Dec. ’22 Housing Market Update: Median Home Price Drops Below $400K

The Tri-Cities housing market continues to shift closer to what we consider a balanced market. When we did our snapshot last week, there were 708 homes for sale (AKA “inventory”). Combine that with the 220 homes that sold last month, and that gives us 3.2 months of inventory right now. We generally consider a market to be balanced when there are 4-6 months of inventory.

There are more signs of the continuing shift right up on the graphic above: prices are down, days on market are on the rise, and inventory only dropped slightly. Let’s take a deeper dive into this month’s market update!

Tri-Cities Home Prices

Home prices dropped for the second straight month, and fell below $400,000 for the first time since our December 2021 snapshot. Prices have fallen by $40,000 over the past two months, essentially wiping out all of 2022’s price increases and putting us back where we were in January, when the median price was exactly $400,000.

Prices fell in all three of the Tri-Cities, with Kennewick seeing the biggest decline at more than $33,000. Kennewick’s median price hasn’t been this low since May 2021. In Pasco and Richland, the current median prices are close to where they were a year ago. Prices jumped last month in West Richland, but that kind of volatility is pretty common there because so few homes sell each month compared to the bigger cities.

Tri-Cities Homes for Sale

The number of homes for sale stayed above 700 when we did our snapshot last week, but was down 7% from last month. It’s been years since we’ve had two straight months with more than 700 homes for sale — October and November of 2019, if you’re curious.

Of those 708 homes for sale, almost half have had a price reduction: 338 to be exact, which comes out to 48%. Price drops are getting more common; when we checked a couple months ago, 38% of available homes had a price reduction. This is happening most often in Richland, where 52% of current listings have had their asking price reduced.

Notice, too, that this inventory is taking longer to sell. The median days on market across the area rose to 19 days last month, which we haven’t seen since February 2020 (23 median DOM). A year ago, our median days on market was just five.

And that’s a look at this month’s Tri-Cities housing market! As always, please drop us a note if you ever have questions about what’s happening around town or in your specific neighborhood.

(*Remember that days on market can sometimes be skewed by how new construction homes are processed in the MLS.)