The real estate market, economy, and Seattle weather have all been experiencing a wild ride this Spring. In the Fall of 2021 I asked Are We Seeing a Seasonal Cooldown? The answer at the time was a resounding “NO!” but this time is a bit different. The Puget Sound area real estate market has seen an increase in inventory which is great news for buyers, but already high prices and rising interest rates appear to be slowing the sales frenzy. To get a better understanding of what is going on in our market, I’ll examine the latest inventory and pricing numbers in this post. Data provided by the Northwest Multiple Listing Service (NWMLS).
Last month a total of 11,681 new listings were added to the market. This is a good sign because it represents the highest number of new listings added since July of last year. Only two counties (King and Jefferson) have seen a year-over-year drop in inventory. King County retains the top spot for hottest market and toughest buyer competition with only 4,199 new listings added last month compared to 4,602 new listings in April of 2021.
Homes are still selling so quickly that we are looking at “weeks of inventory” as opposed to the traditional “months of inventory” where it would take 4-6 months to deplete all inventory in a balanced market. Market-wide there was 0.78 months or three weeks of inventory available in April 2022. This is a slight increase compared to the 0.65 months of inventory available in April 2021. King County remained fairly flat with 0.69 months of inventory available in April 2022 compared to 0.65 in the prior April. The shift is slow, but this trend is good news for buyers while prices remain at record-highs for sellers.
In April 2022, the median closing price for single family homes + condos across the 26 counties served by the NWMLS was $659,950. Excluding condos that number increases to $744,313. Prices in King County (excluding condominiums) also increased by nearly 20% from a year ago! In April 2022 the median single family home price in King County was $995,000 – up from $830,000 in April 2021! For condos area-wide, the median price increased by 15.5% over the last year to $485,000. The median price of a condo closing in King County last month was $518,000. A fact to note is over 60% of all condo sales area-wide over the past year occurred in King County.
A metric the NWMLS is reporting on that I haven’t discussed in this blog before is the list price to sales price ratio. That ratio has been trending over 100% for some time now, meaning most homes sold are bid up above the listing price. In April of this year that ratio was 107.8% which was down slightly from the 12-month high of 108.2%. In April 2021 when prices were still steadily climbing the ratio was 106.6%. This shows at the peak of our market, on average homes were selling for nearly 10% above their list price.
I believe prices will flatten out for awhile, and possibly even decrease slightly in some areas. We are starting to see that trend in the data now, but we need a few more months to see how this plays out. How the economy continues to trend and interest rates will play a significant factor as well.
Real estate metrics are a lagging indicator because we are analyzing closing data at the end of each month, meaning most of the transactions we’re looking at went into contract 30-60 days before the report came out. Anecdotally I’m definitely seeing these numbers reflected in the real world, with an emphasis on reduced buyer activity. I’m consistently seeing less volume through listings and fewer offers on offer review date compared to earlier this year. This point is why I think it is important to choose an agent that has a lot of experience in the current market. In 2022 I’ve been consistently adding new listings every month which gives me a great perspective on how the market is changing, even ahead of the data. This allows me to give my buying and selling clients the most relevant guidance possible. If you are entering the market this year, good luck out there and feel free to contact me with any Seattle area homebuying or home selling questions.