SEATTLE — For months, Seattle-area home prices have been teetering between growth and decline.
They just dropped over the edge.
The cost of a single-family home in May dipped 1.2 percent from 12 months earlier, the first negative change in a major U.S. city in a number of years, according to the latest S&P CoreLogic Case-Shiller data.
“Whether negative YOY (year-over-year) rates of change spread to other cities remains to be seen,” said Philip Murphy, managing director at S&P Dow Jones Indices, in a statement. “For now, there is still substantial diversity in local trends.”
Nationwide, home prices have been slowing their gains for the past year — even in the Southwest, where the market is growing fastest. Las Vegas, which overtook Seattle as the nation’s hottest housing market last June, saw gains of 6.4 percent, still a slight decline over last year.
But an overall fall in Seattle-area prices masks the trend that north and south of Seattle, the market is only getting hotter. In Tacoma and Pierce County, median house prices rose 7.3 percent in June from 12 months earlier, according to data from the Northwest Multiple Listing Service. (The Case-Shiller index lags by one month and is a composite of prices in King, Pierce and Snohomish counties.) And prices in Kitsap and Skagit County both posted double-digit price increases.
Some of that variation is because prices for less expensive homes, which tend to be outside of Seattle, are still rising.
The Case-Shiller index divides homes into three even tiers: homes that cost more than $625,000, those that cost less than $400,000 and those in between. Of the three, in the Seattle metro area only homes in the least expensive tier posted price increases in May, a 2.74 percent jump since last year.
While the Northwest Multiple Listing Service data charts growth in some ritzy suburbs like Bellevue and Mercer Island, that’s not the case for the city itself. Prices in the middle tier of real estate are stagnant, the Case-Shiller data shows, while the top tier has been losing value since early this year.
Those top two tiers include almost all the single-family real estate in Seattle proper, where the median home price is $714,600, according to Zillow.
Kelly Meister, a broker at Compass in Seattle, said buyers “don’t have the sense of urgency they did last year,” when prices for top-tier real estate were growing in the double digits.
And, she said, she’s seeing more variation in home prices from street to street and neighborhood to neighborhood than she did a year ago.
Right now, she said, “the Seattle market is like a microwave: Super hot in some spots and cold in others.”
Nationwide, the Case-Shiller index showed gains of 3.4 percent over the past 12 months. Growth is slowing because “buyers are no longer willing to pay any price,” Zillow economist Matthew Speakman said in a statement.
Buyers, he said, “took a breather ... The fact that buyers — and prices — slowed their roll right through the middle of home-buying season indicates just how few homes are on the market.”
Even though home prices in Seattle are dropping, they remain high. A typical home in Las Vegas, the nation’s hottest market, might sell for $274,000, according to Zillow’s Home Value Index, less than half the median Seattle value.