Spokane Economic Forecast 2027: What It Means for Housing, Jobs, and Our Local Economy

Will Spokane's economy continue to grow in 2027? Will mortgage rates finally come down? And what does all of this mean if you're thinking about buying or selling a home in Spokane or North Idaho?

I recently attended the Greater Spokane Incorporated Economic Forecast, where local economists shared their predictions for the year ahead. I also spent some time reviewing the economic forecast articles published by the Spokane Journal of Business.

My biggest takeaway? The economy is still moving forward, but not everyone is experiencing that growth in the same way.

There was plenty of good information shared, and a few things that really stood out to me as someone who works in real estate and with local business owners.

1. The Economy Is Growing, But Hiring Is Slowing

Steve Scranton, economist with Washington Trust Bank, expects the U.S. economy to grow approximately 2%–2.5% in 2027.

That's encouraging, especially considering the uncertainty surrounding inflation, interest rates, tariffs, and government policies.

But here's where things get interesting.

Grant Forsyth, chief economist at Avista, expects employment growth to be much slower, around 0%–0.5% in 2027.

We're experiencing what economists call a "low-hire, low-fire" economy.

Businesses aren't necessarily laying off large numbers of employees, but they also aren't rushing to hire.

For Spokane, this is especially important because healthcare is such a significant part of our local economy. Healthcare has been one of our biggest drivers of job growth, and that growth is now slowing.

My takeaway: A stable job market is good for housing, but slower hiring could impact first-time buyers, relocation activity, and consumer confidence.

2. Don't Expect Mortgage Rates to Drop Dramatically

This probably isn't the news homebuyers were hoping to hear.

Scranton's forecast suggests mortgage rates could remain in the 6.5%–8% range as we move through 2027.

The message was pretty clear: interest rates may stay higher for longer.

For years, buyers and sellers have been waiting for mortgage rates to return to the historically low levels we experienced during the pandemic. The economists aren't expecting that anytime soon.

But here's something I think is important.

Real estate decisions shouldn't be based entirely on guessing what interest rates will do next.

People still need homes. Families grow, jobs change, people relocate, and homeowners downsize.

The right time to buy or sell depends on your finances, your goals, and what is happening in your specific neighborhood.

3. Housing Affordability Is Still One of Our Biggest Challenges

This was one of the most important conversations of the morning.

Homeownership has become increasingly difficult for younger generations.

Between home prices, mortgage payments, property taxes, insurance, and maintenance, the cost of owning a home takes up a much larger portion of household income than it did for previous generations.

According to the National Association of REALTORS® statistics referenced during the presentation, the median age of first-time homebuyers has reached 40.

Think about that.

For many people, buying their first home is happening much later in life than they originally planned.

And Spokane isn't immune to this challenge.

Forsyth discussed how our region continues to permit approximately 5,000 new residential units annually, yet we haven't added enough housing to significantly improve affordability.

One encouraging example is our apartment market. As more apartments have been built, rent increases have moderated.

It's a reminder that housing supply matters.

If we want Spokane and North Idaho to remain communities where young professionals and families can afford to live, we need to continue having conversations about housing development, regulations, and affordability.

4. Spokane's Population Growth Depends on People Moving Here

This statistic really caught my attention.

According to Forsyth's presentation, approximately 94% of our region's population growth over the past five years has come from people moving here.

Only about 6% came from births exceeding deaths.

That's significant.

Our region's future economic growth depends heavily on our ability to attract and retain residents.

That means our schools, healthcare, housing options, employment opportunities, and overall quality of life matter more than ever.

As a REALTOR® who works with people relocating to Spokane and North Idaho, I see firsthand why people choose to move here.

But we can't take that demand for granted.

We need to make sure our community remains a place where people can build a career, raise a family, and afford a home.

5. Not Everyone Is Experiencing the Same Economy

Dr. Vange Ocasio Hochheimer of Whitworth University discussed something called a K-shaped economy.

Essentially, higher-income households are continuing to spend and build wealth, while many middle- and lower-income households are struggling with everyday expenses.

She shared that the top 20% of Spokane County households receive approximately 49% of total household income.

Meanwhile, the bottom 20% receive just 3.2%.

This helps explain why some businesses are thriving while others are struggling, even in the same community.

It also helps explain what we're seeing in real estate.

Some buyers have significant equity, investments, or cash available to purchase their next home.

Others are struggling to save for a down payment while managing rent, childcare, groceries, and other expenses.

We're not all experiencing the same housing market.

And that's why broad headlines about the economy don't always tell the full story.

6. Washington and Idaho Could Continue to See Different Economic Trends

One topic that caught my attention was the discussion about Washington's tax and regulatory environment.

Forsyth noted that uncertainty surrounding taxes, regulations, and business costs is influencing hiring and investment decisions.

During the panel discussion, economists also addressed whether Washington businesses might consider relocating to Idaho.

While they couldn't quantify how many businesses will actually make that move, they acknowledged that relocation is being considered.

Living and working in a border region makes this particularly interesting.

Spokane and North Idaho share a workforce, housing market, and regional economy, but businesses and residents operate under different state policies.

It's something I'll continue watching, especially as it relates to employment opportunities, relocation, and housing demand on both sides of the border.

7. Baby Boomer Retirements and AI Are Changing the Workforce

Two additional trends stood out in the Spokane Journal of Business articles.

First, baby boomers continue to retire, creating challenges for employers trying to replace experienced workers.

Second, artificial intelligence is changing how businesses operate.

But Dr. Hochheimer made an important point: technological advances don't always create immediate economic growth.

Businesses need time, training, and resources to use new technology effectively.

For our local economy, both trends could affect workforce availability, productivity, and long-term economic growth.

They could also influence housing needs as older homeowners transition into retirement and younger workers navigate a changing job market.

So, What Does This Mean for Spokane's Housing Market in 2027?

Here are the three things I'll be watching most closely:

Housing affordability: Will increased inventory and new construction create more opportunities for first-time buyers?

Employment and relocation: Can Spokane continue attracting new residents while local job growth slows?

Interest rates and consumer confidence: Will buyers and sellers become more comfortable making decisions even if mortgage rates remain elevated?

My biggest takeaway from the forecast is that 2027 may be less about dramatic changes and more about learning how to navigate the market we're in.

There are challenges ahead, but there are also opportunities.

For buyers, that might mean having more choices and negotiating opportunities than during the pandemic market.

For sellers, it means understanding your competition, pricing strategically, and preparing your home to stand out.

And for our community, it means continuing to invest in the things that make Spokane and North Idaho great places to live.

I've worked in real estate through several different market cycles, and one thing remains consistent: people make housing decisions because life happens, not because economists predict the perfect market.

If you're considering buying, selling, relocating, or downsizing in Spokane or North Idaho in 2027, I'd love to help you understand what these trends mean for your specific situation.

Abbey Parsons | REALTOR®

Coldwell Banker Tomlinson

Serving Spokane, Washington & North Idaho

Sources: Greater Spokane Incorporated 2026 Economic Forecast presentations; Spokane Journal of Business, November 5, 2026 Economic Forecast supplement. Economic projections are forecasts, not guarantees.