Seattle housing market shows luxury surge as starter home sales stall

Zillow data indicates a sharp split in the Seattle housing market. Luxury homes – defined as the top 5% of values with an average price of about $1.9 million, up 3.1% year‑over‑year – saw sales increase 6.2% while inventory fell 5.2% and price cuts were limited to roughly 20.6% of listings. In contrast, starter homes – the 5th to 35th percentile with an average price of $202,000, up 2.3% – experienced a 5.4% decline in sales, a 4.5% rise in inventory and price reductions on about 25% of listings.

In Seattle’s Capitol Hill neighborhood, the median home price is roughly $792,000 and properties spend a median of 21 days on the market, reflecting tight supply with only about 110 homes available. Buyers face closing costs of 2%‑5% of the purchase price, amounting to roughly $13,900‑$14,800. Senior economist Kara Ng of Zillow noted that “the best time to buy a home is when nobody else wants to,” highlighting the divergent conditions facing luxury and starter‑home buyers.