Zonda Dealmakers is coming to Seattle at a pivotal time for the city’s new-home sector.
New-home sales ended 2024 on a relatively positive note given the resurgence in mortgage rates. The event comes as the market struggles with affordability, but maintains relative strength compared to many other markets around the country.
“I think the best part about Dealmakers events is that it’s the best of the best that come together to try and see where that future is going,” said Mollie Carmichael, principal at Zonda advisory and an expert on the Seattle market. “You get to hear from the front lines and go meet people from outside your office. You can see your peers while also learning."
Here are some highlights of the market to get you ready for the event.
Strengths
Amazon's recent return-to-office mandate for its workers could increase demand for condos in neighborhoods around the company's downtown South Lake Union corporate campus and for single-family homes in the city of Seattle and close-in suburbs.
Weaknesses
The region experienced a surge in new apartment deliveries, which is expected to continue in 2025. This has stabilized rents. Many prospective homebuyers may find renting cheaper compared to the current high costs of buying a home (interest rates, insurance, HOAs).
Prices
The average list price for a new detached home in the Seattle region increased 5.2% from 2024 to $1,024,530 in February while the average list price for a new attached home decreased 2.5% over the same period to $878,901. Homes priced over $950,000 experienced the most closing activity over the past year. The new home affordability ratio for a detached home reached 22.0% in December.
“Seattle is kind of frothy in the sense that values have gone up so much over the last 10 years,” Carmichael said. “People can exit with a lot of equity and go somewhere with better affordability. Many have moved outside the city during COVID to work from home and live in the woods, but they are being called back to the office. There’s a lot of high-income Gen Ys and a lot of tech – most of those folks are in family mode and need to figure out their next move.”
Economy
Total nonfarm employment in the Seattle area increased 0.9% from the same period last year to 2,158,500 payrolls in Dec. 2024. There were approximately 4,600 more jobs in Dec. 2024 compared to the previous month. The local unemployment rate decreased to 4.3% in December compared to 4.4% in the previous mo nth. Dec. 2024's jobless rate is higher than it was this time last year when it stood at 3.9%. Zonda forecasts the region's unemployment rate will finish the year at 3.1%.
“I would say the market across the board is about waiting and seeing,” Carmichael said. “There are interest rates to consider, the new administration and what effect it may have in a bluer state. There’s just a lot of pause right now as everyone wants to see what will happen next and how it will affect the housing market and the broader economy.”
Community
The current population for the Seattle area is approximately 4,187,190 people. Population in the area is projected to increase by 1.1%in 2025. There are approximately 1,673,810 households in the region which is up 1.7% year-over-year. Forecasts show that current household formation is expected to increase by an annual growth rate of 2.0% for 2028. Incomes increased by 5.7% from the previous year to $123,118.
“Interest rates have the entire market in the palm of their hands,” Carmichael says. “It’s probably the most crucial part of whatever happens next in the market. I think the market is projected to be a bit more positive in the next two years – but the challenge is home prices are up 3-4% but builders are playing incentive games in the background.”
The Zonda Dealmakers Event takes place March 19 at the W Hotel Bellevue. Register here.
