Seattle, WA Housing Market Forecast 2025

Editor’s note: This report was updated in July 2024 to bring you the latest data, metrics, trends and projections.

The Seattle-area real estate market has followed a roller coaster trajectory over the past few years, with major ups and downs for both home prices and sales.

As of summer 2024, forecasts for the Seattle housing market predict that prices could decline a bit through the rest of this year and into 2025. Affordability challenges have cooled the market as home buyers shy away from higher housing costs and interest rates.

Even so, Seattle remains a fairly competitive real estate market for buyers due to limited inventory levels and building constraints.

Current Housing Market Conditions In Seattle

Like many other metros across the U.S., the Seattle-Tacoma-Bellevue metropolitan area has experienced a dramatic cooling trend over the past two years.

The home buying surge that occurred during the pandemic years led to a price bubble and a subsequent decline. Then, after tumbling for more than a year, home prices in the Seattle area eventually hit bottom and rebounded.

Now, in summer 2024, some forecasters are predicting another, shallower downturn.

Here’s a summary of events that led to the current state of the housing market:

1. Pandemic boom: In early 2020, when the pandemic prompted a nationwide surge in relocations and home purchases, Seattle-area home prices skyrocketed. That trend lasted more than two years.
2. Price bubble: In early summer 2022, the median home value for the Seattle-Tacoma metro area reached an all-time high of around $778,000. The median for the city of Seattle itself peaked at $933,000, according to Zillow.
3. Downturn: During the second half of 2022, home values in this market began to fall. That same trend played out in most major cities across the U.S.
4. Mild recovery: Seattle-area home prices hit bottom in the spring of 2023 and began to climb again, though at a much slower pace than before.
5. Flatline forecast: As of early summer 2024, home values across the metro area seem to be flattening out again. The median home price was hovering around $748K for the metro and $872K within the city of Seattle.

Real Estate Forecast for 2025: A Dip in Prices?

Home prices in the Seattle metro area have crept upward over the past few years. But according to some analysts, this market might not be finished with its post-pandemic adjustment phase.

In fact, one forecast for the Seattle housing market suggests that prices could dip between now and early summer 2025.

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That prediction comes from researchers at Zillow, who predicted a -2.2% price decline for the Seattle-Tacoma-Bellevue metro area. This 12-month forecast was issued in June of 2024 and therefore extends through the same month next year.

But this doesn’t represent an anomaly. Zillow’s home-price predictions for other major metros across the U.S. ranged from modest gains to modest declines, with a lot of “flat-line” territory in the middle. So clearly they don’t anticipate any significant price growth over the next year or so.

Prediction takeaway: Some forecasters believe that the Seattle housing market could experience some price erosion during the latter part of 2024 and into the summer of 2025. But such forecasts are the equivalent of an educated guess, so you probably shouldn’t bank on them.

What’s Driving This Negative Forecast?

As usual, it’s a supply and demand story.

Over the past year or so, the Seattle-area real estate market has gained inventory while experiencing a reduction in demand. Some analysts believe this will drag home prices down through the rest of this year and into 2025.

Here is what’s happening on both sides of the equation:

• More supply: Inventory growth has forced sellers to price their homes more competitively. With more competing properties, sellers have to be more conservative and flexible with their asking prices.
• Less demand: Higher prices and interest rates have reduced housing market affordability and squeezed some buyers out of the market, resulting in less demand.

Affordability plays an important role in all of this. The Seattle real estate market has gotten more expensive in recent years. That means there are fewer buyers who can afford to make a purchase, even at the lower end of the pricing spectrum.

According to a report published in The Seattle Times earlier this year:

“In just a few years, the income needed to afford a typical home in the Seattle area has shot up nearly 80%, illustrating how skyrocketing home prices and interest rate hikes together have reshaped the region’s housing affordability.”

Good News: Inventory Situation Has Improved

One of the most notable changes for the Seattle real estate market has to do with inventory.

There are more homes on the market now than a year ago, and this has shifted the negotiating dynamic in favor of buyers.

According to a July 2024 report from Realtor.com, the total number of active real estate listings in the Seattle metro area increased by 61% year over year. Additionally, the number of newly listed homes increased by 25% during that same 12-month timeframe.

