Seattle Real Estate Market Watch 9/26/23

Hey all’s. Zach McDonald, your real estate agent with Real Property Associates, and this is my Seattle Real Estate Market Watch for September 26th, 2023.

Alright, if you’re new to these videos, welcome. These videos are weekly videos that I make on the Seattle Housing Market. And what we do each week is we look at the most recent data over the past week in King and Snohomish County, and we slam ’em together. And the reason we do that is because Seattle area, when people are thinking about Seattle, they’re not necessarily thinking of the city itself, but they’re thinking of King and Snohomish County, which are the counties that surround the city, Seattle being in King County itself. So as we look at the data, just remember King County Data, it Snohomish County data put together over the past seven days, and we’re looking at residential data versus condo data, and today is going to be the last day. We’re going to call this a Seattle real estate market watch. What we’re going to do is we’re going to call these video Seattle Housing market watches.

Moving forward, what I want to do is give some distinction between the Seattle real estate market updates, which are the monthly videos, and then these Seattle Housing Market watches that are going to be weekly videos. So a little context there for you. Now as we transition to the data, I want to point out that we’re continuing to see a decline in the amount of listings, and again, that’s normal for this time of year, but usually the fall we’re seeing that final push of new listings and well, if this is it, yikes. Now we’re looking at week over week decline of almost 60 listings. Actually more than 60. We had 601 new listings over the previous week, and then 539 new listings this last week. List price reductions, we did see an uptick there. 393 versus the 355. This is the time of year where we typically see prices dropping a little bit. There’s a little bit less buyer activity. We’re still seeing a large drop off in the number of new listings though as well that we would see in a given month, or in this case a given week. The pending sales still strong. 706 pending sales over the past week, seven 15 last week. Not a big drop-off there and certainly not as big as the drop-off in the new listings. We had 522 sold properties in King in Snohomish County, slightly down from 536 last week. This next week is going to be the end of the month, so I suspect we’ll see a larger number here next week. It’ll be the end of September, beginning of October. Anything that bleeds over into the new month, canceled listings, again, remaining about the same one 11 this week versus 113 last week. Mortgage rates, let’s look at these here real quick.

The mortgage news daily survey that we look at each week, 7.5% rates as of today, and that’s their survey of rates across the country and different companies as well. 7.25 to seven and a half has been where things have been hovering, and we’re pushing that seven and a half mark for 30 year fixed rate loans. You can see as well some other options and what those prices look like right now. The headline here is that mortgage rates have officially hit new multi-decade highs. Ironically, it says the change is down 0.1%, so it’s actually not quite as high as they were, but they’ve been trying to decide where we’re going to be. Are we going to be at seven and a quarter? Are we going to be at seven and a half? Are we going to be at 7%? Are we going to drop even more than that?

So rates have changed quite a bit, but they have been hovering in this seven and a half-ish range here now as of late. So again, we’ll see what the rest of the year holds. I think there’s still a lot of predictions that we stay in this range. We may see things start to come down mid to end of 2024. I can’t believe it at this point. We were thinking we might be seeing rates coming down and well, that’s just not how the policy has been this year. And the projection is we might see the Fed raise the rates again. And so we’re not in a place where we’ve stabilized with the economy and so well, mortgage rates are kind of following in suit at this point. Now what does that mean for the housing market? And we’ve talked about this in previous weeks, so this isn’t new information.

I wish I had a bunch of new information to share, but hopefully this is a little spin on what we’ve been talking about. A lot of the inventory that’s coming out right now falls into one of these categories. You’ve got new construction people that are building are always building. So like in Seattle, north Seattle, there’s a bunch of townhouses. And I was looking with a client at a couple of townhouses and we were talking about how there’s a bunch of these available, but there’s not very many of the single family houses that they might be interested in in their budget. There’s a bunch of the new construction stuff, the relocators people moving out of the area, got a client like that, that’s moving into a different state, already has moved. Divorce estate, sales have one of those as well, coming up, downsizing, maybe buying something smaller.

But what we’re not seeing right now are the buyers that are moving up to a nicer house. There’s a lot less of that going on right now. People that are like, you know what, I would like to have a little bit better house. I’m going to sell my current house, buy a new one, because if you missed it, last week we made a video about how some people are becoming accidental landlords, and that’s where somebody holds onto a house. Maybe they didn’t really think they would, but they decide to hold onto their house because it has a really good mortgage. But even more often than that, people are just not moving at all. They’re staying put in their house and they’re not taking on that second mortgage. What happens is you have fewer of the first time home houses available on the market because the people that would be buying the next house aren’t selling their first house.

And I would say right now, a lot of the buyers are first time home buyers because they don’t have a house and they want to get into the market, they want to get started with their real estate journey, they want to settle down. Those, I would say would be the most common buyers right now. And then you also have investors. Those people are always buying, right? You’ve got people that are buying houses to fix and flip them. You have people that are buying houses to, in Seattle at least, and this is going to become more common around the state where they buy a house, remodel it, build something in the back, and of course you have the new construction investors, people tearing down a house and building multiple. That would be the urban infill. That happens a lot in the Seattle area. But outside of the first time home buyers and the urban infill, there’s not a lot of people in that middle zone that are buying that next house.

But you also have a lot fewer people selling that first house right now. We’ve got the higher rates, but that’s not the effect. The effect is what we’re seeing here in the data and in the trends and in what buyers and sellers are doing. So I hope this video is valuable for you. I love doing these each week. I did forget to wear the Mariners hat today, but honestly, I didn’t want to wear a Mariners hat today. It’s been a rough, rough last couple of weeks for Mariners’ baseball. There’s been this hope that we’re going to finally make the playoffs two years in a row again, but I’m not so hopeful. Anyways, I’m going to the game tonight. I’m going to wear a hat, so hopefully we can pull out a victory, but for now, we’re just rocking the Seahawks because the Seahawks seem to be having that winning streak. So anyways, we’ll talk with you soon. Until then, bye for now.