‘No relief in sight’ for hyper-competitive Puget Sound housing market

Mar 7, 2022, 2:49 PM | Updated: Mar 8, 2022, 7:57 am

Single family zoning, Puget Sound housing...

(MyNorthwest photo)

(MyNorthwest photo)

Despite some signs of improvement in February, rising prices and ultra-competitive bidding wars have quickly become the new normal for the Puget Sound housing market.

Puget Sound housing market hits record numbers as prices continue to soar

The latest data from the Northwest Multiple Listing Service indicated that a combination of increased inventory and “a slowing pace of price increases” in February could potentially “ease some of the competitive pressures” prospective homebuyers have seen over the last year.

“Buyers in King County are jumping for joy over the nearly 40% increase in new listings that we saw in February compared to January,” Windermere Chief Economist Matthew Gardner said in a release from the NWMLS.

That comes in the wake of a historic 20-year low in housing market inventory in the Puget Sound region, as pandemic-induced restrictions have begun to lift, and sellers have been more eager to list their homes.

Even so, median residential home prices still continued to climb year-over-year in February, increasing by over 14%, 19%, and 15%, respectively, in King, Snohomish, and Pierce counties. That trend has been even more pronounced in other areas, evidenced by a 21% increase in Kitsap County, where market activity “is up across the board,” notes Frank Wilson, a regional manager at John L. Scott Real Estate.

Economist: Unsustainable for Puget Sound home values to be up every year

Meanwhile, expensive bidding wars have continued to cause headaches for buyers, with one Berkshire Hathaway broker recalling a recent prospective instance where a purchaser offered $250,000 over the asking price of a $2 million Wallingford home, “only to be outbid by several hundred thousand dollars.”

That’s expected to continue well into the remainder of 2022, with “no relief in sight,” warns RE/MAX Managing Broker Dick Beeson.

“It seems even homes that wash up on the beach are getting multiple offers,” he observed. “The sound of interest rate increases is ever nearer, and when coupled with the enormous price increases for homes around Puget Sound, the wringing of buyers’ hands will surely be a sad tale of 2022.”

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‘No relief in sight’ for hyper-competitive Puget Sound housing market