SALES MARKET PRICING INDICATORS FOR RENTALS

As 2025 has drawn to a close, it’s now been seven years since our last full year of real estate activity, “pre-COVID-19”. Using that year-end data from 2018 as our “normal” benchmark, let’s take a look at how pricing has fluctuated in the residential Sale market and how, if at all, that has influenced single-family residential Rental pricing (spoiler alert: it has).

Since 2018, pricing fluctuations in the Rental market have tracked closely with the Sales market. In most cases, prices rise more sharply in the spring and summer months. Appreciation cools in the fall and winter, and generally prices fall from their annual peaks earlier in the year. Nothing new here.

Rental pricing changes will often trail Sale pricing by a quarter or two, and in my analysis, we have several examples of that. Rental pricing, by percentage, took a nearly identical path to Sale pricing in late 2019, mid-2021, mid-2022, and late 2022 … in each case following the Sales lead by almost exactly 3 months. Occasionally Rental pricing will set a trend for Sale pricing, as it did in mid-2020, but that is not the norm.

Overall, peaks and valleys will typically correlate, especially since mid-2021, when price appreciation was at its peak in both markets (prices rising by more than 10% across the board in just one quarter!). This historical data acts as a strong predictor that sales market activity throughout 2026 will likely be an indicator of similar Rental market activity when it comes to price fluctuation by percentage.

Overall the average sale price of a home in 2025 Q4 ($1,232,293) was up a whopping 56.6% compared to 2018 Q4 ($786,849), while average Rental pricing was up 37.9% during that same 7-year period ($3,771/mo in 2025 Q4 compared to $2,773/mo in 2018 Q4). While both markets have seen significant pricing gains across this same time span, it’s worth noting that Sale value growth still outpaced Rental value growth by a pretty good clip (almost 20% more). This leads me back to a conversation that I’ve had more times than I care to remember with whoever will listen … lawmakers, media, clients, colleagues (some are more open and willing to listen than others!) about affordability, particularly when it comes to rental housing.

Using the early January 2026 average mortgage rate of 6.16% for a 30-year fixed, let’s analyze the cost of a typical home in King County. The NWMLS 2025 Q4 average monthly rent of $3,771 is by no means “cheap”. By many popular standards, it would require an annual income of more than $135,000 to qualify (which is higher than King County’s median household income as of 2023 data). So yes, it’s expensive to rent the average home. But how much does it cost to purchase the average home? According to NWMLS 2025 Q4 data, the average home in King County is selling for $1,232,293. A down payment of 20% amounts to nearly a quarter of a million dollars! Completely setting tax and insurance aside, the mortgage payment alone would be over $6,000 per month. In reality, this same home as a purchase costs about twice as much per month, not to mention a significant down payment.

My point? Rental housing IS the affordable housing in our communities, even if the monthly rent seems high. Every policy change that influences the owner of a rental home in King County to sell out and pursue greener pastures by positioning their real estate investment dollars in other states directly harms housing affordability right here in our own backyard.

Back to the 7-year price fluctuation analysis, some notable benchmarks along the way:

• The average sale price of a home in King County topped $1M for the first time in 2021 Q2 and has never dropped below $1M in any quarter since. The average sale exceeded $1.25M for the first time in 2024 Q2.
• On the rental side, the $3,000/mo barrier was broken in 2020 Q2, followed by $3,500/mo in 2022 Q2 and then $4,000/mo in 2025 Q3.

Cory Brewer is the VP of Residential Operations at Lori Gill & Associates Property Management. His firm oversees management of over 2,000 residential rental homes throughout the Greater Seattle Area. He may be contacted via wpme@windermere.com. Visit their website wpmnorthwest.com.