Market News • More • January 7, 2025

Local Look: Western Washington Housing Update 1/7/25

by Windermere Staff

Hi. I’m Jeff Tucker, principal economist at Windermere Real Estate, and this is a Local Look at the December 2024 data from the Northwest MLS.

After two very strong months of data covering October and November, we got one last month of strong closed sales data in December, but a slowdown in pending sales growth suggests we shouldn’t expect a boom in closings to start out the New Year.

Here are the four key metrics I watch to track supply and demand in the market: closed and pending sales, which tell us a lot about demand; and listings – new and active – which tell us a lot about supply.

Closed sales of single-family homes climbed 18% year-over-year, from about 3500 to over 4100. Pending sales, which will mostly close in January, only climbed 5% from the same month last year.

On the supply side, about 8% more new listings hit the market this December compared to last one, while the level of inventory in the reservoir was 20% higher at the end of 2024 than at the end of 2023. Of course this is a quiet time of the year in the market, so we should expect all these measures of listings to pick up soon.

The final key metric to check in on: the median price for those closed single-family home sales climbed about 5% year-over year, from $610,000 to $639,000. That’s a bit of a cooldown from price growth in the previous couple of months, and it’s pretty similar to the pace I’m projecting for 2024.

Putting it all together, this looks like a market that had a surge of demand after the Fed began to cut rates in September, but where that demand bump is cooling off now that mortgage rates have stubbornly rebounded to nearly 7%.

Now I’ll dig into the three counties that comprise the Seattle metropolitan area, where we saw similar trends play out.

Residential closed sales climbed 13 percent year over year here in King County, which includes Seattle and Bellevue; a whopping 32% down in Pierce County, including Tacoma, and 15% up in Snohomish County, including Everett. So for the 3-county metropolitan area as a whole, that’s a gain of 18% from the same month last year. November, by comparison, saw a 30% increase for the whole MSA, so the sales gains are clearly decelerating.

The median sale price climbed modestly: just 3% from last year in King County and 5% in Pierce County, but a whopping 15% in Snohomish. This statistic can get noisy when the sample size is small, like in December, so I think we won’t have a clear view of Snohomish price trends for another couple of months.

Looking ahead, there was a pretty different picture for pending sales in each of these counties: up 7% in King, flat year-over-year in Pierce, and down 10% in Snohomish. Again, sales in December are so thin that random noise can look like big changes, so I wouldn’t read too much into that data point for Snohomish County, but the broad picture for the 3-county area is that pending sales were essentially flat year-over-year in December.

On the supply side, the 3-county metro area had about 22% more active listings to end the year than there were at the end of 2023. That could give buyers more options as they start their house hunt in Q1, and could help keep price growth in check. But the biggest factor behind supply and demand this spring will be the number of new listings that come out of the woodwork, which will only start to come into focus in the months ahead.

Architecture • Design • January 6, 2025

What is Prefab Architecture?

by Windermere Staff

Short for “prefabricated,” prefab architecture refers to a type of construction where building components are manufactured off-site and then transported and assembled at the construction site. In recent years, prefab architecture has transformed how homes are built and designed, gaining popularity due to its efficiency, cost-effectiveness, and sustainability. In this post, we’ll explore the various types of prefab architecture, examine its pros and cons, and help you determine whether it fits your lifestyle, wants, and needs.

What is Prefab Architecture?

Prefab architecture is any structure built using components made off-site and then brought to a lot for assembly. Due to increasing appeal, prefab homes now come in various sizes, styles, and distinct forms to suit a range of needs and preferences. They can range from small backyard bungalows or guest houses to larger, multi-story, single-family homes, and the best part, they can be highly customizable. Some of the most common types of prefab construction include kit homes, modular homes, and panelized homes, each with its own set of benefits.

Kit Homes

A kit home is a prefabricated home that comes in pre-cut materials and is delivered to a property with instructions for building. They are smaller and more straightforward structures, often chosen by those who prefer a DIY approach. These homes are also typically more affordable and customizable.

Modular Homes

Similarly, modular homes are prefabricated homes made up of sections, known as modules, also made in a factory or off-site and then transported to the construction site. Unlike kit homes, modular homes must be assembled on a permanent foundation. Due to the pre-built sections, modular homes tend to be quicker to assemble and require the least amount of on-site work.

