The Seattle real estate boom isn’t just affecting neighboring markets – the pressure can be felt more than 50 miles outside of the city.
“We’re preparing the second quarter statistics for our own report now, but it’s still showing that places like Mount Vernon, places like Port Townsend, Kitsap County … are just absolutely taking off,” James Young told KIRO Radio’s Ron and Don Show.
Young is Research Director for the University of Washington Center for Real Estate Studies, and has been analyzing markets for more than 25 years.
“People are willing to commute that bit more to get cheaper houses,” he said.
That’s quite a commute. Mount Vernon is more than 60 miles north of Seattle – a near two-hour drive. Poulsbo is a 90-minute commute with a ferry ride, but a longer drive if traveling from I-5. The 55-mile drive to Port Townsend can take well over two hours during rush hour.
Young said that Seattle’s hot housing market can be attributed to massive growth in Washington’s tech industry (with most of that centered in King County). After all, homes in Seattle are still cheaper for those employees compared to the Bay Area. However, it’s not just tech employees who are increasing demand.
“I mean, you’ve got a lot of demand from industries, not just tech, but everybody kind of forgets about Boeing and everybody forgets about Costco, and all the rest of these guys that have been around for ages as well,” he said
Are local aspiring-homeowners competing with foreign buyers?
Critics have pointed to foreign buyers as another contributor to rising home prices. Young notes, however, while there are many foreign buyers in Seattle, the competition for homes isn’t nearly as stiff as markets in Vancouver, B.C. or Aukland, New Zealand.
“Nothing on the scale of Vancouver or Auckland, where if you invested enough money in real estate, you could get permanent residence,” Young said. “That doesn’t really happen in a U.S. context.”
The rising housing costs ultimately come down to a fundamental aspect of real estate: demand.
“As long as you have the demand, the supply’s not going to be able to keep up,” Young said. “That’s just the way property markets work.”
It would appear home prices aren’t going down anytime soon. Seattle was named the nation’s fastest-growing big city in May, gaining nearly 21,000 residents from 2015-2016. For now, people forced out of the market will continue to look at nightmarish commute times — and Washington’s new distracted driving law means they can forget eating dinner on the ride home.