The market for real estate in the United States has reached its peak, with prices rising at an annualised rate of more than 15 per cent in the past year.
The average price of a detached home in Washington state rose by 7.7 per cent last year, the fastest rate in more than a decade.
Real estate prices have doubled over the past decade in the state of Washington, which is home to the nation’s largest concentration of millionaires.
The number of millionaires in Washington jumped from 1,700 in 2011 to 2,500 last year.
“It’s just the right mix of income and housing,” said Andrew Johnson, a real estate agent and former state governor.
“There’s a high-end luxury component and a low-end, middle-class component.”
A survey released by the University of Washington found that the average price per square foot in Washington is now $1,200, and that the median household income in the region is about $55,000.
Property prices are rising so fast, the state is planning a crackdown on speculation in the market.
The Washington Real Estate Board estimates the cost of housing will rise to $5.6 billion in 2019 from $4.9 billion in 2020, with a net increase of $1.4 billion in property taxes.
The increase in taxes is partly offset by a cut in property sales taxes in 2020 and a rise in sales taxes for 2017.
However, the board has already announced that it will take a “significant step” in 2020 to phase out tax incentives for new development in the city of Seattle, and the city has already passed a measure to ban new development at least a year earlier than planned.