We are coming to the end of 2022. Home prices are high, buyers are starting to decrease, and mortgage rates are skyrocketing. Winter is just around the corner, which often marks one of the slowest times of the year for real estate markets. Whether you’re still planning to buy a home in the Seattle Metro Area in 2022 or are aiming for 2023, this article will fill you in on the details to help ensure a successful transaction.
As 2022 draws to a close, many prospective home buyers in the Seattle area have begun to ask that perennial question: Would it be better to buy a house or condo in Seattle now, or should I wait until next year? Which would be the best time to buy?
Given current trends within the local real estate market, it might be better to jump in sooner rather than later. Here’s why.
Prices Projected to Rise Further In Early 2023
Mortgage rates have been on a steady rise over the past year, and they are expected to stay high throughout 2023. As of this writing, the mortgage rate for a 30-year fixed-rate mortgage is topping 7%, a far cry from the start of 2022 when rates were closer to 2.5%. However, with rates still rising and no end in sight, now may be the time to lock in a rate to possibly realize major savings in interest over the life of your loan.
Of course, home prices in the Seattle metro area have been increasing and are expected to continue to increase throughout the end of the year. According to the latest real estate reports from Zillow, the median home price in Seattle is now around $960,925. That’s within the city itself. Across the broader metro area, relative bargains can be found.
In nearby Tacoma, for example, the median home value is currently $514,336. So there’s quite a bit of variance in terms of house prices.
(Hint: You can think of Seattle proper as the “nucleus” for higher home prices, with values dropping off substantially as you move into the surrounding areas.)
Despite these regional differences in house values, all real estate markets in the Seattle metro area have one thing in common. Prices are predicted to continue rising over the coming months, and into 2023 before they settle.
Related: Outlook for the Tacoma market
Should You Buy That Home in 2022 or 2023?
Getting back to the question at hand. Should you buy a home in the Seattle metro area soon, or wait until next year?
If you’re sure you want to buy, a strong argument could be made for doing it sooner rather than later. House values are projected to continue climbing, partly due to the lack of inventory in the area. So a postponed home purchase might mean that you’ll end up paying more for that house.
For instance, the median home value for the Seattle metropolitan area rose by more than 20% from mid 2021 to mid 2022. And they expect more increases over the coming months, especially as inventory continues to be tight, which is a major driving factor of home price appreciation.
Granted that’s just one forecast. But when you look at the current supply-and-demand situation in the area, it’s plausible to suggest that home values would continue to rise.
Give Yourself Some Lead Time When House Hunting
There’s another reason to start your home search sooner rather than later. It might take a while, due to the shortage of housing inventory across the Seattle metro area. Right now, there is less than a one-month supply of homes for sale in most cities in the area. That’s well below what is considered to be a “balanced” market.
There are a variety of factors causing this supply shortage. They range from sluggish construction to homeowners being reluctant to sell (despite the profit potential). These and other factors contribute to the ongoing supply shortage that’s affecting the Seattle metro area real estate market.
The house hunting process can take longer, as a result of these trends. So if you plan to buy a home in the Seattle area in 2022 or 2023, now is the time to start searching.
Current conditions also underscore the importance of being pre-approved for a mortgage loan. This is practically a necessity in a real estate market like Seattle. It will allow you to conduct a more focused and efficient home search, based on a specific price range. Pre-approval also shows sellers that you’re a serious buyer.
Need a Home Loan in Seattle?
Will you need mortgage financing to buy a home in Seattle? We can help. Sammamish Mortgage has been serving buyers across the Pacific Northwest since 1992, including Washington, Oregon, Colorado, and Idaho. We offer a wide variety of mortgage programs with flexible qualification criteria. Please contact us today with any financing-related questions you have.