Two newly released figures on housing sales nationwide indicate the housing market may be starting to rebound, and recent sales figures in Spokane and Kootenai counties seem to show that the housing market locally has stabilized.
On Monday, the U.S. Commerce Department said new home sales rose 11 percent in June to a seasonally adjusted annual rate of 384,000 houses, from an upwardly revised May rate of 346,000. It was the third straight month of increases. However, the median sales price of $206,200 was down 12 percent from $234,300 a year earlier.
At the same time, the National Association of Realtors said that sales of existing homes increased 3.6 percent to a seasonally adjusted annual rate of 4.89 million units in June from a downwardly revised pace of 4.72 million in May, but are 0.2 percent lower than the 4.90 million-unit level in June 2008.
That compares with a 28 percent increase in home sales in Spokane County from May to June and a 2.4 percent increase last month in Kootenai County, where July sales are on pace for a healthy increase.
“It’s a good indication we are seeing stability,” Kim Cooper, spokesman for the Coeur d’Alene Association of Realtors, said of the sales numbers.
Another indicator of potential improvement in the housing market comes from a decrease in the supply of homes on the market. In Spokane, the supply of homes for sale has gone from 3,400 a year ago to 3,282 at the end of June. It would take 6.6 months to sell those homes at the current pace of sales, an improvement from a nine-month supply at the end of March.
Kootenai County does not keep comparable statistics on home supplies.
Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University, said the recent sales figures are just one small indicator of the direction of the housing market. A broader improvement hinges on economic recovery, he said.
“You have to have people with jobs who are willing to make a commitment” to buy a home, Crellin said.
He pointed out that Washington had a nearly 12-month supply of homes at the end of March, with 47,000 dwellings for sale. A healthier number would be a five- to seven-month supply.
Rob Higgins, executive vice president for the Spokane Association of Realtors, said part of the increase in home sales may be coming from government stimulus programs, including an $8,000 federal tax credit for first-time home buyers.
It appears the tax credit has brought increased sales in the entry level of the market, and may be partly responsible for the decline in average prices since more homes are selling at the bottom end of the market.
New houses are being built to serve that segment of the market in Airway Heights and on the Rathdrum Prairie north of Coeur d’Alene and Post Falls.
In Kootenai County, homes under $200,000 accounted for half of all sales a year ago. This year, homes under $200,000 account for 65 percent of all sales, Cooper said.
The average price of homes sold in Spokane was off 11 percent between June 2008 and June 2009, but it rebounded from May to June this year from $181,677 to $192,970.
A similar rebound has occurred in Kootenai County where average prices tumbled from $224,850 in June 2008 to $197,172 last month. As recently as February, the average price was $186,986. The average home sales price in Kootenai County had gone as high as $232,339 in 2005.
Those figures are only a reflection of the value of homes sold in a given month, and are not an indication of actual value of any given home since the federal tax credit may be skewing sales prices downward and leaving an exaggerated impression that value has been lost in real estate.
Even so, the National Association of Realtors is pushing to extend the tax credit program beyond Dec. 1 and to expand it to all home buyers. Currently, it is limited to purchasers who have not owned a home for more than three years.