Rising interest rates and inflation, coupled with slight improvement in inventory, may bring some normalcy to Western Washington’s frenzied housing market. The Puget Sound housing market has shifted down several levels of hotness in most areas and is more in alignment with the strong market we saw pre-pandemic. Not all homes are selling within the first week on the market. The intensity adjustment means multiple offers will not be as commonplace as they’ve been in the last two years. Premium pricing (above asking price) is softening as well. The normal seasonality in the real estate market will be more pronounced, bringing a bit of normalcy to home buyers and sellers but there will still be an “elevated buyer focus on each new listing.

Last month’s sales of single family homes and condominiums across 26 counties in the report had a list price to sales price ratio of 107.8%, which was down from March when it reached a 12-month peak of 108.2%. A year ago, the ratio was 106.6%. The latest MLS report showed a mix of positive and negative numbers. 11,681 new listings of single family homes and condos during April is the highest number since last July when 12,916 listings were added. Happy buyers in all areas other than King County celebrating last month’s jump in active listings as it means they now have more homes to choose from.

Unfortunately for King County buyers, the area is still desperate for inventory and competition is as fierce as ever. At month end, the selection of homes and condos in the database totaled 6,514, the highest level since September 2021 when there were 7,757 total active listings. Notably, the number of new listings (11,681) surpassed the number of pending sales (9,760), to help boost inventory. Pending sales were down about 7.8% from a year ago and down 3% from March. This is evidence that interest rates are having a cooling effect on some parts of the suburban market and along the I-5 corridor.

With limited selection, sales in those areas also plunged, while prices increased. For condos system-wide the median price on last month’s sales was $485,000 (up 15.5% from a year ago); in King County, where more than 60% of sales occurred, YOY prices rose 12.6%, from $460,000 to $518,000. Area-wide prices for single family home sales (excluding condos) in King County also increased, climbing nearly 20% from a year ago, from $830,000 to $995,000. Closed sales of homes and condos slid from year ago, from 8,791 to 8,344 for a drop of around 5.1%. We are starting to see signs of impact from the significant rise in mortgage rates earlier this year, such as an increase in active listings and months of inventory creeping higher, but the full impact will likely not be felt for a few months.