Panelized Homes

Panelized homes are another popular method of prefab architecture. Instead of building entire sections or modules, this technique involves constructing individual panels—including walls, floors, and roofs—in a factory. Compared to modular homes, panelized homes offer much more flexibility and customization in design and layout during the building process.

Pros and Cons of Prefab Architecture

Prefab architecture offers many benefits that make it an appealing choice for many people. The primary advantages include reduced costs, faster construction times, and a smaller environmental footprint with excellent energy efficiency. This is due to the controlled factory environment where the building components are made, minimizing waste, optimizing materials, and reducing on-site interferences like weather delays or unexpected construction challenges. Additionally, prefab homes often come with high-quality construction standards and can be highly customizable to fit different styles and preferences.

However, there are still some downsides and drawbacks to consider when thinking about investing in a prefab home. Land costs, transportation fees, utilities setup, and the need for permits can make for higher upfront expenses than expected. Additionally, some locations have stricter zoning laws and building regulations that may prevent or limit where prefab homes can be placed.

Is Prefab Right for You?

Prefab architecture combines affordability and sustainability, offering an innovative solution for those seeking a modern and efficient living space. So, whether you’re looking to downsize or embrace a more eco-friendly lifestyle, a prefab home could be the ideal choice for your next home.

Market News • Western Washington Real Estate Market Update • December 11, 2024

Local Look: Western Washington Housing Update 12/11/24

by Windermere Staff

Hi. I’m Jeff Tucker, principal economist at Windermere Real Estate, and this is a Local Look at the November 2024 data from the Northwest MLS.

After a blockbuster October report, this was another very strong month for the Washington housing market, especially for sales of single-family homes, and that’s the data I’ll be digging into today.

Closed sales of single-family homes climbed 25% year-over-year, from about 3800 to over 4700. Pending sales, which will mostly close in December, climbed a little less from last year, by 18%.

On the supply side, I think of listings as the reservoir of options for buyers to choose from: New listings, which represent the flow of new supply, were up only 2% in November, while the level of inventory in the reservoir was 18% higher than a year ago. Those are both more modest increases than we saw in October, which is a reassuring sign that the market isn’t headed for a glut.

The final key metric to check in on: the median price for those closed single-family home sales climbed about 6% year-over year, from $625,000 to $665,000. That’s slightly lower than last month, which is normal for this time of year, and indicates that price growth is not accelerating in an unusual way. That’s important because affordability is still a key concern for the sustainability of the market throughout Washington.

The strength of closed sales, as well as sustained growth in pending sales, suggests to me that October wasn’t just a flash in the pan, of buyers jumping in because the Fed cut interest rates. Rather, I think that home sales are normalizing after staying extremely depressed for much of the last two years.

Now I’ll dig into the three counties that comprise the Seattle metropolitan area, where we saw similar trends play out.

Residential closed sales jumped 27 percent year over year here in King County, which includes Seattle and Bellevue; a whopping 35% down in Pierce County, including Tacoma, and 30% up in Snohomish County, including Everett. So for the 3-county metropolitan area as a whole, that’s a gain of 30% from the same month last year.

The median sale price for those closed sales climbed a little less than last month, when it was closer to 10% annual gains. In November, closed prices climbed 4% in King County, up to $925,000; 5% in Pierce County, up to $565,000; and 8% in Snohomish County, up to $785,000.

Looking ahead, each of these counties had solid, but somewhat lower annual growth in pending sales than they did in closed sales: 15% for King County; 33% in Pierce, and 16% in Snohomish County.

After all those sales, there’s still been a healthy increase in the active inventory of homes available to buy across the metro area, with about 14% more than last year in King County; 18% more in Pierce, and 12% more in Snohomish County, for an overall metro-wide increase of 15%. That’s substantially less than the increase in October, when the 3-county area had 26% more active listings than the year before.

All in all this was another encouraging report showing a much more active market than at the same time last year all around Washington, and it’s good evidence that buyers haven’t just rushed back into hibernation even though mortgage rates rebounded a bit last month.

Community • More • December 9, 2024

A Season of Laughter and Giving: Windermere Foundation Comedy Events Raise $1.14 Million

by Windermere Staff

This fall, supporters of the Windermere Foundation came together in Portland and Seattle for two incredible comedy nights that celebrated laughter, generosity, and community. Featuring world-class performances by Jason Alexander and Micheal Che, along with heartfelt moments and an outpour of support, these events helped raise critical funds for organizations that provide essential services to youth and families in Portland and Seattle. Here’s a look back at these two unforgettable nights.

