Spokane County’s median home price soars to record $325,000 in February

Multiple offers and bidding wars are the norm in a Spokane County housing market that saw the median home price soar to a record $325,000 last month.

The price is reflective of the 21% increase from February 2020 to February 2021, according to the Spokane Association of Realtors.

The county’s median home price continues to increase, in part, because buyers are having to pay tens of thousands of dollars over asking price for properties, said Tom Clark, the association’s governmental affairs committee chair.

“Everything that hits the market is selling,” Clark said. “It’s a real challenge for buyers right now.”

Last month, the county had 133 homes on the market, a nine-day supply, meaning it would take nine days to sell all available homes. A balanced housing market typically contains six months of supply. For comparison, the county had 452 properties on the market in February 2020.

As of Monday, Spokane County had only 10 homes on the market listed from $320,000 to $330,000.

Included among those properties were a 2,100-square-foot, three-bedroom, three-bathroom rancher close to Franklin Park in north Spokane and a 1,981-square-foot bungalow with three bedrooms and a bathroom in the Sunset Hill neighborhood, both of which were listed at $325,000, according to the Spokane Multiple Listing Service.

For $329,900, homebuyers can purchase a three-bedroom, two-bath home with a two-car garage in Airway Heights.

Spokane’s housing market activity has ramped up in the past year as an influx of out-of-area buyers – some of whom are remote workers – are choosing to relocate to the area during the coronavirus pandemic. Those buyers are drawn to a city that has gained national attention for its quality of life and housing affordability when compared with larger metro areas.

While multiple offers were common for homes in the $200,000 to-$300,000 price range just a few years ago, Realtors are now seeing bidding wars for homes in the $600,000 to $700,000 range, Clark said.

“Prices keep going up, and we keep acquiring more buyers and more offers on every property,” Clark said.

Some 439 homes and condominiums on less than 1 acre sold in February, a 4.3% increase compared with 421 homes sold in February 2020.

The national median existing home price was $303,900 in January, a 14.1% increase from $266,300 in January 2020, marking 107 months of year-over-year price gains, according to the National Association of Realtors.

The NAR has not yet released February data.

Eric Johnson, Spokane Association of Realtors president, anticipates the county’s housing market will continue to be brisk in the spring.

“As things are opening back up with Phase 3, and as the employment picture looks like it will improve, I don’t see it slowing down anytime soon, barring something catastrophic,” he said.

There are several contributing factors to the county’s persisting housing shortage, including rising construction and material costs, Clark said.

New building codes enacted by the state in February could increase the cost of new homes by $20,000 to $30,000 and the price of building materials has skyrocketed, driving up the price of new homes, Clark added.

Also, the county is unable to expand its urban-growth boundary until 2025 to accommodate more housing, limiting the ability to address the supply side of the equation, he said.

Spokane County adopted an urban-growth area in 2013, which designates development in the boundary as urban and dictates where utilities, such as sewder, can be extended.

The county entered an agreement in 2016 with state agencies, neighborhood associations and planning advocacy group Futurewise that resolved four lawsuits but limited expansion of the county’s urban-growth boundary.

The Realtors association is encouraging city, county and state officials to relax imact and building permit fees to spur construction of affordable housing, Clark said.

Although buyers are facing a competitive market, current low interest rates could provide them with more buying power, Johnson said.

The average 15-year average mortgage rate is 2.38% and the 30-year average is 3.05% as of last week, according to Freddie Mac.

Johnson encourages potential homebuyers to ensure they are qualified to purchase a home and be realistic about the local housing market, to avoid frustration.

“You can still get a house, you just have to have a lot more patience than you used to,” he said.