Data-based rankings of the ten most affordable places to buy a home in greater Seattle
In a very active real estate market like Seattle, the value of a home is ultimately determined by how much someone is willing to pay … and sometimes it can seem as if everyone is willing to pay more than you are, even if you have a hefty budget.
So what’s a homebuyer to do? How can you find homes at the lower end of the local market’s price range? Once you buy, how do you know if you’re likely to grow your investment?
We dug into the data around single family homes in the greater Seattle area for the past five years, focusing on homes in King, Pierce, and Snohomish counties from Everett to Tacoma with an eastern boundary of Issaquah.
Here’s what we identified:
- The postal codes where single family homes are the most affordable in the region, by median sale price (which gauges the aggregate area) and average price per square foot (which gauges at the individual home level)
- How the prices of those homes have changed from 2015 to 2020 (and will likely continue to change)
- How the changes compare to the average across greater Seattle
Take a look at which areas to check out for the lowest home prices around town, starting with the top ten by median sale price. Remember, median sale price gives us an indication for the postal code in total.
People often ask, “When’s the best time to buy a home?” There’s an answer that may sound a little funny: “Either five years ago … or today.” The idea is that prices trend up, so if you don’t already own a home, you should buy now to start gaining equity as prices continue to rise. The change in median sale prices over the past five years for the ranked postal codes illustrate this point.
Let’s take a more detailed look at the prices in these areas, how they’ve changed over the past year and five years, and how that change compares to the larger region’s change.
How do these areas compare?
In the larger region from Everett to Tacoma, the median sale price increase for single family homes over these five years was 35%. Each of the most-affordable areas saw a larger than average price increase.
In the shorter term of 2019 to 2020, they each beat the area’s median increase of 8% (though 98001 only makes it by rounding up its 7.82% increase).
Also note: the rate of increase in the most affordable areas is speeding up—80% saw their highest price jump in 2020.
While median sale price indicates the price trend for an area, to understand home value appreciation (the earning potential of the home), we need to look at the unit level rather than an aggregate.
To do this, we considered average price per square foot from 2015 to 2020. You’ll notice a few differences from the median sale price rankings. Three postal codes fall out of the top 10: 98201 (Everett), 98204 (Everett, Paine Field-Lake Stickney), and 98168 (Tukwila, Burien, SeaTac, White Center). Three more jump onto the list: 98258 (Lake Stevens, Machias, West Lake Stevens, Lochsloy, Cavalero, Getchell), 98198 (Des Moines, SeaTac), and 98203 (Everett).
Again, we can see prices tend to increase over time.
Now, let’s see exactly how much price per square foot for these homes has changed over the past year and five years, and how that compares to homes in the larger region.
How do these changes compare?
The larger region came in at an average price per square foot of $403 in 2020. It saw an increase of 9% from 2019 to 2020 and 36% from 2015 to 2020. Of the postal codes with the most affordable price per square foot, 70% appreciated more than the region average from 2019 to 2020. 80% appreciated at or above the region average in the past five years.
Single family homes in these areas are increasing in price per square foot, largely at a greater rate than more expensive homes across the region. That data means you’re likely to see faster equity gains over time as a homeowner in one of these areas. So, not only are homes here more affordable than others in the region—they can also make you money!
If you want to buy a home in the lowest-priced areas of greater Seattle, look north and south. You may find that expanding your search area away from just the buzziest neighborhoods can be rewarding. Living in Auburn, you can be a regular at Flaming Geyser State Park, where people and horses can enjoy exploring miles of trails. Tacoma’s Hilltop is getting a convenient streetcar line connecting to downtown Tacoma by 2022. Kent-based folks can easily take advantage of sporting events, concerts, and more at ShoWare Center.
Keep an eye on the local monthly market reports! And, if you’re curious, discover the ten most expensive postal codes in the Seattle area.