23rd Annual Steve Allen Comedy Show in Portland, Oregon

Founded by Windermere 23 years ago, the Steve Allen Comedy Show has become a cornerstone event that benefits New Avenues for Youth, a nonprofit organization dedicated to addressing and preventing youth homelessness in the Portland area. Since its inception, this event has substantially impacted the Portland community, raising over $8 million for New Avenues for Youth and their essential services and programs, including housing and meal support, counseling, job training, and more.

Held on October 22 at the Portland Art Museum, this year’s event welcomed 560 attendees for a spectacular night featuring food, fundraising, and a stellar performance from comedian and Saturday Night Live cast member Michael Che. Through the power of laughter and collective kindness, the evening raised more than $600,000, all in support of an organization that focuses on helping young people overcome the many barriers to stability, well-being, and success.

: Images by Keene Studio

2nd Annual Comedy Night in Seattle, Washington

Following the success of last year’s inaugural event, the second annual Windermere Foundation Comedy Night in Seattle exceeded all expectations, bringing together 440 guests for a truly memorable evening. Held at Fremont Studios on Friday, November 1, the night started with a lively cocktail hour and silent auction. As the evening continued, attendees enjoyed dinner emceed by Windermere agent Nancy Chapin, who introduced the audience to the event’s presenting partner, Seabrook, their new strategic partnership with Windermere, and their shared commitment to supporting local nonprofits in Washington. The program also featured heartfelt testimonials from a few recipient organizations, including Angel Flight West, Treehouse for Kids, and Northwest Hope and Healing, all doing crucial work in the Seattle area to support those in need.

The night was a resounding success with an emotional paddle raise and a side-splitting stand-up performance from comedic legend Jason Alexander, best known for his role as George Costanza on Seinfeld. In total, the event raised an impressive $539,486 for nonprofit organizations in the greater Seattle area that support low-income and homeless families.

: Images by Clarity Northwest Photography

: Images by Clarity Northwest Photography

This season of laughter and generosity has been a powerful reminder of the profound impact that can be achieved when communities unite to support a meaningful cause. Through great dedication and a shared mission, these two events raised nearly $1.14 million, directly benefitting local organizations devoted to helping families and children throughout Seattle and Portland.

To help support the Windermere Foundation, click the donate button below and be a vital part of our ongoing mission to help low-income and homeless families in need.

Donate to the Windermere Foundation.

Market News • More • December 4, 2024

2025 Housing Forecast

by Windermere Staff

Hi! I’m Jeff Tucker, Principal Economist at Windermere Real Estate, and I’m here to share my top 5 predictions for 2025. Let’s jump in!

Interest Rates Will Decline

I expect interest rates to fall to around 6.5% in 2025, but in a gradual zigzag fashion. Temporary factors, like election uncertainty, higher Treasury debt issuance, and market volatility, helped push mortgage rates back up by almost one full point last fall. But the big picture hasn’t changed that much. We are still in the cooldown phase of an economic cycle, with decelerating inflation, a slowing job market, and the Fed cutting short-term rates. Still, if we’ve learned one thing in the last two years, it’s that interest rates never get to where they’re going in a straight line.

Existing Home Sales Will Pick Up

Existing home sales have bottomed out and will pick up by as much as 10% year over year in 2025. Sales volume was held back by the low inventory of homes on the market in 2022 and 2023, but we saw sellers return in 2024, and buyer activity really started picking back up as well in the fall. Buyers and sellers feel less uncertainty now and are getting more comfortable with the new normal range for interest rates, all of which is helping to thaw the market.

Home Prices Will Not Fall

Broadly speaking, U.S. home prices will not fall in 2025, but they’ll only rise by around 2% to 4 %. The last three years have seen a roller coaster of gains and slowdowns when it comes to home prices, thanks to the fluctuation in interest rates and the changing supply of available homes for sale. Now that inventory is back to a balanced level, especially in the Western United States, 2025 should see a more consistent market, causing prices to stabilize.

Affordability Will Start to Improve

This might be surprising given the prediction about home prices not falling, but affordability will gradually start to improve in 2025. The main reasons for this are declining interest rates and rising incomes. The median U.S. household saw their income climb $10,000 over 2022 and 2023, from $70,000 to $80,000. Wages continued growing rapidly in 2024 and are expected to do the same in 2025. Those higher incomes, borrowing at somewhat lower interest rates, are helping home buyers start to catch up with all the home price growth that has happened since 2020.

