School is back in session launching the end of the summer market craze that never quite materialized in the Puget Sound Region. In lieu of the market correction that lead us into 2019, many experts were reluctant to predict if a summer market uptick would send the Seattle market back into the frenzied state that left buyers fatigued a year ago. Turning the corner into September the market continues to stabilize, marking the start of real estate predictability that the region hasn’t seen in nearly a decade.
Three months ago, prices in King County started to drop and kick-started a trend that has lead to a steady decline across the county all summer. Seattle started making headlines is it was dethroned from the hottest market in the nation, to one of the only markets in the nation were prices were declining. According to the latest data from the Northwest Multiple Listing Service (NWMLS) King County average home prices dropped a further $5,900 in the month of August. Median prices also fell $10,000 in August. Median prices in King County dipped to $615,000, the lowest recorded median price in the county since May 2019 but hovered $5,000 above the year over year median price of $610,000. Analysts credit the price drops to buyers favoring regions outside of Seattle. Further proved by the media attention from Tacoma becoming the hottest housing market in the nation.
Experts advise that price corrections are still not a bad sign in King County, with tech giants announcing job growth coupled with low interest rates, King County could simply be continuing to reach a balanced state for buyers and sellers. Prices are dropping, but inventory is remaining stable at 1.74 months, which is lower than the 1.92 months of inventory reported from August 2018. As far as King County is concerned, the numbers are dropping slightly, but numbers are dropping collectively across the board maintaining stability for buyers and sellers.
Dropping prices in King County, mean that prices everywhere else are rising. Pierce and Snohomish counties are experiencing the reverse of King County, where everything is rising, but rising across the board and keeping the market from reaching a “crazed” state. Buyers are flocking to Pierce and Snohomish for the significantly cheaper prices but it’s creating a buyer brawl in certain price brackets. Lower-priced home competition is pitting first-time home buyers against baby boomers looking to downsize. Pierce County inventory is hovering around 1.34 months July to August, meaning that buyers are there, but the inventory is struggling to keep up with this specific buyer pool. Snohomish County reported a significant drop in inventory from 1.57 months to 1.47 months, with experts predicting inventory to drop even further heading into fall.
The Puget Sound is in the middle of an interesting market change where the buyer pool doesn’t show signs of slowing down. However, buyers are reluctant to return to the craze from a year ago, instead moving into Pierce and Snohomish counties for areas showing favorable steady growth, and prices that are much friendlier on the wallet. Homes within the lower price ranges are moving quickly, as evidence by our recent listing that went pending after just 48 hours on the market. Investors would be wise to capitalize on the growth projections, lower prices, and growing buyer pool in Pierce and Snohomish counties. Investors looking in the King County region would be wise to capitalize on current price drops. With Amazon, Apple, Facebook and other tech giants promising expansion and job growth in King County, the region is likely to experience a steady increase in buyers moving to the region.
Heaton Dainard experienced much of the same growth in numbers as was visible across the NWMLS. We closed on 8 properties, maintaining an average closing price 100.82% of list price. We also had 9 new listings throughout the month, a slight increase from July, which brought five new listings. Our team is constantly tracking market trends and advising our investors on the smartest and best use of renovation funds to appeal to the most lucrative market options.
First-time home buyers can also find hope competing in the market with new first-time home buyer options. Coming soon Heaton Dainard will be hosting classes for first-time buyers to learn what options are available to help you begin your journey in home-ownership. To learn more about these classes, contact us today.