Washington State Housing Market: Trends and Forecast 2026

Washington State's housing market cooled in August with a 22% rise in active listings, a 7.6% drop in closed sales, and a 2.3% decline in median prices to about $635,000 regionally. King County's median fell to $845,000, while Pierce's rose slightly. Inventory increased to 4.2 months. High mortgage rates near 7% are limiting demand, creating more buyer choice but maintaining payment pressure. Sellers must price competitively, and investors should focus on durable employment areas and realistic underwriting.