Discovery Zone

Tomlinson Black CEO Dave Black saw a license plate frame a little while ago that he said sums up why this region’s housing market has been so hot.

It said: “Not a native, but got here as fast as I could.”

The message symbolized for Black the younger people moving to this area because technology allows them to work anywhere. He said Spokane and Coeur d’Alene real estate remain “surprisingly good” values, despite double-digit percentage increases in price over the past year. That has contributed to more people discovering this market, including people selling homes in more expensive markets and moving here.

“What a lot of people are doing is thinking, ‘Well, if I could get the same home in Idaho and pay $350,000, I could bank $150,000 and have a cushion to protect myself, which is particularly attractive to senior citizens,” said Richard Kohles, outgoing Multiple Listing Service president for the Coeur d’Alene Association of Realtors.

In the last year, the average price of a home in Spokane County went up by 15 percent, and in Kootenai County by 30 percent. Through November, the number of homes sold in Spokane County was up from last year’s record-setting pace by more than 6 percent, and in Kootenai County by more than 4 percent.

Local real estate professionals say they see the market settling down in 2006, but still continuing to grow. They don’t expect prices to jump quite as much, due to in part to anticipated interest rate increases. Rob Higgins, executive officer of the Spokane Association of Realtors, said he expects prices increases between 3 percent and 5 percent. Kohles expects price increases in Kootenai County in the 5 percent to 15 percent range.

“Obviously no one’s got a crystal ball, but everybody I talk to says Spokane is going to remain strong the next few years no matter what happens in the rest of the nation because we’ve kind of been discovered,” said Vic Plese of Plese Realty, who is also president of the Spokane Realtors association. “We’re not a secret anymore.”

Despite talk of a national slowdown and the real estate bubble bursting, Glenn Crellin, director of the Washington Center for Real Estate Research, said he doesn’t see that happening in this market because price levels here are below those of the major cities on which the national media focuses.

“This is somewhat of a contrarian market,” Crellin said. “It doesn’t follow the lead of some of the larger cities.”

In addition, some new trends are surfacing within the residential real estate market that will continue to offer new choices to potential buyers. Downtown condominium projects have been proposed in both Spokane and Coeur d’Alene, and several of them are due to be completed this year, bringing an influx of new residents into downtown cores.

“We’ve never even had a condo market, let alone a downtown condo market,” Black said.

In addition, real estate professionals say, growth management in Spokane County has pushed architects and builders to be more creative in designs and approach to using space, due to limits on where high-density housing can be constructed. One trend that has begun popping up around the region is cluster housing, Plese said.

Outside the urban growth boundaries, in areas where, for example, one home is permitted on every 10 acres, some builders are proposing grouping homes together, retaining the required ratio of homes per acre on the entire parcel, but then reserving large chunks of land as common space, or open space. In the future, if urban growth boundaries are extended, a contiguous piece of land remains available for future higher-density development, Plese said.

“That’s something a lot of people don’t realize,” Plese said of the cluster housing approach to development. “Not everybody wants 10 acres.”

In addition, many in Spokane’s market are watching and waiting to see what developer Marshall Chesrown will do with the 77 acres of land he owns just across the river from downtown. Chesrown has proposed 2,600 living units, mixed between apartments, condominiums, townhouses and other dwellings. Chesrown has said he expects his proposal to be heard by the county hearing examiner by March.