Signs of relief? Housing market holds steady here

SANDUSKY The worst may be over. Realtors say in spite of major slumps elsewhere and
Annie Zelm
May 24, 2010

SANDUSKY

The worst may be over.

Realtors say in spite of major slumps elsewhere and a sluggish economy, the housing market in the Sandusky area is holding steady.

Not everyone is buying into it, however.

Consumer confidence plays a huge factor in sales, and studies show buyers are growing increasingly uneasy over money — making them more reluctant to sign along the dotted lines of home ownership.

Though the number of houses selling is down, the average sale prices for homes showed a significant climb of 25 percent within the past several months, said Scott Biechele, president of the Firelands Association of Realtors. He said the figures are a sign the market is on an upswing.

“We are not Florida or California, so we don’t get the big swings in the housing market here — just the little ripples,” Biechele said.

The average sale price for homes in March was $118,220, but by May, it had risen to $148,910, according to the Firelands Association of Realtors, which represents all property listed on multiple listing services for the five-county area.

“It certainly shows the market is on its way up,” said Ruth DeHenning, executive director for the association, which has more than 500 Realtors and 125 professional affiliates. “Every agent and affiliate of ours has said they’re getting busier all the time.”   

DeHenning said she’s unsure why the market seems to be improving, but it’s a positive indicator for the rest of the area’s economy.

“Every time a home sells, they buy new drapes, new furniture — it spurs all kinds of sales, whether it’s a vacation property, a second home or beginner’s home,” she said.

It’s not clear exactly who is buying the homes, since local data does not differentiate between first-time buyers and wealthier consumers buying waterfront property, but DeHenning said those factors aren’t as important as the fact that no matter what sells, it boosts the economy.

But according to the Multiple Listing Services statistics, the number of houses sold from year to year has dropped, while the time it took to sell them rose. From July 2005 to July 2006, a total of 695 single-family residential homes sold in Erie County, with an average sale price of  $152,000 and 115 days on the market. A total of 617 houses sold with an average sale price of $135,000 and 127 days on the market between July 2006 and 2007.

In the most recent year, 525 houses sold for an average sale price of $135,000, with 130 days on the market. As of Thursday, there were 676 houses for sale in the county, with an average listed price of $209,000 and 146 days on the market.

Huron appraiser Jim Delahunt said he views the statistics as a sign of a market that is still “somewhat fragile.”

“I don’t know that we’ve hit the bottom yet, but it looks like property values are stable from year to year,” he said. “Compared to two years ago, though, they’ve dropped.”

He said the data accounts for 65-70 percent of the total housing market, so it paints a relatively accurate picture of housing as a whole.

Erie County Auditor Tom Paul said sellers may have to wait a little longer to seal the deal with so many homes on the market, but he expects the number of sales to pick up soon.

“Hopefully this will be the bottom as far as the number of transactions because of the area we live in,” he said. “I think more people went through traditional mortgages here, and you don’t see as much predatory lending as you do in Cleveland or Toledo. Banks are now clamping down on what they want — they’re looking for the traditional 10 to 20 percent down, so that’s why it’s taking a little longer for things to sell.”

Property value in Ohio is assessed every three years and isn’t scheduled to change until 2009, with an impact on payments the following year. Though Paul said 2006 values will hardly be a comparison to those in 2009 because so much has changed, he predicts values will remain steady or decrease only slightly.

Tom Voss, program manager for Neighborhood Housing Services of Greater Cleveland, said lenders have raised their standards, making it more difficult for potential buyers to qualify for housing loans.

Others attempting to finance out of old loans are finding themselves trapped because they now owe more on the property than it’s worth, he said. But the biggest roadblock to overcome may lie with the consumers themselves.

“Everybody is leery of getting the right loan,” Voss said. “Now’s a great time to buy, but with all the stuff going on in the economy, they’re just skeptical.”

The Consumer Sentiment Index, which assesses consumer confidence of personal finances, business conditions and purchasing power, fell to its lowest level since 1992 in March, meaning people are far less willing to spend money.

Ed Hoty of Hoty Enterprises said the reluctance to buy is hurting both the commercial and residential markets.

“Commercial real estate has been the last to go until about three months ago — now it’s really starting to get hit,” he said. “This is a consistent trend — we see it every five to seven years — but this is the first time housing has declined with inflation.”

Others say if the price is right, the buyers will still take the bait.

“I think people think they’ll take a big hit on their home if they sell it, but really if they’re buying in the same market, they should do just fine,” said Sally Routh of Coldwell Banker Routh Realty. “This is the 11th-best year in the housing market in 50 years.”

Norwalk Century 21 Realtor Mike Myers said houses have never stopped selling, but the foreclosure crisis pushed the average sale price down — contributing to the perception of a market slump.

So far this year, at least 259 home foreclosures have been processed through the Erie County Sheriff’s sales, civil clerk Judy Schwochow said Thursday, although some are duplicates filed in a previous year. By the end of May, that number was 153.

Last year, there were a total of 429 sheriff’s sale foreclosures, an increase from the 308 in 2006.

“A lot of homes are sitting on market for awhile and going down in value,” Myers said. “But we’ve never had the big run-up they had in Florida and the west coast, and therefore we aren’t suffering any huge declines.”

Total amount of real estate sold in Firelands:

Year ending May 2005: $37.8 million

Year ending May 2006: $37 million

Year ending May 2007: $30.7 million

Year ending May 2008: $32 million

Source: Firelands Association of Realtors