Seattle's inventory is shrinking, and its home prices are rising - but a slowdown could be in the works.

Seattle has had less than two months of available housing inventory for more than two years. This does not at all point to a healthy housing market, given that the best inventory range is four to six months, according to MarketWatch’s Sam Debord. The low supply has driven Seattle’s home prices up by double digits, but MarketWatch reports that a slowdown could be coming, when one looks at the year-over-year inventory rates.

Seattle’s inventory has shrunk by 13% year over year – a far lower rate than the 20% drops observed over the past eighteen months. This hints to a slowdown, though the market is still very hot. Some fear that the rising prices and shrinking inventory hint towards a housing bubble, but while the last housing bubble was built on false credit, Seattle’s new influx of technology workers have the capital and income to spend on new homes, according to Debord.

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