The Seattle area’s real estate market saw a two percent decrease in the median price of a single-family home in September. While this was a welcome respite for buyers in this seemingly endless nightmare of skyrocketing home prices, this was in fact bad news for many homeowners who are in mortgage debt, collectively owing an estimated $7.5 billion more than their houses are worth.
According to Zillow, 13% of Snohomosh County mortgaged homes and 9% of King County mortgaged homes have a negative equity. This presents a unique problem in the market, as these homeowners do not have the financial enticement that comes with putting a property up for sale, which in turn lowers the inventory to prospective buyers.
This meager supply of homes for sale contributed to the outstanding amount of bidding wars that occurred this summer, and experts say this won’t change until new homes are built.
Have Seattle buyers had enough? Will we continue to see a slight decline in the median home price? Tim Ellis, publisher of the Seattle Bubble Blog predicts a decrease in buyer interest based on three factors; a rise in interest rates, worsening traffic congestion and a plunge back into a national recession.
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