Total building permit values here for the first half of 2010 were up 56 percent over total values in the first six months of last year, but industry observers say the construction slump isn't over yet.

The combined values of permits issued through June by Spokane County and the cities of Spokane and Spokane Valley were $328.2 million, up from $209.9 million during the year-earlier period. Still, that was almost 13 percent lower than total permit values of $376.6 million in the first six months of 2008.

The city of Spokane, at $153 .7 million, saw the largest increase in total permit values. That was more than double its total for the year-earlier period, due heavily to permits valued at $85 million issued for the Spokane County Regional Wastewater Reclamation Facility, at 1004 N. Freya, says Sean Shields, the city's permit coordinator.

"None of the other top 10 projects this year would have made the top 10 last year," Shields says.

Nevertheless, the total monthly values of permits issued during five of the first six months of this year exceeded the total values in the year-earlier month.

The second half of the year is off to a slow start, however, with total permit values in July far below the total in July 2009. Permit values for the three jurisdictions totaled $49.8 million in July, down 55 percent from $77.1 million in the year-earlier month.

Last year marked the lowest total annual permit values here since 2003 and the lowest residential permit values in 10 years.

In the first six months of this year, the three jurisdictions issued permits with total values of $72.5 million for 414 single-family homes, up from permits with total values of $46.9 million for 303 single-family homes during the year-earlier period. Still, this year's figures were well below the first six months of 2008, when permits with total values of $88 million were issued for 532 single-family homes.

The number of single-family home starts in the city of Spokane leveled off at 73 for the first six months of both 2010 and 2009. The 2010 values, however, totaled $16.6 million, up more than a third from $12.1 million last year.

Corey Condron, vice president of Condron Construction Inc., a prominent Spokane homebuilder, says his company's sales this year are similar to its sales last year, although his general feeling is that the market is improving.

In July, Condron Homes' sales exceeded their levels in any of the earlier months this year, which is unusual in any market, Condron says.

"I'm optimistic going into the fall," he says. "Last year, we felt like we were sliding down. This year, it feels like it's going up."

Condron Construction's more affordable homes in the $200,000 range haven't sold well, especially since the first-time homebuyer tax credit expired last spring, Condron says.

"I'm selling more homes for more than $350,000 than for under $200,000," he says. "The people who can qualify for a loan are in a higher-income bracket."

In the nonresidential sector, Kate McCaslin, president and CEO of the Associated Builders & Contractors Inc. Inland Pacific Chapter here, says she's not seeing any rise in demand for construction.

"My guess is there's not very many commercial permits," she says. "I would be surprised if there were more this year."

Spokane County and the city of Spokane Valley issued a total of 216 commercial permits in the first six months of this year, down from 235 permits in the year-earlier period. The total dollar value of this year's commercial permits, however, was $91.3 million, up from $75.5 million. The city of Spokane's building permit activity summary report doesn't break down commercial permits into a single category.

McCaslin says lists of bidders for projects are long, and bids for those projects are low. "Now is the time to build, but it isn't good for the industry," she says.

Next year might not be a lot better for builders, she says. "Most of the industry is being driven by government projects. When that money runs out, if the private sector isn't ready to step in, it's going to be a problem."

Several sizable projects are in the planning stages, including projects estimated at more than $86 million that currently are under plan review, says Joe Wizner, the city's building official. Those projects include the Rockwood Towers project, for which the construction cost is estimated at $55.6 million.

Wizner says he's heard people who are seeking to build projects say that that financing is tight.

"I think that's what's holding construction down a bit," he says. "It's looking like it's going to be a slow recovery. At least it's not trending downward."