Market Update — November 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 October 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: 687 new construction homes were sold in October 2023. The median sale price of new construction homes was $695,502.
Months of inventory: At the current rate of sales, it’ll take around 2 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: 5,291 homes were sold in October 2023 with the median price of $602,000. This translates to a dollar value of about $3.9B.
New listings: 6,134 new listings were added to the NWMLS database in October 2023. This is a decrease of -15.5% from October 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 around 7.5%.
Average 30-Year Fixed Mortgage Rates — September 2022 to September 2023 (Source: Freddie Mac)
Broader economy
Housing Starts (which measure the start of construction on homes) rebounded in September after reaching two-year lows in August, up 7% for the month. While the bulk of the increase came in multifamily units, starts for single-family homes also rose 3.2%. Building Permits, which are indicative of future supply, did decline 4.4% from August while permits for single-family homes reached their highest level in a year.
There has been a growing chorus of Fed members who are inclined to hold rates steady at their next meeting on November 1, given the progress made toward taming inflation and tightening conditions. This includes New York Fed President John Williams, Vice Chair Michael Barr, Fed Governors Phillip Jefferson and Christopher Waller, Atlanta Fed President Raphael Bostic, San Francisco Fed President Mary Daly, Dallas Fed President Lorie Logan and Philadelphia Fed President Patrick Harker. Remember, the Fed has been hiking its benchmark Fed Funds Rate (which is the overnight borrowing rate for banks) to try to slow the economy and curb inflation.
