I have thought for years that Seattle and San Francisco are almost mirror images of each other. Large port cities, built on hills, with large Chinatown's, attracting high tech workers attracted by good jobs and a high quality of life.
There's been a lot of talk recently about how what has happened in San Francisco, with soaring prices and skyrocketing rents, is happening here at the same time. Is that true? Someday, the answer will be yes. So far, we still lag behind them by about 5 years.
Since January 2012, the housing market within the Seattle city limits has appreciated 118.75%. Seattle recently went over the $700,000 mark for median house prices. However, despite this growth we are still way more affordable than San Francisco. One of the reasons our houses have escalated so much in price is that companies in the San Francisco area have been moving satellite offices into our area, and these offices come with highly paid workers seeking housing.
Here is good news for Seattle homeowner's and bad news for homebuyers. We still have a CONSIDERABLE way to go to reach our affordability ceiling. This means that theoretically our housing market still has room to go before we hit our price-point ceiling. Keep in mind, a large part of the appreciation in Seattle is due to San Francisco firms moving satellite offices and high paying jobs here because it's cheaper than San Francisco. So long as Seattle remains less expensive than San Francisco, this trend will continue, and therefore current housing prices will be encouraged to move higher.
Let's look at the difference in prices in the two markets:
So as you can see, with two cities offering similar jobs with similar wages, arguably a better quality of life here, and houses way cheaper than San Francisco, there is a great chance that both house prices and rent prices will continue to climb rapidly in Seattle and in the surrounding suburbs.