The Spokane-area housing market is the strongest it’s been in years, with homes fetching higher prices amid an inventory crunch.
Still, prices in the region remain relatively affordable – especially compared with the torrid market in the Seattle area – and interest rates are low.
All of that makes it a sellers’ market, real estate agents and experts say, with many sellers drawing multiple offers and getting close to full asking price.
Kyle Hallett and his fiance, Emily Joselyn, came to Spokane from Western Washington earlier this month on a house-hunting trip.
The young couple wants to move to Spokane, for both its affordable housing and easy access to the outdoors. Hallett, a corrections officer for the state, is eligible to transfer to the prison in Airway Heights.
Hallett and Joselyn were looking for a house with an acre or two of land for under $250,000.
“This is not what we are used to,” Hallett said of Spokane’s distinctly lower prices. They are currently renting in Mukilteo.
In Spokane, Joselyn said, they “won’t have to compromise nearly as much” and get what they want within their budget. “This exceeds our expectations,” she said while looking at homes on the West Plains.
According to the Spokane Association of Realtors, the median home price in May was $200,000, up 14.3 percent from the same month last year. The median means half the homes sold for more and half sold for less, and more accurately reflects a market than the average price.
At the end of 2015, the median price for a home in the Spokane area was $179,900, which was up from $168,000 for all of 2014. That represented a 7 percent increase in price for all of last year.
But what makes it a good time to sell is the dearth of home listings.
As of the end of May, 2,044 homes were available on the market, which is just shy of a three-month supply, according to the Realtors association. That’s a reduction of 15.6 percent in supply compared with May 2015.
“I don’t think I can remember an inventory as tight as this,” said Rob Higgins, the longtime executive officer of the Realtors association.
He said the Spokane market bottomed out in 2011, which was three years after the nationwide recession. The current market is comparable to 2005 – the boom years ahead of the nationwide bust.
Higgins said the market should continue to strengthen over the next five years.
‘People are confident again’
Young people looking to buy their first homes, empty-nesters looking to move downtown and people who were afraid to make a move for years because of the Great Recession all are part of the current market.
“People are confident again,” said Susie Luby, the managing broker for John L. Scott Real Estate and current president of the Realtor association.
Last week, the state Employment Security Division announced that 6,500 more people had jobs in the region in May than was the case a year ago, with Spokane County’s unemployment rate near the state average. Areas of particular strength are health care, construction and “professional” jobs in fields such as law and accounting firms and research and development connected to the new Washington State University medical school.
In such an employment market, Luby and others said, sellers are mostly getting their full asking price and are not being forced to cut deals in the form of give-backs such as paying for new carpet or some closing costs.
In a handful of cases, multiple buyers are competing for properties, which has led to purchasers offering more money than the asking price.
Luby said she’s seen sellers who are hesitant to list their homes because they’re concerned about not being able to find another house if theirs sells quickly.
In another sign that the market has turned the corner in Spokane, the number of distressed homes – vacated by owners due to hardship – is going down.
The number of distressed homes accounted for 6.3 percent of sales last month compared to 12.8 percent in May 2015.
Louis Flores III, broker for K Loans in Spokane, said financing is generally available for purchasers with credit scores of at least 620 to 640 and a sufficient income stream – two factors that are still obstacles to many prospective buyers.
Buyers can get into a home for as little as 3 percent in a down payment through Fannie Mae and Freddie Mac loan programs, and government-backed loans are available for a down payment of 3.5 percent.
Waiting list of buyers at Kendall Yards
Marianne Bornhoft, a real estate agent, said that homes with strong curb appeal in good neighborhoods are quick to sell. The market has been strong in some of Spokane’s older neighborhoods, she said.
But one of the hottest places to buy or sell is one of the market’s newest neighborhoods: Kendall Yards, across the river from downtown Spokane. There’s a waiting list of people hoping to buy homes under construction. Bornhoft said 13 buyers were available for six homes that opened earlier this spring.
One of the successful buyers was a divorced woman in her 50s who raised a family but now is on her own. Bornhoft, the woman’s agent, said her client wanted to move into a place that had a strong community vibe just outside her front door.
James Evans, a sales agent at Kendall Yards, said the key demographic for the popular development is empty-nesters seeking to downsize. But there are a lot of young professionals and singles, especially single women, drawn to the development, he said.
“The market six years ago was horrible, but now it’s fully rebounded,” Evans said.
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