A Tale of Two Markets

Seattle’s housing market is splitting into distinct tiers. In one tier, single-family homes are flying off the market with skyrocketing prices. In the other, condos are barely budging (and in some cases losing value), while townhouses see only modest gains and still lag far behind their single-family counterparts. Recent data from 2024–2025 reveals a growing gulf in pricing, inventory, and demand between these property types. What’s driving this divergence? A mix of scarcity for standalone houses versus oversupply pressures in condos/townhomes, policy shifts like the One Seattle Plan that encourage multi-unit development, and a buyer pool now dominated by move-up families needing more space rather than first-timers. Let’s dig into the trends.

Single-Family Homes: Prices Skyrocket Amid Scarcity

By 2024–2025, single-family home prices in Seattle have been on a tear. After a brief cooldown in 2022–23, values took off again through 2024. In King County, the median price for a detached house hit $945,500 by spring 2024, up 13% year-over-year​rsir.com. In the city of Seattle proper, the median single-family home sold for about $972,500 in October 2024, an 8% jump from the prior year and even 4% higher than just a month earlier​getthewreport.com. This upward trend continued into 2025. Even accounting for a usual winter slowdown, prices remained elevated; Seattle’s median house price in early 2025 hovered around the mid-$800,000s (roughly flat to a year prior)​windermere-bellevue.com, then began climbing again with the spring market.

Why are house prices so high and still rising? One major factor is scarcity. There are simply too few single-family homes for sale to meet demand. As of March 2025, Seattle’s inventory of homes would sell out in only about 1.8 months at the current pace – “extremely tight” supply for a major metro​themadronagroup.com. (For context, a balanced market is ~4–6 months of inventory.) In practice, many new listings for standalone houses are seeing multiple offers within days. “The classic 3 bedroom / 2 bath home is selling faster than Taylor Swift tickets,” one Seattle broker quipped, emphasizing that “everyone wants to buy a single-family home!!!!”​teamdivarealestate.com. While tongue-in-cheek, that sentiment reflects reality – desirable Seattle houses (especially those under ~$1.5M) are often snapped up in bidding wars, frequently above asking price in 2024–25​urbnlivn.com​getthewreport.com.

The buyer pool for these houses is dominated by move-up buyers and families who “are looking to move up to a larger home for their expanding family,” as Seattle agent Kim Colaprete observed​teamdivarealestate.com. Many of these buyers have equity from a previous home or are relocating from pricier markets, giving them the purchasing power to chase limited single-family inventory. They’re less deterred by high mortgage rates than entry-level buyers, and they prioritize space (yard, multiple bedrooms) – something condos can’t offer. With first-time buyers largely “locked out” of Seattle’s costly market​linkedin.com, competition is fiercest among established buyers, which “keeps the pace fast and prices stable — or climbing” despite 6–7% interest rates​themadronagroup.com. In short, scarcity plus strong family-driven demand equals intense upward price pressure on single-family homes.

Condos: Stagnant Prices and Rising Inventory

On the other side of Seattle’s housing divide is the condominium market, which has been decidedly lukewarm. While house prices soared, condo prices have barely budged – or even fallen – in many parts of the city. For example, the median sales price for condos in Seattle was about $587,500 in spring 2024, up a modest 9.8% year-over-year​rsir.com. But by spring 2025, if you isolate traditional condo units (a condo apartment in a building), the median price was only around $485,000 – **actually ↓9.3% lower than a year prior​seattlecondosandlofts.com. In other words, typical condos lost value year-over-year, even as single-family houses shot up in price. The overall condo statistics can be deceiving, because they’re boosted by new construction townhomes that are legally classified as “condos” (more on that in a moment). When you include those new luxury townhome-style units, Seattle’s “all condo” median looked higher – about $627,650 in March 2025, a 6.8% YOY increase​seattlecondosandlofts.com – but that masks the underlying stagnation in regular condos. In reality, many downtown high-rise and older condo units are struggling to keep their value in this market.

Perhaps more telling is the glut of condo inventory. Seattle ended March 2025 with 798 active condo listings, a whopping +54.7% increase from a year earlier​seattlecondosandlofts.com. New listings have been pouring in (15% more in March 2025 YOY), even as buyer demand for condos remains tepid. This pushed the condo months’ supply to around 3 months – still technically a seller’s market by definition, but far looser than the barely 1.5–2 months’ supply for single-family homes​seattlecondosandlofts.com​nwmls.com. In certain condo-dense neighborhoods (Downtown, Belltown, Capitol Hill), market conditions are soft: units take longer to sell and often require price cuts. As one Seattle real estate report noted, “the Seattle condo market is seeing the effects of a major (+40%) year-over-year supply increase,” which drove the median downtown condo price down 4% between September and October​getthewreport.com​getthewreport.com. More inventory plus less competition means buyers have leverage in the condo space that they simply don’t have shopping for houses.

