The number of foreclosures in Spokane County will climb into record territory this year if a current upward trend doesnt soften.
A total of 691 foreclosures on deeds of trust were recorded through August of this year here, up about 24 percent from the 559 recorded during the year-earlier period, according to county auditors figures.
If that percentage rate held true for the rest of the year, it would translate into 1,032 foreclosureswell above the last documented peak of 853 foreclosures recorded in 1988, when the real estate market here was in a prolonged slump.
The 835 foreclosures recorded last year fell just short of matching the 1988 number.
Im surprised. Weve moved up to pretty dramatic levels, says Phil Kuharski, an economic observer here who has followed the Spokane market for about 40 years. It wouldnt be what I would call a dire situation, but it certainly would be a worrisome one, he says.
Kuharski had predicted earlier that the number of foreclosures in Spokane County would remain between 800 and 900 this year, after having risen sharply in each of the previous four years, and would decline over the next two or three years.
The continuing rise is certainly still an indicator of a buyers market, he says. There have been arguments about that in the real estate community over the last year, but given that mortgage rates went up and took away the opportunity for people on the fringe to do refinancings, that had to be a factor.
Still, interest rates didnt rise a lot, so they shouldnt be contributing much to the rise in foreclosures, and theyre expected to fall some over the next year, Kuharski says.
The still-lingering Kaiser Aluminum & Chemical Corp. labor dispute probably is a factor, but most economic indicatorssuch as a continuing low unemployment rate herewould suggest that foreclosure numbers should be leveling off, he says.
There may be other factors Im not familiar with, he adds.
Whatever economic forces are continuing to drive the numbers of foreclosure upward, Kuharski still foresees a turnaround looming, albeit somewhat delayed.
I dont see any sign that we would be moving up into the 1,200s or 1,500s or anything like that, Kuharski says. To the contrary, I think the economy, regionally and locally, will be moving forward over the next year, and foreclosure numbers here will begin to shrink as that occurs, he says.
Year-to-date foreclosure numbers werent available for Kootenai County.
However, Chuck Hollingsworth, a Coeur dAlene-based Pioneer Title Co. executive, says the month-by-month totals hes seen for Kootenai County this year appear to be running about the same as last year, when there were 359 reported foreclosures begun, which was 5.5 percent higher than 1998.
Northern Idaho has its own economy, which may help explain why foreclosure numbers there dont appear to be rising at the same rate as in Spokane County, he says.
Hollingsworth notes that also it takes several months for a foreclosure action to be completed and recorded, so the latest compiled figures actually reflect what was occurring in the spring and may not be indicative of current market conditions.
He says title activity was slower than usual in Kootenai County last spring and has been stronger than usual the last couple of months. Were having our spring now. Its just flip-flop, he says, adding, Maybe as the scare of higher interest rates drove people out of the market, theyve just settled down and said, Well, lets go ahead. I think were going to see a positive fall.
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