Speaking of our local economy, one big question on my mind regarding the potential housing bubble is “how do wages stack up to the rapidly increasing housing costs?” Thanks to the US Census Bureau, I now have an answer, and it doesn’t look good for Seattle.
The census report outlined a Seattle-area economy that was out of step with the nation last year. Nationally, the poverty rate rose only slightly from 12.5 percent in 2003 to 12.7 percent in 2004, and real median household income was unchanged at $44,389.
In contrast, median income in King County dropped 3 percent to $55,114 in 2004 from $56,881 the previous year. And the percentage of county residents living in poverty jumped from 7.3 percent to 10.4 percent.
And yet home ownership continues to rise—how is that? Two words: creative financing. Which will inevitably lead to a different word for many people: bankruptcy. You can only tread water for so long.
(Paul Nyhan, Cecilia Kang, and Carol Smith, Seattle P-I, 08.31.2005)