More Parents Will Help with Down Payments

I believe parents helping with down payments will become more common, and more important, than ever in 2025. That’s because the high price of homes today means that homeownership feels out of reach for many first-time home buyers. But those same high prices also mean that the Baby Boom generation has a lot of home equity. So, as they discuss homeownership with their adult children, many parents see a down payment gift as one of the most meaningful ways to help them gain access to the American Dream.

In Summary

This is a picture of a housing market gradually settling into a new normal, after several abnormal years. A bunch of superlatives will be fading in the rearview mirror, like “fastest price appreciation ever”, “lowest inventory ever”, “fewest new listings ever”, “highest interest rates in 20 years.” This is a normalizing market, and that includes Americans learning to live with the new normal.

All right, those are my top five predictions for 2025, based on what I’m seeing in the market right now. I look forward to seeing how the new year plays out in the housing market and analyzing it on behalf of Windermere Real Estate.

Living • November 25, 2024

Preparing Your Garage for an Electric Vehicle

by Windermere Staff

As manufacturing technologies continue to drive down production costs and increase the availability of electric vehicles (EVs), they are becoming more affordable and accessible than ever. And as the shift from gas-powered cars to EVs continues to accelerate, more and more consumers are recognizing the significant benefits of this transition, like lower running expenses, a smaller carbon footprint, and improved driving ranges. Additionally, many EV owners find that at-home charging stations provide the ease of refueling at home while alleviating the pressure on the overburdened public charging infrastructure, becoming an essential asset for their daily routines and enhancing their overall EV ownership experience. Before making the switch to an EV, preparing your home for this new lifestyle is important. Here are some key preparation tips to ensure you are set up for success when welcoming an EV into your garage.

Selecting a Charging Level

Charging at home has become the most convenient and cost-effective way to maintain a healthy charge for your EV. Countless EV owners express an appreciation for being able to organize a personalized charging schedule, optimize energy use, save on costs, and avoid the hassle of searching for available public chargers. As you are considering making the switch to an EV or setting up an at-home charging station, it’s necessary to acknowledge the different levels of EV charging to determine which best suits your lifestyle and offers peace of mind.
There are currently three models of EV charging: Level 1, Level 2, and Level 3 or DC fast charging. Deciding the right level depends on your driving habits, current home electrical setup, and the model of your car or if it is a full battery electric vehicle (BEV) or plug-in hybrid electric vehicle (PHEV).

Level 1 Charging

Level 1 is the slowest option available and uses a standard 120-volt outlet that you can typically find in any room of your home, including your garage, which means there may be no additional installation work needed. Oftentimes, when you purchase an EV, it may come equipped with a level 1 charging cable; however, this approach can take up to 50 hours to fully charge a BEV, making it a more suitable and sufficient option for those with lower mileage and range needs, or owners of a PHEV which can be fully charged in 5-6 hours.

Level 2 Charging

Most used for residential installations are Level 2 chargers, which utilize a 240-volt outlet, like those used for an electric stove or dryer. These can charge BEVs from empty to full in about 4-10 hours and PHEVs in just 1-2 hours, making them the efficient choice for those looking to maximize charging speed and convenience. Level 2 chargers have higher upfront costs and installation processes because they often require upgrades to your electrical system and a licensed electrician for professional installment. However, the benefits far outshine this initial investment, as with level 2 charging, owners can optimize time efficiency and integrate a charging schedule by plugging in at night, guaranteeing a full charge in the morning, saving them money on fuel prices, and reducing reliance on public charging.

Level 3 or DC Rapid Charging

DC rapid charging is the fastest charging method available, using 480 volts to charge EVs in as little as 30 minutes. DC rapid chargers are primarily found at public charging stations, making them ideal for quick “fill-ups” on road trips. They are rarely installed in homes due to high costs and the significant electrical upgrades that would be required.

