Talk around the office espresso machine in Seattle often includes gee-whiz accounts of a neighbor's house that sold at some astounding price. Tales of properties going for $100,000 over list price are common. One 3,000-square-foot house in trendy Washington Park overlooking Lake Washington recently sold for $1 million over the $1.6 million asking price. However, a detailed analysis by The Seattle Times showed that houses are more affordable today than at almost any time in the past 15 years.
Rising incomes and falling interest rates during that period have actually overcome soaring home prices. The thrust of the eight-part series, called 'Sticker Shocked,' was to break down housing trends by neighborhood. The newspaper obtained 15 years' worth of sales data from assessor's offices in three counties, and some GIS maps, that served as the backbone to the analysis. We used SQL Server for the primary database work, ArcView for the mapping, and SPSS, a statistical software, to calculate medians.
Excel proved extremely useful for computing financial information, such as interest rates, payment over time and annuities. In Bill Gates' neighborhood of Medina, the average house sold for $811,000 last year, while the median price was $469,000. Depending on which number you use, prices rose either 55 percent or 15 percent in a year. The latter is far more accurate. Using a simple formula borrowed from county assessors and real-estate appraisers: comparing homes based on price per square foot.
We'd calculate the median price per square foot by neighborhood and do the math from there. This gave us a large number of sales for each neighborhood in each year, making it easy to show annual changes in appreciation.