Real estate market update time. Most are asking “Is it true that deal season in Seattle continues into Autumn 2022?” Yes! August may have been the beginning of the deal season, but just like the warm weather we’ve been having… the season isn’t over yet. The market overall has been slowing down from where we were 6 months ago. Single-family homes and condos are starting to level out, and luxury homes are overinflated at the moment. The housing market is slowing down for several reasons, one being higher interest rates, and another reason being the stock market. Then there’s low inventory, midterm election jitters, and buyer sentiment to consider as well. However, homes that are seen as being a good value are still selling quickly. It’s a good time to buy a house, and it’s still a good time to sell.
Roy, What Kind of Coffee Are You Drinking Today?
Today I want to make some tasty coffee, and then we can chat about what we can expect for the rest of this month for the Seattle real estate market.
We are going to start with some beans that came to me through a coffee subscription I’ve had for some time called Trade. They don’t give me money, but I really like their service so I’m going to do a little free advertising. These beans are Rwandan and are from Verve Coffee Roasters in Santa Cruz, CA. Verve describes this single-origin Karambi roast as scrumptious and surprising. Scrumptious is not a word I like to use very often, so these have got to be good.
I’m going to grind the beans to a medium setting and brew them through this really beautiful pour-over system I picked up from Manual out of Chicago.
Coffee with Roy | Seattle Real Estate Market Update September 2022
If you’ve checked out a previous “Coffee with Roy” episode, then you already know that we begin by taking a look at the Demand Rate. Let’s do a quick review of what the demand rate is! The demand rate is a way for us to see how many buyers are in the market at any given time. Check out “Coffee with Roy: February 2022 Seattle Real Estate Market Update” to learn exactly how the demand rate is calculated. Remember that the demand rate can change neighborhood by neighborhood, and day by day. Today, September 13th, 2022, the demand rates are full of small surprises.
Seattle’s Real Estate Market Update aka The Demand Rate
- Luxury Homes – Demand Rate 8.88
- Single Family Homes – Demand Rate 1.68
- Condos – Demand Rate 1.94
Below, I’m going to share exactly what each of these numbers actually means.
Luxury Homes – Seattle Real Estate Market Update
We consider Luxury Homes to be homes valued at $3M or above. Luxury Homes in Seattle are now at a demand rate of 8.88. This is significantly higher than it was last month at 5.82.
That means for every buyer in the market, there are almost 9 homes available to purchase today. If Luxury homes were not in a buyers’ market before, they really are now.
Single Family Homes – Seattle Real Estate Market Update
In Seattle right now, Single Family Homes are at a demand rate of 1.68, which is only slightly higher than it was last time which was 1.43. The interesting change here is that we currently have 55 more available homes in all of Seattle. However, the number of pending homes is down by almost 100. Again, this isn’t a big shift. This leads me to believe that we are settling into a more even market for the foreseeable future.
Condos – Seattle Real Estate Market Update
Seattle Condos are at a demand rate of 1.94. This is down from August when the demand rate for condos was 2.15. This makes sense as buyers are looking for condos to be less expensive than single-family homes. Buyers who are searching for condos are also likely putting more value on location than size.
Seattle Real Estate Market Update | Why Are Interest Rates Still Going Up?
We created an infographic above to help explain what is going on in the market. Bare with us. Basically, the feds are increasing interest rates in order to curb demand for housing and consumer goods. Basic supply and demand. We have a super low supply of housing as a result of a bunch of BS housing policies that refuse to build affordable housing options. Instead of dealing with the supply side of the issue, the Feds are going to take the economy on a not-so-gentle ride and crash land the economy in order to curb demand. No really! That is what is happening.
Why is Seattle’s Housing Market Slowing Down?
There are a couple of reasons why the housing market is slowing down. First, interest rates are still higher than they were at the beginning of this year. The stock market has been all over the place. Also, a big chunk of the available housing stock doesn’t meet buyers’ definition of “value.” And we cannot forget that there are always some midterm election jitters. Homes that are perceived as a good value are still getting snapped up quickly. We just sold Kim’s Greenwood listing in multiple offers, after all.
I only want to buy a house if everyone else does too. If they don’t want it, then I don’t either.
Another factor at play is a little harder to put a name on, so we will call it buyer sentiment. You can also call it herd mentality. It’s the idea that as a buyer: I only want to buy a house if everyone else does too. If they don’t want it, then I don’t either.
It’s very, very easy to get caught in this trap and lose sight of the end goal: buying a home in Seattle. Just because bidding wars are not ratcheting up prices 10% to 20% over asking doesn’t mean that homes are losing value. In fact, homes of all types are still more valuable today than they were at the beginning of the year.
Thank You For Watching Coffee with Roy | Deal Season in Seattle Continues
Is it still deal season in Seattle for home buyers? Yes, it is still a great time to buy a home. In August we saw the beginning of “deal season,” but just like the warm weather we’ve been enjoying, the season isn’t quite over yet. Overall, the market has been slowing down from where it was at 6 months ago. Luxury homes are overinflated at the moment, while single-family homes and condos are beginning to level out. The housing market is cooling for several reasons; one reason is higher interest rates, and another reason is the stock market. Then there’s also low inventory, midterm election jitters, and buyer sentiment to consider as well. However, homes that are seen as being a good value are still selling quickly. It’s a good time to buy a house, and it’s still a good time to sell.
Previous Episodes of Coffee With Roy:
- February 2022 Coffee With Roy | Seattle Real Estate Market
- March 2022 Coffee With Roy | Seattle Real Estate Market
- April 2022 Coffee With Roy | Seattle Real Estate Market
- May 2022 Coffee With Roy | Seattle Real Estate Market
- June 2022 Coffee With Roy | Seattle Real Estate Market
- August 2022 Coffee With Roy | Seattle Real Estate Market
Thank you for sharing a cup of coffee with me. If you have someone who can benefit from this info, share this blog post and the video with them. If you have something you want to know more about, let me know!
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