A buyer's delight? The Greater Seattle housing market update, February 2025

Welcome to the latest and greatest edition of the Greater Seattle Housing Market Update. The first edition of 2025 to contain data from 2025! Hooray! As always, to skip right to the stats, you can do so by clicking here. For more context on everything taking place in our wild local market, continue reading below.

I'll admit, when I first saw the January 2025 stats, I had to take a closer look because I was very surprised at what I saw.

Historically, every year January is the month where we see the lowest levels of inventory. Very, very few homes hit the market after Halloween, so what is on the market during those months are often properties listed in August, September, October, etc that linger before selling, if they sell at all. Therefore, when the new year turns over, we find ourselves at rock bottom for available homes. This is also exactly the time buyers start their search. This is what leads to very friendly seller conditions that persist through April or May, depending on the year.

So you can imagine my surprise when I saw January 2025 had the most homes for sale of any January going back to 2019. In fact, there were 50% more homes on the market compared to January of one year ago!

But something wasn't right. Despite what the data showed, January felt very different for me and my clients. My listings, including ones that had already been on the market for months, were getting more showings than they had been months prior. My buyers were facing intense multiple offer situations every week. So why does the data suggest a more buyer friendly market? This got me thinking that perhaps the answer lies within the superficial data. What I hypothesized turned out to be exactly what I found.

See the graph above. It charts the total number of active townhomes and non-townhomes for sale in the month of January going back to 2019. Looking at the far right column, it's evident to see that, just about every year, we see townhomes taking up a larger share of total available inventory. 

To be fair, this isn't unlocking any groundbreaking discovery. In an effort to create more units, townhomes must be constructed at the expense of single family homes on big enough lots, and we've been seeing this play out for decades. Nevertheless, it's very interesting to me to show that, despite there being 2772 homes available in January 2019 vs 1820 in January 2025, the share of active townhomes relative to total active homes for sale almost tripled from 8.8% to 22%. 

It means that as more and more townhomes are constructed, buyer's are less and less excited about buying them. This isn't to imply that buyer's shouldn't be excited about buying a townhome. After all, I still own my townhome that was my very first home. However, as unattached single family homes become more and more scarce, the demand for that asset increases, and with that, the price.

This would be the reason my experiences in 2025 so far don't match what the data reflects. My buyers who have been pursuing unattached single family homes have been experiencing fierce competition. Buyers pursuing townhomes and condos, that's a very different story. 

Onto the stats:

Seattle: January 2025 median sale price of $857,500. That is a 1.3% decrease YoY and down MoM from $899,000. Inventory is up 36.4% YoY and the months of inventory statistic increased to 2.6 months from 1.42. 

Eastside: January 2025 median sale price of $1,709,000. That is a 16.7% increase YoY and up MoM from $1,545,000. Inventory is up 60.9% YoY and the months of inventory statistic increased to 2.22 from 1.24 months.

King County: January 2025 median sale price of $855,000. That is up .6% YoY and down MoM from $875,000. Inventory is up 49.9% YoY and the months of inventory statistic increased to 2.14 months from 1.28. 

The absorption metric hit it's highest reading since April of last year, but was still about 20% lower than January of last year. 

Onward!

Shattering the record books. The Seattle condo market update, February 2025

Welcome to the latest and greatest edition of the February 2025 Seattle condo market. Our first report of 2025 that contains 2025 data! As always, to skip right to the stats you can do so by clicking here though I'd strongly encourage reading on. Let's go!

As the subject indicates, January 2025 set a new record for the median sale price of a Seattle condo. Let's be frank, it blew any previous record out of the water. The median sale price of a Seattle condo registered $689,975 last month, besting a previous record of $606,000 in September of 2024. In fact, there have only been 3 months where the median price has EVER eclipsed $600,000 or more. For a new record to best its previous by almost 14% was definitely unexpected.

Now, to be fair, those of you who have been following my reports know that these stats are not a true representative of the condo market because they include the new-ish condo-ized units that function more like townhomes or single family homes. For a more consistent look, see the chart below.

