NEAR TERM HOME SALES TO HOLD IN MODEST RANGE 

BY Lawrence Yun, Senior Economist for the National Association of Realtors 

The housing market will probably hold close to present levels in the months ahead, according to the latest forecast by the NAR. Lawrence Yun said he isn't looking for any notable changes in sales activity. "Existing homes sales should be relatively stable over the next few months, holding in a modest range, with some pent up demand growing from buyers who've been on the sidelines," he said. "Mortgage disruptions will hold back sales toward the end of the year, with broader improvement to include the new-home market by the middle of 2008." 

Existing home sales are forecast at 6.04 million in 2007 and 6.38 million next year, below the 6.48 million recorded in 2006. New Home sales are expected to total 852,000 this year and 848,000 in 2008, down from 1.05 million in 2006. Housing starts including multifamily units are likely to total 1.43 million in 2007 and 1.40 million next year, below the 1.80 million units started in 2006. 

"With the population growing, the demand for homes isn't going away, it's just being delayed. More buyers and cutbacks in new construction will eventually draw down the inventory levels and support future price appreciation, but general gains will be modest next year. Serious buyers today have a long term view of housing as an investment-speculators have left the market," Yun said.  

Existing home prices should ease by 1.2% to a median of $219,300 in 2007 before rising 2.0% next year to $223,600. The median new-home price will probably fall 2.3% to $240,800 in 2007 and then rise 2.3% next year to $246,300.  

The 30 year fixed rate mortgage is forecast to average 6.7% in the fourth quarter and then ease to the 6.5% range next year.  

About the Coeur d'Alene, Post Falls and Hayden Real Estate Market 

CALIFORNIANS MOVING IN Account for 35 percent of region's recent growth in population
Article in The Press 1/17/2007 

By Rick Thomas, Staff writer 

COEUR D'ALENE-- California bashers beware. They're still coming, in even greater numbers than in the past.
As recently as last summer, the perception that the Golden State was the top source of growth in North Idaho's population was a fallacy, ccording to Jim Stravens. This year's annual Inland Northwest Demographics report by JP Stravens Planning Associates, Inc. puts Californians as the top of the list, with 35 percent of the region's growth in population coming from that state.
" That's no surprise to me," Stravens said. "We haven't seen this trend for quite a while." Last year, Stravens said a third came from Washington State, a third from other Idaho counties and Montana and another third were
"made right here" as the result of local population growth.
Stravens' latest demographic report shows that in 2005, California led with 35 percent, followed by Washington State at 26 percent and surrounding states at 14 percent.
"We're only making 20 percent of population growth from people who are already here," Stravens said. "That's pretty phenomenal."
He estimates the population of Kootenai County by the end of 2007 at more than 140,000, and by 2010 above 167,000.
" They'll be older and wealthier", Stravens says.
"We're seeing more high-end type homes being constructed for older people," he said. "We're going to see a lot more of that kind of construction."
That means more age-restricted communities, an increase in seasonal population--10 percent of dwellings are now seasonal or occupied less than six months of the year and more wealthy buyers purchasing lots in high end developments like Black Rock, Gozzer Ranch and Powderhorn Bay, Stravens said.
However many of those buyers may not build homes for some time--as long as 10 years, if ever--because they're buying the property to get memberships to the exclusive golf clubs. "That's a trend we didn't see in the past," he said.
Housing for those with lower incomes will remain problematic, with about 62 percent of the county's homes now owner occupied and 28 percent rental units. Stravens said 20 percent of the population is now retired.
Housing construction peaked in 2005 and has since decreased by about half, but unemployment has remained low at 3.7 percent.
About 27.5 percent of households have incomes of less that $25,000, while the average is $56,430, which would qualify them for a home costing up to $210,000. People keep talking about low to moderate priced houses, Stravens said.
That's a misnomer, he said, because less than 25 percent would qualify.
The inventory of available homes grew by 1620 in 2006, but there are still a large number of subdivisions in the works, especially in the Post Falls area. "The number of units in Post Falls already platted is extremely high," Stravens said. That doesn't mean there's a lot of speculation, however. "Everybody wants to get their lots platted before there's a change," he said. "A lot of people complain about farmland being turned into housing. A lot of the farmers are platting their land to avoid (changes in policies)."
Even with housing construction off, there are homes being finished and enough commercial and industrial projects under way to keep the resident labor force busy, said Kathryn Tacke, regional labor economist for Idaho Commerce & Labor.
Unemployment has remained low in part because much of the labor force came in from other areas and the quantity is hard to track, she said.
There are just so many jobs, we can't seem to fill them all," Stravens said. "That appears to be the situation."
He said unemployment data doesn't take into consideration the self employed. "A lot of construction jobs fall through the crack," he said.
One trend that continues is the gradual shift in Kootenai County's center of population, which moved 1,333 feet west and slightly north since the last report as a result of growth in Post Falls and Rathdrum. Last year, it was at the intersection of Atlas Road and Hanley Ave.
In spite of a slowdown in demand for housing in the past year, Stravens doesn't see any likelihood of a retreat in prices now.
that the relative bargains in the region have been uncovered.
"Once you're discovered, it's impossible to go back," he said.  

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