Seattle-area housing market picked up a bit in January

The Seattle-area housing market picked up a bit in January after a sleepy December, but activity is still sluggish as high home prices and interest rates challenge buyers.

Seattle-area homebuyers made more deals in January than in December, a typical seasonal uptick, though sales remained lower than a year earlier, according to new data from the Northwest Multiple Listing Service. In King County, for example, pending sales shot up by 38% from December to January, but dipped 11% from January 2023.

Sellers picked up their activity, too, offering more homes for sale. New listings more than doubled in King County from December to January, though they remain flat from a year ago.

Those are signs that the Seattle area housing market is leaving the doldrums of December. Yet, it won’t be clear until the spring — typically the busiest time in local real estate — just how much the market is picking up momentum.

Mortgage rates leveled off in January, which optimistic real estate agents hope will push more homeowners to sell their properties and more buyers to restart their search. But rates are not likely to drop dramatically this year, and most experts don’t expect a flood of new inventory for sale. Those factors could keep a lid on the market. 

The average rate for a 30-year mortgage sat at 6.6% in early February. That rate was more affordable than last year’s nearly 8% high but still well above the rates many people locked in over the past decade. 

Seattle-area homes are still spending longer on the market than during 2021 and 2022. 

Eastside Redfin agent Hal Bennett expected lower mortgage rates and an uptick in homes for sale to “cause the market to take off right at the start of the new year.”

“But even though demand has picked up some, I’m not wowed,” Bennett said in a recent Redfin report. “Now I believe this year’s market will launch in the spring.” 

Median home prices were flat across much of the Puget Sound region from December to January and remain higher than a year ago. The median single-family home sold for about $850,000 in King County, up 9% from January 2023. Median homes sold for about $730,000 in Snohomish County, up 4%; $540,000 in Pierce County, up 4%; and $550,000 in Kitsap County, up 12%. (Home prices reflect sales closed in January, which likely took place in December.)

The median single-family home on the Eastside sold for nearly $1.5 million, up 11% from a year earlier. In Seattle, the median price of $869,000 was up 8%.

Median condo prices also remain higher than a year ago, up 10% in Seattle to $537,500 and up 5% on the Eastside to $570,000. Condos include both units in multifamily buildings and accessory dwelling units in Seattle that resemble standalone houses and are sold as condos. 

Some eager buyers are encountering bidding wars because of the slim supply of homes for sale, said Compass agent Ryan Palardy. 

Palardy recently represented buyers who paid about $1.1 million for a split-level in Lake Forest Park listed for $975,000. “This was a good house, but not necessarily a premier house,” a sign of buyer demand, Palardy said. “It’s not 2021 all over again … but it’s a smaller facsimile of 2021.”

While escalations are still not at the levels buyers endured two years ago, “they are still happening,” Palardy said. “Unless we get more inventory, that will be the trend.”