The rise in home price growth was driven by a sudden surge in prices for luxury houses, though starter homes are still seeing the largest cost increases.
For the fifth straight month, Greater Seattle has registered the sharpest home-price increases of any major market in the country, as home costs soared at their fastest pace in three years.
The typical price of a home across King, Snohomish and Pierce counties rose 11.3 percent in January compared to a year prior, according to the monthly Case-Shiller home price index, released Tuesday.
The Seattle region has taken the top spot in the national rankings in every month since September, and price growth has only been speeding up as of late after it dipped slightly toward the end of 2016. The increase in January is tied for the biggest jump in home prices since March 2014.
Fastest-rising home prices compared with a year ago
1. Seattle +11.3%
2. Portland +9.7%
3. Denver +9.2%
4. Dallas +8.2%
5. Tampa +8.1%
Source: Case-Shiller home price index
Portland was behind, again, with home prices rising 9.7 percent, followed by Denver, Dallas and Tampa. Seattle’s lead over Portland doubled just in the last month.
Nationally, prices grew 5.9 percent, a 31-month high. And yet Seattle’s increase was nearly double that. Low inventory of homes for sale continues to be a problem both locally and nationally, driving up competition for scarce homes.
Compared to just a month prior, home values in Seattle ticked up 0.6 percent, the second best in the country and triple the national average.
The 0.6 percent rise in prices from December to January may not sound like much, but it’s highly unusual for this time of year.
Going back three decades, prices actually drop more often than they grow, on a month-over-month basis, in January across the Seattle region. The monthly rise was actually the third-highest for any January on record, dating back to 1990.
There’s another emerging trend: For months, the cheapest homes had been seeing the biggest price increases locally, while luxury home prices were rising at the slowest rate. But now, gains in homes at all price points are rising at a similar clip.
The typical top-tier home cost 11 percent more than a year ago, the biggest rise since September 2013, and up from 9.3 percent growth just a couple months ago.
On the other end, the cost of starter homes is up 11.6 percent, but that’s down from the 12.6 percent rise from a few months ago.
The most recent data from the Northwest Multiple Listing Service shows the median single-family home price in February was $675,000 in Seattle and $832,000 on the Eastside, both record highs.
In Snohomish County, the median home cost $412,500 (also a record), and it’s $280,000 in Pierce County.