Market Update | December 2023
Signs of Optimism Despite Reduced Inventory
Published on: January 5, 2024
Northwest MLS, the source for the most current, accurate market listing data in Washington state, today released its Market Snapshot for the month of December 2023.
Market Recap:
The new year kicks off with some hopeful signs for buyers within the real estate market. Interest rates proceeded to drop through the month of December to a current rate of 6.61% from the November level of 7.1%, with the Fed signaling additional cuts on the horizon. Yet inventory remains stagnant in accordance with typical seasonal patterns, and low inventory persisted to pressure home prices in the region, which were up about 5% year-over-year. According to Selma Hepp, chief economist for CoreLogic, “strong home price gains over the course of the year indicate that home prices in most Washington state markets have fully recovered from 2022 losses and are reaching new highs once again.”
CoreLogic’s Home Price Index forecasts another 3.5% appreciation over the course of 2024.
Important takeaways from December’s data:
NWMLS brokers reported 4,018 closed sales in December 2023, an 11% drop from the number of closed sales in December 2022. While 16 of 26 counties in Washington experienced year-over-year decreases in the number of home sales, seven counties saw year-over-year increases, including Clallam, Cowlitz, Grant, Adams, Walla Walla, Island and Kittitas counties.
The median price of homes sold increased in 16 of 26 counties and decreased in 10 counties relative to December 2022. The three counties with the highest median priced homes sold were San Juan County ($1,450,000), King County ($775,000) and Snohomish County ($675,000). The three counties with the lowest median priced homes sold were Okanogan ($275,000), Ferry ($254,900) and Columbia ($152,750).
The inventory of homes on the market has continued to decline throughout Washington, with 15 of 26 counties seeing a year-over-year decrease. Overall, there was a 20% decrease in the number of active property listings in December 2023 when compared to the same month in 2022.
While still subject to inventory shortages, condominium sales appear to be less impacted by market woes. Compared to December 2022, the number of condominium sales in the state experienced a mere 6% decrease, while seeing a 7% increase in median sales price.
“Washington counties covered by NWMLS have followed seasonal trends in transaction volume and inventory levels, both seeing a typical drop when compared to spring and summer months,” said Mason Virant, associate director of the Washington Center for Real Estate Research at The University of Washington. “Inventory levels continue to be low as current owners with low-rate mortgages remain reluctant to sell. This has led to a continued decline in year-over-year transaction volume and inventory levels in the market.”
Active Listings
There were 7,617 active listings on the market at the end of December 2023, a decrease of 19.6% compared to December 2022 (9,475). The total volume of homes for sale has continued to decline, with 15 out of 26 counties seeing a year-over-year decrease.
Year Over Year Active Listings
Island, King and Snohomish County
New Listings
NWMLS brokers added 2,884 new listings to the database in December 2023, a decrease of 3.2% compared to December 2022, when 2,980 new listings were added.
Pending Sales
There were 4,098 total residential units & condo units under contract in December 2023, an increase of 2% compared to December 2022 (4,017). There were 13 counties with a year-over-year increase in the number of pending sales, King, Snohomish Pierce, Kitsap, Cowlitz, Thurston, Kittitas, Jefferson, Okanogan, Whatcom, Clark, Chelan and Adams.
Closed Sales
NWMLS brokers reported 4,018 closed sales in December 2023, which is a 11.2% drop from closed sales in December 2022 (4,524). The total dollar value of closed sales for residential homes for this month was $2,661,716,924 and was $298,646,210 for condominiums. Despite the decrease, seven counties saw an increase in the number of homes sold year over year, including Clallam, Cowlitz, Grant, Adams, Walla Walla, Island and Kittitas counties.
Months of Inventory
A balanced market is considered to be 4 to 6 months by most industry experts. At the current rate of sales, it would take almost two months to sell every home that is active in the NWMLS inventory. The four counties with the lowest months of inventory in December 2023 were Snohomish (0.9), King (1.42), Thurston (1.54), Kitsap (1.75).
Year Over Year Months of Inventory
Island, King, and Snohomish County
Median Price
Overall, the median price for residential homes and condominiums sold in December 2023 was $597,975, up 4.9% when compared to December 2022 ($570,000). The median sales price increased year-over-year in 16 of the 26 counties, with the highest median sales prices in San Juan ($1,450,000), King ($775,000), and Snohomish ($675,000) counties.
