From the March 2021 issue of @Home with Coldwell Banker Tomlinson.  Written by Chris Canning, Coldwell Banker Tomlinson Realtor®

As both a licensed REALTOR® and home builder, I often scroll through my Facebook feed and see homes advertised by our area homebuilders and fellow real estate agents. I often see such remarks as: "They want how much for that house? They're crazy!" or "Why can't builders build more affordable homes?" The general public is not aware of the obstacles faced by members of the industry tasked with meeting the demand for housing. Chief among these obstacles are: 1. A lack of affordable land. 2. Dramatic increases in the cost of materials. 3. The scarcity of qualified tradespeople.

1. Land

   The first line item on any builder's ledger is lot cost. At present, Spokane is faced with issues in obtaining, developing, and delivering reasonably priced lots to builders. Briefly stated, Spokane's Comprehensive Plan dictates when, where, and how development and construction can take place. Its purpose is to prioritize use of existing infrastructure and improvements before venturing into areas that would require expanding infrastructure. Unfortunately, the land within the boundaries of our "Comp Plan" that was easiest and most cost-effective to develop is gone, leaving only very complicated, expensive, steep, rocky, pieces of property to develop. Consequently, developers and builders are forced to confront more expensive and complicated properties and projects. Many consumers who are able are paying these increases, while others have simply been forced out of the market. Let's assume a builder can build a home for $200.00/sq/ft and obtain a fair profit. If the builder is able to obtain a building lot for $60,000, and builds a 1,500 sq/ft rancher – he would need to charge $360,000 for this home. If, due to scarcity, the cost of the lot rises to $80,000, the result is an increase in the finished cost of the home of about $22,000. Otherwise, the builder sees his/her margin of profit slip, which would make it more difficult to obtain financing. Ultimately, the consumer bears the brunt of the cost increase, while the only party to benefit is the original landowner.
    

2. Materials

   You may have heard in the news recently that lumber prices have nearly doubled in our area and elsewhere across the nation. However, it's not just lumber that has seen extensive price increases due to scarcity. Across the board (no pun intended), shortages in roofing, wiring, flooring and other materials, have significantly increased the cost of building a new home today.
    

3. Skilled Labor

   Ask any home builder in town why homes are costing more, and be prepared for a lecture on the shortage of labor in the building trades. As a millennial, I was pushed hard to pursue a career requiring a college degree. I wish I had known then how much demand Spokane would have for skilled labor in the building trades in 2021! Talking to the many friends and family I have working as skilled tradespeople, I find that every one of them is inundated with work, to the extent that they can choose whom they work for and what they should be paid. As a result, while today's new homes are not framed any straighter or plumbed more reliably than those built five years ago, they are a lot more expensive to build, and, thus, to buy.
   
   

Lurking behind every one of these factors in the increasing cost of new homes is the Demon of Demand. As long as Spokane remains the wonderful place to live it is and always has been, we can expect to see increases in the cost of housing, though perhaps less steep than we are coping with now, extending into the future.

View our comprehensive Coeur d'Alene real estate market report for the month of January!

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

Download the January Market Report PDF here.

Want more info about the current real estate market? Contact us today to speak to an agent. 

View our comprehensive Spokane real estate market report for the month of January!

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

Download the January Market Report PDF here.

Want more info about the current real estate market? Contact us today to speak to an agent. 

From the January 2020 issue of @Home with Coldwell Banker Tomlinson.  Written by Neil Johnson, resident CBT Statistics Expert.

The past year has been fraught with a number of issues that have affected the residential real estate market in many ways. The forces that have aligned this unusual year have basically created a housing shortage.

The Spokane and Coeur d'Alene area had been seeing high in-migration prior to 2020 and also low new housing production as evidenced by low rental vacancy rates and a low inventory of homes for sale.  When the pandemic became official and businesses related to housing were closed, the supply of building materials and building itself were interrupted for a time. Simultaneously, people who had been relying on the office as a place to work found that they could work anywhere.

Since most large metro housing markets have remained healthy and strong, the option of selling from a large market and moving to a smaller market like ours has remained achievable. Now, mix in extremely low interest rates, more in-migration and fewer local residents moving away, and you get a high concentration of demand in the Spokane market.

