Home prices start falling in King, Snohomish counties

Home prices are falling in King County, according to the Northwest Multiple Listing Service. It’s the first year-over-year price drop we’ve seen since everything shut down in May of 2020, during the pandemic.

New numbers just out Monday show median homes prices are at $800,000 even in King County — down 6.73% from last year, or $57,750. (In May of 2020, home prices dropped 4% from the year before, to a median of $627,000.)

Snohomish County homes fell by 7.4%, to a median price of $690,560 at the end of February; Pierce County homes mostly held steady, dropping just under 1%, to $529,900.

It brings a bit of good news for buyers — especially anyone who can afford to buy with cash — but there are still plenty of challenges.

“Prices haven’t come down so much that it’s a fire sale, by any means,” said Shonna Peterson, a broker with The Warmack Group. “We’re still in a very, very favorable market for sellers.”

One big issue with the housing market is high interest rates still making house shopping very painful. The high rates continue to hover near 7%, pricing out many buyers, and making sellers more reluctant to let go of their existing homes.

“Ninety percent of homeowners have a lower interest rate than what’s available now, so who is going to move?” Peterson said.

Jeremy Johnson sold his Shoreline home in September for $780,000. He was able to catch the tail end of the hot market. Now Redfin says it’s worth $693,609 — about $86,000 less.

“Exactly what we were hoping to see, obviously, you know, in the ideal world, selling at the top then seeing some kind of a pullback,” Johnson said. But now he and his fiancé are facing different challenges — a serious inventory shortage. They’ve decided to house hunt in Oregon, but are experiencing the same lack of homes on the market.

“It’s been about seven months since we sold,” Johnson said. “Obviously getting a little antsy.”

“The inventory is down at historic lows. Just about where they were then the pandemic started,” said Bliss Ong, a West Seattle realtor with Redfin.  Ong said how busy she is day-to-day has dropped by about 50%.

“There is nothing to buy,” Peterson agreed. Still, Peterson has several listings, including this just-listed West Seattle home where KIRO 7 met her at an open house.

With interest rates at nearly 7%, realtors say people are reluctant to sell their homes. Meanwhile, buyers are struggling to fit what they want into a new budget shrunk by those high interest rates.

“People in the $800,000 price range are now in the $600,000 price range. Finding a house in your price range now is a challenge,” Ong said.

New listings continue coming online daily and realtors say the new inventory is starting to heat up along with the weather.

Robyn Johnson is selling her four bedroom, three bathroom home in Black Diamond because of family reasons.  The listing price is just under $900,000.

“I’m feeling pretty optimistic,” Johnson said. She said while she’s noticed some sellers lowering the prices of their homes in the slower market, she’s hopeful the low inventory will help connect her with the right buyer.

“I just don’t feel that urgency, that scariness or anything like that. So I feel pretty confident,” Johnson said.

Condos are seeing much bigger price drops across the board in King, Snohomish, and Pierce counties, all plunging more than 11% year-over-year.