What is coronavirus doing to Tacoma housing prices?

You'll be surprised at what's happening in some neighborhoods.

  • 3 mins read
  • May 4, 2020

As I wrote last month, the post-COVID 19 housing market is a unique thing. We’re definitely heading into a recession. How can we not, with expected unemployment over 20%? And yet, many fundamentals of our regional and local housing markets remain the same.

For instance, Pierce County still features the lowest number of average days on market of any county in Western Washington. And overall, the shortage-driven seller’s market dynamic of our region continues.

In Tacoma, what I have found is that, with some exceptions, COVID-19 has largely not changed Tacoma housing market dynamics.

Of all the 868 Tacoma-area home sales that took place in the last 3 months, the average sales price was 1.6% higher than the list price – meaning that bidding wars are still pretty common. The average time on market for Tacoma-area sales is 5 days on market. And, revealingly, we have already seen a 7.4% median sales price increase from the last 6 months ago to today.

The average chance of selling – which results from dividing homes that are under contract by homes still being actively listed – ranges from high to…extremely high. The typical North End property has a 100% guarantee of selling if it’s priced correctly, while you have an absurd 400% change of selling if your home is around the 6th Ave district.

So in the aggregate: Tacoma homes are still increasing in value, selling quickly, and selling aggressively. But that’s the average. Is this the case for all neighborhoods and all property types?

Generally yes, with some exceptions. Virtually all Tacoma neighborhoods have seen price increases over the last few months, with tight inventory, and low average number of days on market. The only notable exception? Downtown Tacoma. In the last 6 months, there has been a modest 2.7% drop in the average sales price of downtown inventory, which is mostly due to an over-supply of condominiums on the market. The typical Downtown Tacoma property has a 44% chance of selling, which is far more like a balanced market or even a buyer’s market.

For the other Tacoma neighborhoods, it’s merely a question of “how much” of a seller’s market each one is. Interestingly, while Eastside Tacoma had the distinction of most rapid price growth at this point last year, that neighborhood seems to have been usurped by Central Tacoma (the 6th Ave area in particular) in this respect. North and West Tacoma enjoy modest-to-high price growth as usual. South Tacoma is a close second to Central Tacoma, with a 261% chance of selling. And even despite its increased new construction, Northeast Tacoma has seen an impressive 12% growth in average sales prices within the last 6 months.

The major takeaways? In general it’s a great time to sell in most parts of Tacoma; it’s an excellent time to sell in Central Tacoma; and there’s a short window where you can get a good deal on a Downtown Tacoma purchase. Reach out to me anytime if you are curious about your home value, or the market in general.