Regional Spotlight: Spokane, Washington

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Real estate market appears to cool a bit
RISMEDIA, Aug. 19, 2005 ? (KRT) ? Though Realtors say they’re as busy as ever, some signs indicate the residential real estate market may be leveling out in Spokane and Kootenai counties.

In Spokane County, July sales dipped below those for June and for last July, according to the latest figures from the Spokane Association of Realtors. In Kootenai County, an infusion of new listings onto the market has contributed to an “adjustment period,” said Richard Kohles, president of Coeur d’Alene’s Multiple Listing Service.

“We peaked about three months ago, I believe,” Kohles said. “The activity since then has been good, but we’ve definitely leveled off.”

Earlier this spring, the number of homes for sale in Kootenai County had shrunk to less than 1,000. When Realtors looked at the listings, about half the homes had offers, Kohles said. On Tuesday, there were about 1,740 active home listings in Kootenai County.

“Probably a quarter or less have a pending offering or a contingency offer,” Kohles said.

Despite that, average sales prices continued to rise on both sides of the state line in July, registering at $177,781 in Spokane County, up from $171,073 in June. The average price through July in Kootenai County was $202,602, up from $196,722 through June, MLS statistics show.

And in Spokane County, the number of homes sold so far in 2005 continues to out-pace the record set in 2004. So far this year, 4,314 homes have changed hands in the county, up from 4,217 last year. In Kootenai County, 1,944 homes have been sold so far this year, up almost 13 percent from the 1,725 sold last year.

“I’m not seeing it,” said Ken Sax, sales manager for Coldwell Banker Northwest, of a possible cooling off. “That’s crazy, because our sales (in July) were well above where we were in 2004.”

However, Kohles cautions that July sales are reflective of offers made in May or June. Since then, he said, activity in Kootenai County has cooled slightly. This spring, he said, sellers weren’t looking seriously at contingency offers — those based on things like a buyer obtaining a loan or selling their own home. But with the market shift, he said, North Idaho sellers are starting to consider them again. Price reductions are also starting to show up, he said.

“That would have been unheard of three months ago,” Kohles said.

Some Realtors say July and August can slow down due to people taking vacations. But activity generally picks right back up in September and October, said Sabrina Jones-Schroeder, a co-owner of Exit Real Estate/Jones and Associates in Spokane.

“I think we all know the frenzied boom we’ve had is going to level off” eventually, she said. However, she added, “We’re just as busy now as we’ve ever been.”

Trevor Windhorst, a Windermere Valley Realtor, said if there is a lull, it might be because the inventory of homes is below where it should be. There were 1,615 active listings in July in Spokane, down 13 percent from last year, the association reported. In addition, Windhorst said, builders are having trouble keeping up with the demand for new homes.

“Builders can’t go any faster,” Windhorst said. In one new subdivision, Windhorst said he had a waiting list of 30 people for 15 lots.

Kohles offers several theories on why Kootenai County’s market is leveling off. Rising prices probably dampened demand, he said.

“It’s a common feeling among Realtors and contractors that we have priced the local buyer who’s getting started out of the market,” he said.

A modest, new starter home in a Kootenai County subdivision used to sell for $110,000 to $115,000, Kohles noted. Now, it’s hard to find a new home for less than $170,000. Even with both spouses working, some families would have difficulty qualifying for that loan, he said.

Sales of investor-owned homes might also be contributing, Kohles said. Many people sold their stocks and bought real estate. But if they had a hard time finding renters, those homes went back on the market, increasing the inventory pool.

Copyright ? 2005, The Spokesman-Review, Spokane, Wash.

Distributed by Knight Ridder/Tribune Business News.

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