Cost of Refurbishing and addition of sqft in Redmond, WA

[Mithun Bondugula]

I have bought a very old house in Redmond. WA. This house has 70s kitchen and batch finishes. The house is in a large lot so has some scope for sqft addition. I have been trying to get estimates for the work. The estimates are coming out very high. Some have quoted as much as 375 per sqft for addition.

I have recently been to my friend's house in Olympia,WA which is like 1 and half hour south of here. He bought a 4K sqft house for 400K - which is like 100 per sqft including the land cost. The material/fittings he has in house looks better than he one I am planning to use.

How can cost of construction be so different within such a short distance? What am I missing? If its just the cost of labor in Seattle and surrounding areas, then can I look for contractors from Olympia area to come construct here? Thanks.