What I've done to create the graph above is to isolate condos to only the 1 story variety. This removes the condo-ized units from our equation. To be fair, there are traditional condos that have more than 1 story (townhome style condos), but they're pretty rare. This graph is a more pure look at the condo market, IMO.

As expected, the median sale price really hasn't fluctuated too much over the last 5 years. Isolating only the month of January, 2025 was the second highest level we've seen over the past 5 years, only second to 2024. 

Despite the sensational headline surrounding the median sales price, it was the inventory statistic that really surprised me.

Historically, January is the low point for inventory. Same goes for the SFR market. The market is pretty depressed after Halloween. Not only is there a lack of any new inventory coming to market, but buyers are also disengaged. The weather also doesn't help making it pretty unconducive to tour properties when it's dark by 4pm, cold, and there are lots of vacations planned given the time of year. Because of that, it makes sense that we enter January at ground zero as far as available inventory goes.

Yet January 2025 saw WAY more active listings than any other January going back to 2019. However, when I extract the condo-ized units and only leave room for the traditional 1-story condo, the stats are mostly the same, but not as dramatic.

In my report on the single family market, I focused on the percentage of townhomes that are representing a larger and larger share of the total single family market active inventory. Are we possibly seeing the same thing in the condo market? See below:

Visible in the far right column is proof that traditional 1 story condos are experiencing a declining share of total sold condos. This is especially true from 2023 on as affordability for traditional condos has been disproportionately harmful for buyers compared to their condo-ized counterparts. Once we see continued stabilization with mortgage rates, this will be interesting to monitor. 

With interest rates and rapidly increasing HOA dues, traditional condos will continue to be a struggle from an affordability standpoint. Even outside of those factors, homeowner associations are also struggling to keep up with rising insurance costs and overall inflation where special assessments might become more common place. This is the void condo-ized units can potentially fill. 

Onto the stats!

For January 2025 the median sale of a Seattle condo was $689,975, an all time record. This was up 28.4% YoY and up MoM from $550,000. Inventory was still up big time. 51.9% YoY and the months of inventory rose to 4.37 months from 2.98 in December. 

Onward!

The December doldrums. The Greater Seattle housing market update, January 2025

Welcome to the latest edition of the Greater Seattle housing market, the first report for 2025! As always, you can watch the stats portion of this letter via video by clicking here. I'd recommend continuing to read below for superior information and context. 

The past few months I've been warning about what I've described as "the calm before the storm". The housing market is a sleeping giant in late Q3 and Q4. Buyers are disengaged, inventory is relatively high, and activity is overall pretty dormant. That all changes once the year turns over and the market suddenly wakes up and jumps into action. And that's exactly what I've seen, anecdotally, so far in 2025.

It happens all so fast. Within a matter of weeks we depart a market where listings were getting minimal activity, buyers were casually looking but not ready to commit, then, like a snap of the finger, we enter a market where suddenly showing activity is robust and buyers are gobbling up inventory at a feverish pace.

This is my shocked face. Consider me unimpressed. I'll cover this increasingly competitive market in the next few months of updates.

As for now, let's look back at some interesting reflections on the local 2024 housing market. It's been a wild one.

Outside of 2023, 2024 had the lowest amount of King County homes sales since 2011. In fact, outside of 2010-11, the absolute bottom of the housing market, 2023-24 were the worst years (at least as far back as my software allows me to track). It's especially interesting considering 2021 was the highest amount of home sales in this time period. To go from decade highs to lows worth of home sales, all within the span of 2 years, is absolutely nuts.

As far as national numbers go, I've heard 2024 was the most depressed market since the mid 1990's. That is really something considering how many more people we have in the country now compared to 30 years ago. Real estate has truly been in a recession for almost 3 years. The saying last year was "survive til '25". I don't know that 2025 will be much, if any, better. We shall see! 

And it's been no secret as to the reason for that. See mortgage rates below during the same timespan. 

