Market Update — August 2023
We believe timely and relevant data is key to making good decisions. To this end, we are committed to providing our community and clients with actionable data and insights about the local real estate market.
Local real estate market
With the data from July 2023 in, here’s an overview of the key aspects of the local real estate market. The real estate data below is collected from Northwest Multiple Listing Service (NWMLS).
Median price: The chart below shows the latest median sales prices of homes over the past three years in the Greater Seattle area over the past three years:
New construction: 721 new construction homes were sold in July 2023. The median sale price of new construction homes was $705,000.
Months of inventory: At the current rate of sales, it’ll take around 1.76 months for every listed home to sell. To put this number in context, note that the months of inventory for a balanced market is considered to be 4 to 6 months. So the current data point confirms the enduring shortage of supply relative to demand in the area.
Homes sold: 6,247 homes were sold in July 2023 with the median price of $615,000. This translates to a dollar value of about $4.8B.
New listings: 8,205 new listings were added to the NWMLS database in July 2023. This is a decrease of -30.5% from July 2022, which exacerbates the low supply. This indicates fewer property owners are likely to be interested in selling their homes exacerbating the chronic shortage of supply.
Mortgage rates: The Freddie Mac rate has been stable over the past month hovering just below 7%.
Average 30-Year Fixed Mortgage Rates — August 2022 to August 2023 (Source: Freddie Mac)
Broader economy
CoreLogic’s Home Price Index showed that home prices nationwide rose for the fifth straight month, up 0.5% from May to June. Prices were also 1.6% higher when compared to June of last year. CoreLogic forecasts that home prices will rise 0.6% in July and 4.3% in the year going forward. Zillow also reported that home values have increased 4.8% this year. They’re forecasting that home values will rise 6.3% from June 2023 to June 2024, and predicting that 48 of the nation’s 200 largest markets will see increases of 7% or more.
While inflation is still elevated, it has made a big improvement from the 7% peak seen last year and is now less than half that amount at 3% on the headline reading. This welcome news not only signifies lower costs for some goods and services, but lower inflation also typically helps both Mortgage Bonds and mortgage rates improve over time.
