Recalling somewhere that home buying reaches its peak in the summer, the City Beat called up a few Grand Cities area Realtors last week to see how things were going for them. As my story says, they think it’s great and this year should end on about the same note as last year, though, it’s worth pointing out that the people that sell your homes tend to be an optimistic lot.
The numbers paint a somewhat more sobering picture. We’re about 10 percent behind where we should be to keep up with last year. That’s mostly in the number of homes sold and the volume, or total value of homes sold, which, of course, is affected by the number sold.
It may be that we were off to a bit of a late start. The ever reliable and ever chipper Jerry Youngberg from 1st Realty says the new fed lending rules means loans take longer to process, he’d guess two weeks.
Patsy Dombovy-Vasquez from Coldwell Banker and Mavis Winkels from Greenberg Realty both pointed out that the $8,000 tax credit is encouraging a lot of new homebuyers. From the news coverage, it looks like the tax credit officially went into effect earlier this month or late last month, meaning we might not see its impact until later in the summer.
Below is the Realtor data I used, courtesy of Jerry, with 2008 numbers adjusted for deflation. Notice how steady the average home prices have stayed. For lower-priced homes, I would guess there might be some appreciation, too. Since I don’t have a median value, I can’t say for sure. But that would seem a fair assessment given what the Realtors told me about the preference for lower-priced homes, which sound like it’s more pronounced now than in the housing boom, and the appreciation in the price of condos, which tend to be cheaper.
|Condo/townhome||Jan-May 2009||Jan-May 2008||% change|
|Number under contract||66||66||0.0%|
|Single-family home||Jan-May 2009||Jan-May 2008||% change|
|Number under contract||325||335||-3.0%|
|All homes||Jan-May 2009||Jan-May 2008||% change|
|Number under contract||391||401||-2.5%|
Let’s look at construction permits, which tells us how much inventory we’ll have later in the year. As can be expected, builders are building cheaper homes, though they still seem to be focused on the more profitable up-market homes ($236,000 for a single-family home? Who’s buying these monstrosities?):
|EGF single-family & townhomes||2||$387,000||$193,500|
Compare this to 2008….
|EGF single-family & townhomes||5||$892,000||$178,400|
You have to wonder who’s buying the $276,000 monstrosity from last year!
By the way, since I referenced an earlier story about how great 2008 was, here’s a few grafs from to remind you:
Grand Forks-area Realtors had their third best year of home sales in 2008, a sign that the local economy remained an island of stability in a chaotic national economy.
"That’s remarkable coming off the two good years, and we had a few good years prior to that, too," said Jerry Youngberg, a Realtor and former president of the Grand Forks Board of Realtors.
Another sign of stability was the way homes here mostly maintained their value. Adjusted for inflation, the average area home sold for 1.7 percent less in 2008 than in 2007, according to data area Realtors submitted to the board.
Youngberg said he thinks the average decreased because buyers were increasingly focusing on older homes, which generally cost less than new homes.
Nationwide, the median home sold for 13.2 percent less in November 2008 compared with the same month in 2007, breaking a record, according to the National Association of Realtors.
The value of all homes sold in the Grand Forks area totaled about $125.8 million, according to the Board of Realtors. The data doesn’t include some year-end numbers that haven’t yet been submitted.
Compare this with 2007 when sales totaled $138.8 million and with 2006 when they totaled $139.3 million. But nothing in the past 10 years even approached those levels. In 2005, the fourth highest, sales totaled about $122 million.
Youngberg said he expects sales this year to be about the same as 2008.