Seattle Real Estate Market Watch 4/18/23

Hey y’all, Zach McDonald, your real estate agent with Real Property Associates, and this is my Seattle Real Estate Market Watch for April 18th, 2023.

What’s up everybody? I’m excited to be back in the office. I took a week, a little over a week in San Diego with my family and I had a great time, but I also did not record any videos ahead of time or during the process. I just wanted to relax. So jumping back into these, if you missed the most recent Seattle Real Estate market update or the King County Snohomish County updates, those were posted at the end of last week, so make sure you check those out. But we’re gonna jump back into these market watches on a weekly basis again here. And let’s start with some of the data. And I won’t rewind back to a few weeks ago and compare because it doesn’t really make sense in this setting. But what I’ll do is I’ll share a few of the numbers from the most recent king ins to Hoish County updates to help give perspective about where we’re at in the Seattle area housing market, and where we might be headed here into the summer, 498 new listings.

Over the past week, we are starting to see more listings coming on the market, which is normal for this time of year. I suspect we’re still gonna see far fewer than normal as these numbers are not ballooning, but at the same time, we’re starting to see some more houses come on the market, which is a good sign. Going into the summer, we were really struggling and we have been seeing quite a bit fewer houses coming on the market in King and Snohomish counties, and I’ll talk about that here in a little bit. Towards the end, back on the market, 49 properties, most of those probably were some of those canceled listings. There were 47 canceled and 22 expired. So a few of those coming back on the market. There might be some more people jumping in here trying to take advantage of the resurgence in the housing market.

It’s nowhere near where it was, but it’s certainly starting to heat up here in the recent months. List price reductions 155, we’re still seeing houses with price reductions, so it’s not like every house is selling super quickly, but when we look at the data here, and if you want to get more into it, you can watch those other updates I mentioned. Things are starting to sell quicker, especially at their priced where they should be. I would say as far as where the comparables are and where recent sales are suggesting contingent sales nine, this has continued to trend down. So fewer and fewer contingent purchases still nine in King, in Snohomish County is good. But when you think about the percentages, and this is what I want you to think about, there were 736 pending listings over the past week. Now, pending listings again, already under contract and went closer to sold.

So maybe they were pending inspection and they went straight to pending, which means no inspection contingency anymore, pretty likely to, or they just came under contract. But even if, let’s say half of those were brand new under contract over the last week, which it’s most likely more, but let’s just say it was half, you still have a very small percentage that are contingent. So if you have a house to sell and you want to buy, this is not the best or ideal market to be doing both simultaneously, if you have to have that as a contingency. The successful buyers right now are most likely going to either sell first and then make the purchase, or they will go ahead and make the purchase with the ability to keep both mortgages in the short term. There are some other strategies or ways to deal with this that are a little more creative, and I’ve made some videos about that and I’m also happy to have a conversation about some of those strategies.

But it can be a little bit complicated when you’re making that transition, right from owning one house to making that purchase on another. There’s some navigation that needs to be done in most situations. Now, pending listings are already mentioned, 736 over the past week, sold listings 5 27. The closings are starting to pick up, and really what we’re seeing is a housing market that is heating up. And back in July, we had considerably more inventory. Those numbers have dwindled, and we’ve seen things start to pick up as far as prices go as well since December, January timeframe. So the past few months, we’ve been seeing prices start to climb again in the Seattle Bellevue Metro areas. And interestingly, interestingly, we’re even seeing houses selling over asking price in King and Salish County. Again, you gotta check out the updates that I do, the monthly updates to get a little bit more insight on that.

But we are starting to see the price pressure going on the opposite direction. So instead of downward pressure on the prices like we’ve been seeing, we’re seeing upward pressure on the prices. Now interestingly here, interest rates are starting to climb again. So interest rates have just been super volatile over the past few months. If you follow these updates or pay attention to the interest rates on a regular basis, you’ll see that the mortgage interest rates have been fluctuating a lot lately. We saw them up over seven, we saw them back down to the upper fives. We’ve seen them climb back up to seven. We’ve seen them drop back down towards six, and then now they’re starting to trend up towards seven again, kind of mid mid sixes at this point, 6.61% according to mortgage news dailies daily survey. And that would’ve been as of yesterday, four 17.

