Seattle Real Estate Update: 98105 (University District) Market Review

If you are watching Seattle real estate and wondering where things are heading, the 98105 zip code is a great micro market to study. This is the University District, one of the most desirable and supply constrained neighborhoods in the city. It has a big mix of housing styles, price points, and buyer types, which makes the data look a little choppy month to month. But when you zoom out, a clear trend shows up.

Let’s break down what is happening right now in 98105, what the numbers actually mean, and how to use this window if you are buying, selling, or investing.

Prices are still rising, but the pace is slowing

The University District continues to outperform the county as a whole.

On a smooth 12 month rolling basis through September 2025:

• Median price is up about 4.5 percent year to date
  
  
• Average price is up about 6.2 percent year to date
  
  

That gap between median and average tells you something important. There are both lower priced homes and higher end properties trading in this zip code, so a few luxury sales can pull the average up quickly. The median is often the cleaner reflection of what the typical buyer is paying.

The bigger takeaway is this. Prices are still climbing, but appreciation is cooling compared to the frenzy years. Higher rates have kept a lid on demand, and buyers are taking longer to decide.

Inventory is up, but still not enough to create a true buyers market

Listings are rising, which is the headline everyone is pushing. But the context matters.

Year to date:

• Listings are up around 16 percent
  
  
• Total homes for sale are up around 18 percent
  
  
• In some months, new listings spiked as high as 46 percent
  
  

Those sound like scary numbers until you look at months of supply. 98105 is sitting around 3.8 months of supply. That is not a glut, that is still a tight market.

If no new homes hit the market, inventory would be gone in less than four months. That is the definition of an undersupplied neighborhood.

This is why prices are not collapsing even when inventory rises. We are shifting from a white hot sellers market into a more normal, buyer friendly balance. Not into a crash zone.

Pending and closed sales show a late summer slowdown

Sales activity was mixed in late summer.

• Pending sales are up about 8.7 percent over a rolling 12 month period
  
  
• Closed sales are up about 13 percent year to date
  
  
• Monthly closed sales dipped sharply in mid summer
  
  

That dip lines up with what buyers and agents felt in real time. July and early August were slower, then activity started to rebound by late August and into September.

The market is not freezing. It is just reacting to affordability pressure and seasonal rhythms.

Days on market are still low for Seattle

Average days on market in 98105 is about 21 days.

Three weeks to sell a home is still fast. It shows buyers are active, but also more selective than they were in recent years. Good homes that are priced correctly move. Homes that are stretched on price sit longer.

Buyers are finally getting small discounts again

The percent of original list price is one of the best quick signals for negotiation power.

• Spring peak 2025 hovered near full price or mild bidding wars
  
  
• August dropped to about 97.9 percent
  
  
• September climbed a bit to about 98.6 percent
  
  

Translation. Discounts are back, especially for normal homes where buyers have options. This is what deal season looks like in Seattle. Not a collapse, but a temporary pocket where buyers can negotiate without getting crushed in bidding wars.

Historically, 98105 heats up hard in spring. During the frenzy years, the area peaked around 110 to 111 percent of list price. That shows you the demand power sitting under the surface here. If rates drop further, the neighborhood will react quickly.

The rate backdrop favors a hotter spring

The 10 year Treasury has been trending down. As debt gets cheaper, Seattle buyers re enter the market fast. In this region, demand tends to accelerate once mortgages drift into the low sixes.

Rates today are hovering around the mid sixes for most buyers. If that trend continues, expect a stronger spring market in 2026, especially in high demand zip codes like 98105.

A supply crunch keeps the long term bullish

Even with a softer economy, Seattle’s biggest problem is not demand. It is supply.

Local zoning, long permit timelines, and geographic constraints make it hard to build enough housing. In the Seattle metro, we are roughly four years behind on new construction. That deficit does not disappear quickly. Even if builders ramped up tomorrow, it would take many years to catch up.

That is why prices in neighborhoods like the University District tend to rise over time, even through choppy cycles.

What this means for you right now

If you are a buyer or investor, this is the window.

• Inventory is higher than the frenzy period
  
  
• Days on market are longer than peak years
  
  
• List to sale ratios are below 100
  
  
• Rates are drifting down, but buyers have not fully rushed back in yet
  
  

This is the playbook moment. Shop the properties that have been sitting. Negotiate hard on terms. Look for homes that are slightly dated or mispriced and use that leverage now, before spring demand returns.

If you are a seller, pricing and positioning matter more than ever. The market will reward realistic pricing and strong presentation. Wish pricing will get ignored.