Safety Measures for Preparing Your Garage and Using an At-Home EV Charger

It’s important to follow specific safety procedures when preparing your space for installation. Start by checking if your current electrical infrastructure is up to code and ready to support your new charging system. This may require help from a licensed electrician who will do a full assessment beforehand and recommend any necessary upgrades. Once your home’s electrical panel capacity can handle the load of the EV charger, you are now ready to follow these few safety measures to prepare your garage and start using your EV charging system:

Always invest in certified equipment that meets current safety regulations and is covered by a warranty. Low-quality equipment can lead to safety hazards, damage to your vehicle, or expensive repairs.
Consider the location of your charging station and make sure it is easily accessible, adequately placed three to four feet off the ground, and away from any water source or flammable materials.
Climate-control your garage with proper insulation to maintain charging efficiency, especially in cold climates, as colder temperatures can adversely affect charging times.
Only utilize a dedicated circuit, and never use multiple adapters or extension cords.
Avoid overcharging your EV or leaving your EV plugged in longer than necessary.
Regularly inspect the charging station, cable, and outlet for signs of damage or wear and tear that could be potentially dangerous. Avoid attempting to repair electrical equipment on your own.

Installing an At-Home Charging Station

Now that you’ve taken all the safety measures, you can install your EV charging system. If you’ve opted for a level 2 charger, the best thing you can do is get in touch with a licensed electrician. Consulting with a professional is recommended for more than just assessing your home’s electrical capacity but also verifying that your setup meets safety standards and that the electrical connections are securely installed and working correctly. With the proper installation and precautions in place, you can now enjoy safe, reliable, and efficient at-home EV charging!

Market News • November 21, 2024

Housing & Economic Update: Numbers to Know 11/21/24

by Windermere Staff

This is the latest in a series of videos with Windermere Principal Economist Jeff Tucker where he delivers the key economic numbers to follow to keep you well-informed about what’s going on in the real estate market.

Hi. I’m Jeff Tucker, the principal economist at Windermere Real Estate, and these are the numbers to know right now.

The first number this week: 970,000.

That’s the annualized pace of new single-family construction started in October, according to the latest new residential construction survey released Tuesday, November 19. That’s a big step down from September’s (revised) pace of 1 million, 42 thousand, and generally lower than forecasters were expecting. As you can see here, back in 2021 builders were running at a pace well above 1 million annualized starts, before interest rates climbed and dampened their enthusiasm in 2022.

However, when you dig into the regional details of the new construction report, it turns out that here in the Western Census Region, single-family starts actually climbed about 5%, to 229,000 annualized new homes. The headline decline was driven by a drop in the South (which usually accounts for almost half of new construction), as well as the smallest, noisiest region, the Northeast.

The next number to know this week: 326,000.

That’s the annualized pace of new multifamily apartment construction started in October, from that same new residential construction report by the Census. It’s a bit noisier than the single-family survey, and this month did represent a step upward from September’s revised pace, but it still leaves apartment construction on the low side, relatively depressed after the boom that peaked in 2022. In fact, it’s still lower than in most months before the pandemic.

The Census doesn’t release regional breakdowns for multifamily starts, but if we back them out from the difference between total starts and single-family, we can see that the West had a huge jump in starts for homes in any building with 2 or more units: from 60,000 to 109,000, annualized. Now, this is a noisy data series, and we shouldn’t read too much into one month’s data, but it’s still an encouraging sign of strength for builders in the West.

The next number to know right now: 46.

That’s the preliminary November reading for the Housing Market Index, published by Wells Fargo and the National Association of Home Builders. The index is constructed so that any number above 50 means a majority of builders feel confident about current and near-future conditions. November’s score of 46 is the closest we’ve come to that threshold since April of this year. In their press release, the president of the builders’ association pointed to growing confidence about regulatory relief, while their chief economist cautioned that high interest rates and potentially rising tariffs could darken the industry’s outlook next year. Nonetheless, on balance, builders are starting to feel a little better about their prospects.

Historically, higher builder confidence as measured by this survey goes hand in hand with more housing starts, but in the last couple years that relationship has broken down. In fact, right now we’re still seeing a lot more single-family construction than this middling level of builder confidence would lead one to expect. I think the simplest explanation for this divergence is that the Housing Market Index survey is sent to a broad sample of home builders, which intrinsically means it tends to overweight the outlook of smaller home builders, relative to their share of new construction. In the last couple of years, the strong financial position of the biggest publicly-traded home builders has helped them thrive even after interest rates climbed, in part by offering interest rate buydowns for their customers.

Our final number to know right now: 7.08% or 6.78%.

