Real estate experts say local market on upswingPublished 6:51pm Friday, November 29, 2013
As Christmas and the New Year approach, two area real estate professionals chime in on the question: How is the real estate market currently performing in Polk County?
Kathy Toomey, broker-in-charge at New View Realty, is familiar with the question.
“That question is asked by just about everyone I encounter lately, especially since the national media is reporting drastic improvements in the real estate market. Real Estate is local ,and sellers in particular need to understand that. From my perspective, the local market is improving. The number of closed transactions I was involved with in 2012 was up 60 percent over 2011. The number of my closed transactions in 2013 is up 100 percent over 2012.
Toomey said these numbers include some vacant land sales, which have been very slow the past few years. “The number of first-time homebuyers for the above transactions increased from one in 2012 to seven in 2013. Most of these sales involved a conventional loan, which indicates, that with good credit you can obtain a mortgage. It takes, however, a lot more patience and time to close a transaction that involves financing than in years past.”
With regard to how the Polk County real estate market is performing?
Toomey said asking prices have not increased because the inventory is still at about 32 months. However, the selling price as a percent of the asking price has increased from 90 percent to 91 percent. That means sellers are receiving an amount closer to their asking price, she said.
Another indicator of an improving market is that the number of sold homes in Polk County in the $200,000-$299,999 range has increased from 22 in 2012 to 32 in 2013, with four more pending. Additionally, in the $300,000-$399,999 range there were four homes sold in 2012 compared to 18 in 2013, with seven more pending.
Paul Pullen, president of Town and Country Realtors, said 2013 has far exceeded the previous five years of sales in the local real estate market.
“Although the number of sales has dramatically increased, selling prices in our area have yet to see marked increases,” Pullen said. “Real estate selling prices have not risen, except marginally, in most market areas of the country during the last six months, except for a few areas like San Francisco.”
Part of reason for the lack of significant price appreciation is the supply of housing on the market. Price appreciation is typically dependent on supply, however, the longer a house sits on the market, the more reductions you see in home prices, Pullen said.
Further complicating home sales are bank lending practices and the appraisers’ frustrations in finding sales comparable to the subject. Because appraisers use previous sales to justify current value for a bank loan, it may take several years to see noticeable gains in home prices, even as the country and area recover from the recession.
Polk County has not suffered as much as other parts of the country during the recession. Because the market demographic is older, semi-retired and retired, it is found that these individuals generally don’t have mortgages and thus haven’t suffered as much with foreclosures, Pullen said.
“We do find that this demographic does experience some stress in selling a home, primarily because of a need to enter assisted living or death,” he added. “Thus, estates-selling real estate are pricing their homes to sell as quickly as possible. It may take another year or more for sellers in our area to see noticeable gains in future sale prices. If homeowners can wait another year or two, they should see better pricing opportunities and sales.”