General Market Update
Here is your February 2023 Market update for the Coeur d’Alene MLS. I could spit out all the data about the housing market and this would be quite boring, so let’s focus on just a few interesting changes that I think might have the biggest effects on you and your Home Equity in 2023
Everyone knows housing inventory and months of supply have doubled. Days on market are up almost 6%, Closed sales are down significantly. And yes we are trending towards a buyers market. However, what I want to talk about is the H. A. I. (Housing Affordability Index.) You might ask what the heck is the Housing affordability index?
Housing Affordability Index
It’s a measure of what a family with a median income can afford. If 100% value then the average family can afford the median priced home. Anything less signifies that it will be harder for a family to purchase. Also, anything more signifies a market that average incomes can afford most housing with ease.
So looking at Kootenai County from last year we dropped from an unimpressive number of 88 down to a 69. This is a 21.6% drop. Meaning that to buy in the February 2023 market you need to be making 131% or more of the average salary. Or you need to have a substantial down payment. Now you can see why I think this is the number to focus on this year. If we continue to trend this way then home ownership will be harder to attain.
Market moving forward
Eventually we will see a combination of several changes to combat this. Interest rates will have to drop. Prices, which by the way just passed January’s ascent of last year on its way down this year, should still come down further. Buyers will have to have more cash down and Sellers will have to offer more concessions. And incomes really need to trend upwards.
This is your Coeur d’Alene market update for February 2023. If you want to know how this applies to you then call me (208) 699-5782.