Those are the two most recent readings for where mortgage rates stand, first according to Mortgage News Daily as of Monday, November 18, or secondly according to Freddie Mac’s Primary Mortgage Market Survey as of Thursday, November 14. Those daily readings from Mortgage News Daily have been unusually volatile in the two weeks since the election, and I’m also opting to show them alongside Freddie Mac’s popular weekly survey, in part because the two sources have diverged a bit more than usual in the last couple months. It’s a good reminder that there isn’t one single source of truth on mortgage rates, and everyone’s rate will depend on their particular circumstances and their lender.

Still the big takeaway I see here is that rates are up sharply from their lows in mid-September, but hopefully they might be stabilizing after climbing for the last two months, and they’re still somewhat below the highs they reached back in May of this year, or October of last year.

Living • More • November 14, 2024

5 Ways to Incorporate Feng Shui into Your Home

by Windermere Staff

Modern contemporary style small wooden terrace in lush garden with house interior background

Feng Shui, an ancient Chinese practice, is not just about creating a calming and aesthetic space. It’s about creating a space that resonates with your energy and promotes well-being. By balancing the world’s five natural elements : water, fire, earth, metal, and wood, you can transform your living space into an environment of serenity and positivity. And the best part? It doesn’t have to be expensive or complicated. If you’re looking to find new ways to rearrange furniture, declutter your area, or introduce natural elements into your space, Feng Shui might just be the missing piece! Here are five simple ways to embrace the elements of Feng Shui in your home.

1. Create Depth with Water

Each element in Feng Shui carries a unique meaning. By integrating these elements in a balanced way, you can create a space that is not just aesthetically pleasing but also promotes well-being. For instance, water is believed to bring prosperity and wisdom into your life. To incorporate water into your home, add dark blue or black accents like hand towels, artwork, and small area rugs. Reflective surfaces or mirrors can also be used to symbolize the fluidity and reflection of water. Feng Shui experts believe that purposefully placed water features both within and outside of a home will bring about positive energy and good luck.

2. Transform Energy with Fire

Fire, a symbol of passion, energy, and transformation in Feng Shui, can be a powerful addition to your home. You can start by strategically placing and lighting a few candles, which is a simple way to introduce the fire element. But, if you are looking for a more intense effect, consider incorporating an indoor or outdoor fireplace to encourage gatherings and create a warm, inviting ambiance. You can also add design accents to your home using reds and oranges which will add more dynamic fire energy.

3. Establish Stability with Earth

In Feng Shui, the earth element can be associated with stability and different grounding forces. When we think of the various aspects of earth within a home, we tend to gravitate towards the more natural features like stone counters, wooden furniture, and clay accents. However, the earth element in Feng Shui goes even further than just aesthetics. More ways to incorporate this element into your home include decluttering and organizing to create flow, inviting nature in with more houseplants and natural light, and utilizing earthy tones like browns and beiges. You can also enhance these earth-centered qualities by repositioning your furniture to create more harmonious spaces.

4. Promote Precision with Metal

According to Feng Shui principles, metal is a strong symbol of precision, wealth, and efficiency. There are plenty of ways to integrate metal into your home beyond mere stainless-steel appliances. Copper, bronze, brass, and nickel accents add warmth to kitchens and living spaces. When incorporating these metals, consider using decorative features like cabinet hardware, lighting fixtures, and other metal accent furniture.

5. Embrace Vitality with Wood

Wood, which symbolizes growth, vitality, and new beginnings, is the final core element in Feng Shui. Consider using natural materials like bamboo, rattan, or reclaimed wood when designing with this element in your home. There are a number of ways you can harness the energy of wood, such as through furniture, flooring, or even smaller wooden accents like coasters and photo frames.

Market News • Western Washington Real Estate Market Update • November 7, 2024

Local Look: Western Washington Housing Update 11/7/24

by Windermere Staff

This is the latest in a series of videos with Windermere Principal Economist Jeff Tucker titled Local Look where he delivers the key economic numbers to follow to keep you well-informed about what’s going on in the local real estate market.

Hi. I’m Jeff Tucker, principal economist at Windermere Real Estate, and this is a Local Look at the October 2024 data from the Northwest MLS.

All in all this was an incredibly strong report for the Washington housing market, especially in the single-family residential segment, which I’ll be focusing on today.

Here are the four key metrics I watch to get a sense of the market: sales, which tell us a lot about demand; and listings, which tell us about the state of supply.

In total we saw residential closed sales climb by over a thousand from the same month last year, or 24%. And, as an important leading indicator for next month’s sales data, pending sales were up 27% year-over-year.

