Residential Realtors expect sales rebound

The broker at Coldwell Banker reports that in recent weeks, her agency’s sales have resurged, driven by local residents who are moving up.

“I think people are finally saying, ‘The news media’s not going to run our life … rates are cheap, and we’re ready to buy,’” she said.

And buying they are.

“You wouldn’t even believe what’s happened in the market just in the last two or three weeks,” Huntsman said, though she declined to break out the company’s transaction figures. “We are absolutely swamped. Two of my agents had five sales apiece last week. We’ve had two of the biggest weeks we’ve had in two and a half years.”

Data from MLS President Kelly Holts shows, that the number of units sold in first-quarter 2008 was 16 percent lower than the same period a year ago – down to 1,258 units from 1,512 – but Huntsman is in the process of adding another person to her closing department to pick up the slack.

Tom Kissee, broker at Tom Kissee Real Estate Co., said the market is definitely tougher, but it’s far from stagnant.

MLS figures for March – the most recent month available – show that sales were down 23 percent compared to March 2007, but business gained steam in April.

“I think sales are fewer and farther between, but we’re staying busy,” Kissee said. “We’re probably real close to being equal to the same period last year in number of sales.”

His recent buyers are people relocating with their jobs, retirees and local people moving up or downsizing.

Kissee, a 22-year veteran of the industry, and Huntsman, with 39 years in real estate, approach the market with equanimity.

“I’ve seen things a lot worse than this,” Huntsman said. “I’m just optimistic every week that you just have to work a little harder – the business is there, and by gosh, it has been.”

Changing conditions

Still, there is no denying that the market has changed. New home construction has slowed, the market is adjusting to tightened lending standards and Springfield has shared in the subprime crisis.

The good news is foreclosures here are low.

Greater Springfield Board of Realtors President Doug Andrews noted in February that only about 4 percent of listed properties are in foreclosure here, compared to. 15 percent to 17 percent in hard-hit markets.

Also, because Springfield property values did not experience precipitous increases in value, the market has been spared that magnitude of drops, Kissee said.

“I don’t really see that our properties here in the Springfield area have decreased; I think they have slowed in appreciation,” Kissee explained.

Another way the market has changed is that buyers – like lenders – have become much more risk averse. The keys to selling a property are “location, location, location” and “condition, condition, condition,” Kissee said.

“They’re paying more attention to the good, stable locations that they can be assured are going to see growth and stability,” he said. “This is not the time to buy a property in an empty neighborhood.”

Nor, of course, to sell one.

Also, with gas at $3.35 per gallon, buyers are less interested in rural acreage.

“I think they’re paying attention to the commute,” Kissee said, but the risk factor is also a deterrent. “Instead of jumping out in the rural community, not knowing what’s going on next door in some of the areas with no zoning, I think they’re paying a little more attention and want to be a little more secure in their investment.”

In terms of property condition, buyers are “being very selective, and they’re real picky,” Kissee said. “So, the homes that are well-maintained, well-groomed and well-updated, they’re selling.”

The current inventory of homes is not high, in Kissee’s opinion, but he said there is some “stale inventory” that needs to be worked out, including distressed homes and new homes whose floor plans, color schemes or designs fall short of selective buyers’ expectations.

And pricing homes to sell from the get-go is much more important in today’s market.

“If you want to sell your home, you need to really price it competitively,” Kissee said. “The old attitude of ‘We can always price it high and come down,’ that’s not really working now. Now we need to price them at their market value – and we’re seeing them sell.”

Top Myths of the Springfield Market

Local brokers say that, for property owners with well-maintained and well-located properties, now is as good a time to sell as any. Here are a few of the myths they feel are keeping some potential sellers – and buyers – on the sidelines:

Myth: “I’d have to price my home so low to sell it, I’d be giving it away.”

Fact: “Newer houses are bringing 97 percent, 98 percent of listed price, so the idea that these people are giving their homes away is not true,” said Judy Huntsman, broker at Coldwell Banker.

Myth: “I can get a better deal on a foreclosure than a new home.”

Fact: Many foreclosed homes are financed to the hilt and the price reflects the bank’s need to make back as much as possible on the sale, according to Tom Kissee, broker at Tom Kissee Real Estate Co. Also, buyers should take a close look at condition when it comes to distressed properties.

Myth: “I should wait to sell because the market is depressed.”

Fact: “Spring and early summer is the best time of the year to sell,” Kissee said. “The sellers need to remember, if they sell now, even if they think the market is a little depressed, they’re also buying on that same market, so it’s kind of a lateral move.”