People who bought homes in the Seattle metro area in 2017 made about $10,000 more than homeowners who bought in previous years, and made more than double what renters earn.
Seattle-area home prices are still dropping at the fastest rate in the country. But that doesn’t mean homes are suddenly affordable to people who don’t make good money.
Far from it: The median income of homebuyers in the Seattle metro area has reached $114,000, or about 40 percent more than the region’s actual median household income of $82,000.
A report released Tuesday by Zillow analyzes census data to determine the actual income of homebuyers in the year they purchased their home — by looking at homeowners who moved in the same year.
It shows that, as prices soared in recent years, buyers in 2017 needed more pay than ever to afford a home here: Adjusted for inflation, the median income of homebuyers has jumped $35,000 in five years and is up $15,000 since the bubble popped a decade ago.
Most Read Business Stories
- 'They'd just given up' — an inside look at seafarers trapped aboard ships amid COVID-19 restrictions
- Apple, Amazon and Google are all pretty bulletproof | Commentary
- Hot, hot summer for Washington home shoppers: Record-breaking prices and a cutthroat market
- Apple’s stock split should put a focus on numbers that truly matter
- Why did it take more than 2 months to stop the largest fraud in Washington state history?
Homebuyer incomes have grown twice as fast as renter wages in the last half-decade across Greater Seattle. Buyers now make more than twice as much as renters, who have a median income of $55,000.
New homebuyers also make more than those who bought their homes back when houses were cheaper. In 2017, all homeowners in the region — regardless of when they bought — made $104,500, compared with $113,900 for those who bought that year. That’s a new phenomenon; for the previous decade, new homebuyers made about the same as existing homeowners.
Only six metro areas had median homebuyer incomes higher than in Seattle: San Jose, San Francisco, Boston, Washington, D.C., New York and San Diego. For renters, only San Jose, San Francisco and D.C. tenants made more.
The recent drop in home prices hasn’t been significant enough to move the needle on those trends, at least so far. Prices have dropped 12 percent in the last seven months in King County, but that was after prices grew more than 135 percent in the prior six and a half years.
The monthly Case-Shiller home-price index, also released Tuesday, showed prices fell 0.7 percent in November from the month before, across the region that spans King, Snohomish and Pierce counties.
Seattle was tied with a few other regions for the biggest monthly decline in the country after leading the nation in monthly price drops for the previous three months in a row.
On a year-over-year basis, prices still grew 6.3 percent — the third-most in the country — mostly behind gains from cheaper homes in the outer edges of the region, particularly in Pierce County, where the housing market hasn’t slowed the way it has in King County.
The index divides homes across the metro area into three price categories. The cheapest homes in the region, typically those on the outer edges, saw values grow 9.2 percent in the past year. The priciest homes, mostly those in Seattle and the Eastside, saw prices grow 4.9 percent year-over-year, or less than the national average of 5.2 percent.
The current median home price is $639,000 in King County, $470,000 in Snohomish County and $344,000 in Pierce County.