Seattle realtors are candid about this condo malaise. “The Seattle real estate market in 2025 is a tale of two markets,” Colaprete explained. “One is the hot-moving single-family home market. And the other is the dreaded condo market. Condos are having issues!”​teamdivarealestate.com. She noted her team had “condos that we were unable to give away last year”​teamdivarealestate.com – a stark contrast to the multiple offers seen on detached houses. Another broker, Matt Goyer, agreed that “townhome and condo buyers have it a little easier” these days, recounting how a client of his bought a loft for $100K less than what it sold for a year ago – a huge price drop – “[m]eanwhile, a single-family home we listed in South Seattle went pending in a day”​urbnlivn.com. These anecdotes underscore the lack of demand from first-time buyers and urban professionals who typically drive the condo market. Many of those buyers have pulled back due to affordability concerns or are sitting on the sidelines hoping for interest rates to fall. As a result, Seattle’s condo sector has an oversupply of options and an undersupply of eager buyers. Units in high-rise buildings, in particular, face competition from the many new apartment towers (for rent) and lingering post-pandemic wariness about downtown living.

It’s not all doom and gloom for condos – the segment is historically cyclical, and some see opportunity in the softer prices. With developers largely halted on new condo projects (no new condo towers have broken ground in Seattle since 2020, meaning “zero new supply for sale is expected in Seattle between 2025–2027”​rsir.com​rsir.com), the current glut consists of existing inventory that will eventually be absorbed. In theory, if buyers snap up today’s discounted condos, the lack of future supply could even “provide a clear runway of potential gains ahead for [condo] unit owners” once the market balances​rsir.com​rsir.com. But that scenario may be a few years out. For now, condos remain the cool corner of Seattle’s hot housing market, with flat or falling prices and much more buyer-friendly conditions.

Townhouses: Moderate Gains, but Still Lagging Behind

Somewhere between the standalone houses and condos lies the townhouse segment – and it truly is caught in the middle. Townhomes in Seattle (typically multi-level attached homes, often newly built on former single-family lots) have seen price increases, but nothing like the surge in detached house prices. Many new townhouses hit the market in the past two years, providing an important source of “middle” housing inventory. Buyers have responded with moderate interest: townhomes do sell, especially newer ones with decent square footage, but they don’t spark bidding wars at the same clip as single-family homes.

In fact, many townhomes are sitting on the market longer. It’s not uncommon for a Seattle townhouse to take 30–60 days to find a buyer, whereas a well-priced house might be gone in 7–10 days. “Townhouses are not selling in the first or second week. It takes at least one month for a townhouse to grab attention… You have to have your home priced at or below the lowest-priced comparable property,” advises Colaprete to townhouse sellers​teamdivarealestate.com. In other words, whereas sellers of single-family homes can be ambitious (and still likely get offers above list), townhouse sellers often must price competitively and be patient. The pool of buyers willing to consider an attached home is somewhat larger than the condo buyer pool (since townhomes can offer more space and often no HOA dues), but these buyers are also looking for relative value – they expect a townhome to be cheaper than a house, and in 2024–25, it certainly is.

How much cheaper? The price gap between detached houses and townhomes is significant. In Seattle, brand-new townhomes in popular neighborhoods often list in the $700,000s to low $800,000s – and that’s for 3 bedrooms, maybe ~1,500 sq ft and a small patch of yard (if any). Compare that to a detached 3-bedroom house in the same area, which might easily top $1 million if updated. Regionally, the gap is evident in the data: On Seattle’s Eastside (Bellevue and surrounding suburbs), the median single-family house sold for about $1.71 million in January 2025, whereas the median condo/townhome sold for $724,000​windermere-bellevue.com. Seattle’s city stats show a similar pattern – detached houses in early 2025 were around $857K median, versus roughly $690K median for condos (with townhomes included in that condo figure)​windermere-bellevue.com. And if we isolate just traditional condos, the gap is even wider (houses nearly double the price of an average condo). Single-family homes have become a luxury good, and townhouses are the “budget” family option – serving those who can’t afford a standalone house but need more space than an apartment. This positioning has kept townhouse prices from appreciating as quickly as houses; they “fare a bit better” than condos, but as one agent put it, “what everyone wants to buy is a single-family home!”​teamdivarealestate.com.

Inventory dynamics also play a role. Seattle has been on a townhouse-building boom in recent years, and new supply is steadily coming online. Many of these townhomes are built by tearing down older single-family houses. It’s common to see a mid-century bungalow sold, bulldozed, and replaced by three or four skinny townhome units. This incremental infill means the supply of townhouses has grown, easing the upward pressure on prices in that segment. In contrast, every time an old house is demolished, that’s one less “starter” single-family home on the market, further tightening the supply of detached houses (especially affordable ones). It’s a paradoxical situation: building townhomes adds to housing stock (a positive for overall supply), but if it replaces a standalone house, it also removes the very product type that is most scarce.

