Like any other product, real estate is driven by supply and demand. This is one of the basic principles that helps sustain many real estate markets across the country. While metropolitan areas such as Northern California and the Washington region were growing their job bases through the 1990s, local jurisdictions were afraid of losing open space to houses ? so they passed laws to limit development.
"High housing prices in Seattle are attributed to many factors. Homeowners are willing to lock down a low mortgage rate for a longer period, reducing the amount of available homes on the market. In addition, the state of Washington limits the amount of homes that can be built each year. This creates high demand for housing in the Seattle area. According to an analysis by the Seattle Times, increased housing demand is due to low mortgage rates, increased job growth, high work wages, and out-of-state residents who can afford to buy homes. The Seattle Times reports that King County "had 30 percent fewer homes on the market than it did a year ago." However, with limited housing and a high demand, bidding wars ensue, resulting in increased home prices. With a high demand and increase in home prices, many potential homeowners will find themselves outbid for the home of their choice. The result of this demand is that those who cannot afford to purchase homes that have doubled in price in the last few years, will purchase less expensive homes and thus buy out potential homeowners with smaller budgets, increasing overall home prices" (Is the Seattle Housing Market a Bubble?) This statement clearly shows why Seattle has an average $287,817 selling price. As shown in Table 1.
Topeka, KS of the five has the lowest selling price. (See Table 1) N ...