For those of you who are homeowners, here's an exercise that might make you a little sick. Go here and see what the estimated monthly payment would be on your home if you had to buy it at today's price and interest rates. 

Did anybody else throw up in their mouth? My own mortgage payment would triple! This is precisely the obstacle for sellers in today's market, realizing just how challenging affordability is for many buyers.

Yet, despite housing affordability remaining near all time lows, Seattle area single family home values barely flinched. In fact, in 2024 home values accomplished something that's never been done. The median King County SFR sales price was $900,000 or higher in all but 2 months of the year (January and December). That includes hitting an all time high of $1,001,000 in June (the first time ever the median sale price eclipsed $1m). This is truly remarkable and speaks to the resiliency and power of our local housing market. 

BREAKING NEWS: As I'm in the middle of this report, I'm learning that META (Facebook) just announced a layoff of 5% of it's workforce. I don't see where those jobs are located (I'd assume mostly in the Bay Area), but it's possible some are in the Seattle area. More locally, Redfin also just laid off 46 employees, too. Not to be outdone, but their competitor, Zillow, also announced layoffs. If/how this impacts the local housing market will remain to be seen. I doubt these collective layoffs will make much, if any, impact, but I'm already hearing of some local buyers pausing their home search until they get more clarity in the security of their employment.

As discussed in last month's report, Seattle Mayor Bruce Harrell's One Seattle Plan, aimed at increasing density by rezoning many neighborhoods in Seattle to make them conducive for multi-story and multi-family buildings, is still progressing. If you'd like to comment, and/or keep track of how this is progressing, click here. As the co-president of my neighborhood community council, we're getting LOTS of questions from neighbors. 

Onto the stats:

Seattle: 2024 ended with a December median sale price of $898,900. That is up 5.75% YoY yet down MoM from $968,000. Total inventory was up 11.9% YoY, yet the months of inventory statistic fell to 1.42 months from 1.79 months. 

Eastside: December 2024 median sale price of $1,545,000. That is up 7.29% YoY and up just slightly, MOM by $8,000. Total inventory was up 21.6% YoY and the months of inventory statistic increased slightly MoM to 1.24 months from 1.17.

King County: December 2024 median sale price of $875,000. That is up 2.95% YoY and down MoM from $925,000. Total inventory was up 21.28% YoY, but the months of inventory statistic fell to 1.28 months from 1.49. 

Thank you all again for an amazing 2024. I enjoy creating this report for you each month and hope you get even a smidge of value out of it. Best of luck in 2025.

Onward!

Amazon to the rescue? The Seattle condo market update, January 2025

Welcome to the latest edition of the Seattle condo market update. As always, you can jump right to the stats by clicking here. To get the best out of the data with context, I urge you to continue reading below. 

As of earlier this month, Amazon's RTO (return to office) mandate has been in effect requiring employees to work from the office 5 days a week. Just like the old days, remember those?!? This should hardly come as a surprise as Amazon had been gradually requiring workers back after granting WFO orders during the height of the pandemic fueled shutdown. A voluntary return then changed to a hybrid model and now we're back to RTO 5 days a week.

Some have opined with conspiracies as to the real motivation for this mandate. Some of my favorites have been: 

This was a politically greased move. The city of Seattle and their leaders colluded with Amazon to require workers back to the office in order to help revitalize downtown businesses and culture.

My favorite conspiracy suggests that the mandate was calculated to induce resignations. Rather than announce layoffs, which is never good for employees or employers, perhaps requiring everybody back to the office 5 days a week, a move Amazon knew was already unpopular with many of their employees, would induce those employees into resigning, thus avoiding having to execute layoffs themselves? That doesn't sound too crazy.

Whether or not there's some truth to these conspiracies, we might never know, but this mandate could very well be the spark needed to ignite a resurgence in the downtown Seattle condo market. A resurgence that's badly needed.