Newly built two-story townhomes in Seattle’s South Park neighborhood, constructed on a lot where a single older house once stood. City zoning changes are enabling higher-density replacements of single-family homes, as seen here.

Seattle’s One Seattle Plan and related zoning policies are accelerating this trend. The city’s new comprehensive plan (One Seattle) envisions “additional housing density” in formerly single-family zones across the entire city​theurbanist.org. In fact, a state law (HB 1110) now mandates that Seattle allow 4 to 6 housing units on all residential lots by mid-2025, effectively ending exclusive single-family zoning​theurbanist.org​theurbanist.org. The city council has already implemented a temporary ordinance to meet this requirement. Practically, this means lot splits, duplexes, triplexes, and more townhouse-style projects will become routine in neighborhoods that once only had single houses. We’re already seeing what this looks like on the ground. For example, in the South Park neighborhood, a developer recently took a single 6,000 sq ft lot and added six small townhome-style houses (each ~832 sq ft, 2-bed/2-bath) in place of one old cottage​theurbanist.org. Similar infill projects are happening in areas like Ballard, Crown Hill, and Beacon Hill. The One Seattle Plan will encourage even more, with proposals to allow small apartment buildings near frequent transit lines and “neighborhood anchors” alongside the townhome infill​theurbanist.org​theurbanist.org.

The impact on market dynamics is twofold:

• More townhome supply should, in theory, help moderate prices for those units (and provide more options for buyers who are priced out of detached homes). Indeed, as noted, Seattle’s condo/townhome inventory has ballooned, giving buyers a break. A North Seattle area saw its median condo/townhome price jump +21.8% in March (to ~$737K) only because many high-end new townhomes sold; if you exclude those and look at just traditional condos, the median was $425K – a 7.4% price drop year-over-year​seattlecondosandlofts.com​seattlecondosandlofts.com. In other words, new townhomes are propping up the “condo” stats, but also adding to supply and choice, which can push sellers to be more competitive on pricing. Townhome builders know they can’t push prices infinitely – buyers will simply opt for a different neighborhood’s single-family home if a townhouse gets too expensive.

• Less single-family supply: On the flip side, every older house replaced by townhomes makes detached houses even more scarce. Many homeowners with a standalone house and a sub-4% mortgage rate are staying put (why sell when replacing that house would cost much more in today’s market?)​rsir.com. So the churn of single-family homes remains low, and some of the churn that does happen results in those homes being removed from the single-family pool (converted to multi-unit). This contributes to the phenomenon of the standalone house as an increasingly precious commodity in Seattle. It’s part of why single-family home prices have stayed high even as overall inventory creeps up – “residential prices have stayed steady or increased… reflecting continued competition among buyers” despite the most new listings Seattle has seen since before the pandemic​getthewreport.com​getthewreport.com. Essentially, scarcity of houses is self-perpetuating in the short term: the more we densify, the fewer intact houses there are, and those that remain become even more coveted by families set on having one.

Families vs. First-Time Buyers: A Shifting Buyer Pool

Underlying these trends is a demographic/economic shift in who’s buying homes in Seattle. In the late 2010s, low interest rates and tech-driven growth meant lots of millennials jumping into homeownership – including many first-time buyers who often chose condos or smaller townhomes as their starter home. Now, in 2024–25, first-time homebuyers have pulled back dramatically. Seattle’s affordability has worsened to the point that only a handful of U.S. markets (San Francisco, San Jose, L.A., New York) are less affordable​linkedin.com. Pair that with mortgage rates around 7%, and you get a generation of would-be buyers who simply can’t make the math work on even a condo purchase. Seattle Times reports have noted that many first-timers feel “locked out” and that this situation is unlikely to improve much in 2025​linkedin.com. The result: fewer entry-level buyers in the market. Those who remain are either buying further out (in suburbs or exurbs where prices are lower) or staying in rentals for now. This drop in demand hits the condo and townhome segment hardest – exactly what we’ve seen with sluggish condo sales and price stagnation.

Meanwhile, the buyers who are active in Seattle skew toward older, repeat buyers with more money. Many are people who sold a condo or starter home a few years ago and are now “move-up” buyers, often with kids or planning for kids. These buyers overwhelmingly want single-family homes with a yard, good schools, and room to grow. “What everyone wants to buy is a single-family home,” as Colaprete says bluntly​teamdivarealestate.com. The data backs this up: across King County, home sales over $1 million (mostly detached houses) have been strong, while the volume of lower-priced home sales has been relatively weaker, in part because there just aren’t as many qualified buyers in that starter range. This aligns with anecdotes from agents like Goyer who note that single-family homebuyers “may not see much relief” in competition, whereas “townhome and condo buyers have it a little easier” in 2024–25​urbnlivn.com. Essentially, families needing more space are driving the market, and they’re chasing a limited number of listings, which pushes house prices up. First-time buyers, who would normally soak up condos and entry-level townhomes, aren’t keeping up at the same pace – contributing to softer prices in those categories.

