Puget Sound Home Buyers Faced 'Super-Charged Prices' In January

KIRKLAND, WA — Puget Sound's real estate market remained tough for buyers in January, as available inventory tumbled to a record low and prices continued to soar. The Northwest Multiple Listing Services released its monthly statistics Monday, noting an especially apparent seasonal slowdown, exacerbated by winter weather at the beginning of the month and a peaking omicron surge.

The Kirkland-based firm, which tracks the trends among 32,000 brokers in 26 Washington counties, found a nearly 14 percent drop in both pending and closed sales during January, as the overall number of active listings declined more than 30 percent from January 2021.

The report found King County experienced the sharpest drop in active listings, down almost 60 percent year-over-year, followed by Jefferson County, down 40 percent and Snohomish County, down 35 percent. However, the homes that were on the market sold fast — and many sparked bidding wars.

"The market remains virtually sold out, and there is a significant backlog of buyers looking for a home to purchase," said J. Lennox Scott, CEO of John L. Scott Real Estate. "Given the market conditions, nearly all homes are going under contract within a week of being listed, and multiple offers are commonplace in price ranges where there is a shortage of available homes for sale."

Overall, NWMLS found January's median prices were up nearly 15 percent from the same time last year, with a handful of rural counties seeing prices surge more than 30 percent. Even within counties, prices can fluctuate significantly, including along the Interstate 90 corridor in King County.

While Seattle actually saw its median price for closed sales dip more than 2 percent over the last year, according to NWMLS statistics, prices surged nearly 40 percent on the Eastside, landing above $1.2 million in January.

"The market is crazy," said Dick Beeson, a managing broker at RE/MAX Northwest Realtors. "We've been experiencing huge increases in median sales prices and a continued lowering of the number of days homes are on the market. The massive reduction in inventory has led to fewer pending sales and super-charged prices. Many properties have literally gained 40% to 50% appreciation in just the last two years or so — a rate of increase no one can comfortably live with."

The Seattle Times profiled a recent, particularly shocking example in Bellevue, where a one-story home near the city's Spring District sold to a cash buyer for nearly $1 million above its list price, after attracting more than a dozen bids.

Still, realtors said sellers should expect the staggering growth in prices will level off sooner than later.

"People waiting longer to sell their home should not expect the same steep prices increases we were seeing in 2021," said John Deely, an executive vice president at Coldwell Banker Bain. "An influx of people coming to the market and a decrease in the buyer pool due to interest rates going up should help to keep prices level."

Those factors, joined with more certainty expected over the future of work-from-home and hybrid employment practices, could bring more opportunities, inventory and stability come spring.

"Many buyers are considering homes farther north, south and east with more affordable prices and more selection," said Dean Rebhuhn, owner of Village Homes and Properties. "Hybrid work-from-home conditions are allowing more flexibility for buyers. Job demand and lifestyle choices continue to drive sales."