The Seattle housing market continues to generate headlines, but the context has changed. We are finally seeing signs that the local real estate market is cooling down a bit.
That’s just one of the Seattle housing market trends we are following in 2017. Here are three important trends that could define the local real estate scene through 2017 and into 2018.
Seattle Housing Market Trends in 2017
Home prices in Seattle are cooling a bit, though they’re still expected to outperform the nation in 2017. The city was recently singled out for having the biggest housing shortage among 150 of the largest cities in America, which means home buyers are competing fiercely for limited inventory. Here are some more notable trends.
1. Double-digit price gains of 2016 have reduced affordability.
According to the real estate data company Zillow, the median home price in Seattle rose by double digits last year. Their latest figures show a gain of 11.3% over the last 12 months or so (Feb. ’16 – Feb. ’17). The median house value in the city is now somewhere between $610,000 and $630,000, depending on the source.
This housing market trend has created affordability issues for some would-be home buyers in Seattle. As a result, we are now seeing a slowdown in home-price appreciation as some buyers are squeezed out of the market. This will likely lead to smaller price gains in 2017, compared to the last couple of years. And that brings us to Seattle housing market trend #2.
2. Additional, yet smaller, home-price gains are expected during 2017.
The local real estate market is expected to cool down a bit this year, at least where appreciation is concerned. We wrote about this previously, and we are now seeing the early signs of it in several recent reports.
According to the latest data from the Northwest Multiple Listing Service, the median house price in King County rose 6.9% in January 2017 compared to a year ago. That’s the slowest annual growth for the area in a year and a half.
The slowdown in Seattle is even more pronounced. Local MLS data showed that single-family home values in the city rose by a modest 2.7% in January, compared to a year ago. That was the slowest price growth in nearly three years, according to The Seattle Times, and a far cry from the high double-digit gains recorded last winter.
3. Housing market will remain very competitive due to inventory shortage.
Recent Seattle housing market trends suggest that the real estate scene could be slowing a bit. But local home buyers should still expect a high level of competition in 2017. There’s a lot of demand for housing in Seattle, but supply is limited.
According to a January 2017 report from Realtor.com, Seattle had the biggest housing shortage among the nation’s 150 biggest cities.
The message to home buyers is clear. Due to current housing market trends in Seattle, including the inventory situation, buyers should be prepared for competition. This means having your financing lined up ahead of time, and studying the market so you can move quickly with a strong offer.
Need a loan? Do you need mortgage financing to buy a home in the Seattle area? We can help. We’ve been helping buyers across the state for more than 20 years. Please contact us with any questions you have, or to receive a rate quote on your next home loan.