Seattle Real Estate Market Update | December 2021

Right now home prices are the highest they’ve ever been, inventory is low, and interest rates are still at record lows! These catalysts, along with many buyers in the market, are showing that we are continuing a strong sellers’ market as we head into 2022.

Here is last month’s market update – Seattle Real Estate Market Update November 2021. And below is the latest update for the Seattle real estate market:

Video Transcript:

Hey y’all. Zach McDonald, your real estate agent with Real Property Associates, and this is my Seattle real estate market update for December 2021. The Seattle housing market as we wrap up 2021 and head towards 2022 continues to become increasingly competitive as inventory continues to decline and prices specifically on the east side continue to run away from the same place that they were last year. Before we jump into any of the stats, which is why I know many of you are here, I want to start this market update off with a story, which we do in every update.

This month, we’re featuring Kyle, one of my great clients who bought his first place ever with me. About five years back, he bought a condo in Edmonds. He’s recently purchased a house over on the east side of the state. And now after renting his house out or condo out for a few years, he’s decided to sell. We recently wrapped up that transaction and he’s going to almost double up on his money, which is absolutely amazing after such a short time. So Kyle, congratulations on the great result and we wish you the best as you focus on building your life over on the east side of the state.

Let’s jump into the stats now. And again, these stats are from November 2021 from the Northwest multiple listing service. So we are looking at last month’s stats as we jump into the beginning of December 2021, and we’re looking at Seattle and Bellevue, the two big dogs in the Seattle region and really Seattle dwarfs Bellevue in size and the amount of homes sold. But I started including Bellevue in here, just so you can get a little bit of a glimpse at how different it is on the east side of Lake Washington versus the west side of Lake Washington.

Now, the median sales price in Seattle last month was $825,000 up 3.3% year over year, which is considerably less than we’ve seen across King county and even more so in Snohomish county up north from the city of Seattle. And there are again many factors why that might be the case, and you can go back and listen to some of my older updates this year if you want to get some thoughts or perspective on maybe why that is, but the city of Seattle itself is right now at a record high. Never seen median sales price this high in November, but it is down a little bit from the high earlier in the year.

If we look at Bellevue’s median sales price last month, they set a new record high for themselves in the month of November. Again, not the record high, but the highest median sales price for the month of November at $1.65 million, which is a 26.9% jump. I mentioned earlier, we’re going to see the differences between Seattle and the east side. And again, this video, isn’t a comparison, battle of Bellevue versus Seattle real estate, but it is good to see if you’re somebody who’s looking to move to the area or you’re already in the area and you’re trying to get perspective on what does it cost to live in Seattle or Bellevue or one of the suburbs around, and the east side suburbs are considerably more expensive to the tune of two times.

As I’m looking at the numbers this month, I’m realizing that Bellevue’s median sales price is exactly two times the median sales price for Seattle. As we dive deeper into the Seattle real estate stats and the Bellevue real estate stats, we are going to see that there are a few trends continuing on as we finish out 2021. Number one, the median days on market is still hovering right around that five to six day mark, depending on where you’re at. And the big reason is because we are artificially setting those dates. Most listing agents are setting a five to six day offer review period. They are waiting to review offers until the specified date, and then they are reviewing offers with their client.

If that was not the policy, agents and buyers and sellers would be scrambling around and I bet we would see median days on market closer to one or two days on market, which is nuts and super, super chaotic for real estate agents and buyers. So I really do like the idea of the offer review date. One thing I wish that agents and buyers and sellers did a better job with was honoring those review dates so we weren’t constantly in this chaotic, are they going to honor it? Are they not going to honor it? Do I need to submit an offer within 30 minutes? Or can I wait a few days? So I think we could definitely benefit from some more clarity here. It sounds like maybe there’s another video for me to make because I’m passionate about that.

But I do like that it’s hovering in that five to six day range because number one, it’s better for sellers. Sellers get more competition and more buyers have a chance to come see the house. And it’s better for buyers because buyers get the chance to see the house and they get to bring an offer versus missing out. And maybe they would’ve got the house if they were able to get in their quicker, but we’re limited with some of the COVID restrictions still with showings. So it would be nice to have a little bit more stability at least on that piece. But as a prospective buyer seller, expect an offer review date in most cases and expect five to six days on market.

The second Seattle real estate trend you’re going to notice is that homes are still selling above asking price. In the city of Seattle specifically, houses are selling on average 3.7% above asking price. That’s not a huge number. And a lot of people are on the super, super competitive houses winning with offers in that 10 to 15% over range, which is nothing to sneeze at. But if you compare it with the east side, Bellevue’s median over asking or average in this case actually, the average over asking price 15% over asking price. So the average house is selling 15% over asking price. That means the one that gets asking price and the ones that are way, way over. So what I’m seeing if you’re over in Bellevue or the east side right now is 25 to 30% over asking price is not unheard of. In fact, a lot of the houses are selling for that.