This means there are more properties available overall, and also more new listings coming onto the market—compared to a year ago.

This could make things easier for Seattle-area home buyers during the remainder of this year and into 2025, especially if the growth trend continues.

But despite these inventory gains, the Seattle housing market still has a relative shortage of homes when compared to the number of buyers seeking them.

Prediction takeaway: The Seattle real estate market could become more buyer-friendly in 2025 due to supply growth that has occurred over the past year (and is still occurring). But it’s still not a classic buyer’s market and probably won’t become one anytime soon.

Current Home Prices Across the Metro Area

Home prices can vary significantly from one city to the next, even within the same metro area. And the Seattle-Tacoma-Bellevue metropolitan offers a prime example of this variance.

Here are the median home values for key cities, as of July 2024:

• Seattle: $872,515
• Bellevue: $1,457,136
• Tacoma: $492,151
• Kent: $646,450
• Everett: $652,735
• Renton: $760,912
• Federal Way: $595,950

Tacoma, Washington (33 miles south of Seattle and with a population 223,000) is the most affordable major city in the metro area, in terms of home prices. Bellevue is the priciest, with a median home value nearly three times that of Tacoma.

Home buyers with some flexibility as to where they live could get a lot more house for the money just by expanding the search box.

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About the Seattle-Tacoma-Bellevue Metro Area

This housing market forecast covers the Seattle-Tacoma-Bellevue metro area as a whole, as well as individual cities. Here are some things you should know about the area if you’re planning to buy a home in 2024 or relocate in from elsewhere. 

Sometimes referred to as the “Puget Sound region,” the Seattle-Tacoma-Bellevue metropolitan statistical area is a major urban complex within the state of Washington.

This metro includes the state’s three most populous counties—King, Pierce, and Snohomish—and is home to over 4 million residents as of the latest census. The largest and most well-known city is Seattle, followed by Tacoma and Bellevue as other major hubs.

 Geography and Climate

Western Washington is defined by its diverse landscape, including the saltwater inlets of Puget Sound, the Cascade Mountain range to the east, and the Olympic Mountains to the west. The Seattle metropolitan area is situated within this varied terrain.

The Puget Sound region is known for its temperate, often rainy climate with mild summers and cool, wet winters. Temperatures rarely drop below freezing in the winter. The area experiences a significant amount of precipitation throughout the year, with the majority falling during the fall and winter months.

The proximity to the Pacific Ocean influences the climate, moderating temperatures and contributing to the frequent rainfall and cloudy days.

Economy and Employment

The Seattle area is a globally renowned technology center. Industry giants like Microsoft and Amazon have their headquarters here, along with many startups and other tech-focused companies.

Aerospace (Boeing), biotechnology, healthcare, and maritime trade are also significant economic drivers in the region. The metro area consistently ranks as a leader in job opportunity and attracts workers from around the country.

Housing and Cost of Living

The Seattle housing market can be fiercely competitive. Home prices and rental costs far exceed the national average. When this report was published, the median home value for the Seattle metro area ($698,000) was more than double the national median price ($343,000).

Home prices can vary significantly depending on location and desirability within the metro area. For example, the current median price in Sammamish, Washington is around $1.4 million, while the median in nearby Tacoma is closer to $460,000. But the two cities are only about 15 miles apart.

According to an analysis by U.S. News & World Report:

“The average salary in Seattle is higher than the national average, but it’s not enough to keep up with the metro area’s cost of living. The area offers a lower value than similarly sized cities when comparing housing costs to median household income.”

The region offers a mix of housing options, including urban high-rises and condos in downtown areas, traditional single-family homes in extensive suburbs, and more rural options in outlying towns.

Lifestyle and Culture

The Seattle metro area caters to outdoor enthusiasts, with access to hiking, camping, skiing, boating, and water sports. The nearby mountains, forests, and waterways provide abundant recreational opportunities.

Seattle boasts a vibrant arts and culture scene with world-class museums, theaters, and a thriving music and independent arts community. The area is synonymous with coffee, and independent coffee shops thrive alongside major chains.

Disclaimer: This report contains real estate market predictions for the Seattle area extending into 2025. Those projections were issued by third parties not associated with the Home Buying Institute (HBI), which makes no claims about future housing conditions.