But I wanna share something with you as we wrap this up because we, we go through these stats and instead of comparing week over, I just wanna share a few of the stats from the king in Snohomish County market updates. These might be slightly different numbers, and when I say slightly, I do mean slightly because the PDF published by the MLS doesn’t change or update. But these stats that I share do as agents make updates or add things later. So they’ll be slightly different possibly. We’ve been talking about how much prices have changed or adjusted. So if we look at the year over year numbers, that’s a really good way to see, okay, how has the mark, even with the ups and the downs, where are we at right now? So compared to last March, March, 2020, home prices in King County are down 9.5% and in Snohomish County down 9.4% in King County.

And we’ve been talking about this, the new listings, right? I talk about this every week. King County is down 25.3% year over year with new listings. And I’ll show this graph too. So you can see the trend line down over the past few years, even last year we were down new listings. Snohomish County is down 40.8%, 40.8% down from 2022. That’s a massive drop off. In new listings, you would think, well, that would mean that maybe there aren’t any houses available at all. And that’s not true because what’s been happening here over the past few months, and really the last eight, nine months as we’ve been seeing less buyers in the market too. So pending sales or the houses that are coming under contract have been trending down as well. King Counties down 32.7% on the pending sales. Snohomish County down 39.3% for the pending sales last month in March.

But what that’s done is it’s shrunk in over the past few months, we’ve seen the inventory of homes on the market shrink. So back in July, 2022, we saw the highest number of available houses in King County and Snohomish County, and they were right around two months of supply in the market, which is not a huge amount historically, but still it was significant change from the low inventory environment we were in. Over the past seven, eight months, we’ve seen those numbers slowly drop, and in recent months, we’ve dropped down to 50% fewer listings on the market than we saw back in July. So those numbers have dropped. Making our absorption rate, or the more common word for everybody is the inventory or supply numbers. That’s the amount of available homes for the buyers. We’re sitting at 1.1 months in King County and 0.9 months in Snohomish County.

That is not a lot of supply. That is not. Historically, we like to see three to four months of supply. It’s more of a balanced market, mark it, but it’s still half of where we were back in the summertime. So I, I want to be super clear about this. We’re looking at the King and Snohomish County data, right? Residential data, but that’s where we pay attention to. At least that’s where I pay attention to for these updates. But what I’m seeing are things starting to heat up. I’m seeing more competition, more pressure on prices, mainly because of the lack of inventory and the buyer interest. That’s at least keeping up with the current supply numbers. Now, what’s that doing for days on market? So there’s two different numbers that we track for days on market. There’s the average, which tends to be higher because it pulls the houses that are sitting for forever, right?

And those tend to pull the numbers up. So I really like median days on market to show what’s actually happening in the market right now because it takes those houses out of the equation and gives a little bit more, in my opinion, accurate perspective on the speed of sale. So back in January, so a few months back, we had the highest median days on market that we’d had for the past few years. I mean, we’d been hovering in the 10 days realm for quite a while, for a couple years straight. But back in January, we went up to 34 days on market in King County for the median days, Snohomish was 31 March. All right? Over the past few months, this has dramatically shifted. March’s median days on market in King County was nine and 13 in Snohomish County. So we saw a massive drop off in that median number, which means things are selling faster.

So the market has shifted, it’s changed, will it continue in this direction all summer? I think the biggest, biggest thing here in the spring and into the summer is going to be what are the inflation numbers looking like, right? How are people interacting with those numbers as well? But how are the inflation numbers? Those are what’s affecting the mortgage rates right now. So good news is going to most likely mean better mortgage rates and more buyer activity. Bad news is probably gonna mean worse. Mortgage rates, less buyer activity. So that’s one part of it. The other part is are people going to be selling and we’re seeing a lot fewer listings right now than we normally do. So if that trend continues, I don’t see that we’re gonna have this massive balloon in inventory heading into the summer and the fall, which will continue to keep pressure on the existing inventory that we do have.

So I think that’s the biggest thing that we’re gonna keep watching. Could we see a slower fall in a slower summer like we did last year? It’s possible. I personally think it’s going to be a little bit more flat and stagnant than anything. I, I don’t think we’re gonna see a continuation of last year with 20% drops year over year from last year, right? We’re seeing those right now because we had the peak prices, but I think as we get towards the end of the year, those numbers might tighten up a little bit in 2023. So those are my thoughts here as we wrap up this update. Of course, please tune into the market updates that I just posted here on the channel if you want to get a little bit more insight into king County or Snohomish Counties housing market. And as always, if you have questions about your personal situation or want to connect, feel free to reach out.