The years of 2023 and 2024 were the LOWEST number of condos sold in the downtown core (downtown, Belltown, lower Queen Anne, Capitol Hill, First Hill, etc) since 2010-11! For those of you unfamiliar with ancient history, 2010-11 was the absolute bottom of the housing market due to the Great Financial Crisis imploding a few years prior.

The median days on market for a downtown core condo reached 40 days twice in 2024. While you may be thinking that doesn't sound that bad, keep in mind this is just data on the condos that did sell. MANY, hundreds, if not thousands of condos were listed in 2024 that never ended up selling. Perhaps a better figure would be to look at the months of inventory stat.

Remember how rough 2020 was for the downtown condo market and all the headwinds sellers faced then? 2024 pretty much told 2020 to "hold my beer". Not that downtown conditions were anywhere as out of control as they were in 2020, but for one reason or another, buyer demand faded and the months of inventory statistic reflected this. Only one month in 2020 was there a month of higher inventory than 2024 (August 2020 4.9 vs August 2024 4.7).

More abstractly, there were roughly 33% fewer sales in 2023 and 2024 (averaged) than in 2020. Furthermore, total sales in 2010-11 (averaged) were only 26.5/units more per year than in 2023-24. That's barely 2 sales a month! This, I believe, is 100% related to affordability.

I believe that condos have been disproportionately impacted by the housing unaffordability crisis relative to single family homes. Even if we assume values are stagnant (not necessarily the case, let's just assume that's the reality) HOA dues in many buildings have skyrocketed to cover increases in taxes and insurance. This is in addition to mortgage rates remaining elevated (currently we're hovering near 7 month highs with rates averaging 7.25-7.5% for owner occupied condos). What does downtown living offer to offset such a significant expense? Perhaps proximity to an office one is required to spend 40  hours/week at? As Amazon goes, maybe the rest of the tech industry follows? 

That being said, as I'm in the middle of this report, I'm learning that META (Facebook) just announced a layoff of 5% of it's workforce. I don't see where those jobs are located (I'd assume mostly in the Bay Area), but it's possible some are in the Seattle area. More locally, Redfin also just laid off 46 employees, too. Not to be outdone, but their competitor, Zillow, also announced layoffs. If/how this impacts the local housing market will remain to be seen. I doubt these collective layoffs will make much, if any, impact, but I'm already hearing of some local buyers pausing their home search until they get more clarity in the security of their employment.

Onto the stats: The median priced Seattle condo in December 2024 was $550,000. That was down 6% YoY and down MoM from $575,000. Inventory YoY was up 40.9%, yet the months of inventory settled at 2.98 months, which is down from 4.15 the month prior. In fact, the months of inventory has not been this low since March. 

One final thing to report: Seattle Mayor Bruce Harrell's One Seattle Plan, aimed at increasing density by rezoning many neighborhoods in Seattle to make them conducive for multi-story and multi-family buildings, is still progressing. If you'd like to comment, and/or keep track of how this is progressing, click here. As the co-president of my neighborhood community council, we're getting LOTS of questions from neighbors and it's good info for all Seattleites to have.

I hope you had an amazing holiday, New Year, and have an awesome 2025 planned.

Seattle goes vertical. The Greater Seattle housing market update, December 2024

Welcome to the latest edition of the Greater Seattle Housing Market Update. As always, to skip right to the stats you can do so by clicking here. But for more valuable information, continue reading below!

As the title suggests, the city of Seattle is going vertical! This isn't exactly new, but they're trying to go even more vertical than before.

With the passage of last year's House Bill 1110, residential lots within Seattle are now permitted to accommodate 3 units (on a single family lot). You've likely seen these, or remember me mentioning them in past market updates. These new structures are being referred to as "condominium-ized" properties. The Council, Mayor, and other legislatures are considering an amendment to the proposal that would not only allow for 4 units per lot (possibly more in some situations), but also allow for greater diversity in the types of structures that can be constructed on these lots. 

