Jan. ’23 Housing Market Update: Prices Inch Up But Activity Slows

It’s always fun to put together the January market report every year, because this is the report that sets the tone for the next 12 months. It’s the one we’ll often use to compare future reports. Unfortunately, it’s also a report that happens during real estate’s typically slowest time of year. And this month’s update is very typical for the month of January. #shrug Let’s dive in to this month’s numbers!

Tri-Cities Home Prices

The median price of homes sold last month bumped up just a bit, from $399,450 to $408,070. That was driven completely by what happened in Kennewick last month. Kennewick had the highest number of homes sold and was the only city we track where prices rose. And Kennewick prices were up enough that it offset the price declines everywhere else.

Prices for the whole area finish 2022 flat. We began last year with a median of exactly $400,000 and we end the year just $8,070 higher — a 2% rise for the year.

Here’s how prices fared for the year across the area:

• Kennewick: up 7.3%
• Pasco: up 3.9%
• Richland: down 5.5%
• West Richland: down 13.6%
• Benton City: down 16.5%

Take the West Richland and Benton City numbers with a small grain of salt; the number of home sales there is so small that it’s easy for price gains and declines to be exaggerated. (And that’s why I’m not including Burbank in the list above, too.)

Number/Speed of Homes Sold

We only had 183 homes close in December. That’s the lowest since we began tracking market stats in 2018! And here’s a very telling stat: Of those 183 homes that sold last month, 107 sold below asking price (58%). Only 37 (20%) sold for more than the asking price.

Homes continue to spend more time on the market. Last month, it took a median of 22 days for a home to sell. The last time we had a 22-day median was February 2020 — literally right before the pandemic.

Inventory (aka Number of Homes for Sale)

Our inventory dropped for the second straight month. As I mentioned at the start of this report, that’s very common for this time of year. If history is any indication, inventory will probably drop again for the next month or two.

Those 617 homes for sale are still 61% more than we had at this time last year, so the market is still much less competitive for buyers than it’s been the past few years.

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.)