Homes and Equity Real Estate

King County’s housing market hit two milestones in December: The median single-family home price set a new high, $508,000, topping the $481,000 peak reached in July 2007 before prices began their long slide.

And the number of active listings of houses and condominiums — just 2,196 — hit the lowest monthly level since at least 1993, according to data from the Northwest Multiple Listing Service.

For sellers, it’s a dream. For buyers, it’s a nightmare. And for sellers who want to buy their next home, it’s complicated.

The desperation for listings is so great that it’s encouraging some to go off the beaten path to get deals.

Affordability under pressure

Region at a crossroads as home-buying power shrinks

For example, Faira, a new Kirkland technology firm started by former eBay and Microsoft veterans, is free for sellers and charges buyers only a 0.5 percent fee. Its chief executive even penned a sincere offer to Zillow CEO Spencer Rascoff to help sell his Madison Park home.

Mike Chaffee, a John L. Scott broker in Issaquah, uses the personal touch. At homes not on the market, he drops off a handwritten solicitation with a photo of his buyer and $5 Starbucks gift card. The kicker: The whole transaction costs the seller half the typical 6 percent commission.

Such off-market home sales represent a shadow inventory: Chaffee says one-third of the roughly 60 homes he helped sell last year were not listed on the MLS. He guesses that about 10 percent of homes sold by other agents are off-market deals.

“I just sold a 1,600-square-foot house in Kirkland on a 6,000-square-foot lot built in 1940, for $940,000,” Chaffee said. “A little cottage house! It says to me there’s no inventory in really desirable areas. Some people are just fed up of waiting so long, they’re OK with paying a little bit more.”

Or a lot more. Last year’s bidding wars resulted in homes in popular neighborhoods selling for premiums that shocked even brokers. There was a three-bedroom home in north Ballard that sold for $640 a square foot. A Montlake house listed for $880,000 sold for $1.6 million.

November’s $11.2 million sale of a Hunts Point waterfront mansion appeared to be the highest price among homes sold in King County last year. According to media reports, the buyer was a senior Microsoft executive who helped lead its cloud platform.

Surrounding counties also saw robust gains: The median price in Snohomish County was $358,000, up 8 percent; in Pierce County, $252,500, up 11 percent; and in Kitsap, $269,950, up 15 percent.

Location, location

Across the region, however, there continue to be large discrepancies in home prices and market dynamics.

On the Eastside, the most expensive submarket in King County, the median price of single-family homes sold in December was $675,000, up a relatively small 6 percent over the year.

In Seattle, the median price rose 20 percent over the year to $600,000. North King County saw its median price jump 25 percent over the year to $480,000.