[WSJ] The high cost of living in Seattle.

I Find Karma (adam@cs.caltech.edu)
Tue, 11 Aug 1998 10:56:55 -0700

The median price of a single-family home in Seattle is $203,500?!
Fifth worst in the country behind San Francisco, Honolulu, Orange
County, and (?) Bergen/Passaic in Jersey.

And east of Lake Washington the average is $283,000? Yuck.
My apartment in Bellevue normally costs $1600/month. Double yuck.

No wonder Roy would rather live in Portland. At least there housing
is affordable!

> Seattle's Home-Price Leap Makes Buyers Sleepless
> by Paula L. Stepankowsky, The Wall Street Journal, 08/10/98
> If you think timing the stock market is difficult, try buying a house
> in Seattle or its suburbs.
> A confluence of factors, including high job growth, antidevelopment
> sentiment and geographic barriers, have combined to make Seattle one of
> the most competitive housing markets in the nation.
> Add to that the effect of "Microsoft millionaires," those flush with
> stock options courtesy of the nearby Redmond software giant, and
> conditions are downright depressing-especially for transferees and
> first-time buyers.
> "Clearly, the Microsoft millionaires, and a very active high-end market,
> are emphasizing the problems we're seeing in greater Seattle," said Glen
> Crellin, director of the Washington Center for Real Estate Research at
> Washington State University.
> Propelled by an economy that is creating jobs faster than anywhere but
> Phoenix, the greater-Seattle area ranked sixth on a list tracking median
> home-price increases in 138 urban areas in the first quarter, according
> to the National Association of Realtors and the Washington Center for
> Real Estate Research.
> The median price of a Seattle-area single-family home was $203,500, an
> increase of 14.8% from the year-ago first quarter, the center said. The
> same report ranked Seattle housing the fifth-most-expensive in the
> country, behind only San Francisco, Honolulu, Orange County in
> California and Bergen/Passaic counties in New Jersey.
> By contrast, the median price of an existing home in the New York/New
> Jersey/Long Island area was $178,200 in the first quarter, an increase
> of 2.8% from a year ago, and in Los Angeles, $176,500, up 4.3% from a
> year ago.
> Prices are even higher in the tony suburban areas east of Lake
> Washington, which include Bellevue and Redmond. There, the average
> selling price was $283,146 in the 1998 first half, up 21% from the
> previous year, according to the Northwest Multiple Listing Service.
> Seattle's watery, hilly geography is a big factor in the current housing
> crunch. Puget Sound lies west of Seattle, Lake Washington to the east.
> Streams and rivers cut south of the city. To get almost anywhere you
> have to cross a bridge, which makes housing close to downtown areas even
> more expensive as commuters try to avoid worsening traffic. Unlike
> sprawling, flat-land cities such as Phoenix and Houston, Seattle has
> terrain that is hilly, bordered by the Cascade foothills to the east.
> This limits flat land available for development.
> "You've got a situation much more like San Francisco, where it's
> extremely constrained by water and mountains, and that's exactly what
> has contributed to housing-affordability problems," said Mr. Crellin of
> the Washington Center for Real Estate Research.
> Antigrowth sentiment, never far below the surface here, is slowing
> developers who want to build new houses.
> The state's 1990 Growth Management Act was a reaction, in part, to a
> flood of home buyers who moved to the Puget Sound region from California
> in the late 1980s. The act requires all counties with populations over a
> certain threshold to submit development plans for approval to a review
> committee. A certain percentage of natural areas must also be preserved.
> While the area's home prices leveled off in the early 1990s, they began
> to rise again in the mid-1990s as high-tech hiring at Microsoft Corp.
> and other companies, as well as another boom at Boeing Co., recharged
> the market.
> With an unemployment rate that is 38% below the national average, the
> area's economic growth trend looks like it will continue for some time,
> said Robert Baker, senior economic analyst for the state Department of
> Employment Security.
> Mr. Crellin noted that the Seattle area already has used up a
> significant portion of land designated under the act to accommodate new
> housing for the next 20 years. "So that means there is a shortage of
> land available for development, and that situation tends to increase
> prices," he said.
> While the Seattle/King County area is expected to create as many as
> 65,000 net new jobs this year, the Northwest Multiple Listing Service
> reported that in June, the inventory of homes and condos available for
> sale in King County was 6.7% lower than a year ago.
> New regulations, building permit costs and processing fees all add to
> the price and time it takes to get new housing on line, said Rick Lemon,
> chief executive of Murray Franklyn Inc., a Seattle residential
> developer.
> "Almost every project would move faster with less red tape," Mr. Lemon
> said. "Most of our investments we're working on today we put in place
> three years ago in anticipation of the market and knowing it would take
> a very long time to go through the approval process."
> High housing prices have caused some companies, including Boeing and
> Microsoft, to express concern about the impact on new hires and
> transferees, said Bob Watt, president of the Seattle Chamber of
> Commerce.
> "Some members used to moving people here have found more and more
> potential employees say, 'Gosh, this is a great company and a great
> area, but we can't afford to live here,' " Mr. Watt said. "It's talent
> that not only keeps the current economy growing but also sets the stage
> for the future. That means we have to figure out ways to get people in
> here."
> The area's real-estate agents say transferees have grown faint, or even
> cry, when they hear what they will have to pay for a house in a good
> area.


The cost of living has gone up another dollar a quart.
-- W.C. Fields