Last year, Seattle-area homeowners witnessed their properties suffer a value setback, a stark contrast to the pandemic-fueled price surge of previous years. As reported by The Seattle Times, the 2023 dip in home prices marked the first year-over-year drop in over a decade. The deceleration appears in conjunction with a broader slowdown in the market, pushed by ascending mortgage rates that cooled off the buyer and seller zeal.
The unraveling of the housing boom was uneven, with rural counties like Clallam, Cowlitz, and Skagit seeing an uptick in home prices, while prominent areas proximal to Seattle felt the chill. Mason Virant, associate director of the Washington Center for Real Estate Research, told The Seattle Times that the market is "finally coming back to reality" after what was termed as "off-the-charts" price increases during the early pandemic period. In a slight correction, King, Snohomish, and Pierce counties recorded 3% to 4% price drops.
Despite the downward trend in single-family homes, Seattle's market demonstrated a semblance of resilience as condo prices saw a slight increase. In 2023, the median condo in Seattle reportedly went up in value by 4%, now costing a median of $558,000. Meanwhile, the Eastside saw a modest 1% dip in condo prices. The condo market's buoyancy, particularly in urban centers, reflects a shift in buyer preference towards more affordable alternatives amidst soaring single-family home costs.
But the situation wasn't all rosy for those looking to purchase property. Sales across King, Snohomish, Pierce, and Kitsap counties plummeted by up to 27%, as would-be buyers found themselves balked at high interest rates that saw monthly mortgage costs "significantly more than what they could potentially rent for," real estate agent Jenny Wetzel described in an interview with The Seattle Times. In fact, many potential homebuyers opted or were forced to rent as the affordability gap widened, despite falling home prices.
The effects of the market cooldown also manifested in the new listings, which saw a significant drop from the previous year. King County registered 27% fewer new listings, with even steeper declines in the neighboring counties. This scarcity of available homes, induced partly by the reluctance of current homeowners to abandon their low mortgage rates, has indirectly prevented further price slides. However, the region's housing market still favored sellers by the end of 2023, offering a silver lining with fewer bidding wars and giving buyers a bit more leeway and protection in the real estate game.
