Seattle sees second-largest home price drop in the country as spring market fizzles, Redfin reports

Seattle’s housing market is cooling as the spring season winds down.

The city’s home prices dropped 4.8% year-over-year, the second-largest decline of any major metro, according to new data from Redfin.

San Jose, California, saw the largest drop in housing prices, with a decrease of 6.2% year-over-year. Seattle’s second-place ranking was followed by Portland, Oregon, which saw a decline of 2.8%; Dallas, Texas, with a 1.8% drop; and Orlando, Florida, with a 1.5% decline.

Meanwhile, metros that saw the largest median sale price increase were San Francisco, California, at 11.5%; Detroit, Michigan, at 9.7%; West Palm Beach, Florida, at 9%; and St. Louis, Missouri, at 8.5%.

Nationally, home prices just hit a record high, keeping many buyers away. In Seattle, that pressure is showing with median sale prices down nearly 5% from a year ago while pending sales have dropped 12%. New listings fell to their lowest level since the start of the year nationally, dropping 1.7% from the previous week.

Sellers pulling back as buyers gain the upper hand

Redfin said home sellers are pulling back because of softening demand, and that demand is being dragged down by high housing payments. Despite the slowdown, Redfin noted it’s a buyer’s market across much of the country, with hundreds of thousands more sellers than buyers.

“Home inspectors are busy. Buyers are regularly including inspection contingencies in their offers, which is one sign that they have the negotiating power; when sellers have power, buyers often waive the inspection,” Ben Ambroch, a Redfin Premier agent in Milwaukee, stated. “They’re requesting repairs and money based on the inspection, and sellers often need to give buyers what they ask for in order to close the deal. Of course, some homes are still competitive. The ones that are in the most desirable neighborhoods and in tip-top condition inspire bidding wars.”

Broker warns Seattle’s luxury market is in trouble

Last month, principal broker Leah Courage of The Courage Group at ONE Realty warned on “The John Curley Show” on KIRO Newsradio that Washington’s real estate market was headed for serious trouble. Courage shared that the day after Senate Bill 6346 was passed and signed by Governor Bob Ferguson, luxury listings — listings of homes worth more than $2 million — spiked by 65% in one single day, while luxury listing sales were down across the board.

The exodus of high earners could accelerate further, as those who don’t establish a primary domicile outside Washington within 12 to 24 months will be taxed on all income over $1 million starting in 2028 under the new law.

Contributing: Aaron Granillo, KIRO Newsradio; Julia Dallas and Frank Sumrall, MyNorthwest