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After two years of hectic housing market conditions and short supply, Seattle-area home buyers are finally getting some good news. Recent reports show there are more homes coming onto the market. The overall pace of the market has slowed as well, giving buyers a chance to catch their breath.
These trends and reports have a lot of folks wondering the same thing:
Could we see a buyer’s market in Seattle, later in 2022 or into 2023?
That’s a hard prediction to make, given all of the variables involved. But one thing seems clear. The Seattle metro area real estate market is moving in a more buyer-friendly direction for a change.
If you keep up with housing market trends in the Seattle area, you’ve probably heard that the real estate scene is starting to cool down. It’s true. After two years of fast-paced and challenging conditions, the Seattle housing market is beginning to ease up.
The main reason for this: inventory growth.
According to a recent report from Realtor.com, the Seattle-area real estate market has experienced significant supply gains over the past year or so. That report, published just over a month ago, showed a 65% increase in the number of active real estate listings within the Seattle-Tacoma-Bellevue metro area.
Granted, supply levels remain tight across the Seattle metro housing market. Among the nation’s major cities and metro areas, the Seattle area currently has one of the lowest levels of real estate inventory.
At the end of 2021, there was almost no inventory available for buyers (a 0.3-month supply, according to one source). But things are improving. According to a recent report by The Seattle Times, the region is now up to about a two-month supply of homes.
As the market cools off, it would now take nearly two months to sell through all the single-family homes for sale at current demand across the region. The last time inventory was at that level was in late 2018 and early 2019, when the region’s housing market was going through another slowdown.
We still have a ways to go before we approach a “balanced” real estate market in the Seattle area. But in the meantime, buyers could have an easier time finding and purchasing a home, compared to last year.
For more evidence that the Seattle real estate market is downshifting in 2022, we can look at the number of price reductions. In this context, a “reduction” occurs when sellers reduce their asking prices, after initially listing the home at a higher price.
The Realtor.com report mentioned above showed that an increasing number of Seattle-area sellers are reducing their list prices. During the month of June 2022, for example, 18% of listings within the Seattle-Tacoma-Bellevue metro area had a price reduction. Even more telling: price reductions were up by 13.5% in June, compared to a year earlier.
So it seems that home sellers in the Seattle area have gotten the message. Perhaps they realize the housing market is cooling, and that they need to be more flexible when it comes to pricing and negotiations.
All of this brings us back to the question we started with: Could we see a Seattle buyer’s market in the near future? During the latter part of 2022, perhaps, or later in 2023?
Given the current supply-and-demand situation in the area, a classic buyer’s-market scenario doesn’t seem likely. That’s due to the ongoing supply shortage.
Inventory has risen in the Seattle real estate market, and that’s great news for home buyers. But supply levels remain very low by historical standards.
A classic or “textbook” buyer’s market occurs when supply levels greatly exceed demand. In other words, it’s when there are many more homes for sale than buyers seeking them. That’s not the current situation within the Seattle-area real estate market.
Even so, we are definitely witnessing a kind of shift within the housing scene. And it’s happening on both the supply and demand side of the equation. The inventory gains mentioned earlier are giving home buyers more properties to choose from, while putting pressure on sellers. Higher housing costs, meanwhile, have reduced the number of qualified buyers.
So we might see a new kind of real estate market, later in 2022 and into 2023. Buyer’s could gain some negotiating leverage in spite of the ongoing supply shortage.
With labels aside, the Seattle metro area housing market is clearly moving in a more buyer-friendly direction. Home buyers entering the market over the coming months could have more properties to choose from, more room to negotiate, and a chance to catch their breath for a change.
Do you have questions about rates this week and home loans? Or are you ready to apply for a mortgage to buy a home? If so, Sammamish Mortgage can help. We are a local mortgage company from Bellevue, Washington, serving the entire state, as well as Oregon, Idaho, and Colorado. We offer many mortgage programs to buyers all over the Pacific Northwest and have been doing so since 1992. Among our programs includes the Diamond Homebuyer Program, Cash Buyer Program, and Bridge Loans. Contact us today with any questions you have about mortgages.
Whether you’re buying a home or ready to refinance, our professionals can help.
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No Obligation and transparency 24/7. Instantly compare live rates and costs from our network of lenders across the country. Real-time accurate rates and closing costs for a variety of loan programs custom to your specific situation.