Are we there yet?

The folks who waited, and waited, for the bottom of the market have, for the most part, realized that bottom has long since passed. The question we are most often asked now is, "How long will the strong market continue?"

Just as when the inquisitor wanted us to predict the bottom we cannot predict when, or if, there will be a top. Let it suffice to say that the market recovery appears healthy now. Even though many homeowners are still underwater, our rising prices appear to be narrowing the gap for those who bought early in the housing boom, generally considered to be that period between 2004 and 2007. A review of our North Idaho average prices demonstrates some disparity although current market activity, if sustained, could easily erase that pricing difference.

As reported here in recent weeks, our average price is up from last year by 8 percent. That increase reflects continuing upward movement in our market. However, the average price of a single family home on less than an acre of land sold in April 2007 - the year our prices peaked - was $250,118. This April our average stood at $201,648. This represents a deficiency for those who bought in 2007, but our market activity is outpacing that year by roughly 13 percent and shows no signs of slowing.

From April 1 to May 1, 2007, we sold 319 homes. This year during that same period we sold 366. This is still a far cry from the 471 homes sold in that period of 2005, but that was in the heat of the feeding frenzy that would later prove to be a housing bubble. In 2008, the year the bubble burst, we had slowed to 263 home sales and the following year just 218 homes were sold in April - less than half of 2005.

Before you reach for your pencil and paper we will tell you that our April sales reflect a 41 percent increase over 2009's activity. Our current volume shows an increase in sales of 20 percent over last year and with school still in session, many believe that number will continue its acceleration provided houses are available as our inventory shrinks.

So it could be that our still-attractive lower housing prices are helping drive the market, but surely interest rates are the true driving force. A loan for 30 years in the frenzied market of April 2005 would have cost about 5.7 percent interest. By 2007 that 30-year rate had climbed to 6.39 percent. The payment on a $200,000 mortgage then would have been $1,276 whereas today, that same loan amount would require a payment of just $899.21.

So not only can today's buyers get more home for the selling price, they can afford that home for about 30 percent less per month than before. Is it any wonder the market movement is brisk? And those who find they are no longer underwater are able to refinance those homes with relative ease, reducing their household budget significantly in the process. The mortgage market is also brisk.

For those still wondering when the progressing market will slow, we can only say, "Don't wait." Obviously, we are not there yet.

Trust an expert...call a Realtor. Call your Realtor or visit www.cdarealtors.com to search properties on the Multiple Listing Service or to find a Realtor member who will represent your best interests.

Kim Cooper is a real estate broker and the spokesman for the Coeur d'Alene Association of Realtors. Kim and the association invite your feedback and input for this column. You may contact them by writing to the Coeur d'Alene Association of Realtors, 409 W. Neider, Coeur d'Alene, ID 83815 or by calling (208) 667-0664.