Seattle housing market "icy cold" at end of 2022

If you're trying to buy a house in the Seattle metro area, you may finally get a break.

What's happening: The value of a typical Seattle-area home fell 5.8% between April and November, a much steeper drop than the normal seasonal decline, according to Zillow's latest market report.

• Nationwide, by contrast, November home values were down only 0.5% from their high point in June.

Meanwhile, in another sign of a fast-cooling market, the number of homes listed for sale in and around Seattle this month was more than double the number listed a year earlier, per Zillow data.

Why it matters: Local buyers have been battered by rapidly rising prices during the pandemic, coupled with a rise in interest rates, which have caused mortgage costs to skyrocket.

Yes, but: Those high costs have caused homes to stay on the market longer, giving local buyers — at least the wealthy ones — more options to choose from.

• Among the 50 largest U.S. metros, Seattle had the second-highest year-over-year increase in housing inventory as of Dec. 10, per Zillow. Only Salt Lake City saw a bigger percentage spike in home listings.

The big picture: Earlier this fall, Seattle-based real estate brokerage Redfin pegged Seattle as having the nation's fastest-cooling housing market.

• That trend has continued, Redfin deputy chief economist Taylor Marr told Axios, with Seattle seeing "the sharpest cooldown in the nation."

What they're saying: "It's gone from blazing hot to icy cold," Marr said.

• Marr said that reflects how Seattle — a major hub for tech jobs — has been hit hard by high interest rates, which have taken a particular toll on tech stocks.
• Jeff Tucker, senior economist for Zillow, said because competition for homes in and around Seattle is down, buyers are less likely to end up in bidding wars.
• "Those are much friendlier shopping conditions now," Tucker told Axios.

Reality check: Still, the typical Seattle-area home cost $761,311 in November, according to Zillow.

• That makes for a typical monthly mortgage cost of $3,841, up 105.6% since 2019.

What we're watching: If mortgage rates tick down over the next few months, that would further improve the market for buyers.