North Tacoma home prices are still climbing but not quite as dramatically as they were last year.
First Quarter Market Update
for North Tacoma
The median home price in North Tacoma was up 17% year over year in the first quarter of 2022 (compared to 19% in the fourth quarter of 2021). Our hope is that year over year price gains will continue to taper gently until they reach a healthier range of 4-6%, but rapidly rising mortgage interest rates could trigger a more abrupt market rebalance.
We’ve seen early signs of a market shift in the past few weeks – a drop off in showing activity, fewer offers on listings and an uptick in price reductions – but it’s not yet clear if this shift is temporary or a sign of things to come.
We thought rising interest rates would dampen buyer demand, resulting in an increase in available inventory, but that hasn’t happened yet. Housing inventory levels in North Tacoma remain extremely low.
128 single family homes were sold in zip codes 98403, 98406 and 98407 in the first quarter of 2022 – essentially the same as the first quarter of last year.
Homes continue sell quickly in North Tacoma – moving from active to pending in less than two weeks on average.
Current Market Conditions
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- Mortgage interest rates have risen by a percent and a half since the middle of last year, with the better part of that increase occurring in just the past 3-4 months. Current rates are hovering in the mid to high 4% range and will likely crest 5% by the summer.
- Home prices have continued to rise in spite of rising interest rates, fueled by demand from buyers eager to get homes purchased before interest rates climb higher.
- With interest rates and home prices rising simultaneously, affordability is becoming increasingly problematic. According to a senior economist for the National Association of Realtors, nearly 6.3 million households have now been priced out of the market.
- Though the market still feels hot, a decline in online searches, home tours and mortgage applications suggest that things could finally be cooling off.
In the current real estate marketplace, it remains critical for buyers and sellers to seek expert advice. If you’re thinking about buying or selling a home in the area, please contact us to discuss how we can put our knowledge and experience to work for you.
Mark Pinto is a top-producing Realtor with Windermere Chambers Bay, specializing in residential real estate in Tacoma, Gig Harbor, University Place and Lakewood.
Mark Pinto: (253) 318-0923
MarkPinto@windermere.com