If you're a Seattle resident, not only can you learn more about the proposed changes, but you can also comment on them by going here. Even if not a Seattleite, I'd encourage taking a peek. It's pretty interesting stuff. 

Some highlights of the current proposal:

- A max of 4 units are allowed on all lots, regardless of lot size, and up to SIX lots if the property is located within a quarter mile walk of major transit OR if two of the six units are "affordable". What exactly affordable means, I've yet to find.

- Lot coverage would increase to 50%, compared to 35-40% for most lots today. This would help accommodate two story buildings, which are less common today because the current lot coverage limit requires three-story buildings to achieve the maximum FAR (floor to area ratio). 

- Front and rear setbacks would be reduced, which would allow a wider range of layouts and more usable open spaces. New rules would encourage porches by allowing them in the front setback. 

- Unit lot subdivision would be permitted, allowing a more straightforward, fee simple sale and ownership of homes, compared to the more complex condominium-ized arrangements currently in use. Editorial opinion, this would be fantastic! 

- Depending on the zoning, new requirements could increase the maximum number of stories per structure. For example, anything zoned LR-2 will potentially allow a structure up to four stories high. LR-3 will allow up to five stories. NC2-55 will allow a mix of retail, office, residential, etc and to a maximum 55ft height limit. 

Let the arguments, name calling, and brawling begin! 

Pro-density proponents will advocate this will help to bring down housing costs by adding more supply to the market. I don't disagree, but would recommend they temper their expectations on how impactful these changes will be. It's not like this bill will pave the way for $400,000 starter homes or anything close to it. Whatever is constructed will still be expensive, and if there's relief provided, I'm of the opinion it's more likely to be felt by renters as opposed to home buyers. At least that's what appears to be the effects of the current HB-1110.

Opponents might argue these buildings are likely to take away from the aesthetic character of their neighborhoods, possibly bringing down resale value. I don't 100% disagree, but also think this is an overreaction. You can get ideas on what some of these 4-5 stories look like and I think they're pretty sharp! Additionally, here's what we do know. If your lot is capable of being developed into a multi-unit site, you're lucky. Developers will pay premiums for lots that can offer this potential so it benefits the homeowner financially when they're ready to sell because not only is the property going to be desirable for buyers looking to buy the home and occupy it for themselves, but it will also be appealing to developers. The more buyers, regardless of their intentions with the property, the more likely that home can sell for more and more. 

The reality is that, in some areas of Seattle, lots are pretty small (under 4,000sqft). Even assuming this amendment passes and these changes take place, it's not like every single family lot will suddenly be conducive to development. And even the ones that do, maybe some homeowners won't want to sell to a developer. Or, maybe when they're ready to sell, their agent doesn't understand the full scope of possibilities that can be done with that lot and therefore miss out on marketing to developers. Whether you're a proponent or opponent, I'd recommend taking a deep breath because change does not happen overnight. 

Especially when it comes to building in Seattle, a city infamous for excessive regulation. This directly impacts building costs and timelines. If the city really wants to accelerate the impacts of this initiative, they're going to have to loosen up regulations, especially when it comes to tree preservation. 

The regulation involved in which trees can be removed to create housing has essentially created an ideological tug of war between housing affordability and tree preservation advocates. Can both exist, or does one have to concede to the other in order to maximize the effects of this amendment? The city needs to decide which is a stronger priority.

One thing is for certain, we need more homes. King county added over 30,000 new residents over the last year, 18,000+ of which settled in Seattle. If roughly 3 out of every 5 new King County residents settle in Seattle, and we have NO LAND on which to build new inventory, we need to do everything we can with existing land to create more inventory. Personally, I don't think we'll ever get ahead of the curve given our region is so far behind building (and limited topographically) and we have an amazing regional economy attracting highly educated, skilled, and strong wage demanding populations to settle here, from all over the world. Pending any major natural disasters and/or massive regional economic shakeups (god forbid), I forever see our housing dynamics as being in one version of a seller's market or another. 

