Seattle's housing market is facing a substantial downturn, characterized by sharp declines in home sales and an increase in available inventory. This weakness is largely attributed to a wave of layoffs within the tech sector, which has historically been the primary driver of the region's real estate growth. DR Horton Inc. CEO Paul Romanowski specifically noted "weakness out in the Northwest," particularly in Seattle, during an analyst call, linking it to the shift in software jobs and increased layoffs. Redfin reports that Seattle's pending home sales plunged 15.6% year-over-year in July, making it the sharpest drop among major U.S. metropolitan areas. Closed home sales also fell by 9.1%, placing Seattle among the top five steepest declines nationally.
Median home prices in Seattle remain high, at approximately $809,479, which is roughly double the national average of $408,795. This makes the market particularly vulnerable to elevated mortgage rates and the current job insecurity. Redfin Premier agent Chase Costello observed that tech workers are less likely to move between companies or into the area, reducing demand for new homes. While prices are down 1.8% year-over-year in May, and the median home was listed for $738,000 in June, affordability remains a significant barrier, with an entry-level budget of $550,000 often limiting buyers to condos or townhomes.
The tech industry's belt-tightening and job cuts are having a chilling effect. Amazon initiated 16,000 corporate job cuts this year, following 14,000 last fall. Microsoft cut about 15,000 jobs in 2025 and an additional 4,800 recently, with 1,600 in its Xbox division. Other major tech companies like T-Mobile, Zillow, Starbucks, Meta, Google, Oracle, Epic Games, Bungie, and Salesforce have also experienced layoffs. Over three-quarters of the region's layoff notices this year were for tech jobs. The Puget Sound Regional Council reported a loss of 12,900 jobs in 2025, the first annual decrease outside of the pandemic since 2009. Microsoft's research indicates that AI is impacting "highly AI-exposed jobs" for workers aged 22-25, with employment falling by about 13% in these roles compared to less exposed ones. These job changes include customer service reps, telemarketers, technical writers, web developers, and computer support specialists.
