The housing cycle came later to Seattle than to other West Coast cities and prices held up longer. They hit their high in May 2007, more than a year after the rest of the nation. Now, prices are going down, having fallen 5.2% in the past six months. In total, they are 28% off their peak.
Two factors affecting prices are now clashing, according to Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State. On the positive side: Hiring is picking up at some of the area's signature employers, such as Boeing, which recently won a new contract, and Amazon, which Crellin said is posting about 50 jobs a week.
The economic rebound will not be able to offset the growing foreclosure problem. "There's a 28-month shadow inventory of foreclosed and pre-foreclosure properties," said Crellin. "That's going to hold prices very flat."
Sellers have had to slash prices to compete. The average time on market before the first reduction is 54 days in Seattle, according to Trulia, and that first cut is about 6%.
This area house in Newcastle, Wash., has gone through two reductions since last July and is now listed at $699,990, 12.5% lower.
For more information: Trulia