Seattle Greater Housing Market News
News in 3-min
CURRENT TRENDS
Updated 11/5/24
Interest Rates (avg 30yr conv): 7.04%, Up m/m, up w/w
Mortgage rates dropped to 6.11% in early September due to investor anticipation of fed rate cut but has risen since due to a strong Jobs Report and a higher than anticipated CPI report. https://www.mortgagenewsdaily.com/mortgage-rates/30-year-fixed
Buyer Sentiments up m/m, up w/w
Although rates have dropped since the 7.5% high this year and 8.1% high at the end of 2023, many buyers excited but are waiting for the recently announced fed rate reduction to affect mortgage rates failing to understand rates are not related to the fed rates (banks only service loans and do not actually fund mortgage loans). Funds ultimately come from mortgage-backed securities sold to individual investors or wallstreet and investment activities are affected by inflation and speculation. Buyers are sidelined and eager to jump back into the home search but aren’t sure when.
Seller Sentiments up m/m, up w/w
Sellers are generally confident are playing it safe and waiting to list in 2025 where economists are unanimously bullish nationwide — especially for Seattle Metro.
“Golden Handcuffs”: 84.2% of current homeowners have a sub-6% rate, 74.6% sub-5%, and 56.2% are sub-4 %. We expect resale to be low for many more years until lower interest rates encourage more sellers to consider upsizing or downsizing, but most economists don’t believe we will see sub-5% anytime soon. Few people are selling outside of necessity or major life changes, but more than last year.
General Consumer Sentiment up y/y; up m/m
There have been slight but increasing numbers monthly since August and continues in October. http://www.sca.isr.umich.edu/. Also, visit: https://www.conference-board.org/topics/consumer-confidence
WoW
Buyer activity has fluctuated depending on the area, with the number of pending listings either slightly increasing or decreasing compared to the previous week. New listings have remained steady week over week, as has the median active price, while the median sold price has seen a slight uptick following the late summer rush, accompanied by a decrease in days on market.
MTD
Compared to last month, active inventory has remained steady, while the number of pending listings has increased as we move into the fall market. The median sale price continues to hold steady, boosting buyer confidence, driven by various factors.
YoY
Upon reviewing the preliminary results from September 2024 compared to September 2023, the number of pending listings, active inventory, and sold inventory all increased, driven by a substantial rise in new listings brought to market. The median sale price continued to rise year-over-year, while the median active price remained stable, and days on market saw a slight increase.
CURRENT STATS
KING COUNTY
DOM: 30 | Median Active Price: $819K | Median Sold Price: $937K
SEATTLE
DOM: 29 | Median Active Price: $775K | Median Sold Price: $905K
EASTSIDE
DOM: 25 | Median Active Price: $1.350M | Median Sold Price: $1.450M
PIERCE
DOM: 41 | Median Active Price: $625K | Median Sold Price: $550K
SNOHOMISH
DOM: 28 | Median Active Price: $780K | Median Sold Price: $760K
SKAGIT
DOM: 34 | Median Active Price: $693K | Median Sold Price: $590K
WHATCOM
DOM: 31 | Median Active Price: $655K | Median Sold Price: $574K
THURSTON
DOM: 39 | Median Active Price: $580K | Median Sold Price: $510K
ISLAND
DOM: 34 | Median Active Price: $764K | Median Sold Price: $660K
SAN JUAN
DOM: 73 | Median Active Price: $1.395M | Median Sold Price: $1.344M
KITSAP
DOM: 28 | Median Active Price: $650K | Median Sold Price: $560K
BRIAN’S FORECAST
Interest rates: Q4’24 Avg 6.25% (fluctuating 6-6.5); Q1’25 6% (fluctuating 5.75-6.25); Q4’25 5.75% (fluctuating 5.5-6).
