Got a $100,000 budget? Good luck in North Idaho

Not that long ago, $100,000 homes were as common as osprey over Lake Coeur d’Alene.

Older neighborhoods were packed full of them, and even new subdivisions stocked a few modest ranchers and split-levels for buyers on budgets of a hundred grand or less.

Housing was so plentiful and cheap in Kootenai County that Realtor Marshall Mend taught classes on investing in single-family dwellings. His strategy: Buy a three-bedroom, two-bath rancher for under $100,000. Rent it for $850 per month. Profit from the difference between the rent check and the mortgage payment.

“I don’t teach that class anymore,” Mend said.

The class was a casualty of North Idaho’s booming real estate market. It might still fly in Idaho Falls or Twin Falls – lower-priced areas of the state. But in Kootenai County – where the average sales price has soared past $200,000 – and even in rural Shoshone and Bonner counties, the era of $100,000 homes has passed.

Finding one is rare, real estate agents say. Finding an inhabitable one is akin to spotting a cashmere sweater on a thrift-store rack of polyester blazers.

Two weeks ago, a Spokesman-Review reporter and photographer set out to discover what was available in North Idaho for under $100,000. Our criteria: stick-built homes – no mobiles.

We started in Kootenai County, where only one home was listed for sale for $100,000 or less. As we drove across the Rathdrum Prairie, we scanned the real estate flier. “Rustic get-a-way cabin in Hauser,” it said.

At first glance, the 1940s cabin exuded a certain woodsy charm. The roof appeared new, the back yard was full of towering firs, and lilac bushes framed the walkway. But inside, it reeked of cigarettes and wet dog.

Time did not pass gently here. Warped floorboards were visible beneath worn-out linoleum. Some of the ceiling was missing, and the wind blew through a slit above the back door. A battered, hard-used look lay over the 540 square feet of living space.

Still, an offer was pending on the cabin, which was listed for $93,000. The value is in the lot, located about a block from Hauser Lake.

“This is what you call a tear-downer,” Mend said.

Our next stop was Shoshone County, which has a larger inventory of homes in the $100,000-or-less range. Karen Henry, president of the Shoshone County Board of Realtors, pulled up two dozen homes on her computer. We agreed to look at houses in Kellogg. Values are better in Mullan, according to Henry, but Kellogg – in the western end of the county – is a more natural fit for people commuting to work in Coeur d’Alene.

The homes on our list ranged in price from $56,000 to $99,900. One lacked a foundation; most had only one bedroom. The most promising was a two-bedroom, 1 ½-bath home for $89,000. It came with a treehouse and two-car garage. But the house was less than 1,200 square feet, and getting to the basement required squeezing down a steep, narrow stairway.

Henry calls the houses “miners’ specials.” They were built for working-class families in the 1920s, ‘30s and ‘40s. Most need significant structural and cosmetic improvements.

In Bonner and Boundary counties, inventory under $100,000 tended toward unfinished cabins in the woods. Twelve stick-built homes were advertised in that price range. One was an A-frame shell, another – described as “rough but livable” – had no plumbing, and a third needed a well drilled.

The rapid extinction of homes for sale under $100,000 surprises even real estate agents. The change has occurred over the past five years.

In the two-year period after the Sunshine Mine closed in 2001, more than 250 homes were put up for sale in Shoshone County. Nearly all of them sold for under $100,000, according to Henry.

In Kootenai County, homes for under $100,000 accounted for 34 percent of the sales as recently as 2002, but just 8 percent of sales last year.

Five years ago, buying a new home for under $100,000 was also an option. Viking Construction used to build starter homes in that price range in Post Falls and Coeur d’Alene, said marketing director Ryan Olson. The dimensions were modest – 1,040 square feet – but the houses came with two bedrooms and two bathrooms.

Now, Viking’s low-end homes sell for more than $170,000. Changing tastes, as well as rising costs for land, labor and materials, are responsible for the price increase, according to Olson. Most families want larger homes, he said, and they prefer a fancier exterior, with stone or brick accents.

“You’re paying more, but you’re getting more than you would have four or five years ago,” Olson said.

Tricia O’Donnell still hopes to snag a home for under $100,000. After her divorce, the 34-year-old mother of two polished her credit rating and qualified for a 4 percent loan through a federal program. She’s reworked her household budget several times and figures she can afford payments on a $100,000 house.

“The problem isn’t getting the loan,” said O’Donnell, a title clerk at Dave Smith Motors in Kellogg. “The problem is finding a house. … They’re either too small or too much work. I’m not looking for ritzy or grandiose, but I’m looking for livable.”

Six months of searching hasn’t turned up anything in the Kellogg School District, where her daughters go to school. The inventory in her price range is disheartening, O’Donnell said. On a paycheck-to-paycheck existence, she can’t take a chance on a home that might need a new furnace or sewer line.

“Affordable housing is getting to be such an issue here,” she said. “The only people who can afford to buy houses are from out of town.”

Mend shares the affordability concerns. North Idaho’s homeownership rates still beat the national average, but affordability for first-time buyers has slipped 35 percent over the past three years, according to an index that calculates the ability of middle-income families to make mortgage payments.

“If you can find a house for under $160,000, that’s the new challenge,” Mend said. “Finding one under $100,000 isn’t a doable deal anymore.”