Land prices skyrocket as NW building accelerates

By Dan Tilkin
and KATU Web Staff

WASHOUGAL, Wash. - Everyone knows home prices keep going up, but did you know that land prices are skyrocketing as well?

For example, a year ago, homebuilder Jerry Clark bought land in Washougal with a breathtaking view for $105,000.

This year, he bought a similar piece of land just a mile away with nearly the same view for $70,000 more.

"It's been frustrating," Clark says. "This last year has probably been the most significant single-year increase that I've seen."

"I am amazed that the prices have gone up so quickly," says Len Magazine, whose real estate company tracks home and land prices in Washington and Oregon.

Magazine says a square foot of dirt to build your house on will cost you 40 percent more now than it did a year ago.

So why is there such a huge demand all of a sudden?

For one, low interest rates make home buying easier. Plus, people just keep moving to the Northwest from other states.

Also, urban growth boundaries are squeezing the land supply.

So far, local governments have decided the higher land prices are a fair price to pay to protect the landscape.