The North Tacoma housing market has definitely slowed down in response to higher mortgage interest rates, which are currently hovering around 6%.
Second Quarter Market Update
for North Tacoma
Potential home buyers aren’t as eager to purchase as they were just a few months ago. High home prices and high interest rates have made them more cautious. Multiple offer situations are less frequent, and year over year price gains continue to taper off. The current median home price in North Tacoma is $650K - just 8% higher than it was in the second quarter of 2021. That’s impressive historically speaking but not nearly as impressive as the double digit gains we saw last year.
This shift in the housing market may feel unsettling, but it actually brings with it a healthier balance between buyers and sellers. In the long run, that’s a good thing for everyone.
220 single family homes were sold in zip codes 98403, 98406 and 98407 in the second quarter of this year – a 19% decrease in sales activity when compared to the second quarter of last year.
Though sales activity is down significantly, the houses that have been selling have been selling quickly.
Though buyer demand has weakened, inventory levels remain relatively low with just one month’s worth of available housing stock in North Tacoma. It will be interesting to see if inventory levels begin to rise as we move into the second half of the year.
Current Market Conditions
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- Higher mortgage interest rates have definitely dampened home buyer interest. According to the Mortgage Bankers Association, mortgage applications were down 16% year over year in June.
- Sellers are relying pretty heavily on price reductions to get their homes sold. According to Altos Research, more than 25% of homes on the market right now have been price reduced.
- As issues of affordability persist, the number of first time home buyers continues to drop. First time home buyers comprised 28% of sales in April of this year, down from 31% just a year ago.
- Foreclosures and short sales remain historically low, representing just 1% of sales in April.
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