The Growing Price Gap and What It Means

All these factors have led to a growing price gap between single-family homes and other types of housing. In plain terms, detached houses now cost dramatically more than condos or townhouses in Seattle. A few years ago, a condo in the city might cost, say, two-thirds the price of a house. Now it’s often half the price (or less) of a comparable house. For instance, in early 2024 the median Seattle condo ($587K) was about 62% of the median Seattle house ($945K)​rsir.com. By early 2025, the median traditional condo (~$485K) was only 55% of the median house ($857K)​seattlecondosandlofts.com​windermere-bellevue.com. The gap is even wider for larger family-sized homes in prime neighborhoods. In Bellevue, a new luxury condo might sell for around $1 million, but a single-family home in the same area can easily be $2–3 million. Even in suburbs like Shoreline (just north of Seattle), where the median home price is around $800K in 2025, new townhomes are being listed in the $600Ks – a gap that shows how much premium a standalone lot and yard still command. Scarcity has made the single-family home a hot commodity, and relative oversupply has made condos/townhomes a buyer’s market.

For Seattle’s housing future, this divergence raises interesting possibilities. The city’s push for density via the One Seattle Plan could eventually narrow the gap by increasing the supply of moderately priced townhomes and small multiplexes, giving buyers more choices aside from expensive detached houses. Over the long term, if hundreds of new townhouses get built in Seattle’s neighborhoods, we might see condo/townhome prices stay relatively stable while single-family house prices plateau (simply because there will be fewer buyers who must buy a house at any cost when alternatives exist). Already, there are hints of stabilization: more inventory is “leading to market stabilization” according to NWMLS economists, who note that increased supply will “slow pressure on home prices over time.”​seattleagentmagazine.com. However, in the short term, the effect may actually be the opposite – the more we densify, the rarer the untouched single-family house becomes, and the more its price shoots up due to competition among space-hungry families. As one columnist wryly observed, Seattle’s market has become “a tale of two markets”​teamdivarealestate.com, and right now those two markets are moving in opposite directions.

Bottom line: If you’re a Seattle home shopper or seller in 2025, it’s critical to recognize which segment of the market you’re in. Single-family homes are ultra-competitive – expect fast sales and high prices (great if you’re selling, tough if you’re buying). Condos and townhouses are comparatively soft – buyers can take their time and negotiate, while sellers need to price sharp and be patient. The gulf between a $1 million Craftsman house and a $500K downtown condo has never been wider. Until either supply increases for houses or demand returns for condos, that gap isn’t likely to close. Seattle’s growth plans and zoning changes will be important to watch: they aim to inject more supply (and more affordable choices) into the market, but their early influence seems to be “more townhomes, fewer houses.” In the meantime, Seattle’s housing story remains one of big contrasts – a booming single-family sector and a cooling condo/townhome sector – both coexisting in the same city, each telling a very different tale of the market.

Sources:

• Northwest MLS / Seattle housing market data (2024–2025)​rsir.com​getthewreport.com​seattlecondosandlofts.com​seattlecondosandlofts.com

• Seattle Condos and Lofts – Seattle Condo Market Recap March 2025 (analysis of traditional condos vs new townhome condos)​seattlecondosandlofts.com​seattlecondosandlofts.com

• Kim Colaprete (Team Diva Real Estate) – Seattle 2025: Sell Single-Family, Maybe Townhouse, Hold Condo (local agent insights)​teamdivarealestate.com​teamdivarealestate.com​teamdivarealestate.com

• Matt Goyer (Urban Living) – Weekly Market Commentary Feb 2025 (broker anecdote on condo vs house sale)​urbnlivn.com

• Seattle Times (via LinkedIn summary) – First-time homebuyers may not see much relief (Seattle affordability rank and first-timer challenges)​linkedin.com

• Seattle Met / Windermere Reports – Seattle and King County market updates Oct 2024 – Mar 2025 (price and inventory trends by segment)​getthewreport.com​getthewreport.com​windermere-bellevue.com

• The Urbanist – South Park upzoning example & One Seattle Plan (townhomes replacing a house; comprehensive plan allowing 4–6 units per lot)​theurbanist.org​theurbanist.org

• NWMLS/Seattle Agent Magazine – Inventory and market stabilization commentary​seattleagentmagazine.com