The newest signal of the Seattle space’s sluggish housing market? A relative glut of properties sat in the marketplace in Could, sometimes the peak of Seattle-area homebuying season.
The slowdown displays a confluence of elevated mortgage charges and financial uncertainty. In that setting, some patrons are nonetheless battling it out in bidding wars whereas loads of others take a breather, leaving some corners of the market “lifeless within the water,” in a single native agent’s phrases.
The story isn’t completely new. Whereas the early months of this yr noticed an uptick in Seattle-area dwelling gross sales, offers dipped in April as President Donald Trump introduced new tariffs, plunging the inventory market and discouraging some dwelling consumers.
By the tip of Could, pending single-family dwelling gross sales had bounced again a bit, however loads of patrons continued to play it secure, based on month-to-month information the Northwest A number of Itemizing Service launched Wednesday.
Spring, the market’s busiest season, “got here sooner and ended sooner” this yr, stated Seattle Windermere agent Candace Hagen.
Extra sellers put their properties in the marketplace final month, however extra of these properties had been nonetheless ready for a purchaser when the month ended — an indication of cooling purchaser curiosity.
That’s welcome information for consumers. Seattle-area homebuyers had “extra negotiation energy in Could than any Could on file going again to 2018,” stated Zillow senior economist Kara Ng.
That’s, if they will afford it.
At the same time as median dwelling costs dipped in some areas, prices remained excessive. The median single-family dwelling bought for $989,000 in King County in Could, down 4% from April and 1% from Could of final yr, based on the NWMLS.
The image is combined throughout the county: The median single-family dwelling bought for $1 million in Seattle, up 5% from a yr earlier, whereas the Eastside’s $1.6 million median was down 4%. Costs additionally dropped from a yr in the past in North and South King County. (Could costs possible mirror gross sales that went pending in April and closed final month.)
Outdoors King County, dwelling costs climbed. The median single-family dwelling bought for $833,000 in Snohomish County, up almost 1% from a yr earlier; $589,000 in Pierce County, up 5%; and $594,500 in Kitsap County, up 2.5%.
At these costs and as we speak’s mortgage charges, month-to-month prices are powerful for a lot of patrons.
Mortgage charges averaged just under 7% final week, about the place they’ve hovered all yr.
The mortgage cost on a typical midtier dwelling within the Seattle metro space was about $4,000 on the finish of Could, the fifth highest amongst main metros, based on Zillow. That estimate assumes a house costing about $767,600 with a 20% down cost. In Seattle, the place the median dwelling prices greater than $1 million, the month-to-month cost is even greater. Patrons with out 20% to place down additionally face greater prices.
Month-to-month funds dipped a bit in Could from a yr earlier however have greater than doubled since earlier than the pandemic.
Patrons braving as we speak’s market sometimes depend on excessive tech salaries, cashing out inventory portfolios for a down cost, assist from household or having already owned a house they will promote, Hagen stated.
And a few corners of the market nonetheless really feel scorching. Patrons are shedding bidding wars for some properties, particularly the uncommon turnkey Seattle itemizing priced beneath $1 million or $1.1 million for a single-family dwelling.
“A number of gives are nonetheless taking place on single-family properties under $1 million as a result of you’ll be able to’t get something for that,” Hagen stated.
However even consumers who could possibly afford the area’s dizzying prices face large questions: Are their tech jobs secure? Is a recession on the horizon? Is proudly owning even well worth the greater price than the area’s comparatively flat rents?
Demand for city properties and condos is particularly weak — “lifeless within the water in the intervening time,” stated Seattle Compass agent Ryan Palardy.
First-time patrons and those that aren’t dashing to discover a dwelling earlier than their children’ college yr begins this fall really feel much less strain to maneuver instantly, he stated.
“Ever because the tariffs went into impact, and all the pieces that’s been downstream of that, they simply don’t really feel inclined to take a danger on a home that’s going to price them twice as a lot as they’re paying in lease at a pleasant spot proper now.”
At as we speak’s demand, it might take about 2 ½ months to promote all of the accessible single-family properties at the moment listed. That’s nonetheless removed from a balanced market, nevertheless it’s the very best month-to-month stock degree since September 2018.
Many extra condos can be found: almost 4 months of stock. The median King County apartment bought for almost $570,000 in Could, down 4% from a yr earlier.
The speedy improve in King County stock of every kind is on par with the market in 2007 and 2008, based on Palardy’s evaluation of NWMLS information.
With some stock lingering, sellers are providing value cuts and different concessions. Greater than 1 / 4 of dwelling listings recorded a value drop in Could, based on Zillow, the very best share in Could going again to at the least 2018.
Observers say these patterns are more likely to proceed except one thing shakes up the market, most notably a decline in mortgage charges.
“I don’t see the answer on the horizon except charges drop,” stated Matt Miner, Palardy’s Compass colleague.
However a pointy drop in charges is unlikely.
Mortgage charges are more likely to finish the yr within the mid-6% vary, however that prediction comes within the face of a unstable economic system, stated Ng at Zillow.
“There’s a variety of uncertainty in that forecast.”
