Seattle-area home prices unscathed by coronavirus pandemic
Despite a statewide stay-at-home order, massive job losses and an uncertain economic outlook, home prices in the Seattle area zoomed up faster in April than any large metro in the country save Phoenix, according to the latest release of the S&P CoreLogic Case-Shiller Home Price Index.
Nationwide, U.S. businesses cut an unprecedented 20 million jobs in April. But the U.S. housing market has proven to be "remarkably stable," said S&P managing director Craig Lazzara in a statement.
Around Seattle, home prices in April rose 7.3% from a year ago, compared to a 4.7% increase nationally — the fifth straight month local home-price increases topped national averages. Only Phoenix saw hotter price growth, with an 8.8% year-over-year increase. Prices around Seattle also rose month-over-month by 1.4% from March to April.
Historically low mortgage rates may be bolstering buyer demand, fueling competition and driving up prices. Prices rose in each of the 19 cities Case-Shiller tracks. In 12 of them, prices were at an all-time high in April. (Typically, the Case Shiller index tracks 20 cities, but data for the Detroit metro area was unavailable for the second month in a row due to recording delays caused by the pandemic.)
Around Seattle, buyer demand bottomed out in the first week of April, with pending sales dipping nearly 45% lower than last year's numbers. Since then, it's been on an upward trajectory. Pending sales topped last year's pace by mid-May, according to data from the Northwest Multiple Listing Service.
The number of homes on the market, meanwhile, had lagged last year for much of the past three months. The surge in buyer interest wasn't being met by a surge in inventory — a recipe for higher prices. That trend, though, may be over: data from last week show the number of new home listings has nearly caught up last year.
Seattle-area home-price growth was strongest in the most affordable tier of homes, those selling for less than $445,507. There, prices were up nearly 11% price year over year. Highest-priced homes, those selling for more than $665,668, saw price increases of about 6%; prices for homes between those two points rose about 7.5%.
While "substantial risks remain and the longer-term outlook for home prices is still very much unclear," said Zillow economist Matthew Speakman in a statement, "at least for now, the housing market continues to cruise through this historic downturn more or less unscathed."