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King County property values drop after last year's all-time high

The most significant decline was homes on the east side of Lake Washington. Sammamish property values dropped 22% on average.

SEATTLE — Property values in King County are seeing a decline after reaching all-time highs last year. Initial results show residential property values are correcting downward in King County.

“January 1, of 2022 was a high water mark, the real estate market was red hot. Houses were selling for a half million bucks over the asking price. January 2023, is a whole different world and the values have actually gone down,” said King County Assessor John Wilson.

For example, homes in Seattle’s Queen Anne neighborhood dropped 8% but the largest decline was homes on the east side of Lake Washington. Sammamish property values dropped 22% on average.

“Last year especially on the east side, it was not unusual for us to see values go up, oh, 30%, 35%, 40% or more. That's simply not sustainable economically over a repeated number of years, so what you're seeing is market course correction,” Wilson said.

Wilson said the decline could be driven by high-interest rates and home buyers not rushing after properties. Wilson said the housing market is still healthy in King County but has cooled in 2023. 

The decline in property values could mean lower property taxes in 2024, roughly 40% of a homeowner’s property tax bill comes from voter-approved levies and ballot measures. Wilson said if property taxes drop it can help seniors and first-time homeowners. 

“It should help a lot of folks get a little bit of a breather from the double hammer of inflation and skyrocketing property value,” Wilson said.

For homeowners looking to buy on the east side, it doesn’t necessarily mean prices are dropping.

“The east side, the prices have increased. As of April 2023, 40% of those homes went over ask,” said Meg Barlament, real estate broker for Windermere.

Barlament said property value assessments look at January and behind what the market is doing now.

“Where we are right now we have lower inventory. We have a higher demand and not as much supply which is why we're seeing higher prices,” Barlament said.

Barlament said high-interest rates are likely to blame for fewer people wanting to sell who are locked in at a 3% rate, but advice for homebuyers is to buy now and refinance once interest rates go down.

Barlament also tells first-time homebuyers to be patient.

“It is definitely not a sprint. It's a marathon. What I like to tell people is if they don't get the house that they put an offer in and it goes to someone else just know that just means your house isn't on the market yet,” Barlament said.

Values of commercial office buildings fell by 15% to 20%, reflecting the impact of a transition to less in-office work activity. 

The King County Assessor's office expects to finish sending value notices for all 720,000 residential and commercial properties after Labor Day.

According to the Assessor’s Office, receipt of a value notice triggers a 60-day window where property owners can appeal their new value, but not specifically the taxes. 

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