Central Washington Real Estate Market Trends

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Q1

2022

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Our Central WA real estate market data is updated quarterly to aid in your real estate forecasts. Historical Central WA real estate data and trends are included below the latest update. We break down our data by county, but we cover major cities in this region including Chelan, Wenatchee, Leavenworth, and Yakima.

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Q1 2022 Gardner Report

Central Washington
Real Estate Market Update

by Matthew Gardner

Below is the latest Central WA housing market trends analysis. Additional links:

Historical Central WA Data
Western WA Data
Eastern WA Data
Other Regional Data

 

The following analysis of select counties of the Central Washington real estate market is provided by Windermere Real Estate Chief Economist Matthew Gardner. We hope that this information may assist you with making better-informed real estate decisions. For further information about the housing market in your area, please don’t hesitate to contact your Windermere Real Estate agent.

 

Regional Economic Overview

Central Washington employment rose 6% year over year. However, with the significant revisions to 2021 employment levels the state made, total employment is down 3,778 jobs from the pre-pandemic peak. The jobs shortfalls are primarily in Kittitas and Yakima counties, with far smaller shortfalls in Okanogan and Chelan counties. Douglas County is the only market where employment levels are higher than the pre-pandemic peak. Unadjusted unemployment levels in Central Washington were 7.6%. When adjusted for seasonality, they were 5.9%. The county with the lowest unemployment rate was Chelan at 4.8%; the highest was Yakima, where 6.5% of the labor force was still without work. I expect that the region will be back to pre-pandemic employment levels by this summer.

Central Washington Home Sales

Sales in Central Washington rose 6.8% compared to a year ago, with a total of 1,022 homes sold. Sales fell 36.1% compared to the final quarter of 2021, but it is likely that seasonal factors impacted the number.

The drop in sales compared to fourth quarter of 2021 suggests that closings in second quarter of this year will remain tepid.

Compared to a year ago, sales rose in Okanogan, Yakima, and Kittitas counties, but fell in Chelan and Douglas counties. Sales fell across the board compared to the final quarter of last year.

Even though inventory levels rose 4% year over year, there were 33.5% fewer listings in the first quarter than in the prior quarter. This is creating frustrating conditions for buyers who have seen financing costs increase significantly in recent months. I hope more homes will come to market as spring gets underway, but the market is far from balanced.

A bar graph showing the annual change in home sales for various counties in Central Washington between Q1 2021 and Q1 2022.

Central Washington Home Prices

The average home price in Central Washington rose 17% year over year to $485,435 but was 0.8% lower than in the final quarter of 2021.

Lower quarter-over-quarter sale prices may be a function of rising mortgage rates, but it’s too soon to tell given that there’s usually a lag between rising financing costs and their impact on prices. Data from the second quarter of this year will give us a better indication.

Every county except Yakima saw double-digit increases in sale prices compared to the first quarter of 2021. Prices were lower in Chelan and Yakima counties than in the previous quarter, but the other three counties saw higher sale prices.

Median list prices have slowed their ascent in many of the markets contained in this report, which could also indicate some softening in the region. That said, the extent to which this is impacting secondhome markets—which are more susceptible to rising mortgage rates—remains uncertain.

A map showing the year-over-year real estate market percentage changes in various counties in Central Washington for Q1 2022.
A bar graph showing the annual change in home sale prices for various counties in Central Washington from Q1 2021 to Q1 2022.

Mortgage Rates

Average rates for a 30-year conforming mortgage were 3.11% at the end of 2021, but since then have jumped over 1.5%—the largest increase since 1987. The surge in rates is because the market is anticipating a seven- to eight-point increase from the Federal Reserve later this year.

Because the mortgage market has priced this into the rates they are offering today, my forecast suggests that we are getting close to a ceiling in rates, and it is my belief that they will rise modestly in the second quarter before stabilizing for the balance of the year.

A bar graph showing the average rates for a 30-year conforming mortgage, plus Matthew Gardner's mortgage rate forecasts for Q2 2022 through Q1 2023.

