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Small signs of a return to ‘normalcy’ in Puget Sound housing market

by Patrick Regan

Northwest MLS brokers added more listings in April than any month since July, a sign that some pockets of the frenzied Seattle-area housing market may be cooling slightly. 

“The Puget Sound housing market has shifted down several levels of hotness in most areas and is more in alignment with the strong market we saw pre-pandemic,” J. Lennox Scott, chairman and CEO of John L. Scott Real Estate, said in a NWMLS news release.

He predicted the “normal seasonality in the real estate market will be more pronounced, bringing a bit of normalcy to home buyers and sellers.” 

NWMLS brokers added 11,681 listings of single-family homes and condos during April, the most since July’s 12,916 news listings.

The new listings outpaced pending sales by nearly 2,000 in the NWMLS 26-county footprint, boosting inventory across the state. Housing inventory was estimated at .78 months in April, the most since October 2020. 

“This is evidence that interest rates are having a cooling effect on some parts of the suburban market and along the I-5 corridor,” said James Young, director of the Washington Center for Real Estate Research at the University of Washington.

King County, though, continued to see a decline in inventory. 

“Unfortunately for King County buyers, the area is still desperate for inventory and competition is as fierce as ever,” Windermere Real Estate chief economist Matthew Gardner said.

Condo inventory in King County was down in April by 35%, compared to a year ago. Median condo pricing rose in King County to $518,000 last month. It was $460,000 last year.

King County single-family home median pricing rose 20% from $830,000 last year to $995,000 last month.

“One thing that has not been impacted by rising financing costs is home price growth,” Gardner said, pointing to double-digit gains in nearly every county, “including a whopping 27% in Snohomish County, the highest by far in the four-county Puget Sound region.”

Kitsap County home listings were up nearly 36% from a year ago. Median pricing increased 15% year over year, from $485,000 to $558,500.

Lawrence Yun, chief economist at the National Association of REALTORS, said price declines are “unlikely,” but he expects “more pullback in housing demand as mortgage rates take a heavier toll on affordability. Declining affordability is always the most problematic to first-time buyers who have no home to leverage, and it remains challenging for moderate-income potential buyers as well.”

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