Foreclosures have represented about 40 percent of local home sales this year and continue to drive prices down.

The average sale price in Kootenai County is $164,746, down 8 percent from $178,264 this time last year, according to the latest report from the Coeur d'Alene Multiple Listing Service.

"Foreclosures in your neighborhood are going to drive down your value," said Kim Cooper of Select Brokers, LLC, in Coeur d'Alene. "If there's one or two it's not so bad, but when there's six or seven it puts downward pressure on the market. The more foreclosures on the market, the less likely your home will sell at true market value."

Last year at this time there were 159 foreclosure sales and so far this year the number is 205.

Distressed sales, including foreclosures and short sales combined, have represented 41 percent of the sales this year in Coeur d'Alene, 51 percent each in Hayden and Rathdrum/Hauser and 57 percent in Post Falls.

New construction housing represents only about 9 percent of the local sales this year.

"Unless you're selling repossessions, it's pretty slow," said Pete Faust of Century 21 Beutler and Associates.

Pat Krug, managing broker of Windermere Realty, sees a silver lining.

"It is motivating buyers to take advantage of some of these lower prices combined with interest rates," Krug said. "Last year people weren't motivated to do that. We've got to clear out the (distressed) inventory."

Mortgage rates remain low - around 4.5 percent for a conventional 30-year fixed loan - but industry observers expect it to gradually climb.

"Rates have been low for more than a year," Cooper said. "I don't expect to see any significant increase in the short term, but people waiting to invest in real estate may be surprised at the end of the year or early next."

The total number of local home sales was down 14 percent (511 to 440) through the end of April compared to the same time last year.

The only area where the average sales price was up was in the Rathdrum/Twin Lakes area. It saw a 1 percent increase from $146,994 to $147,867.

Prices in Coeur d'Alene were down 10 percent to $161,103, Post Falls down 13 percent to $149,344 and Hayden 2 percent to $201,076.

About 72 percent of all residential sales in April were homes at less than $200,000.

Krug said buyer activity has increased in all price ranges of the market in the past month, which bodes well for the summer.

"That's promising," she said. "If the weather improves, it will help all of us."