Real Estate Year in Review
2023 is in the books and it was a very different year in real estate compared to 2022. This post will focus on a 2023 real estate market recap for the Greater Seattle Area and conclude with predictions for 2024. Rising interest rates and low inventory was the general theme of the year. All data and graphs in this post is provided by the Northwest Multiple Listing Service (NWMLS). The NWMLS encompasses 26 member counties, primarily in Western Washington.
Before we dive in to the stats I want to say a big THANK YOU to all my clients over the past year. The majority of my business comes from referrals so I’m grateful that my clients trust that I will take care of their friends, family and coworkers. Out of over 32,000 agents in the NWMLS I ended the year well into the top 1% of agents by sales volume and average sold price. It makes me so fulfilled to help people with some of the biggest financial decisions of their lives and I couldn’t do it without my amazing clients. The trust and satisfaction of my clients is invaluable and their happiness is the driving force behind my passion for this field. It is not just transactional because every sale is an opportunity to create lasting relationships.
NWMLS agents listed 81,612 homes & condos during 2023. Compared to 110,294 listings in 2022, we saw a significant YoY listing decrease of 26%. June had the highest number of new listings last year at 9,481. June having the most listings for any month of the year is no surprise and I’ve previously written about why spring is the best time to list your house for sale.
Unlike the buying frenzy of 2021 and early 2022, we are no longer talking about “weeks of inventory” as a measurement unit for how much supply the market has. In 2023, our market averaged 1.77 months of inventory. This is a big improvement from the 1-2 weeks of inventory we were seeing a couple years ago. That said, we are still well below the 4-to-6 month mark which indicates a market is balanced between buyers and sellers. The month with the lowest months of inventory last year was March at 1.38 months, providing further evidence that Spring and early Summer markets are usually the hottest!
In 2023 the total dollar value of sales from NWMLS real estate agents was $47.7 billion with a median price of $600,000. In 2022, total sales were valued at $63.8 billion so we can see what a major impact decreased listing volume has made to the market. Overall the median price of a home in our region did decrease slightly from 2022 to 2023. Last year the median closing price was $600,000 vs $615,000 in 2022 for a decrease of 2.5%.
San Juan county had the highest median sales price last year at $927,500. This was followed by King and Snohomish counties at $875,700 and $737,500 respectively. Home sales (excluding condos) in 2023 had closing prices at 99.9% of the original list price. Compare this to 2022 where the closing price was 102.5% of the list price. This shows that on average, buyers received the slightest discount on home prices last year. That said, what I observed last year, was buyers much more frequently asking (and receiving) closing cost credits from the seller. Those credits would not change the closed price metric so buyers were getting a bit better of a deal than these numbers are reflecting.
2024 Market Predictions
As interest rates continue to decrease in 2024, I predict we’ll see prices increase. Any buyers sidelined by higher interest rates last year will be closely watching the market. This also means we could see a return of buyer bidding wars. Buyers stepping back into the market will most likely continue to face low inventory which will lead to the higher prices and competition for homes. I think that interest rates have a ways to go until we see a big shift in new listings hitting the market. A recent Redfin report shows that 78.7% of homeowners have an interest rate below 5%. At the time of writing this post, the rate for a 30-year fixed rate mortgage is 6%, down from a 52 week high of 7.8%.
Being in the top 1% of agents gives me a tremendous amount of exposure to current market conditions. This means I am on top of what is happening right now vs. waiting for market statistics to be compiled which are lagging indicators. If you’d like to discuss buying or selling a home in 2024, feel free to contact me!