While forecasts project a 4% – 5.5% drop in home prices nationally, Seattle might see an even steeper drop. The Seattle area housing market is already one of the fastest-cooling U.S. markets.
This decline in housing costs is likely to help only the wealthiest buyers. Given how high home prices are in the region, even a 5% – 10% drop in prices will not make housing affordable, especially with rising interest rates.
Plus, the drop in housing costs could leave some homeowners underwater. It’s estimated that a 4% drop in housing prices could move 6% of homeowners underwater, while a 12% price decline could drive 16% underwater.