Seattle single-family September market report: median price down 11% from the peak, but still up 7% y-o-y

The numbers for what the Seattle single-family and townhome real estate did in September are out. The headline is that the median price is $887,500 and is now down nearly 11% or $108k from its May and April peak. However, prices are still up 7.1% year-over-year. Last year at this time the median price was $829,000. Some of this price decline is seasonality, prices typically cool off in the back half of the year, but some of it is definitely the impact of higher interest rates (mortgage rates are 7% today, last year at this time they were 3.2%) and lower stock prices (a lot of tech buyers in Seattle need to sell their company’s stock for their down payment).

Here’s a deep dive into all the numbers.

As expected the number of new listings we saw in September,1,057, jumped substantially from August’s 797; August is typically a slow month for new listings and in September we usually see a post-labor day bump in new listings. Expect to see the number of new listings to decline in October, November, and December; we won’t see the rate of new listings increase until January. Also expect that this fall we may see fewer new listings than usual as listing agents counsel sellers who don’t need to sell immediately, to wait until 2023 since so many buyers are hitting pause on their searches.

So sellers were busy listing a lot of new homes in September, what about buyers? Buyers put 557 homes under contract in September down from 619 in August. Given that September had more new listings than August, we would have expected to see the number of pendings in September to be higher than August. Clearly, interest rates and the stock market are taking their toll on buyers.

We ended September with 1,239 homes for sale which is a lot more than last year, but below 2018, 2019, and 2020. Since the number of new listings slows each month in Q4, expect that the number of homes for sale will also decline each month of Q4.

As it does each fall, but likely especially so this fall and winter, the market is slowing with the median days on market at 13 in September. Buyers have more than double the amount of time they did earlier in the year. Conversely, sellers shouldn’t expect their homes to sell in a week.

The median percent of sale price to list price is now below 100% and will likely continue to fall like it did in Q4 of 2018. This year feels a lot like 2018…

In September there were 566 closed sales which is mainly a function of the number of homes going under contract in August.

With the inventory of homes for sale increasing and buyers hitting pause, it isn’t surprising that the months of supply, a measure of how long it’d take to sell all the homes for sale, is increasing. But we’re still far from a balanced market!