‘Significant obstacles’ remain for homebuyers in the Puget Sound region

Sep 8, 2021, 11:56 AM
Seattle single family zoning, homebuyers...
A row of homes in Seattle. (Joe Mabel, Wikimedia Commons)
(Joe Mabel, Wikimedia Commons)

Home prices in the Puget Sound region are still a difficult and frustrating topic for many, especially for those hoping to be first-time homebuyers.

“It is still tough. I think there’s a couple of things within the numbers in August which are worth while chatting about very briefly,” said Matthew Gardner, Windermere’s chief economist. “Obviously, listing activity is down. But you know what? It’s August, that really isn’t a surprise. Traditionally, we do see a pull-back then.”

“So it’s tight in terms of homes on the market and the number of them, however, pending sales rose in the central Puget Sound, which is certainly a sign that there is still significant interest from buyers out there, irrespective the fact that there is next to nothing to choose from,” he added.

While the bidding wars don’t seem to be quite as frenetic as it was in months past, it is still happening.

“The reason I can say that is that … I like to look at list prices because they’re kind of more of a leading indicator,” he said. “And what I found fascinating was that the median list price, let’s say in King County, was lower than the median sale price.”

“So when you’ve got sale prices above list prices it means that, obviously, homes are going for above the prices being asked, so that is applicable in King and Snohomish counties, not so much yet down in Pierce,” Gardner explained. “But the market is still very, very robust.”

There’s also pockets of additional inventory, and Gardner’s hopeful that will increase in the fall.

“Naturally, all dependent upon COVID,” he noted.

Home office space is now ‘very high on people’s list of requirements’

With so much information — on how long people stay in their house, construction prices, and other housing topics — what’s most important to pay attention to for those who want to be a homeowner?

“Let’s go through that list,” Gardner replied. “Yes, we are living in our homes in the Seattle area in general for twice as long as we did back no more than a decade or so ago. So we’re not moving for our jobs as frequently, or if we are taking a new job we’re staying put, we’re not seeing people downsize, we’re not retiring when we’re supposed to, we’re staying in the workforce longer.”

“So because of that, we’re not going to move,” he continued. “And if we’re not seeing that downsizing, it means that people are looking to move up, those second time homebuyers, they’re limited in terms of the choice of homes out there.”

If they can’t find somewhere, they don’t sell. If they don’t sell, then first-time homebuyers “are shot.”

“On the construction standpoint, although everyone’s been talking about lumber prices, which went parabolic several months ago, they have pulled back dramatically,” he said. “However, it’s not just lumber, it’s all the components to build a house, and also — believe it or not — appliances as well, there’s a shortage out there.”

“So new home builders are having a hard time, again, because of cost,” he added. “So if we’re creating households, we’re not building enough housing, what does that do? That puts upward price pressure on the existing housing stock and that’s exactly where we are today.”

The added challenge is that there’s no precedent for what we’re going through now, at least not that any large number of people have lived through.

“The last time we saw this — we didn’t — it was 1915 with the Spanish flu pandemic,” Gardner said. “So it’s been a long, long time. And so there really is no precedent. We were in a very different place than we are today.”

“However, if we look at the overall numbers, yes, a lot of us are still working, a majority of us are still working and that does very much apply, as I mentioned earlier, to those industries where you can work from home,” he noted. “But in a lot of respects, I think a lot of the larger companies in our area who are planning on people coming back to work after Labor Day, well, given the increase in people catching COVID, they’re now pushing that back, a lot of companies now until the start of January. So it just adds an increased amount of uncertainty.”

“And what markets do not like is uncertainty,” he added.

Economist: ‘Don’t give up hope’ on Seattle housing market

Gardner is confident we’ll get through this, but recognizes that we all just want to come out the end of it.

“We will, but unfortunately just not quite yet,” he said. “Has it got the capacity to drag us back into another recession? I just don’t see that happening. But there’s certain significant obstacles, without a doubt, that are out there still that we were hoping would be gone by now.”

