Windermere analyzes county market
COEUR d'ALENE - Windermere Coeur d'Alene Realty is sharing its annual in-depth analysis of the Kootenai County real estate market with the community.
"Our current market highlights the difference between what buyers want and what they need," said Pat Krug, managing broker for the Post Falls office of Windermere. "Today, people are most likely to purchase what they need, rather than what they want, which illustrates the lagging sales in residential with acreage and waterfront."
Single-family homes, waterfront properties, condominiums and multi-family residence statistics from 2003 through 2009, along with an analysis of trends for the rest of this year, are included in the report, prepared by Krug and Jennifer Smock, Windermere human resources and statistical director, with data provided by the Coeur d'Alene Association of Realtors Multiple Listing Service.
Produced since 2005, the report is designed to provide an overview of the local marketplace and identify trends that will influence the local marketplace in the next 12 months - and the opportunities that exist in these trends, Krug said.
It is likely prices have stabilized in most segments, she said, "with the exception that some sellers still think it is 2005. They are experiencing the frustration of following the market down."
People who purchased their property prior to 2004 have seen the value of their home appreciate, Krug said, and if they did not extract equity through refinancing and home equity loan purchases, they have an opportunity in today's market to realize gains that can be used to purchase a new home that better suits their current lifestyle.
The number of properties will probably increase as a "shadow inventory" of bank-owned real estate goes on sale.
"We are anticipating as many as an additional 500 homes in this category could impact our market in 2010," Krug said.
Last week, the Fed said it plans to hold interest rates at zero to 0.25 percent, and made no changes to a program to drive down mortgage rates and bolster the housing market, even as a government report Tuesday showed housing construction tumbling in February.
Under that program, the Fed is scheduled to end purchases of $1.25 trillion worth of mortgage-securities from Fannie Mae and Freddie Mac at the end of this month. Some analysts fear that once the program ends, mortgage rates could rise. That could weaken the recovery in housing and the overall economy. The Fed left the door open to extending the program if the economy weakens.
"I predict mortgage interest rates will rise in 2010," Krug said. "I do not predict a drastic rise but even at 1 percent, this equates to a 10 percent drop in buying power. For example, a purchaser who can qualify for a $200,000 priced home at 5 percent rate will now qualify for a purchase of $180,000 if rates go to 6 percent."
The combination of low interest rates, lower prices and the home buyer tax credit has created tremendous affordability in the entry level market, Krug said.
"Even with the expiration of the home buyer tax credit, we predict that home sales in the $200,000 and below range will continue to be strong," she said.
The report is also available at www.cdarealty.com, or in the offices of Windermere, at 1000 Northwest Blvd. in Coeur d'Alene (664-9221); Post Falls, 1616 E. Seltice Way (777-9900); or Hayden, 867 Prairie Ave. (762-4888).