'American dream' out of reach for many in Kootenai County

In 2020, about 75% of Kootenai County households made enough money to buy a home in the county.

The income needed in 2020 to pay the mortgage on an entry-level Kootenai County home was $66,000 for those with good credit, minimal debt and some savings for a down payment.

But that has changed as home prices surged over the past few years.

Today just 30% of households in Kootenai County make enough to buy a home, said Samuel Wolkenhauer, economist with the Idaho Department of Labor.

Rachel: Budget to buy a home — $325,000 to $400,000

Rachel Sandvig is a manager at a remote nurse staffing agency. She has a car payment and student loans, and lives with her boyfriend who is a firefighter. They are financially independent, and Sandvig makes more than about 56% of Kootenai County households by herself. Sandvig is looking to buy a house because at 32, she feels like she’s at that point in her life.

“Being in your 30s and sharing walls with people is challenging,” she said. “There’s a lot of private and personal sacrifice you're making.”

Sandvig and her boyfriend are fortunate to live in a duplex right now with a yard, and an incredible landlord. They’ve recently upgraded from an apartment, and love where they live, but hoped to buy for financial and personal stability.

Sandvig was looking for a place in Coeur d’Alene, close to downtown, that’s at least two bedrooms with a yard so her two dogs can have their own space. She needs a home office because she works remotely. She’s considering building a family, so she doesn’t want a home she’ll immediately grow out of, like some available with minimal square footage.

“I’m not ready to buy an 800-square-foot house for $400,000 and be house broke,” she said.

Sandvig’s realtor and mortgage lender expected her to get approved for around a $400,000 home. Sandvig was shocked when not only was she not pre-approved for the $400,000, but even homes in that price range were smaller than the duplex she’s renting now, and many didn’t have a yard.

“We found a few at $400,000 that weren’t quite enough,” she said. “I thought $400,000 was going to be enough, and it wasn’t.”

She also looked at homes that cost less that were in her pre-approval price range. Typically they’re duplexes or townhomes, and too small to make sense, or too far out of town compared to where she lives now.

Because she’s been priced out of the market, Sandvig has decided to delay her home buying for a little while.

“I want a yard for the dogs,” she said. “The idea of simple living for me has become extravagant in this market. The simple living you grew up in is an extravagant lifestyle.”

Sandvig grew up in Coeur d’Alene, and she refuses to move from her hometown, but it’s hard.

“I love Coeur d’Alene. I love this area,” she said. “I really believe in the community here. I try to look at all the positives and it’s really hard being stuck. I’ve felt stuck.”

Sandvig and her boyfriend have decided to hold off on buying a house for a little while, to see what happens with interest rates and if their situation changes. But competition will be fierce if interest rates drop.

“How fortunate are we that we get to live here?” she said. “We try to focus on the positives.”

They live downtown and joke about their “little Italian lifestyle,” where they walk to their local grocery store and take daily walks with their dogs.

Sandvig has decided to savor this time in her space, while also taking the opportunity to do some traveling.

She may look at buying again soon, but now isn’t the right time for her.

“It’s just hard when you’ve grown up here, and this is my home,” Sandvig said.

Gina: Budget to buy a home — $425,000 to $450,000

Gina Lovenitti wants to buy a home for a few reasons, mostly practical. Her entire family is in real estate, and it’s been her plan for herself to own property. It’s also a point of pride for her to be a single female her age buying a house by herself. She’ll turn 30 in May.

Lovenitti took a risk on a new job for a health care tech startup, as a growth operations manager, and made six figures in 2022. That propelled her into a position to buy. She makes more than about 80% of Kootenai County households, and she has a car payment, but no other debts.

“It took me a while to find a lender that really worked with me,” Lovenitti said. “I finally found a lender who was creative, with me as a first time home buyer. They didn’t just enter numbers into a calculator. They really worked with me to find something that worked.”

Lovenitti wasn't initially qualified to get what she was hoping to buy, and her lender let her know how much more she needed to make to reach her goal. Lovenitti was able to use that amount to negotiate with her boss for a raise that was already in her future to qualify for the home she wanted.

“The stars aligned to let me get in the market at the price point I’m at,” she said.

And Lovenitti isn’t too particular, so she’s able to be a flexible buyer, which gives her a competitive advantage in the market.

“Any time you make a decision like this there’s an emotion attached to it” she said. “It’s a little bit of freedom. Like family to come visit me and have a place to stay. Having friends visit and have a place to stay.”

Lovenitti is looking for a two to three bedroom home around 1,100 to 1,800 square feet. Architectural style doesn’t matter, location doesn’t matter, but she does need a yard. She has a mastiff heeler mix living with her now in her one-bedroom, one-bath apartment.

“I’ve wanted another dog for him to have a pal,” Lovenitti said. “But I can’t in good conscience get another dog in a one-bedroom apartment. He loves to roll in the grass and lay in the sun. And I feel so bad keeping him inside all day. I want to see him be a dog.”

Lovenitti has lived in her apartment since she moved here in 2020, and she has watched her rent go up, but not as much as it could. Her ground floor apartment with an attached garage started at $995 per month and went up $400 in three years.

“My office is in my living room, my gym is in my bedroom,” Lovenitti said. “Most of my decision is coming from I’d like an office so I can close my work door at the end of my day.”

But when she started her new job, her income also leapt, so she can pay between $2,000 and $2,800 per month for a mortgage.

She’s made an offer on a few houses, but they've fallen through. One offer was accepted, but in the inspection the home needed a new roof, and other offers weren't accepted.

“When it comes to buying a house, what is meant to be for you will work out,” Lovenitti said. “If it doesn’t work out, I’ve gotten to the point where I can move through it a little bit better. Something else will come up.”

The big picture

The Idaho Housing and Finance Association has a portfolio of products geared to help borrowers afford a home loan, like down payment assistance or low interest rates.

“As a general rule we’re focused on the low- to- moderate income home buyer,” said Gerald Hunter, president of Idaho Housing and Finance. “And we try to serve markets up to the median sales price home. That’s sort of our goal.”

But the Idaho Housing and Finance portfolio of lender tools leaves a $126,000 gap between its average loans and the median cost of a home, Hunter said.

The average amount loaned by the agency in 2020 in Kootenai County was for a $254,000 house. Now, the average home cost through Idaho Housing and Finance is $377,000.

That's significantly less than the median home value in Kootenai County, which was was $501,000 last month, up 54% since 2020.

“There is innovation to put new products in the market,” Hunter said. “Freddie Mac came out with a new affordable housing product. It would offer decreased interest rates for eligible home buyers. That’s had a positive impact on our ability to reach some buyers that we wouldn’t have otherwise been able to serve.”

But the affordability gap persists, while interest rates and home prices rise, people have to make more money to be able to afford a starter home.

To buy an average entry-level home in today’s Kootenai County housing market, a household will need about $30,000 per year more than just three years ago, or roughly adding a salary to their home.

“No nurse can go to their employer and say I need you to double my salary,” said Coeur d’Alene City Council member Kiki Miller.

Miller works with the Regional Housing and Growth Issues Partnership, an organization advocating for affordable housing solutions and studying the local impacts of housing availability on the community.

A household income of $95,000 a year is likely two skilled laborers, like a drafter, a nurse, or a teacher, Miller said, often with student loans or car payments.

So a family of two experienced teachers can barely afford to buy a starter home in Kootenai County.

“Our businesses are not going to be able to close that wage gap,” Miller said.

For every $30,000 in home value, a household would need to make about $10,000 more a year.

For every interest point, a household would need to add about $6,700 to its annual income.

“Over time we hope that incomes will increase,” Hunter said.

Wages have not increased as much as home prices.

“This has been a challenge for us because prices have gone up so quickly,” Hunter said. “It has been difficult in our products to reach up to that range. It’s more difficult for people to afford homes and it’s more difficult for our products to reach people.”

Prices spiked over a short period of time, Miller said.

“The finish line got moved so far away that many borrowers are looking to go elsewhere," she said.

People who are reaching home buying age are being pushed out of the area where they grew up – people like Sandvig.

“Locals wanting to move on are going to have to move away,” Miller said. “They’re not going to stay if they can’t eventually have the opportunity to buy a home.”

Despite home loan amounts going up, quantity and total volume are still dropping for Idaho Housing and Finance.

Those factors also strain the labor market, where conservative estimates indicate Kootenai County has lost around 1,600 workers due to housing issues, according to a housing availability and affordability study for Kootenai County done at the University of Idaho.

“For Kootenai County, non-resident home buyers will likely have the resources to outbid residents if housing supply is constrained,” Miller said. “We are going to be fighting for every single person to keep them in our community to keep it running.”

The Regional Housing and Growth Issues Partnership is exploring several policy changes and solutions to the housing availability crisis in Kootenai County, but the solutions are complicated and extensive.

“There is not a (single) solution,” Miller said. “It’s got to be ongoing and a community effort, focusing on building tool kits to drive housing availability. We’re looking at Accessory Dwelling Units, for seniors to build ADUs and rent them out. Hopefully we move the dial a little bit.”

Policy solutions that could impact housing availability aren’t always popular with residents, like building more affordable housing. Or aren’t always easy, like developers seeking to build housing types with the best profit margins, not usually affordable housing options.

“People who’ve lived here for quite a while are screaming for an answer,” Miller said.

The answers are not simple and will take time.

“Homeownership, that’s the American dream, but it’s not achievable here,” Miller said. “Technically, yes, it’s achievable. But on average it isn’t.”