Listen to Seattle’s Morning News weekday mornings from 5 – 9 a.m. on KIRO Radio, 97.3 FM. Subscribe to the podcast here.

Dave Ross on KIRO Radio 97.3 FM
  • listen to dave rossTune in to KIRO Radio weekdays at 5am for Dave Ross on Seattle's Morning News.

Dave's Commentary

Dave Ross

voting rights...
Dave Ross

Ross: It’s time to start working on a plan B to protect voting rights

Everyone who is passionate about protecting voting rights, start working on plan B now. Use that anger to show voters how to comply with repressive laws.
15 hours ago
Inslee, swear...
Dave Ross

Ross: Let them swear they will tell nothing but the truth

My daughter heard yesterday’s commentary about Inslee’s proposed law to discourage candidates from lying about elections, and came up with an alternative.
2 days ago
health care workers, hospital...
MyNorthwest Staff

Mercer Island MD: New guidelines for health workers could expose ‘vulnerable people’

Dr. Gordon Cohen, Mercer Island MD, comments on the new guidelines from the CDC that allow COVID-positive health care workers to return to work.
3 days ago
emergency powers...
Dave Ross

Ross: Gov. Inslee’s bill to punish lying politicians may be asking for trouble

A growing number of reasonable people are questioning Governor Inslee’s bill (Senate Bill 5843) to punish lying politicians.
3 days ago
MyNorthwest Staff

UW Virology head: Not yet to the peak of omicron in Washington state

In Washington state, at least in the local population that UW Medicine is caring for, it's not yet safe to say that omicron has peaked.
5 days ago
vaccine mandates...
MyNorthwest Staff

Former state AG: OSHA’s COVID vaccine mandate was too broad

Former state Attorney General Rob McKenna provides insight into the U.S. Supreme Court's ruling on President Joe Biden's vaccine mandates.
6 days ago

Sponsored Articles


Compassion International Is Determined to ‘Fill’ a Unique Type of Football ‘Stadium’

Compassion International SPONSORED — During this fall’s football season—and as the pandemic continues to impact the entire globe—one organization has been urging caring individuals to help it “fill” a unique type of “stadium” in order to make a lasting difference in the lives of many. Compassion International’s distinctive Fill the Stadium (FtS, fillthestadium.com) initiative provides […]

What are the Strongest, Greenest, Best Windows?

Lake Washington Windows & Doors SPONSORED — Fiberglass windows are an excellent choice for window replacement due to their fundamental strength and durability. There is no other type of window that lasts as long as fiberglass; so why go with anything else? Fiberglass windows are 8x stronger than vinyl, lower maintenance than wood, more thermally […]

COVID Vaccine is a Game-Changer for Keeping our Kids Healthy

Snohomish Health District SPONSORED — Cheers to the parents and guardians who keep their kids safe and healthy. The dad who cooks a meal with something green in it, even though he’s tired and drive-thru burgers were tempting. The mom who calms down the little one who loudly and resolutely does NOT want to brush […]
Experience Anacortes

Coastal Christmas Celebration Week in Anacortes

With minimal travel time required and every activity under the sun, Anacortes is the perfect vacation spot for all ages.

Delayed-Onset PTSD: Signs and Symptoms

Lakeside-Milam Recovery Centers SPONSORED — You’re probably familiar with post-traumatic stress disorder. Often abbreviated as PTSD, this condition is diagnosed when a person experiences a set of symptoms for at least a month after a traumatic event. However, for some people, these issues take longer to develop. This results in a diagnosis of delayed-onset PTSD […]

Medicare open enrollment ends Dec. 7. Free unbiased help is here!

Washington State Office of the Insurance Commissioner SPONSORED — Medicare’s Open Enrollment Period, also called the Annual Election Period, is Oct. 15 to Dec. 7. During this time, people enrolled in Medicare can: Switch from Original Medicare to a Medicare Advantage plan and vice versa. Join, drop or switch a Part D prescription drug plan, […]
‘Significant obstacles’ remain for homebuyers in the Puget Sound region