According to a recent housing market forecast from Zillow, home prices in Tacoma, Washington are expected to continue rising well into 2018 (and possibly beyond). Earlier this month, the company’s real estate economists predicted that house prices in the city could rise by around 4% between now and March 2018.
In March 2017, the company stated: “Tacoma home values have gone up 14.2% over the past year and Zillow predicts they will rise 4.1% within the next year.”
This is not surprising, given the current state of the Tacoma housing market. Home prices in the area have risen steadily over the last couple of years, and by double digits in 2017 alone. This was due to an imbalance between supply and demand. There are a lot of home buyers in the market, but a relatively limited number of properties available. Prices tend to rise under such conditions, and that’s exactly what they’ve been doing in Tacoma.
Tacoma Home Price Forecast for 2018: A Cooling Trend?
It’s also worth noting that this recent Tacoma real estate forecast, which extends into 2018, marks a slowdown in home-price appreciation. According to various sources, housing values in Tacoma rose by more than 10% during 2017. So a 12-month home price projection of 4.1% suggests a cooling trend.
As of March 2017, the median home price in Tacoma was around $244,000. That’s still relatively affordable for the Seattle metropolitan area (Seattle’s median is currently north of $600,000), but it does mark a big increase from where Tacoma house values were a year ago.
A Return to Sustainable Growth
From an economic and housing standpoint, this is good news. Double-digit price gains are generally not sustainable over the long term because they outpace wage growth, leading to affordability problems.
The more moderate forecast for the Tacoma real estate market through 2017 and into 2018 suggest a return to normalcy, and a more sustainable pace of appreciation.
This doesn’t mean the Tacoma real estate market will be any less competitive in late 2017 or early 2018. Competition will likely remain high in the area, due to limited inventory.
According to a recent report from the Northwest Multiple Listing Service, the number of homes listed for sale in Western Washington has declined by around 25% since last year, dropping below 10,000 for the first time since they’ve been tracking it. At the same time, demand remains high from local buyers, transplants, and foreign investors. So the Tacoma real estate market will probably remain very competitive for the foreseeable future.
Disclaimer: This story contains forecasts and home-price predictions for Tacoma, Washington, extending into 2018. These statements and data were provided by third parties not associated without our company. We have presented them here as an educational service to our readers.