On the supply side, I think of listings as the reservoir of options for buyers to choose from: New listings, which represent the flow of supply, were up 24% in October, while the level of inventory in the reservoir climbed was 25% higher than a year ago. This looks like a market returning to a more healthy balance between buyers and sellers, although of course we expect the usual seasonal decline in inventory to begin any day now.

Also impressive to me: across the NWMLS, the median price for those closed single-family sales climbed more than 7% year-over year, from $625,000 to $671,500.

All in all it seemed that buyers finally responded in a big way, to the growth in active listings to choose from, as well as the decline in interest rates over the course of the summer. And while mortgage rates did rebound back up over the course of October, it seems like the news about how much downward progress they made, and the number of options to choose from, all helped to entice buyers to forge ahead with purchasing plans last month.

I can’t get into every local market, but just digging into the three counties that comprise the Seattle MSA, we saw similar trends play out, with especially high activity in King County, which includes Seattle and Bellevue.

Residential closed sales jumped a whopping 33 percent here in King County, and a still impressive 26% down in Pierce County, including Tacoma, and 20% up in Snohomish, including Everett.

The median sale price for those closed sales climbed 9% in King County, up to $960,000; 9% in Pierce County, up to $580,000; and 11% in Snohomish County, up to $730,000.

Looking ahead there’s not much sign of a slowdown, as pending sales were up 33% again for King County; 38% in Pierce, and 19% in Snohomish County.

Even after all those sales, there are still a lot more single-family houses on the market around the 3-county region than this time last year, with about 25% more in King County; 31% more in Pierce, and 22% more in Snohomish County.

All in all this was a very encouraging report showing signs of life returning to the local housing markets around Washington, and maybe most importantly, a proof of concept that when mortgage rates fall, even just to near 6%, activity in the market picks up and people get back to moving, buying and selling.

Market News • November 4, 2024

Housing & Economic Update: Numbers to Know 11/4/24

by Windermere Staff

Hi. I’m Jeff Tucker, the principal economist at Windermere Real Estate, and these are the numbers to know right now. The first number this week:

12,000 … with a big asterisk!

That’s the number of jobs the economy added in October, and the asterisk is there to call out how this month’s jobs report was impacted by Hurricanes Helene and Milton!

The Bureau of Labor Statistics even included a special note at the top of this month’s Employment Situation Report, highlighting the fact that this report was based on the first survey of employers since the hurricane struck, and response rates for their survey were unusually low. They also emphasized that it was not possible to estimate how much the hurricanes reduced the headline job growth number.

Nonetheless, economists had been expecting about 100,000 more jobs than this to be added, even knowing that the total would be reduced by the hurricanes and the ongoing strike by workers at Boeing. Further, in this report they also revised down their estimates of job growth in August and September, by a combined 112,000 jobs. Last month we talked about what a big upward surprise the September jobs report was, and this information tempers that impression a little bit.

All in all, it’s hard to interpret this month’s jobs report but on balance it makes me revise my impression of the labor market a little bit downward. One very likely takeaway is that the Fed is now viewed as almost certain to go ahead and cut their benchmark overnight rate by a quarter point at their next meeting ending on Thursday November 7. That will continue the normalization process for short-term interest rates, although as we saw in September, cutting short-term rates is not at all a guarantee of falling mortgage rates.

10%

That’s how much pending home sales grew in October from the same month one year ago, according to the latest data from Realtor.com. This is a strong data point confirming that the housing market saw an upward surge in activity here in the first half of the fall season. The most likely reasons for the bump in pending sales included a healthier supply of listings for buyers to choose from, and I believe a lot of buyers woke up to the news that interest rates had fallen over the year, especially in September but even still in early October.

Looking ahead, we are now going into the coolest time of the year for home sales, just seasonally speaking, and unfortunately the recent rebound in mortgage rates is likely to help put the market back on ice for at least a couple months.

Which brings me to our final number to know right now:

7.09%

That’s where the 30-year mortgage rate stood on Thursday October 31st, according to Mortgage News Daily. It’s now up almost a full point in just 7 weeks, from its low on September 17. The upward movement in the last couple months is a pretty surprising trend break, after it declined by more than a point from April through September, and I think it reflects the strong economic news we’ve gotten lately about job growth especially in September, as well as very strong annualized real GDP growth of 2.8% in the third quarter. I’ve mentioned before that election uncertainty may be contributing as well, and that theory will be put to the test as we wait to see what rates do after the election.