COEUR d'ALENE - Assessed property values in Kootenai County have plummeted again.

The Assessor's Office mailed out 87,760 assessment notices to county property owners on Tuesday, which reflect an overall assessed value in Kootenai County of about $11.6 billion.

That's about an $897 million drop from 2010 values.

Marking the fourth year of falling values, the slip is at least smaller than the billions dropped over 2009 and 2010, said Assessor Mike McDowell.

"Our market has clearly shown there is still a decline," McDowell said on Tuesday. "The result is what you will see on assessment notices."

The county's official assessed value for 2011 won't be available for several months, McDowell added, when operating and transitory property values will be available.

The addition of those numbers won't change the $11.6 billion figure more than 5 percent, he said.

In 2010, the county's assessed value was $12.6 billion, McDowell added, not including the values still missing this year.

The latest decline follows a $2.1 billion drop in values in 2010, a $1.2 billion decline in 2009 and a $720 million drop in 2008.

The continuing decline, McDowell assured, is just a return to normal values after the housing bubble in the mid 2000s.

"If we had experienced normal market conditions, and not the huge inflation, we would be about to the number we're at right now, and it (net value) would've been going up every year," McDowell said.

He couldn't say if values will increase next year.

"We're experiencing market conditions we've never experienced before, so this soothsaying is very hard," he said.

The reduction in values is smaller this year because of lower homeowner exemptions, McDowell said,

The exemption maximum, set by the state Tax Commission each year, decreased a few thousand dollars in 2010 to $101,153.

"Obviously, that will soften any decline in value," McDowell said. "If there is less exemption, there is more net taxable."

Assessments for 2011 are based off local property sales and other market information in the 2010 calendar year.

The county analyzed assessment levels in all 659 neighborhoods in the county, McDowell said.

Areas with the steepest declines included new subdivisions with a number of empty units, he said.

"There are areas of less decline in more developed, stable areas," McDowell said.

Land values fell more than building values, he added.

Circumstances like short sales and foreclosures made up about 25 percent of residential transactions in 2010, he said.

That number was up to 40 percent in the first quarter of 2011.

"The bulk of our activity is residential," McDowell said.

Jeff Doty, Windermere sales agent, said he wasn't surprised by the drop in assessed values.

But the market is still moving, he said.

"I'm personally having a good year so far," Doty said. "I think if you're paying attention to your business, there are still plenty of sales to be had."

Prices have come down enough, he said, that mid-to-high-end houses are selling now.

"The values are now good enough across the board, I do think this year is shaping up to be better than years prior," Doty said.

Jason Walker, Keller Williams Realtor, said he doesn't expect the market to rebound soon.

"We are seeing an increase in the $125,000 and under price range," Walker said. "But I anticipate continued depreciation above that."

McDowell recognizes signs of encouragement.

Some rural areas are no longer seeing decline in values, he said. And apartments and rental houses are returning to healthy values.

"Historically, stabilization of those values is a precursor to more general stabilization," he said.

Lowered property values don't necessarily mean lower property taxes.

Property taxes are determined both by property values and levies set by local taxing districts, which members of the public can comment on at district budget hearings.

Hearing schedules are included on assessment notices.

Property owners can contest the assessed values by contacting the Assessor's Office at 446-1500, or by emailing kcassr@kcgov.us.

Folks can also visit the office in the county Administration Building at 451 Government Way.

McDowell assured that any market changes this year will be reflected in the 2012 assessments.

"It looks like the decline is slowing down, but I don't know if it's coming back yet," McDowell said. "I'm hoping this is the bottom of it. I can't guarantee that. I wish I could."