POST FALLS - Single-family home sales in Kootenai County are down 2 percent compared to last year at this time, while the average sales price is down 5 percent, according to the latest Coeur d'Alene Multiple Listing Service report.

Through Oct. 31, there were 1,365 local single-family sales compared to 1,393 a year ago. The average sales price has dipped to $175,528 from $183,832.

"Short sales and bank-owned properties continue to provide the bulk of sales and guide the pricing and appraisal value of sold homes," said Peter Faust of Century 21 Beutler and Associates. "They're influencing buyers' perceptions of what they should be paying for something."

But Realtors say the market has shown signs of recovery the past few months.

Joel Elgee of Coldwell Banker Schneidmiller Realty said that through June sales were down 15 percent compared to last year and the average sales price at that time was down 6 percent, so recent improvements have been made in both areas.

Add to that the tax credit that expired in 2010 and heavily influenced the market like a "steroid shot," and there's reason to be positive, Elgee said.

"We've been playing the game of catch-up, and we've caught up pretty quickly during the second half of 2011," Elgee said. "By the end of 2011 I think you'll see the number of homes sold (in Kootenai County) up."

Elgee said he believes an increase in demand and a decrease in supply will ring through in the coming months to create an improved market.

Waterfront sales through Oct. 31 were up 33 percent (78 to 104). Pat Krug, a managing broker for Windermere Realty, said 16 sales have closed since Oct. 1 on properties of more than $500,000 and 18 such deals are pending.

"I see some of our higher-end buyers coming off the sidelines after three years," Krug said. "The reason is that many of these properties are good values."

Krug said the buyers are a mix of both local and from out of town.

There are other bright spots, including the average number of days on the market was 103 days in October compared to 131 days last year.

Perhaps the biggest difference compared to last year has been the spike in sales of homes for less than $100,000, jumping from 336 to 514.

"Folks are really price-conscious," Faust said.

Sales in the biggest part of the market - in the $100,000 range - have stayed virtually the same at 1,321.

Single-family sales in Coeur d'Alene/Dalton Gardens are down 9 percent and in Post Falls 7 percent, while they are up in Rathdrum/Twin Lakes/Hauser at 22 percent and Hayden at 10 percent.

The average sales price is down in all of those areas.

"With prices being down, people who have money can pick up a bargain," Faust said.

Financing has become harder to obtain because banks have tightened their lending criteria, Faust said.

"Although if buyers don't take the first "no" as final, mortgage brokerages have been getting these same folks approved," he said.

Townhouse sales are down 30 percent due to the inability to obtain financing. Many of the complexes no longer meet the criteria for FHA and other options and thus are "cash only."

Faust said homes in some subdivisions have been able to maintain their appraisal values with steady closings.

"The last recorded sale in Tullamore (in Post Falls) actually appraised higher than the sales price," Faust said. "We were pleasantly surprised."

Meanwhile, sales are up in other areas of North Idaho, including Silver Valley (35 percent), Bonner/Boundary (18) and Benewah (65). The average sales price in the Silver Valley has dropped 17 percent from last year from $93,093 to $76,978.