If you’ve been watching the Seattle real estate market over the past few years, you’re well aware that sellers have enjoyed a distinct advantage. But as inventory levels begin to shift, we’re all asking the same question: Are we heading toward a balanced market?

What Is a Balanced Market?

A balanced market is defined by a five-to-seven-month supply of homes for sale, where neither buyers nor sellers have a decisive edge. Prices tend to stabilize, giving both sides a fair playing field, and the number of homes available allows for more choices. After several years where sellers held all the cards, many of us are eager to see this shift. But is that where we’re truly headed?

Starting this year, the national housing inventory stood at a three-month supply. Now, it’s increased to four months. While this may not seem like a huge leap, it indicates a national market trend edging closer to balance. However, it’s crucial to understand that this rise in inventory doesn’t signal an impending oversupply that could trigger a market crash. Despite the recent growth, we’re still far from that scenario.

Take a look at the following chart, which uses data from the National Association of Realtors (NAR) to illustrate where inventory levels have been in recent years and where they stand today:

Currently, we remain in seller’s market territory—just not the hyper-competitive seller’s market we’ve seen in the past few years. As Mark Fleming, Chief Economist at First American, points out:

“The faster housing supply increases, the more affordability improves and the strength of a seller’s market wanes.”

What about Seattle?

At the current rate of sales, it would take a little over two months (2.29) to sell every home that is active in the NWMLS inventory. That's far less than a 'Balanced Market.' Although there is far more choices for homes than there was last year, the Seattle Metro Area still has a long way to go before the market would be considered 'Balanced.'

The six counties with the lowest months of inventory in July 2024 were Snohomish (1.5), Thurston (1.81), Kitsap (1.88), King (1.95), Pierce (2.08), and Columbia (2.09). (See chart below)

What This Means for You and Your Move

So, how does this market shift affect you, whether you’re buying or selling? Lawrence Yun, Chief Economist at NAR, offers this perspective:

“Homes are sitting on the market a bit longer, and sellers are receiving fewer offers. More buyers are insisting on home inspections and appraisals, and inventory is definitively rising on a national basis.”

The following graphs, using the latest data from NAR and Realtor.com, illustrate these changes:

• Homes Are Sitting on the Market Longer: With more homes available, properties aren’t selling as quickly. Buyers may find they have more time to make decisions, while sellers need to be mindful of pricing their homes correctly to avoid prolonged market exposure.

• Sellers Are Receiving Fewer Offers: For sellers, this means being more open to negotiation on price and terms. Buyers, on the other hand, might face less fierce competition, making it a good time to explore your options.

• Fewer Buyers Are Waiving Inspections: In this shifting market, buyers are regaining negotiation power, leading to fewer waived inspections. Sellers should be prepared to address repair requests to ensure a smooth transaction.

How a Real Estate Agent Can Help

Of course, this is the national picture, and real estate is all about location. Market conditions vary significantly from one area to another, so it’s essential to work with a local expert who understands the nuances of your specific market.

Whether you’re buying or selling, staying informed about how the market is evolving gives you a critical advantage. As your trusted Seattle real estate agent, I have access to the latest data and deep local insights, ensuring you’re always equipped to make the best decisions for your situation.

Bottom Line

The real estate market is constantly evolving, and it’s vital to stay ahead of these changes. Understanding the shift toward a more balanced market can help you navigate your next move with confidence. If you have any questions or need tailored advice, don’t hesitate to reach out. I’m here to help you achieve your real estate goals.

If you're making a move, reach out, and lets chat. Happy to brainstorm and come up with a solution that gets you a tangible and actionable plan that fits your unique situation.

Best,

Justin H Gazabat
Broker | PNW, Seattle, Ballard, East Side
Your Friendly Seattle Neighborhood Real Estate Professional.
www.JustinGazabat.com

PS: If anyone in your social or work circles considering a move, just send Me an intro text or email with their best contact info, make sure everyone is CC’d and I’ll take care of the rest! I promise to take great care of them, serve them well, make you look good, plus help them get great results.

Information from our friends at: National Association of Realtors (NAR), First American Financial Corporation, Realtor.com, Keeping Current Matters, Lawrence Yun, Chief Economist at NAR, Mark Fleming, and Chief Economist at First American.