If you know boats or you’ve ever been on a big one (cruise ship, ferry boat, cargo ship), you know that it takes time to maneuver one. They don’t turn on a dime–and neither does the real estate market.

Does that mean nothing is happening? Nope. What it means is even when the turn happens, it may take some time before we really see and feel the effects.

What’s Happening Now

The last couple years have been absolutely frantic in the Puget Sound area. We have seen properties go for a million dollars or more over the asking price. Bananas, yes. But keep in mind those were homes that were already listed over $1M to begin with. As for the rest of the more “average” priced homes, those have tended to sell for around 10-15% over asking, sometimes closer to 20% over.

Now, what we are seeing is the ship just beginning to turn. Prices have been landing closer to asking, or maybe 100-105% of asking. We’ve been seeing more price reductions, too. Don’t get too excited, though. These are homes that were likely priced on the higher side to begin with, and buyers are no fools. Especially after the last few years. Just because we are seeing over-priced homes get closer to reality does NOT mean the same thing as “prices are dropping.”

What’s Next in the Puget Sound Market

Tech hiring remains on a tear. Expect thousands more to move to the greater Seattle/Tacoma area in the next few years. As the #WFH dust settles, we can also expect a lot of those transplants (and others) to migrate further out of town, west to Kitsap County, north into Snohomish and Whatcom Counties, and deeper into Pierce County. Don’t expect any abrupt price reductions there. At best, a leveling off.

Also as interest rates continue to rise, more and more buyers will unfortunately be priced out of their desired markets, and some out of the market entirely. (The rental market remains strong, but that’s a post for another time). But those buyers who are well-qualified, pre-approved, and ready to go, may finally be rewarded for their patience and fortitude.

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