The latest forecasts for the Seattle real estate market suggest that home prices in the area could rise more slowly in 2018 than they did over the last couple of years. But prices will most likely continue climbing between now and 2019, due to tight inventory and strong demand within the housing market.
Seattle’s Housing Market Over the Last Two Years
During 2016, home prices in Seattle rose by double digits (year over year). They did the same thing in 2017 as well. When this article was published in March 2018, house prices in Seattle were at an all-time high and still rising. At the start of 2018, the median home value in the city climbed above $700,000, according to multiple sources.
Inventory is partly responsible for the rapid rise in house values in the area. Or rather, a lack of inventory. Throughout 2017 and into 2018, the housing stock in and around Seattle became severely depleted. There was plenty of demand from buyers, but not enough homes for sale to meet that demand. Buyers have had to compete fiercely for limited inventory, especially at the lower end of the price range where competition is highest.
That’s where we were at the start of 2018. As for the rest of this year, and into 2019, we will likely see a continuation of these trends. While home prices are expected to rise more slowly during 2018 than in previous years, they will probably continue moving north.
Forecasts Call for Rising House Values Into 2019
A February 2018 forecast from Zillow, for example, predicted that the median home value in Seattle would rise by around 5.4% over the next 12 months (through February 2019). That’s quite a decline from the whopping 17% increase the company recorded over the previous 12 months. And that’s to be expected.
Double-digit annual price growth within the housing market is an anomaly, and it’s generally not sustainable over the long term. So, from an economic standpoint, the Seattle real estate market could actually benefit from a cooling trend.
Granted, this is just one forecast. But the general consensus among housing experts is that prices in this market will probably (A) slow down a bit over the coming months but (B) continue rising to some degree.
Less Than a One-Month Supply of Homes for Sale
Likewise, the inventory situation could continue to present challenges for local home buyers in 2018. From a supply standpoint, Seattle has one of the most constrained housing markets in the country. It might even rank #1 in that department, a disheartening distinction in the eyes of buyers. According to one report, Seattle had a meager 0.9-month supply of homes for sale as of January 2018. That’s well below the 5- to 6-month supply level that economists consider to be a “balanced” housing market.
As a home buyer, you’ll want to bring your ‘A’ game when entering this market. Getting pre-approved for a mortgage, researching the area where you want to buy, and working with a real estate agent can help you succeed in this tight, highly competitive market.
Disclaimer: This article contains predictions and forecasts for the Seattle real estate market through 2018 and into 2019. These outlooks were provided by third parties not associated with our company. We have presented them here as an educational service to our readers.