San Francisco Nips at Seattle's Heels in Latest Case Shiller Index Results
November 2017 was Seattle's 15th month leading the nation on the S&P/Case-Shiller Home Price Index, the nation's pre-eminent measure of single-family home prices.
Having briefly subsided from September into October, residential prices in Seattle resumed their upward trek, with the index turning positive by 0.18% in November. The official report from Case Shiller noted that “Seattle, Las Vegas, and San Francisco reported the highest year-over-year gains among the 20 cities. In November, Seattle led the way with a 12.7% year-over-year price increase, followed by Las Vegas with a 10.6% increase, and San Francisco with a 9.1% increase.”
Competing Pacific Coast gateway San Francisco’s three-month spurt of price growth comes near the end of a year that has brought it past the highs of the subprime bubble a decade ago. According to Drew Becher of the Bay Area’s Paragon Real Estate, “All neighborhoods in the city of San Francisco itself have now surpassed previous peak values by very substantial, and sometimes astonishing margins,” and “high-price tier homes [have] been climbing well above previous 2007 peak values,” exceeding $1,087,500 as of October 2017.
Compare this result with Seattle’s organic demand-driven price trend. Feverish hiring by local employers has exacerbated an acute shortage of downtown condominiums, keeping some would-be buyers in apartments while driving the more affluent to soak up single-family homes in all areas of the city. The now well-established spillover effect of the shortage has forced buyers into competing for single-family homes throughout the Seattle Metropolitan Statistical area upon which Case Shiller’s index is based. This has escalated prices from the Eastside as far north as Skagit County, and now into Tacoma as well.
For Seattle’s performance on the Case-Shiller Index, see the chart below; and for more details, download Case Shiller’s summary report.