Realtor ranks rise in the Inland Northwest
Ratio of brokers to home sales is one to four in Spokane, one to two in Coeur d’AleneJuly 19th, 2018
The number of residential real estate agents in the Spokane and Coeur d’Alene markets is rising. Some industry professionals say the Spokane housing market remains healthy but saturated with agents, and others say the Coeur d’Alene market is downright bursting with brokers.
Rob Higgins, executive vice president of the Spokane Association of Realtors, says the organization has more than 2,000 Realtors as members, up from about 1,940 at the beginning of the year. By the end of this year, Higgins projects the association will involve about 2,100 Realtors, but that number doesn’t outpace the prerecession membership peak of roughly 2,300 Realtors, probably around 2007, he says.
Even so, that’s a substantial membership increase from a low point of roughly 1,400 Realtors in 2012.
As the number of Spokane-area Realtors trends upward, the number of homes for sale keeps declining. Inventory at the end of June dropped 24 percent compared to year-earlier inventory, and median home prices, at $245,250, were up 13.9 in June compared with prices in the year-earlier month.
Higgins says the association projects about 8,000 home sales will be completed this year, which would result in roughly a one-to-four ratio of Realtors to homes closed.
Jared McFarland, president-elect for the Coeur d’Alene Association of Realtors’ Multiple Listing Service, says the association boasts just over 1,800 Realtor members. In January, it had about 1,270 members, he says. That’s up dramatically from 870 in January 2010.
As of the end of June, 1,540 single-family home sales were completed through the Coeur d’Alene MLS, up 2 percent from the year-earlier period, he says. The organization projects a total of 3,090 home sales will close this year, making the ratio of Realtors to transactions nearly one to two.
McFarland, also an agent with Century 21 Beutler & Associates in Coeur d’Alene, says, “Two months ago, at our board meeting, I think we approved 12 new brokerages into our MLS, which is a lot. It’s very apparent—there’s a lot of new agents.”
McFarland says it’s typical for agent numbers to surge when the market thrives and to exit when it dips. Right now, the Coeur d’Alene market is strong, but a lack of inventory and new construction is affecting home costs. The area has also seen home sale price hikes, with waterfront properties, for example, rising roughly 15 percent in the last year.
“Everything is growing fast, but we’re seeing that this year has been the year of high-end and waterfront (property) appreciation,” he says.
One new agent, Riley Elmer, left the brewing industry in March to join Windermere Real Estate/City Group LLC after being invited to enter into a business partnership with another agent, he says.
In addition to the offer, Elmer chose to become an agent because the industry has piqued his interest for a while, he says.
“My grandfather and father owned investment properties, so it’s a world that I’m pretty comfortable in,” says Elmer.
The current number of agents and people searching for homes oversaturates available inventory, but that’s to be expected as part of the ebbs and flows of the market, he asserts.
“In my eyes, right now, it’s very competitive … there is low inventory and a lot of offers on properties, so you are seeing offers going at listing price or higher. You just have to go in with an aggressive mindset and your buyer’s best intentions in mind. It’s a hot market,” Elmer says.
The number of real estate agents will even out eventually because the current inventory can’t sustain the current number, he asserts.
Higgins says the Spokane market is still seeing a healthy number of home sales and a good Realtor-to-transactions ratio.
“Our membership is over 2,000, but there’s a number of people who have real estate licenses that aren’t full time; they don’t sell real estate for their living. Either they’re semiretired and do that to supplement their income, or for whatever reason,” he says.
In order to become a Realtor, real estate agents must join the association, so membership doesn’t encompass all agents in the Spokane market, says Higgins, adding, however, that most residential brokers join the association so they can gain access to the Multiple Listing Service.
Echoing Higgins, Melissa Murphy, designated broker and owner of Spokane-based Prime Real Estate Group, says Spokane has maintained a healthy number of transactions, or home sales closed, and a relatively healthy ratio of agents to transactions.
Murphy says Prime Real Estate Group is on track for its best year ever in terms of the dollar volume of home sales closed, a figure expected to rise about 23 percent from last year.
Located at 417 W. First, the real estate agency has been involved in $50 million in transactions so far this year, she says.
Prime Real Estate brought on eight more agents in the past year, bringing its total number of independently contracted agents up to 35. Next month, the agency also will open its first office in Coeur d’Alene in roughly 2,000 square feet of space at 421 E. Lakeside.
With fewer homes for sale and higher agent saturation, Murphy, who has been an agent here since 2005, says the Coeur d’Alene housing market is much tighter than Spokane’s market.
Scott Wetzel, president and CEO of Windermere Real Estate Services Mountain West, agrees that the number of Realtors is increasing, but that the industry isn’t necessarily oversaturated.
Adding more real estate agents enables firms to increase their connections, says Wetzel.
“By continually adding good quality, well-trained, or able-to-be-trained agents, they then make the relationship connection with their sphere or database. What ends up happening, you end up getting more of the overall pie that’s available to the market,” he says.
Additionally, bringing on new agents involves little risk; agents are mostly independently contracted and work on a commission, he says.
“It’s a relatively low cost-per-agent risk bringing a new one on. There’s tons of training that goes into it—we do a ton of training of the agents—but that’s more human capital and time than actual dollars,” he says.
To be a successful real estate agent in the Spokane-Coeur d’Alene market, Murphy says it’s best to work full time. Many sellers ask agents if they’re full time as a way to gauge an agent’s commitment level.
“In my experience, the agents that succeed in this industry go in full time. It is rare that I see somebody go in part time and do really, really well, especially in a market like this where the competition is higher,” she says.
She also recommends agents work with mentors, and for new agents who aren’t familiar with either the Spokane or Coeur d’Alene markets to break into the Spokane market first.
“If you had no market knowledge of either area and you were moving to the area brand new, didn’t know a single person, Spokane would be easier, because of the number of transactions, to get your foot in the door,” says Murphy.