Homebuyers in Spokane County could have a tough time finding a property less than $400,000.
The median price for homes and condos on less than 1 acre soared in February to $400,000 for the first time, a 23.1% increase compared to the $325,000 median price in February 2021, according to the Spokane Association of Realtors.
The county’s previous all-time high median sales price was $395,000 in July 2021.
“A limited amount of inventory continues to put upward pressure on the price of homes,” said Eric Etzel, president of the Realtors association. “Buyers are in multiple-offer situations and making their offers exceed the price by as much as they can with hopes the homes will appraise for that.”
Tom Clark, broker with Kestell Co. Realtors and governmental affairs committee chairman for the Realtors association, said it’s surprising to see the rapid pace of market activity from 2021 carrying over into this year.
The market’s rising prices in February may be because sellers were listing homes aggressively in the $500,000 range, with the properties closing between $400,000 and $450,000, he added.
“There is still a number of buyers out there who haven’t been able to find what they want and are in multiple-offer situations,” Clark said. “But I think we are still hoping we will see a little bit more inventory this year, so buyers have more of a selection.”
Spokane County had 237 homes available on the market in February, representing a 21-day supply of inventory. That means it would take three weeks to sell all the available homes. By comparison, the county had inventory of nine days at the same time last year.
“The market, in general, slows down when we have an extreme weather event. We had some snowstorms and cold snaps that probably contributed to a week of that time” in February, Clark said. “There was period of time there where I think homes sat (on the market) longer because of that.”
A John L. Scott February real estate market report indicates Spokane is experiencing an “uber-frenzy” for homes below $750,000, which make up 92% of sales activity.
Last year, new listings were up 52% from February to March and that trend is expected to continue this year, according to the report.
“Buyers can look forward to more available homes this spring, as more listings are on the way,” J. Lennox Scott, CEO of John L. Scott, said in the report. “Historically, the number of new listings bumps up in March and April, then goes up even higher in May and June.”
While it’s still possible for buyers to find homes less than $300,000, they are likely to be fixer-uppers, Clark said.
“Anything under $250,000 is going to be a very small house or buyers are going to be in a sweat-equity situation,” he said. “But, if they can get a conventional loan, they can pick up a lot of equity just by doing some of those (home improvement) projects themselves.”
The national median existing home price for all housing types in January was $353,300, up 15.4% from $303,600 in January 2021, according to the National Association of Realtors. February data will be released later this month.
Clark said it’s difficult to predict how much home prices could increase going into spring.
Economic uncertainty, inflation and increasing gas prices could pose a financial hurdle for some potential buyers, he added.
“That is going to hurt some folks, especially those that are already scrambling to find something or those that don’t have a big down payment or extra cash,” he said.
Etzel anticipates more homes will hit the market in the spring, which is typically the busiest time of the year for real estate.
Increasing prices are likely to persist, but not at the same breakneck pace that brought double-digit appreciation in 2021, he added.
“Not every house that goes on the market is $400,000 and above,” Etzel said. “Many times, buyers have to be patient and make multiple offers … it’s still a good time to take a look at buying a house now as prices could be higher in the spring.”
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