South Sound home values among nation's highest

Thurston County shows median value of $145,750

LORRINE THOMPSON, THE OLYMPIAN

Originally published August 6

THURSTON COUNTY -- Karin Milner's house-selling story is a happy one. She advertised her Lacey area home for $139,000 last month, and sold it 10 days later.

"It was definitely a good market for us," said Milner, whose family will move into a larger house in Tumwater.

Milner and others selling a home in South Sound and Washington state are operating in one of the most active, most expensive housing markets in the United States.

A Census report released today ranked Washington's median housing price of $169,323 as fifth-highest in the country in 2000.

Although the Census report does not list values by county, statistics from Olympic Multiple Listing Service showed Thurston County's median house price in June 2000 at $145,750.

That places housing prices in Thurston County higher than those in 37 states.

The county has seen prices rise $26,850 since 1996, an average of about 4.5 percent per year.

The 2000 median value information for the state was included in Census results released today. The data was gleaned from a new type of Census survey being tested throughout the United States called the American Community Survey.

The survey includes a wide variety of social and economic details about income, housing, education, languages spoken and more, similar to the Census long-form questionnaire.

The new survey will not reach as many households as the Census long form, but is expected to be released every year rather than once every 10 years.

The high home prices listed in the 2000 survey for Washington are likely to continue, with Thurston County values growing steadily for several reasons, say South Sound real estate experts.

"The market we have in 2001 is probably the best we've had in 10 years," said Dennis Adams, co-owner of Virgil Adams Real Estate.

Adams has worked in real estate in the county since 1977.

"Realtors are very busy right now, and they have been since the first of the year. And that's not just us -- that's across the board," Adams said.

Reasons are many

A strong economy and low interest rates have fueled an annual growth in prices of 3 percent to 5 percent in Thurston County.

In addition, new industry coming into the area -- such as a 1.5 million-square-foot Target regional warehouse set to locate in Lacey -- will bring in workers who can qualify for home loans, Adams said.

Another trend affecting house prices is an influx of buyers who work in Pierce and King counties.

"They're discovering Thurston County," Adams said. "They're finding out they'd rather live here and commute than buy a house up there for twice what they'd pay here.

"We're starting to see a lot of migrants. We're getting people from Bellevue, even from Microsoft."

Adams estimates that a third of his firm's clients work out of the county.

With most of the "migrants" holding jobs in the north, and with industry starting to locate in northern parts of the county, Lacey "is really heating up right now" as a housing market, he said.

The good news for buyers: Thurston County remains one of the most affordable places to buy a home along Interstate 5.

Thurston County "is the least expensive of all the counties we cover," said Leonard Magazine, who tracks real estate trends in King, Pierce, Snohomish, Thurston and Clark counties, as well as three counties in Oregon for his publication Real Estats.

Housing prices in Thurston County are about 40 percent below those of comparable houses in King County, Magazine said.

Many starter homes and condominiums are available in the $100,000 range here, Adams said, so young couples and first-house buyers don't have to move out of the county to buy -- yet.

But if the market stays healthy and housing prices continue to rise, "That's when young people start moving out of the county to buy their first homes. Then when they get older and can afford a more expensive home, they move back," Adams said.

Prices, wages

Housing prices in Washington are high because wages are high, particularly in the Seattle area, Magazine said.

While Thurston County does not have the soaring high-tech salaries of King County, it has a strong and stable economy with state government as an employment base. That means the county is not likely to go boom or go bust, said Dean Stohl, owner of RE/MAX Four Seasons real estate agency in Olympia.

"We're very fortunate," Stohl said.

What's ahead is hard to say.

Adams believes the county is on the verge of a healthy cycle of home sales and home value increases, one that may last three or more years.

"Real estate tends to go in two- to five-year cycles," he said.

With interest rates low and new industry moving into the county, "All the stars get lined up," Adams said, "and we don't see that that often."

Lorrine Thompson covers Thurston County and health for The Olympian. She can be reached at 360-754-5431.

On the web:

Census 2000.

U.S. Census Bureau.

The Olympian Copyright 2001

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