As we near the halfway point in the year, it’s time for an update. I wanted to share a few details on the health of the Seattle Condo Market.
Let’s jump in.
The most important markers in the Seattle condo market that I follow are Active units, week/over/week pending and closed sales, absorption rate, median sales price, days on market and YTD sales. Lets define those in clear detail so its easier for you to follow:
Active Units: Simply the number of active condos currently on the market
Week over Week: Week over week sales (showing sales velocity/activity)
Absorption Rate: The term absorption rate refers to an evaluation metric in the real estate market to evaluate the rate at which available homes are sold in a specific market during a given time period.
Median Sales Price: The median sales price is the price with exactly half of the houses priced for less and half priced for more.
Days On Market: DOM is the number of days from the date on which the property is listed for sale on the local brokers’ multiple-listing services (MLS) to the date when the seller has signed a contract for the sale of the property
YTD Date Sales: is a period, starting from the beginning of the current year (either the calendar year or fiscal year) and continuing up to the present day.
Ok, so why is all of this important? For one, I make this a priority for my clients. I have to be the expert if I want to earn my clients trust. The Seattle condo market is complex. If I don’t pay attention to the details, I’m doing my customers and readers a disservice.
Coronavirus and the Seattle Condo Reaction
So lets dive into the numbers. How is the Seattle condo market following The Covid-19 epidemic?
This is what the inventory looked like back in April:
I started keeping weekly stats back then to see how the market would handle the epidemic. As you can see the market had about 154 units. That included new construction.
The peak pandemic condo inventory hit 355 units in September.
Now, inventory is stable and even nearing pre-pandemic levels. In fact, the market has been very active. Brisk sales, lots of buyers re-entering the market and the rental market is starting to heat up. All signs that the Seattle condo market is recovering. There are just 140 re-sales on the market. That is a very healthy, stable supply.
WEEK OVER WEEK SALES
Week over week pending and sold units are both important when determining the health of any market. Specifically in the Seattle condo market, I’m looking for sales velocity. Market stability. Here is a look at week over week sales and pending sales
Absorption rate is one of the best indicators for the health of a condo market. You can calculate it two ways:
Rate of Absorption
Months Supply Of Inventory
I’ve always found that “Months Supply” is the easiest marker for clients to relate too. As you can see here, the months supply is just 3.2 in Seattle. See below for a chart on how to use months supply to establish if we are in a buyers market, neutral market or sellers market.
The other three components/markers I use when evaluating a market is days on market, median sales price and YTD sales. As you can see above – the average days on market in Downtown Seattle is 116 days. The median sales price for active units is $775,525. Finally, the YTD sales figures are coming in at 315. That is off last years pace but shows a strong recovery coming out of the Coronavirus pandemic.
Let me summarize how the Seattle condo market is doing. For one, it’s improving. No one could have expected the epidemic that we just went through. This hurt the condo market. As people fled for the suburbs, inventory climbed and the market worsened. That trend is absolutely, positively reversing. I’m hearing from a lot of clients and contacts who are returning to work and living in the City. It will take a while, but for now, the market has greatly improved. The only debate now is if and when new construction makes a full recovery. More on that soon.