Seattle housing prices improved, but still not a buyer’s market

A recent report from the Northwest Multiple Listing Service was generally positive on the outlook for buyers in the region’s housing market, but Windermere Real Estate Chief Economist Matthew Gardner also cautions that we’re not quite in a buyer’s paradise yet.

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“Are we going to see house prices continue to drop?” Gardner asked KIRO Radio’s Dave Ross on Seattle’s Morning News. “I would argue that no, that’s not the case. Why do I say that? Quite simply, I think we’ve reached an affordability ceiling.”

That ceiling saw the median closing price for houses in King County settle at $639,000 by the end of 2018, down from the year’s high of $726,275 in May. That marked a 2 percent raise year-over-year, the lowest King County has seen in “several years” according to Gardner.

This seems to build on what the NMLS report said as well — in it, Windermere President OB Jacobi noted that the end of 2018 brought us “closer to a more balanced market.”

“We are not in a buyer’s market yet, however we’re heading toward a more stabilizing market,” Gardner agreed.

Without a true buyer’s market, many are deciding to adopt the “wait and see” approach as they house-hunt.

“A lot of home buyers now are saying ‘perhaps we’re just going to wait, perhaps there’ll be more choice next year, [or] perhaps prices will continue to soften,'” said Gardner.

Gardner expects that to change come spring 2019, where he expects prices to trend up, albeit at “far more modest rates” than in past years.

As for the days in the Seattle housing market where dozens of offers would come in on a single house within days? Those might actually be numbered.

“I think what we saw over the course of the last couple years, (where) a home came on the market on a Sunday, and there were 25 offers by the Wednesday, that has certainly gone away,” Gardner noted.

Meanwhile for renters, it really depends on where you’re looking. Gardner cites data that claims one out of every 10 apartment units in Seattle are vacant, but Bellevue is a different story altogether, thanks in some part to Amazon.

The evolution of Bellevue has been quite remarkable — we’re seeing an awful lot of new commercial activity there, new apartment units being built, [and] new office space. Obviously Amazon moving into that market place is going to be a very major impact as well. That’s going to have effects, and that’s going to push rental rates in Bellevue up I believe.

The next year for the Northwest’s housing market will be one to watch, as prices continue to settle into the more balanced market predicted by Gardner and his Windermere colleagues.

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