Onto the stats:

Seattle: November 2024 median sale price of $968,000. That is up 2.5% YoY and down slightly MoM from $972,500. Inventory is up 12.6% YoY while the months of inventory statistic was flat MoM.

Eastside: November 2024 median sale price of $1,537,312. That is up 9.8% YoY and down slightly MoM from $1,555,000. Total inventory was up just .6% YoY and months of inventory declined to 1.17 from 1.28 months.

King County: November 2024 median sale price of $925,000. That is up 4.5% YoY and down MoM from $960,000. Inventory is up 14.2% YoY while the months of inventory statistic dropped to 1.49 months from 1.58.

Have a wonderful Holiday season and New Years. See you in 2025! Onward!

Optimism wanted. The Seattle condo market update, December 2024

Welcome to the latest edition of The Seattle Condo Market Update. As always, to skip the detailed info and go straight to the stats, you can do so by clicking here. Otherwise, to get the most out of this update, continue reading below!

November 2024 wasn't the most dramatic month within the Seattle condo market. To be fair, Q4 is never really too dramatic regardless of the year as we see inventory decrease. However, that doesn't necessarily mean that buyer demand follows the same downward trajectory.

That piqued my interest, too. 

As it turns out, November saw the second highest number of condo units enter pending status in the last 5 months. And we all know why October's numbers stand out, right? Right?

That's because mortgage rates in September hit 18 month lows! Those buyers got off the fence and into contract in October closing either that month, or in November. We have to go back to 2021 to see a November with more units sold than this last month. 

Anyone who's been reading my reports understands the challenges the condo resale market has experienced over the past number of years. Some areas (the downtown core) more than others. I've not held back in identifying some of those headwinds including 20 year high mortgage rates, cost prohibitive HOA dues, restrictive HOA rules and regulations, the work from home trend pushing residents out of city cores and into the suburbs, etc. No need to rehash any of that. 

Instead, let's look to end 2024 on a positive note identifying some factors that could potentially contribute to a market turnaround.

Here are the stories/trends/headlines I'm watching in 2025:

In no particular order:

1) The return to office trend. We know that Amazon is requiring employees back to the office 5 days a week starting in January. Will others follow? I have to imagine this is a huge positive for the entire downtown commercial core. I'm sure there's some truth to the belief that, as Amazon goes, others will follow.

2) Mortgage rates. Not that I brand myself any kind of mortgage expert, but I never saw rates staying as persistently high as they have the past 2+ years. Looking into 2025, I've learned to temper my expectations for a significant drop so I'm anticipating they'll hover in the 6.5% range, more or less, throughout the year. Inflation, the labor market, geopolitical issues, these are major headlines to continue watching on how this affects the financial markets.

3) People continue to move here. This article from the Urbanist shows that last year King County gained 30,000 new residents, with 60% of them moving inside Seattle. Obviously not every new resident moving here buys immediately. In fact, I'd assume it's a very small number that do, but the more people we get migrating here to outpace those immigrating elsewhere continues to put more strain on our infrastructure of existing housing inventory. Generally a net positive for homeowners. Additionally, this article from Axios shows that the Seattle metro area was tops in the nation for economic growth. Note, this is not including the Boeing workers strike so that was not taken into account. 

4) A sane Seattle City Council - Matthew Gardner, former chief economist at Windemere, put it accurately when he said at a recent conference I attended, "the wack-a-doos" are gone. Of course, he's referring to former council members who have since been replaced with more pragmatic representatives who are likely to reverse many of the issues that plagued the city over the past number of years and promote healthier, more business and resident friendly environments. Will they be given long enough terms to undo the damage done by their precedents? Let's hope so.

Onto the stats:

The median priced condo in Seattle for November 2024 was $574,950. That's down 1.3% YoY and down MoM from $580,000. Total active inventory was up 32% YoY while pendings and sold inventory were up 19.8% and 30.6%, respectively. The months of inventory statistic dropped MoM slightly to 4.15 months from 4.22.

Have a wonderful holiday season and new year. Onward!