Brian’s Client Tip: 1% decrease in interest CAN roughly equal to 10% more borrowing power but even a 0.5% fluctuation changes buyer demand (and thus competition) the week or two after the fluctuation hits headlines.
https://money.usnews.com/loans/mortgages/mortgage-rate-forecastBrian’s Client Q&A: If fed rates don’t affect mortgage rates, what does? 10Y Treasury bond, CPI/Jobs Reports
https://home.treasury.gov/policy-issues/financing-the-government/interest-rate-statistics
https://www.epi.org/indicators/unemployment/
https://www.bls.gov/cpi/
Increase buyer competition in Q1/Q2’25
Widespread use of escalation clauses with promises to pay additional down in case of low appraisals or even waived financing in all of 2025 from the vast number of sidelined buyers, our growing population, Amazon and half dozen major companies returning to full return to office (1/1/25), and those “typical” new buyers each spring/summer.
Improved condo market from increased DT workers. Also increased metro traffic will increase desired urban living or at least pied-à-terres.
Bully offers will increase in the Eastside in Q1 and Seattle + Seattle metro will see frequent bully offers by Q2.
Increased absorption rate and decreased monthly supply due to World class events like 2025 FIFA Club World Cup in June ‘25 will increase buyer activity before Seattle’s hosting of FIFA’s ‘26 World Cup but won’t encourage sellers to sell
Continued low inventory for rest of decade but increasing and nearing pre-pandemic levels
Minor bump in inventory in 2025 as more sellers will be more comfortable becoming buyers themselves with the lower interest rates and increased consumer confidence.
All economists agree of not enough housing at least through the decade nationwide but especially in Seattle metro where for decades it has been normal to only have 3-4 month inventory opposed to a “balanced” 6 months
HEADLINE NEWS
2024 Slowest Year In Real Estate sales since 1995
FNMA expects 2024 sales to end at 4.7M with a slow but slightly better 5.1M in 2025 if mortgage rates improve 2025 Q3/4. https://www.fanniemae.com/research-and-insights/forecast/economic-developments-september-2024
“Priced to Sell” is worth 8.5%
Homes marketing their value as a a good deal are discounting their home to an average of 8.5%. Seattle metro average is 3.7% and by 2.8% of September’s listings. https://www.realtor.com/research/september-2024-priced-to-sell/
Starting January 1, 2024, all buyers in Washington State are required to sign an agency agreement to receive advice from any real estate agents.
Most likely if you’re reading this, you’ve signed one already as I’ve been using them since 2016!
www.brianhuie.com/agencylaw
Commissions and NAR*: Ruling disallows NAR to force sellers to pay for buyer’s agent’s commission
NAR, along with two brokerage chains, lost an Antitrust lawsuit that stated NAR was forcing sellers to pay for the buyer’s agents’ commissions. NWMLS is not an NAR-affiliated MLS and has not forced sellers to pay a buyer’s agent’s commission. https://www.nbcnews.com/business/business-news/jury-finds-realtors-liable-inflating-commissions-rcna123149
*NWMLS is a member-owned not-for-profit organization NOT an NAR-affiliated MLS - we haven’t required a seller to pay commission since at least 2015. https://www.nwmls.com/about-nwmls/
HISTORICAL TRENDS
Click bait headlines report these trends as if they are unprecedented - These graphs show trends similar to patterns we have seen happen nationwide and through several decades.
New Listings most frequent March-October
Most homes to choose from in October
Month Supply is the time it takes for the current active listings to deplete at the current sales pace. Very low in spring and summer despite having the most new listings, indicating higher buyer activity
Sale Price/Original Listing Price is highest in May and lowest in January but is a 2-6 week lagging indicator based on a successful sale and doesn’t include the original prices of prior unsuccessful listings.
Average time on market lowest in May, highest in December and doesn’t include time a listing has spent on market in a prior unsuccessful listing.
New loan applications peak mid-end of January each year.
Yellow markers indicate the highest point of applications in each year (January); Blue marker is the last reported data for that year (End of December)
National average time a buyer closes after their most recent preapproval is 50-days with a 45 day transaction. It is common in Seattle Greater to search for 3-9 months and transact in 15-28 days.
Average Fixed 30 Year Mortgage Rates
Brian’s Client Q&A: If fed rates don’t affect mortgage rates, what does? 10Y Treasury bond, CPI/Jobs Reports
https://home.treasury.gov/policy-issues/financing-the-government/interest-rate-statistics
https://www.epi.org/indicators/unemployment/
https://www.bls.gov/cpi/