So the big drivers, and this is going to be trend number three, it’s really the lack of homes for sale. Quite frankly, the amount of buyers is dwarfing the homes that are on the market. So if we look at some of those stats here, which I think will finish up this part of the video with, we’re seeing new listings about where they normally are to be honest. So it’s not like nobody’s wanting to list their house. We’re just seeing normal amounts of listings on the market.

So Seattle and Bellevue both are slightly down from where they were last year as far as new houses on the market, but right in line with more normal years. Last year, more people listed during the winter and late fall than they normally do, just because they were holding off during the spring because that’s when the COVID-19 fears were at their highest and now we’re seeing more normal numbers for perspective. If we look at homes for sale, though, the numbers are dramatically dropping off. We have 62.1% less houses for sale in Seattle as we headed into December, and Bellevue had 80.5% fewer houses. Guys, Bellevue had 15 houses for sale at the end of November, heading into December. That’s ridiculous. We haven’t seen numbers like this since 2017. And that was the previous lowest inventory we’d ever are seen in the Seattle area.

So as we’re looking at 2022, we’re seeing inventory numbers, and I suspect it’s going to keep getting tighter. I wouldn’t be surprised to see even less than 15 houses on the market as we head into January 2022, especially with the Christmas holiday coming up. And in Seattle, there’s a lot of room, I guess, in Seattle to have less houses. But again, I think we’re going to see less homes on the market heading into the new year.

Speaking of inventory, we’ll wrap up the stats section talking about that because in Seattle we have 0.4 months of supply, and that really just means we have like a week and a half, almost two weeks of homes on the market. And in Bellevue, we have 0.1 months of supply, record low. Never seen that low of a number in Bellevue. And a lot of the east side suburbs of Bellevue/Seattle have very similar numbers, which just means there’s not even enough houses each week for all the buyers. There’s nothing.

So when you look at a map, you’re going to see a whole bunch of yellow and red dots for pending and solds. If you were looking on Zillow or Redfin, and you’re going to see hardly any greens, and that’s just across the board, any price range, any type of property. And the same thing in Seattle, you’ll see a lot more in Seattle, bigger city, a lot more inventory, but in Bellevue, when you have 15 houses for sale across the whole city, that’s not very much.

We’ll end this Seattle real estate market update, just like we do with all the other ones and that’s with some application for buyers and sellers. If you’re a seller, this is your dream scenario, not enough houses, a lot of buyers, low interest rates. This is going to be, as we head into 2022, the best time that you’ve ever had to sell your house, you have the highest prices that we’ve ever had and I think they’ll continue to go up as we head into the new year and this spring. You have no homes available for sales. You have all these buyers competing over your home and you have low interest rates. So people are able to pay more and more and more for your house.

So if you’re somebody who’s been thinking about selling, maybe you thought about it last year or even the year before, and now you’re considering maybe a relocation to another place, you’re thinking about downsizing, or you’re just ready to cash in, get some of the equity and kind of wait this out and see what’s going on. This is going to be the year to do it. Buyers, for you, I’m sorry, but I don’t have better news. This market right now is super, super competitive and it will continue to be competitive as we head into 2022. I bet even more competitive.

I think prices are going to continue to go up. And I think middle of the year, maybe end of the year, we’re going to see interest rates at a higher point than we see them now. Right now, Freddie Mac is saying that we’re at 3.1 approximately for the average mortgage rate across industry for a 30 year fixed rate, at least as of the time of filming this video and I think we’re going to see that go up. Last year, rates were down below 3%. We’re up about 0.4% year over year, and I could see something like that or even more as we head into the summertime, into the fall next year. So that would in increase the rates and decrease your affordability.

So I don’t think it gets better as a buyer as we continue to head into 2022. So if you’re somebody that has buying a house as a goal, you’re thinking about it. I think this is going to be the time to do it. Get prepared, get started, start having those conversations. I do think though, you need to be aware and prepared for competition, a little bit of missing out. There’s going to be some highs and lows. There’s a little bit of that. You got to hang in there. You got to be tough. You got to be tenacious. And if you are that type of a person and you want to start talking about buying a house, this is going to be the time to get started.

Thanks so much for watching my Seattle real estate market update for December 2021. I hope that this video brought a lot of value to you. If you are a buyer or seller or even just somebody that is a homeowner in the Seattle area, I hope that this video was helpful for you. So a couple requests, number one, please, please, please if you haven’t subscribed to my channel yet, do so. Number two, please drop a comment down. I love engagement and engaging with the people that follow along on a regular basis. And number three, if you’re somebody that lives in the area and you’re thinking about buying or selling real estate, I’d love to be a resource for you.