Since the demand is high, the rising cost of building new housing has been offset by buyers who have no financial restrictions and can pay higher prices for new homes. As new homes are selling at record prices, those homes become benchmarks to all existing housing, encouraging home sellers to raise their asking prices, only to find that competing buyers bid those prices even higher. Incredibly, the high sales velocities are reflecting market acceptance, as homes are selling in numbers similar to 2006-07, which was the height of the housing market prior to the Great Recession.

Our region, with its affordability, access to recreation and excellent quality of life is very attractive to a great number of people, and as long as the larger markets remain stable, the cost of mortgages low, and the incentive strong for local residents to stay, we will see values rise.

View our comprehensive Spokane real estate market report for the month of December!

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

Download the December Market Report PDF here.

Want more info about the current real estate market? Contact us today to speak to an agent. 

View our comprehensive Spokane real estate market report for the month of November!

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

Download the November Market Report PDF here.

Want more info about the current real estate market? Contact us today to speak to an agent. 

View our comprehensive Spokane real estate market report for the month of October!

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

Download the October Market Report PDF here.

Want more info about the current real estate market? Contact us today to speak to an agent. 

View our comprehensive Spokane real estate market report for the month of September!

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

Download the September Market Report PDF here.

Want more info about the current real estate market? Contact us today to speak to an agent. 

View our comprehensive Spokane real estate market report for the month of August!

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

Download the August Market Report PDF here.

Want more info about the current real estate market? Contact us today to speak to an agent. 

View our comprehensive Spokane real estate market report for the month of July!

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

Download the July Market Report PDF here.

Want more info about the current real estate market? Contact us today to speak to an agent. 

Download the June Market Report PDF here.

Download the individual Supply & Demand Report PDF here.

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The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

Download the May Market Report PDF here.

Want more info about the current real estate market? Contact us today to speak to an agent. 

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

Download the April Market Report PDF here.

Want more info about the current real estate market? Contact us today to speak to an agent. 

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

Download the March Market Report PDF here.

Want more info about the current real estate market? Contact us today to speak to an agent. 

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.

The Washington State Governor's Stay Home, Stay Healthy order does not define real estate as an essential service. What does this mean for Washington Realtors® and clients?

Please note, this information is accurate as of this article's posting time, March 25th, 2020, at 12:00pm.  The situation is very dynamic and is subject to change.

Washington State Governor Inslee's "Stay Healthy, Stay Home" order, effective midnight March 25th through midnight April 8th, 2020, prohibits all people in Washington State from leaving their homes or participating in social, spiritual and recreational gatherings of any kind regardless of the number of participants, and all non-essential businesses in Washington State from conducting business with a few very specific exceptions.

Real estate brokerage activities generally are not considered essential, so business must not be conducted in person for the period covered by the order. 

What does this mean?  The Spokane Association of Realtors® clarifies, stating:

All in-person contact with clients must cease which would include client meetings, property showings, and open houses.

Virtual/electronic activity may continue and is encouraged: video meetings, virtual tours/open houses, and electronic documents/signing.

It shall be a violation of the REALTOR® Code of Ethics and possibly also a violation of law to conduct business as usual, in person, during this time.

Furthermore, Washington REALTORS® Legal Hotline Lawyer Annie Fitzsimmons provides additional clarifying points:

Real estate brokers are not allowed to continue conducting business except remotely, from their homes. 

Physically touring houses is not considered an "essential business".

To the extent a broker can develop a virtual tour of seller's home, broker can continue to show seller's home. Otherwise, home showings are restricted by the "Stay Home" order. Listing brokers have until the night of Wednesday, March 25 to develop a virtual tour of listed properties.

Once the order goes into effect, there is no obvious allowance for home inspections while the order is in effect.

Pending sales can likely proceed to closing under the Financial Services section of the "essential businesses" list.

Is it possible that appraisers will be considered as essential workers in the Financial Services exception? It is possible although that conclusion is not immediately apparent.

We at Coldwell Banker Tomlinson are abiding by the Stay Healthy, Stay Home order, for your safety and ours.  It's the right thing to do even though it's difficult.  We are all working remotely from home.  We are equipped to support you virtually using the industry's finest technology.  We are here for you.  Please reach out if you have any questions.

Want more info about the current real estate market? Contact us today to speak to an agent. 

The information in this report is compiled from a report given by the Spokane Association of REALTORS© and to the best of our knowledge is accurate and correct.