A record-low inventory of homes for sale in King County, very low interest rates and a growing Puget Sound economy combined to push the median price of houses sold in February to $365,000, an 18 percent jump over a year ago.

Only 2,947 homes were listed for sale in King County last month, down from 5,178 a year ago, according to Tuesday’s report by the Northwest Multiple Listing Service.

“The extreme shortage of listings is clearly adding to the price pressure,” said Glenn Crellin, associate director for research at the University of Washington’s Runstad Center for Real Estate Studies.

“I would not want to be a buyer now,” said Tim Ellis, who writes the real-estate blog Seattlebubble.com.

Just how extreme is the supply shortage?

Real-estate experts closely watch the ratio of home listings to pending sales, as a gauge of how many months’ worth of inventory is available.

In February that number sank to 1.19, the lowest level in more than a decade. A ratio of 6 is considered a balanced market.

Ellis called the February ratio “insane” and predicted the spring buying season, typically the peak season for home sales, would be “crazy.”

Condos, whose prices were battered during the market downturn, are coming back too. In King County, the median price of condos sold in February was $210,000, 31 percent higher than a year ago.

By historical standards, “we have what should be the makings of a housing boom,” said Dick Conway, an economic forecaster.

Low interest rates mean a mortgage, as a percentage of household income, is more affordable than at any time since 1970, he said. Job prospects in the Puget Sound are good, and home prices are rising. Put those three together, he says, and a housing boom should occur.

Bidding wars and cash offers are common again in popular Seattle neighborhoods.

“This is the best market for sellers since 2006,” said Paul Cantu, owner of Cantu Real Estate Group in Wallingford.

A home he listed in trendy Ballard received eight offers and the buyer paid $68,000 over the asking price, Cantu said. Another home he listed in the Rainier Valley got four offers, he said.

John Deely, principal managing broker at Coldwell Banker Bain in Seattle, said the “high velocity” market meant that buyers don’t have a lot of time to think before putting an offer on a home.

Brokers are seeing cash offers in every price range, he said.

January’s median price for houses sold in King County was $350,000, an 11 percent increase over a year earlier.

First-time home buyers are jumping into the market, observers say, since housing prices hit bottom a year ago. When the median house price in King County hit $308,125 in February 2012, that was the lowest level in eight years.

But inventory isn’t keeping pace for several reasons:

Some sellers are waiting for prices to climb higher before listing their homes. Others still owe more on their homes than they’re worth. A third group of sellers is unwilling to interrupt the cash flow they receive from renting out their homes at high rates.

There’s still the “shadow” inventory of houses in foreclosure and repossessed by banks that haven’t been listed for sale. Those homes will gradually come on the market.

“We’ve got close to a year’s worth of distressed properties” statewide, Crellin said.

These distressed properties accounted for about one out of every eight homes sold in King County in the fourth quarter last year, and they sold on average for 35 percent less, according to RealtyTrac, which tracks foreclosures.

But the number of these distressed properties sold was down 33 percent from a year earlier. The changing mix of homes for sale has translated into higher median prices.

Crellin said he believes banks are ramping up foreclosure activity, but see a benefit in waiting longer to list properties.

In Snohomish County, homes sales also saw a jump in prices: The median price was $282,617 for houses sold in February, up from $258,500 in January and $238,750 a year ago. The median price for condos sold was $159,000, up from $132,000 in February 2012.

Conway, the economic forecaster, said robust job creation by the likes of Boeing, Amazon and other major companies headquartered here should create more demand for new housing, which in turn will create construction jobs, and hunger for more housing.

“We’re heading in the right direction, and if the housing market busts out that will have further positive effects on the economy,” he said.

Sanjay Bhatt: 206-464-3103 or sbhatt@seattletimes.com On Twitter @sbhatt