According to a report from the University of Alaska Anchorage Institute of Social and Economic Research, Eagle River ranks among the fastest growing communities in the state. Therefore, it should be no surprise when the trees are cut down and new housing developments are going up wherever there is a vacant piece of land.

In recent months, lots were cleared behind Carl's Jr. to make way for the Dove Tree Townhouses. Several lots, on West Skyline Drive at Eagle River Loop Road have been cleared as developers prepare to construct roads and install utilities for the 28 homes of Roseberry Park Estates.

With all the new development, one might wonder if the local housing market can sustain the continued growth. Yet, despite what many are calling a downturn in the housing market, developers continue to build to meet the demand.

"There are two schools of thought when looking at the local housing market," said Eric Bushnell, a realtor with Prudential Vista Real Estate in Eagle River. "One is that the market is slowing, but I don't believe that. It's just correcting itself and is not going to collapse anytime soon."

Lee Baker, owner of Discovery Homes and developer of the Dove Tree Townhouses, which is being excavated behind Schuck's and Carl's Jr. in downtown Eagle River, is counting on Bushnell's optimistic outlook being correct.

"We believe that there is a strong market for entry-level housing," Baker said. "Other similar developments in the area have all sold, so there obviously is still a market in Eagle River, and we're moving forward with the project."

Baker's development is one of four new developments in the works. In addition to the 47 new town homes planned in Dove Tree and those in Roseberry Park, Bushnell said Eklutna has 33 new home sites ready in Powder Ridge and will likely have another 60 to 70 available by spring.

The new construction is not limited to single-family homes; a pair of condominium developments is also sprouting up. In addition to Dove Tree, the Hidden Hills development across from Eagle River Elementary School will feature 60-plus units.

According to Bushnell, the current inventory of homes combined with all the planned development makes the local market favorable for the homebuyer.

"There were 132 homes listed for sale in Eagle River in November of last year. Monday, 225 were available," Bushnell said. "And there are new homes being built as we speak. That gives the buyer an edge, as it can take an average of 90 days for a home to sell today."

Despite the increased number of homes available, Bushnell believes that as long as there is a military installation in Anchorage, Eagle River will remain a solid community.

"We've seen an increased number of homes listed and maybe a 10-13 percent dip in number of sales, but the future looks good for the local housing market because military families want to live here," Bushnell said. "They like the sense of community Eagle River offers, and they get involved in the community."

A population estimate by the State of Alaska Department of Labor and Workforce Development states that 30 percent of the 2005 population of 34,108 in Eagle River were military families. The report also showed that over the past 25 years, the population almost tripled, climbing from 12,858 in 1980.

"Other people are moving to Eagle River for the same reason military families are moving here," Bushnell said. "Most of the business I do is through the Internet, with people relocating to Alaska, and they are looking to come to Eagle River."

Bushnell indicated that in addition to working with troops moving north with the F-22 unit being stationed at Elmendorf Air Force Base, he has also helped pilots with UPS and FedEx find homes in the area.

"The housing market might not be as robust as it was at this time last year, but it is still strong," Bushnell said. "We've been selling an average of 70 homes for the last three months out of our office."

Bushnell added that while the number of sales has slowed slightly from last year, the average cost of a home in Eagle River remains among the highest in the state.

"The average home in town was worth about $335,000 last year," he said. "That is up about 12 percent from the previous year."

By comparison, the average home in Anchorage sold for $292,000 in 2005 according to Zillow.com, an online real estate tracking service. In Alaska, the average was $291,000, and it was $267,000 nationwide.

"It's all about the land," Bushnell said. "You can't buy a lot suitable to build a home on for under $125,000. And as more land is developed, the price and demand for property near the central part of town will only increase."

Reach the reporter at news@alaskastar.com.

This article published in The Alaska Star on Thursday, November 9, 2006.