When Will the Home Prices Go Down in WA?

This is the question that I receive often, so let me explain what I think. In my opinion and experience serving greater Seattle area (eastside mostly), I don't see how the prices will go down. Seriously! With lots of demand and scarce supply, basic economy is telling me prices would unlikely go down.

Predicting the future of the housing market is tricky, and it's especially challenging to say definitively when home prices will go down in WA. However, I can share some insights from current trends and forecasts to help you understand the possibilities:

Reasons for potential decline:

Mortgage rates: While still elevated, mortgage rates have eased slightly in recent months. This could potentially lead to increased inventory and decreased buyer demand, putting downward pressure on prices.
Economic outlook: Some economists predict a mild recession in 2024, which could dampen buyer confidence and further slow the market.
Affordability issues: Home prices in WA remain high, making it difficult for many buyers to afford. This could eventually lead to price stagnation or even declines.

Reasons for potential stability:

Tight inventory: Despite some recent increases, housing inventory in WA remains near historic lows. This limited supply could continue to support prices, even in a slower market.
Strong job market: WA's economy is relatively strong, with low unemployment and rising wages. This could continue to generate demand for housing.
Limited new construction: Supply chain disruptions and labor shortages are limiting new construction, further constraining inventory and potentially keeping prices propped up.

Predictions by area:

Seattle: Some forecasts predict a slight decline in home prices in Seattle in 2024, possibly around 0.7%.
Other areas: Smaller cities and towns in WA may see more varied trends, with some experiencing small declines and others remaining stable or even seeing price increases.

Overall:

It's unlikely that WA will see a significant crash in home prices in 2024.
A more likely scenario is a stabilization or modest decline in prices, with significant variations depending on location and type of property.

Ultimately, the timing and extent of any price decline in WA will depend on several factors, including national economic trends, local market conditions, and government policies. If you're considering buying or selling a home in WA, it's wise to consult with a local real estate agent who can provide more specific guidance based on your individual circumstances.

Here are some resources that you may find helpful: