How far will Kootenai County house prices decline?

If you believe some ‘bubble bloggers’, we are heading for a massive loss of value here in Kootenai County. If you head on over to the Coeur d’Alene Press community blogs, you’ll find a lot of bubble pundits proclaiming that North Idaho Real Estate is primed for at least a 20% drop in value, some even proclaim as high as a 50% drop in value.

Honestly, these people are living in a fantasy bubble. A bubble that surrounds their brains with a mish mash of dreams with zero basis in reality. Zero. Zip. Zilch. Nada.

I’ve been called all kinds of things, including ‘one of those real estate agents who spouts positive when the world is falling down around you’. Does it even matter to me? No and here’s why – consider the source. The source are people who 1) don’t even own real estate and 2) don’t have the faintest idea about history and cycles and 3) just plain parrot what other pundits parrot.

So, just to add fuel to the fire – here is some reality (and yes it’s positive) for ya’ll about Coeur d’Alene real estate prices.

The PMI Group just released their Spring 2008 Economic and Real Estate Trends Report (you’ll want the appendix too for more details). There are a couple of things you’ll want to note. First and foremost, take a look at the Coeur d’Alene area stats. There is a less than 7% chance that home prices in the Coeur d’Alene area will be lower in two years. In otherwords, there is a 93% chance that home prices will maintain and appreciate over the next two years (in Kootenai County).

Here’s something else, from the trenches. On resale homes, I am selling homes for the same prices that they sold for last year and the year before. For example, in the sub-divisions of Sunshine Meadows and The Landings, entry level resale homes that are approximately 1,100 square feet are selling for $164,000 – $167,000 (less any seller concessions of $3,000 – $4,500 on average) which is the exact same prices these homes have been selling at for the past two years and the same price I am selling these homes for today.

Now, there are some sellers that are selling out of a form of desperation: pending foreclosure, short sale, scared of the market, need funds for other reasons, fast relocation, etc. These sellers typically sell for anywhere from 3%-8% lower than the true market value of the property. These are what we call ‘deals’, and there are ‘deals’ in every kind of market. ‘Deals’ are nothing new.

Investors, if you must sell, you must sell regardless of the market. Get your property on the market now and get it sold in the height of the season. Otherwise, hold. Real estate values over the long run will be strong and serve you well.

Home-owners, if you want to test the market – don’t bother. You are wasting your time and money. If you want to sell, hire a Realtor® who will price your home correctly (to sell it) and not one who will just give you a ‘high value’ in order to ‘buy’ your listing. Believe me, it is cut-throat right now. With 1,300+ agents in Kootenai County and only 797 closed sales to date this year, you can easily do the math. There are a lot of hungry agents out there that do not care about you or your property. They care only about ‘getting a listing’ or ‘closing the next deal’.

Buyers, if you are thinking about buying, get it done. We are at the bottom of the market and your selection is great right now.