Seattle Real Estate Market Update

We’re now halfway through the year. So, we figured we’d hop in for a quick 2024 real estate market update.

RATES

After peaking at nearly 8% in late October of last year, 30 year mortgage rates saw a precipitous fall to ~6.6% in January. Since then, we have seen rates slowly creeping upwards in fits and starts, reaching as high as 7.2% in early May. Right now, the outlook on rates is marginal: not good, not bad. We are hovering just under 7% (though many are doing better than this), and should stay there over the next quarter. Q4 is likely to see rates start dropping closer to the 6.5% mark, on average. Expect minor volatility between now and then.

Rates went up, then down, then all around over the last 12 months.

INVENTORY

PRICES

It appears we have reached peak pricing for the year. Memorial Day is the unofficial midpoint of the residential home sale season. Just a week removed from that holiday, we are already seeing decreased offer numbers on numerous listings, as well as an uptick in listings with price reductions. This is a normal, seasonal occurrence. As list prices keep going up, and demand slows, we reach a natural tipping point. Expect prices to be relatively stable for the next month or two, before starting to slowly decrease in late Summer. Keep in mind, not all that’s shiny is gold. The good listings will still see multiple offers and fetch high prices, even as overall demand slows. There remain plenty of buyers out there, ready to pounce. And it only takes two determined buyers to drive up the price of a home. Condo buyers are likely to see less of this effect, however, and will probably enjoy pretty reasonable pricing from here on out until at least early 2025.

**A quick note. No one thought prices were going to rise this year as much as they did. Perhaps it was due to too much wishful thinking surrounding interest rates and the potential for new listings. Whatever the case, 7-8% year over year price increases in a high rate environment aren’t what most of us had in mind. Hindsight is always 20:20. Perhaps buyers would have been better served to purchase when rates were high in late 2023. As always, it’s generally best not to try and “time the market.” This is just another example of why that maxim holds true.

Don’t let the huge jump fool you. We’re near the peak and things are leveling out.

WHAT’S NEXT

Opportunistic buyers should continue to keep an eye on the market. But, don’t rush. Deals should start cropping up more as the year goes on. That said, these improvements are likely to be marginal. The best thing we can say is that things don’t seem like they’re going to get worse for buyers from here on out. We’re leaning more upside than downside.

Please don’t hesitate to reach out for more details/to have your questions answered!