diff --git a/test/unit/property-effects-elements.html b/test/unit/property-effects-elements.html
index aeb74816c1..0d9853cde0 100644
--- a/test/unit/property-effects-elements.html
+++ b/test/unit/property-effects-elements.html
@@ -421,6 +421,39 @@
   </script>
 </dom-module>
 
+<dom-module id="x-handle-notify-event">
+  <template>
+    <slot name="drawer"></slot>
+    <div id="before"></div>
+    <x-basic id="basic1"
+      on-notifyingvalue-with-default-changed="handleNotify">
+    </x-basic>
+    <div id="later"></div>
+  </template>
+  <script>
+    Polymer({
+      is: 'x-handle-notify-event',
+      properties: {
+        prop: {
+          observer: 'propChanged'
+        }
+      },
+      created: function() {
+        this.readySpy = sinon.spy();
+        this.afterSettingProp = sinon.spy();
+        this.propChanged = sinon.spy();
+        this.handleNotify = sinon.spy(function() {
+          this.prop = 'prop';
+          this.afterSettingProp();
+        });
+      },
+      ready: function() {
+        this.readySpy();
+      }
+    });
+  </script>
+</dom-module>
+
 <script>
   Polymer({
     is: 'x-reflect',
diff --git a/test/unit/property-effects.html b/test/unit/property-effects.html
index b236897d5b..bc6404e0c0 100644
--- a/test/unit/property-effects.html
+++ b/test/unit/property-effects.html
@@ -633,6 +633,37 @@
 
 });
 
+suite('handling notifying evevnts', function() {
+
+  test('handle notifcation event and set property with observer when connected', function() {
+    var el = document.createElement('x-handle-notify-event');
+    document.body.appendChild(el);
+    assert.ok(el.shadowRoot.querySelector('#before'), 'element not found before default notifying elmeent');
+    assert.ok(el.shadowRoot.querySelector('#later'), 'element not found after default notifying elmeent');
+    assert.isTrue(el.readySpy.calledOnce, 'ready called more than once');
+    assert.isTrue(el.handleNotify.calledOnce, 'listener called more than once');
+    assert.isTrue(el.propChanged.calledOnce, 'observer called more than once');
+    assert.isTrue(el.handleNotify.calledBefore(el.propChanged), 'observer called before event');
+    assert.isTrue(el.afterSettingProp.calledBefore(el.propChanged), 'accessor side effect processed during notifying event (before clients ready)');
+    assert.isTrue(el.propChanged.calledBefore(el.readySpy), 'observer called before ready');
+    document.body.removeChild(el);
+  });
+
+  test('handle notifcation event and set property with observer when *not* connected and _enableProperties called', function() {
+    var el = document.createElement('x-handle-notify-event');
+    el._enableProperties();
+    assert.ok(el.shadowRoot.querySelector('#before'), 'element not found before default notifying elmeent');
+    assert.ok(el.shadowRoot.querySelector('#later'), 'element not found after default notifying elmeent');
+    assert.isTrue(el.readySpy.calledOnce, 'ready called more than once');
+    assert.isTrue(el.handleNotify.calledOnce, 'listener called more than once');
+    assert.isTrue(el.propChanged.calledOnce, 'observer called more than once');
+    assert.isTrue(el.handleNotify.calledBefore(el.propChanged), 'observer called before event');
+    assert.isTrue(el.afterSettingProp.calledBefore(el.propChanged), 'accessor side effect processed during notifying event (before clients ready)');
+    assert.isTrue(el.propChanged.calledBefore(el.readySpy), 'observer called before ready');
+  });
+
+});
+
 suite('1-way binding effects between elements', function() {
 
   var el;