Real Estate Market Update - July 2023

Home purchase and sales activity for the greater Seattle-Bellevue area is following typical seasonal market trends. Home sales activity peaked in mid-June and currently the quantity of Sold properties (demand) decreased over 13% from June to July while homes For Sale (supply/inventory) increased over 5.5% during this period as of August 1, 2023. Expected seasonality indicates the quantity of properties going under contract (Pending) may continue to gradually decrease until there’s a spike in activity from mid-August into September. Thereafter, home sales activity should decrease again through the holidays into December. I believe the residential market in Q3-Q4 will be more similar graphically to 2018 and 2019.

Seasonality and the foregoing historical data indicate that real estate sales activity should be slowing, but it doesn’t feel like it. The pool of inventory is historically low (a 40% decrease from 2022), but the pool of ready, willing and able buyers is larger. Based on my experience, properties properly prepared, marketed and priced correctly will likely be in multiple offer situations.

Real estate prices appear to have adjusted to higher mortgage interest rates in early 2023. See last month’s report for 10-year home price trendlines. I do not believe interest rates will decrease materially in the foreseeable future unless there’s some negative exogenous recessionary event. The average 30-year mortgage for over 50 years is over 7% and the market, including Buyers, Sellers, lenders etc are adjusting to the reversion of current interest rates to such long-term average:

I’m here to help you or someone you know achieve their real estate goals.

---