One thing I've noticed about my friends who are buying now is that they pick location over a quality home, then end up overextended with a house that's falling apart. My wife's best friend and her husband bought a house at the top of their budget, and it's falling apart and they just had a baby and don't have any spare cash to fix it (they should've headed for ze hills with that house, but I digress...). A coworker and his partner bought a house in Ballard and they're dumping money into it to just get basic stuff like wiring up to snuff so their house doesn't burn down. Buying a move-in ready house of reasonable size with modern features in a good neighborhood is a minimum of $700k in Seattle now. It's no wonder why people are renting -- most of the houses out there that millennials could buy in Seattle (even DINKs with high incomes) are pieces of shit that need a lot of updating. Unless you're really passionate about owning a house, renting seems a lot more attractive given that you can have a nice, modern place for the price of a mortgage and don't have to fix things when they break.

I bought a small house as a single guy in 2011 when the market was near the bottom. It was flipped so it's up to date (new wiring/plumbing/kitchen/etc.), but it's small (900 sq. ft.). My wife and I want more space and the only realistic way we can afford it is to add on to this house. If we sold it, thanks to the uptick in the market, we'd have over $100k to put down on a new place, but that isn't even 20% down on anything we see that we want on Zillow. It's insanity right now. I don't even want to think what a bidding war would be like.

It's crazy to me that half a million barely buys a fixer upper now. I know it's been that way in other markets for a long time, but it's still crazy.