According to recent home-price projections for the Seattle metro area, house values in several cities could rise more slowly over the next 12 months.
You probably already know that the real estate website Zillow offers property listings. But did you know the company also employs a team of economists, data scientists, and housing analysts? It’s true. Their economic research team publishes a steady stream of data relating to property values across the country. They offer city-specific forecasts as well, and that’s what I want to share with you today.
Zillow’s home-price predictions for the Seattle metro area suggest that the market could cool down a bit over the coming month, and into 2017. They still expect house values to rise over the next 12 months. But they’re predicting a slower rate of appreciation than what we’ve seen over the last couple of years.
Seattle-Area Home Price Projections for 2017
Here are some home-price forecasts for key cities in the Seattle metro area. These projections were published in August 2016. That means the 12-month forecasts extend through August 2017.
Seattle: According to data compiled by Zillow, home prices within the city of Seattle rose by 16.7% over the last 12 months. They projected a smaller, but still significant, gain of 8.1% over the next 12 months (through August 2017).
Tacoma: The company’s home-price projection for Tacoma is similar to the one offered for Seattle, in the sense that it too suggests slower appreciation in 2017. Prices in Tacoma rose 13.7% over the last year, with a forecast for 7.1% growth over the next 12 months.
Bellevue: You might be noticing a trend here, in terms of smaller home-price projections going forward. According to Zillow, house values in Bellevue, Washington rose 12.3% over the last 12 months. Looking forward, they expect values to rise 6.8% through August 2017.
Everett: Yep, there’s definitely a trend here. The 12-month home price projection for Everett was also significantly lower than the last year’s gains. The Zillow Home Value Index for Everett rose 11.3% over the last year, with a 12-month forecast of 6.5%.
Some key takeways from these Seattle-area price projections:
- Home values across the metro area are projected to continue rising between now and this time next year.
- While prices will likely continue moving north, the rate of appreciation could slow down in the coming months.
- The 12-month price projections for these Seattle cities is still much higher than the national forecast. Zillow has predicted that home prices nationwide will rise by around 2.9% over the next year.
These are forecasts — not facts. So you probably shouldn’t “bank” on them. Nor should we get too wrapped up in the exact numbers that are presented above. (Different sources report different figures.) It’s the bigger picture that’s important here. The broader outlook is that home prices in the Seattle metro area are expected to rise more slowly during 2017, compared to the last couple of years.
Population Growth a Major Factor
Population growth tends to increase demand for housing, simply because there are more people entering the real estate market. This is what we’ve seen in the Seattle metro area in recent years.
According to the U.S. Census Bureau, Seattle is one of the fastest growing big cities in America, and it has been for several years. The city gained nearly 80,000 residents from April 2010 to July 2015, and it’s still growing.
But housing supply across the metro area is limited. Construction is ramping up a bit, but it still falls short of demand. This creates a supply-and-demand imbalance and puts upward pressure on home prices.
Disclaimer: This story contains home-price projections for the Seattle metro area in 2016 – 2017. Forecasts were provided by third parties not associated with our company. We have compiled and presented them here as an educational services to our readers.