Is there no end to amazing real-estate stories? This one's about a 1940s vintage house, a modest 1,500 square feet on a small city lot, offered for sale at $929,000. Within days it sold for $2 million.

But this house isn't in Seattle, or Bellevue or Mercer Island, where our most fantastical tales originate.

It is in Palo Alto, the posh next-door neighbor to California's Silicon Valley, and it illustrates that no matter how outrageous our sticker-shock stories are, there are worse elsewhere, says Glenn Crellin, director of the Center for Real Estate Research at Washington State University.

"I've been reading a tremendous amount about Silicon Valley, and by comparison you don't have any problems at all," Crellin says of the Seattle area.

Reassuring as that may be, in the larger context Seattle has gone from a city that used to offer a high degree of housing affordability to a city that's now markedly less affordable than much of the rest of the country.

The best way to measure affordability is to calculate what percentage of households can purchase a median-priced house, explains Mark Calabria, a senior economist with the National Association of Realtors. This factors in both housing costs and income.

Nationally, 63 percent of households can afford the median-priced home, which was $133,000 late last year. (Median means half were priced higher, half lower.) But in Seattle, with a median-house price of $221,000, just 52 percent of the households can afford a mid-priced house.

"People are getting paid more in Seattle, but they're paying more for housing, and that's what's making it relatively less affordable than it is nationally," Calabria observes.

Seattle is also less affordable than several other high-tech meccas. Among them:

• Boston, which has higher median house prices ($255,000) but markedly higher wages, thus 56 percent of households can afford the median-priced home.

• The Raleigh-Durham, N.C., area called Research Triangle. Its median house price of $165,000 is affordable to 66 percent of households.

• Austin, Texas, where the median-priced house is $131,000 and 59 percent of the households can afford it.

But compared with West Coast cities, Seattle's affordability is good, Calabria says, and compared with parts of California, it's downright excellent.

"In most parts of Orange County (think Disneyland) and the San Francisco Bay area, the incomes are very comparable to Seattle's but the house prices are much higher," he says.

Indeed just 46 percent of Orange County households can afford the $273,000 median-priced house.

As for San Francisco, "it's by a long shot the least affordable market in the country, and that's really because of the price of the homes," Calabria says, adding that wages are high there - just not high enough to make housing readily affordable. Thus the median-priced San Francisco house is $373,000, but a scant 12 percent of households can afford to buy it.

Seattle is also more affordable than San Diego, where only 36 percent of households can purchase the median-priced house, and Portland, where 46 percent can afford to do so. Strict growth curbs have been a factor in pushing Portland's affordability down.

Price and growth limits

The No. 1 moderator of housing prices, says Calabria, is how much new housing can be built. "In most places like the South and Arizona, that really isn't a constraint. In California it's hard. But in Seattle it's a moderate problem to build, so that's kept things reasonable.

"In a sense," he continues, "you're benefiting from sharing labor markets with the rest of the West, which is keeping wages high. But you haven't had the restrictions on housing development that have driven up prices as much as they have on the rest of the West Coast."

But this area certainly isn't alone in the kind of double-digit appreciation that's caused sticker shock.

According to statistics compiled by The Meyers Group, a housing-information provider, there were at least a half-dozen cities, besides Seattle, that saw appreciation ranging from 10 to 16 percent last year. They include Minneapolis-St. Paul, San Francisco, Miami, Charleston, S.C., and the appreciation leader, Denver.

In Seattle, the jump in last year's house prices was especially felt by first-time buyers, who paid 13 percent more for entry-level homes than buyers had a year earlier. This was more than twice the price increase felt by first-time buyers nationally, according to an annual survey by Chicago Title and Trust Co.

Additionally, local buyers, both first-time and repeat, poured a slightly larger percentage of their monthly after-tax income into house payments than the national average: 35 percent compared to 32 percent.

Elizabeth Rhodes can be reached at 206-464-2306, or by e-mail at erhodes@seattletimes.com.