Kootenai Real Estate Booming May Home Sales Increase 40% Over Last Year

Belying predictions of malaise, Kootenai County’s home sales so far this year have surged, with houses changing hands at a near-record pace.

Sales increased 40 percent in May compared with the same month last year, catching real estate observers off guard.

“It surprised me a little bit,” said John Beutler of John Beutler & Associates in Coeur d’Alene. “I was one of the ones predicting a drop-off of about 10 percent, but we’re going at the same pace we were last year.”

For a North Idaho economy that has leaned heavily on new construction for its vitality, continued strength in home sales comes as good news.

Relatively affordable prices are a major reason for the increase.

Several thousand homes sport “For Sale” signs in Kootenai County. Realtors say that means buyers have a choice, and sellers have had to lower prices.

Business leaders - including Coeur d’Alene tourism and media magnate Duane Hagadone - have forecast home sales and construction drops of up to 20 percent compared with 1995.

May’s figures from the Coeur d’Alene Multiple Listing Service show the home sales market ahead 13 percent of 1995, and just about 4 percent behind 1994’s record sales pace, a year which ran Realtors ragged.

Spokane’s home market has been fast-paced as well so far in 1996. Year-to-date figures by the multiple listing service show 16 percent more homes have sold compared with the same time in 1995.

Spokane home prices are up more than 4 percent from last year, averaging $111,899. That makes them more expensive than in Kootenai County, where average home prices are staying about the same as last year at $108,939. That could explain why some Realtors are seeing more Washingtonians and Spokanites in their offices, said Peggy Sawicki, Coeur d’Alene Realtors Association president.

Realtor Allen Mastros agreed.

“I just sold a waterfront home to a Spokane couple today,” he said. “They don’t have the recreation opportunities that we have. They want to hunt, to fish, and they don’t want to buy out-of-state licenses. Everything’s cheaper over here, so why not come live here?”

Buyer credits offered through home builders have spurred sales as well. The credits - up to $2,000 in some cases - can be applied to closing costs and make buying a home cheaper, Sawicki said.

“I never felt that we were going to be down this year,” Sawicki said. “We’re seeing a lot of first-time buyers, and interest rates being where they are have helped.”

Rates have risen since last year, but only slightly. Home mortgages nationally range close to 8 percent.

While new home sales have contributed to the brisk sales pace, the existing home market also remains hot, said Mastros, of Treaty Rock Realty in Post Falls.

As with other Realtors, Mastros’ firm has sold many homes in the $85,000 to $99,999 range. The listing service shows that homes priced there have made up 27 percent of all homes sold in the county.

Economic observers also predicted a slowing in commercial construction. So far this year, that prediction appears equally untrue. The city has issued far more building permits so far this year for construction valued nearly a third more than last fiscal year. That year was a record setter.

But it may be too early to say that 1996 could be a record-breaker, cautions Beutler, a veteran of the market who’s seen the highs and the lows.

“I think the next 90 days will be very telling,” he said.

Hagadone, in his annual speech to Realtors early this year, predicted that much of the drop-off would occur during the second half of the 1996.

But for time being, Realtors are busy folks.

“People perceive right now to be as good a time to buy a home as any time in the past five years,” Beutler said. “A lot of people have been waiting, and with interest rates where they are, they’re deciding to buy.”

, DataTimes ILLUSTRATION: Graphic: Home Sales