Permits issued to build single-family homes in the Mid-Columbia are up 31% compared to this same point last year – and contractors are building more townhomes and multifamily homes than last year.

Listings have once again climbed above 1,000 following the winter lull and after reaching that level last fall for the first time in years. In 2026, there have already been four straight months of median home prices above $440,000, a threshold only reached twice in 2025 and not at all in 2024.

“The record median price is $450,490 back in July 2022, so we’ve been close to a record for these past three months,” said Matt McGee, chief marketing officer with Cari McGee Real Estate Team.

On the surface, this looks good for the region’s housing market, McGee and others in the industry told the Tri-Cities Area Journal of Business. But there are signs the market is on shakier ground as economic uncertainty, perennial affordability concerns and other factors chip away at builder and homebuyer confidence.

“Even though a lot of permits are being pulled, there’s a lot of complexity and a lot of unknowns,” said Jeff Losey, executive director of the Home Builders Association of Tri-Cities. “You’ve got a lot of builders who are going to start pulling back on the reins because you don’t want to get out too much over your skis.”

Rising interest rates

Nearly 1,100 homes were sold in the Mid-Columbia in the first four months of this year, according to data from the Tri-City Association of Realtors, a 9% increase over the number sold in that same period in 2025. The association’s sales data, the most recent available, includes the Tri-Cities and adjacent communities but also farther outlying communities, such as Connell and Paterson.

Further data analysis from the association said that a downward trend in days on market for listings, a solid amount of pending transactions, and near-record prices point toward a strong market heading into the summer peak.

“The market is tracking consistently year-over-year in volume while achieving notably higher prices – a sign of sustained demand rather than speculative momentum,” according to the analysis.

As of early June, McGee said his data showed sales continuing to climb month-over-month and inventory growing. However, he also sees signs the market beginning to slow, with homes starting to stay on the market longer and the number of completed sales beginning to stall. That’s especially true for homes priced above $500,000.

“So homes above $500K are selling more slowly this year, and homeowners are having to discount off their original list price more than last year,” he told the Journal.

Homebuyers and homesellers in the Mid-Columbia aren’t the only ones moving more cautiously in recent weeks. New listings of homes for sale nationwide were down 1.3% week over week as of June 4, one of the biggest declines of the year, according to Seattle-based brokerage Redfin.

In addition, pending home sales ticked down slightly week over week during the week ending May 31, the third in a row. Mortgage-purchase applications dropped to their lowest level in more than a month.

The recent uptick in interest rates has likely contributed to folks pulling back. The national average was 6.66% on June 5, according to Mortgage News Daily, the highest level since August last year.

But people also don’t feel great about the state of the economy. Consumer confidence dropped to an all-time low recently, exacerbated by high gas and food prices. The U.S. military action in Iran and inflation fears also are piling on.

“Many Americans aren’t able to – or don’t want to – buy a home when the cost of everything else is rising,” according to the Redfin report.

Addressing affordability

That same uneasiness is also haunting builders, Losey said. Part of the reason this year’s permit activity is so high compared to 2025 is that the uncertainty that pervaded last year – from tariffs on building materials to anxiety around federal budgets and the jobs they support – severely curtailed home construction.

“You can see in the permits that it did have a cooling effect with all the uncertainty,” Losey said. “Prices were being raised on things that weren’t even tariffed.”

While the tariffs have been largely overturned by courts and last year’s proposed deepest cuts to federal spending averted, they’ve been replaced by new uncertainty around gas prices, inflation and the war in Iran.

There’s also still a real need to address affordability, Losey said, particularly for entry-level homeowners. While the price of housing is considered more accessible in Eastern Washington than on the west side of the Cascades, average home prices remain tens of thousands of dollars above the national average, which continues to rise.

Some housing experts attribute the slowing market and barriers to homebuyers to be from a lack of starter homes. Last year the median age of first-time buyers was 40 years old and the median repeat buyer was 62, representing a demographic that can lean on the proceeds of past home sales to finance the next.

“Affordability today is still nowhere near what it was for much of the last decade,” Nadia Evangelou, senior economist for the National Association of Realtors, told Stateline, a nonprofit news organization.

The growth in townhome projects in the Tri-Cities reflects an effort to combat that problem, Losey said. State lawmakers and housing officials are pushing for denser housing to meet demand, and cities are approving more of them to satisfy the state housing mandates. And that can work out in new homebuyers’ favor.

“That’s another way you can get the price down, by increasing the density,” Losey said. “It’s definitely getting us closer to workforce or entry-level housing.”

Ultimately, though, it’s on individuals to pull the trigger on buying a home, he said, and he hopes more will realize that housing costs are only going to go up.

“I think at the end of the day anyone who’s on the sidelines waiting for an advantage with lower interest rates, that’s not going to happen,” Losey said. “If you qualify for a home and you can afford the home, it doesn’t make any sense to wait.”