The Seattle metro area saw single-family home prices surge 13.5 percent during the 12 months ended in July, according to the monthly Case-Shiller home-price index, released Tuesday. Portland was second, with 7.6 percent growth.
Fastest-rising home prices compared with a year ago
1. Seattle +13.5%
2. Portland +7.6%
3. Las Vegas +7.4%
4. Dallas +7.3%
4. Detroit +7.3%
Source: Case-Shiller home-price index
This marks the 11th straight month Seattle has had the nation’s hottest housing market. And it’s the first time increases locally are nearly double that of any other metro area.
The Pacific Northwest has been the center of the universe for surging home values for nearly two years.
Seattle overtook Portland for the biggest home-price growth in the country in late 2016, though Portland remained close behind during the first months of this year.
But in recent months, Portland’s market has cooled off, while Seattle’s keeps getting hotter.
Seattle’s real-estate surge has been driven by a combination of a historic shortage of homes for sale, and strong job and population growth ratcheting up demand, leaving homebuyers to fight it out through bidding wars. Portland also has few homes available but demand has been shrinking, counter to the national trend.
The continued rise in the cost of buying a house in Seattle differs from the rental market, where a boom in apartment construction has helped shrink rent hikes to the slowest pace in five years. Unlike apartments, the city is all but done building single-family homes — leaving an ever-growing number of buyers to fight for the same number of homes — though some suburbs are still adding subdivisions to put up new homes for sale.
To find the last time home costs here were surging at such a rapid rate, you need to go back to the 2006 housing bubble, when local prices grew more than 18 percent at times.
And the last time any region in the country was this hot was San Francisco more than three years ago, when price growth was as high as 25 percent.
Nationally, prices are up 5.9 percent year-over-year, the fastest growth in a couple years.
Home values in Seattle are soaring nearly three times faster than their historical average, which is about 4.8 percent annual growth.
In all, costs here have surged 79 percent since bottoming out in 2012. And they’re up 20 percent since the old bubble peak a decade ago.
The data show the increase is about even across all types of homes and throughout the metropolitan region, from Pierce County to Snohomish County.
This is the time of year that local prices typically start to cool down. In August, the median house in Seattle stood at $730,000, and on the Eastside, it was $853,000, both down slightly from record highs reached months earlier, according to the Northwest Multiple Listing Service.
The typical house sold for $455,000 in Snohomish County and $313,000 in Pierce County last month.
The Case-Shiller data show Seattle-area home values in July grew 0.6 percent compared with just a month earlier, the slowest month-over-month growth since March. That monthly growth was actually slightly below the national average.
But that’s typical for this time of year, since our local market is usually hottest in the spring. When adjusting for normal seasonal changes, Case-Shiller says, Seattle’s month-over-month home cost bump is actually the third-highest in the country, behind only San Francisco and Los Angeles.