Friday, April 10, 2009

Valley real estate rides with the times

2008 saw large declines, but lower prices could bring in sales


By JON DUVAL
Express Staff Writer

As most would expect, real estate sales in the Wood River Valley took a hit in 2008, with 36 percent fewer sales than the previous year and approximately a 10 percent drop in the median price. According to local broker Todd Conklin, there are currently around 1,600 properties for sale in the valley. Photo by David N. Seelig

The crash in the real estate market is far from a secret by this point, but recent figures show just what the economic downturn meant to housing in the Wood River Valley last year.

According to figures released in March by the Sawtooth Board of Realtors, the 353 closed transactions in Blaine County during 2008 represent a 36 percent decline from the previous year. These sales totaled an estimated $298 million, just over half of the dollar volume from the previous year.

Some figures contributing to that data include: only two single-family homes sold north of Ketchum; 25 fewer single-family homes sold in Hailey compared to 2007; and the median sales price of condominiums and townhouses in the North Valley declined by 16 percent from 2007 to 2008.

Despite these declines, the median sales price of all residential property in Blaine County fared better than the rest of the nation during the slump. While the median sales price in Blaine County fell from $540,000 to $485,000, a 10 percent decline, the National Association of Realtors reported that the median house price in the U.S. fell 12 percent, to $180,000, during 2008.

In addition, the price drop, which puts median prices back to levels last seen between 2004 and 2005, isn't enough to make homeowners feel as though they've made bad investments, as long as they got into the market in time.

According to a special report in March from Windermere Real Estate, residential property has experienced an average annual gain of 14 percent over the past six years, which included a 100 percent increase from 2002 to 2005.

The Windermere report notes that forecasting the housing market in the current economy is "risky business," but also takes an optimistic stance given the lower housing costs, the abundant inventory and the fact that many sellers are having to sell, all helping create a true buyers market.

A March news release from Todd Conklin, owner of Conklin & Co., the Ketchum branch of international real estate company Coldwell Banker, states that the Wood River Valley has approximately 1,600 properties on the market. This translates to a 91-month supply, a ratio between inventory and sales. By comparison, Conklin wrote that there was a similar inventory in March 2007, but a 25-month supply, indicating how current sales have slowed.

According to the National Association of Realtors, in January there was a 9.8-month supply of homes across the United States.

In his release, Conklin also pointed to a silver lining in the housing slump, visible through the lens of a prospective buyer.

"The higher inventory in the Wood River Valley is an expected outcome of the market correction and gives buyers more choice and substantial negotiation leverage," Conklin wrote.

And while the National Association of Realtors reported that second-home sales were down 30 percent in 2008 compared to 2007, Conklin said the reduction in prices, coupled with an aging population, could fuel more sales.

"As the stock market adjusted in September and October of 2008 and the Baby Boomers lost confidence in the value of their assets, the second-home purchases slowed dramatically," Conklin wrote. "Now that we have seen what appears to be some stabilization of the stock market, we are seeing smart money taking advantage of the low prices and increased inventories."

Jon Duval: jduval@mtexpress.com




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