Published December 13, 2022
November Market Report: The Ride is Shifting
The latest statistics for our region are hot off the presses, and reflect the widely held mixed feelings of economists, investors and our neighbors throughout the community. While our inventory levels have dropped significantly, we are not seeing the level of competition expected in such a strong sellers market. This lack of competition is evident in increasing days on market and lower list/sales price ratios, and is beginning to affect median home price which is significantly lower month over month though up slightly year-over-year.
The next 3 to 6 months will be very interesting to watch as we are beginning to see signs of slowing inflation which is helping decrease interest rates and make homes more affordable. Meanwhile, as we come out of the winter holiday season, we expect buyers to begin to take advantage of the more balanced, if not buyer favored, market to lock in moderate prices on homes. While we don't expect enough buyer activity to take us back to 2020-21 levels of competition in the market, we do expect enough activity to help stabilize median home prices so that we will see marginal (± 3%) changes year-over-year through the first two quarters of 2023.
With the exception of seeing a significant increase in unemployment in our region, we believe 2023 will be a stabilizing year for regional real estate market where sellers, buyers and investors acclimate to long-term higher interest rates (5-7% rather than 3-4%) and begin to move forward with their life and investment plans knowing they can always refinance should interest rates fall.
Inventory - LowerKing County decreased from 1.9 months in October to 1.6 months in November, and Snohomish County decreased from 1.9 months in October to 1.5 months in November.Days on Market – HigherKing County days on market increased 4 days from 13 days in October to 17 days in November , Snohomish County days on market increased 12 days from 25 days in October to 37 days in November.List Price Versus Sale Price – LowerKing County dropped 0.7% from 98.6% to 97.9% from October to November. Snohomish County dropped 0.8% from 97.5% and 96.7%.Median Home Price – LowerFrom October to November, dropped $50,000 in King County from $800,000 to $750,000, and Snohomish County dropped $36,000 from $686,243 to $650,000. Though, when looking at year-over-year prices, values are up $10,000 (1.4%) from November 2021 to November 2022 in King County, and are even in Snohomish County.Interest Rates – LowerAfter peaking at around 7.25% in October, interest rates have dropped to 6.58% and stayed steady at this level for much of the month of November after seeing early signs of decreases in inflation and more optimistic economic statistics.