Central Washington Days on Market

The average time it took to sell a home in Central Washington in the first quarter of 2022 was 55 days.

During the first quarter, it took three fewer days to sell a home in Central Washington than it did a year ago.

All counties other than Chelan and Kittitas saw the length of time it took to sell a home drop compared to a year ago, with noticeable improvement in Okanogan County. Compared to the final quarter of 2021, days on market rose in all counties.

It took 17 more days to sell a home in the first quarter than it did in the fourth quarter of last year.

A bar graph showing the average days on market for homes in various counties in Central Washington during Q1 2022.

Conclusions

This speedometer reflects the state of the region’s real estate market using housing inventory, price gains, home sales, interest rates, and larger economic factors.

The market remains in a state of imbalance. On one hand, the number of homes for sale increased as we moved into the year, but there were fewer pending sales. This is a little counterintuitive given that rising mortgage rates should have been a stimulant for home buyers. Even so, I believe home sellers remain in the driver’s seat, but the year has not started in the way some may have hoped for. Second quarter data should give us some more clarity as to the direction the market will take in 2022, but it is likely that higher mortgage costs combined with lower affordability may act as a headwind.

A speedometer graph indicating a seller's market in Central Washington during Q1 2022.

As such, I am moving the needle a little more towards buyers but, for the time being, sellers still have the upper hand.

About Matthew Gardner

Matthew Gardner - Chief Economist for Windermere Real Estate

As Chief Economist for Windermere Real Estate, Matthew Gardner is responsible for analyzing and interpreting economic data and its impact on the real estate market on both a local and national level. Matthew has over 30 years of professional experience both in the U.S. and U.K.

In addition to his day-to-day responsibilities, Matthew sits on the Washington State Governors Council of Economic Advisors; chairs the Board of Trustees at the Washington Center for Real Estate Research at the University of Washington; and is an Advisory Board Member at the Runstad Center for Real Estate Studies at the University of Washington where he also lectures in real estate economics.

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Major Eastern WA cities covered in this report:

Wenatchee

Yakima

East Wenatchee

Chelan

Ellensburg

Sunnyside

Grandview

Cle Elem

Kennewick

Richland

Cashmere

Omak

>

Eastern WA counties covered in this report:

Chealan

Douglas

Kittitas

Okanogan

Yakima

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Gardner Report Archive

Central Washington
Historical Reports

2022
Q1 2022 Central Washington Real Estate Market Trends

Q1 2022
POST | (PDF)

2021
Q1 2021 Central Washington Market Trends

Q1 2021
POST | (PDF)

Q2 2021 Central Washington Market Update

Q2 2021
POST | (PDF)

Q3 2021 Central Washington Market Trends

Q3 2021
POST | (PDF)

Q4 2021 Central Washington Real Estate Market Trends

Q4 2021
POST | (PDF)

2020
                    Central Washington Real Estate Market Update

Q1 2020
POST | (PDF)

                    Central Washington Real Estate Market Update

Q2 2020
POST | (PDF)

                    Central Washington Real Estate Market Update

Q3 2020
POST | (PDF)

Q4 2020 Cetnral Washington Market Trends

Q4 2020
POST | (PDF)

2019
                    Central Washington Real Estate Market Update

Q1 2019
POST | (PDF)

                    Central Washington Real Estate Market Update

Q2 2019
POST | (PDF)

                    Central Washington Real Estate Market Update

Q3 2019
POST | (PDF)

                    Central Washington Real Estate Market Update

Q4 2019
POST | (PDF)

2018
                    Central Washington Real Estate Market Update

Q1 2018
POST | (PDF)

Q2 2018
POST | (PDF)

                    Central Washington Real Estate Market Update

Q3 2018
POST

                    Central Washington Real Estate Market Update

Q4 2018
POST | (PDF)

These Central Washington real estate reports, data, forecasts, and market trends are provided for informational use. If you find it useful, please properly attribute this resource with a link. Areas in this region of Washington State are also known as the Cascades, Lake Chelan, the Wenatchee Valley, and the Yakima Valley.