declining sold listings 429 from the last week, a little bit more than last week.

But again, we’re still continuing to see a good amount of solds. And those would’ve been, again, January’s sales. A few observations from the past week and number one, open houses are packed. We were showing some clients over the weekend and we didn’t even want to go inside until the open house was done. There were so many people in the house. We also had showings where they were double booked overlapping showings. Again, there were so many people wanting to see a house where the house had multiple showings happening at one time and for a while during the Covid pandemic that wasn’t allowed. But it has been re allowed here in recent times, and we’re starting to see just lots of people wanting to see the same houses again and multiple offers. Yes, we’re seeing those again, and that’s another observation competition in the market. A lot of the negotiating power that buyers had even over the past three to four months has been waning.

Will it return again later in the year? I don’t know. I don’t know. I think if inventory stays low like it is, it keeps the amount of interest in those specific listings at such a point where maybe you’re not having to bid up a bunch on the price. It’s not like people are paying 20% over asking price or 30% over asking price right now, but there isn’t as much wiggle room down. You’re not paying less than asking price often, and you’re not getting the seller to pay for a mortgage rate buy down maybe like what I was talking about a few months ago. So things have been changing, but I think that opportunity for buyers still exists. Prices are down, right? Prices are down, interest rates are higher, but prices are down. And sellers, the good news is that houses are selling now and not taking as long to sell, but I think the expectation needs to be that you’re not going to be getting as much as the neighbors got.

Last year I mentioned mortgage rates are up as of today on Mortgage News, Daley’s website, 6.88% quite a bit up from earlier in the month where they dropped just below 6%, but again, still kind of in that 6% range. So it’s not like rates of ballooned a bunch, but they have ballooned. More recently, some of the data from the last week does suggest that purchase loan applications are down significantly over the last week as rates have been climbing. But again, a lot of that activity is still happening as we look at those pending sales. Thanks so much for watching this week’s Seattle Real Estate Market Watch. If you got a lot of value out of this video, please consider subscribing to the channel if you haven’t already. So you can follow along with some of the other videos here. And if you want to talk more about your specific situation, whether it makes sense to buy or sell in this current market in the Seattle area, I’d love to be a resource for you.