Well, I’m not bearish on Seattle’s market… nor am I bullish. But Seattle is facing some headwinds. It’s great if you are a buyer, but if you’ve been holding off on selling, you might want to pay close attention to our observations.
First, I don’t think home prices are going down, but they are going up more slowly. Of course, my opinion is subject to change depending on a few factors, but I don’t see anything brewing at the moment that could cause a reversal in home prices. Currently, homes are only selling with one or two offers.
Fundamental housing market dynamics are dependent on only a few drivers. These include:
Demand (The number of homes available and number of active buyers)
Affordability (Cost of ownership, interest rates, national market, perception of market, and home prices)
Market perception (Are people feeling happy or concerned?)
Geopolitical factors (Stability vs. instability)
Local political pressures (Taxes, jobs, etc)
The factors I’m especially watching are:
Weak dollar (Will this be a continued trend, or will we see a reversal? This is a new negative factor as of this year.)
Inflation (A continued trend or will we see a reversal. Another new negative factor as of this year.)
Interest rates (Likely to continue increasing next year, but on hold for now at 5%.)
Amazon H2Q (People will be transferred to a new location to help open offices.)
Geopolitical instability (This depends on so many factors, and we are all in uncharted territory here. Perception is the issue.)
To expound a bit more on the weak dollar and inflation, these two things are closely tied together. Our dollar has been battered over the last several months, and couple that with some of the highest inflation rates we’ve seen, and you have the beginning of a potential issue. If the dollar buys less, people can afford less.
There are just some preliminary thoughts—2019 is still a ways off, but if you’re thinking about buying or selling, it’s never too early to plan. Have a question about any of this? I’m happy to chat! You can get in touch here.