RISMEDIA, July 21, 2009-(MCT)-As different as it may be from the rest of the nation, the Mississippi Coast bears one striking similarity to many other areas these days: Single-family home sales are taking a thrashing.
Latest figures on the local market show sales falling by more than 23% in the first half of this year, compared to the same period in 2008. Total dollar volume is down as well, as individual home prices have slipped.
Sales volume for the first half of this year “is the lowest number tracked since 2004,” said a report issued recently by Ray Gonzales Jr., a broker and manager with Century 21 Williams and Associates in Gulfport. Gonzales tracks real estate sales activity, analyzes the numbers and issues a regular market summary.
His latest report, based on past data and new numbers from Jan. 1 to June 30 this year, shows that single-family home sales- the lion’s share of local real estate market activity- have taken a major hit over the past three years.
The area saw 2,624 closings of single-family home sales in the first six months of 2005. For the same period by June 30 of this year, home closings had sunk to 1,164.
But Gonzales and others believe the Coast may be seeing the worst of the market in a rear-view mirror, not in the headlights. Some think a turnaround may have already begun, and will become more pronounced when major economic events, including a mega-expansion at the Port of Gulfport, come into play. “I’m expecting the momentum to start in the last quarter,” spurred primarily by low interest rates, Gonzales said.
“I see it picking up,” said Angela Strickler, a sales associate with Coast and County Real Estate in Hancock County. She said sales listings are on the rise, with beachfront properties coming on the market and offers being made on single-family homes.
For now, though, the harsh reality is that real estate seems to have moved at a snail’s pace. “The real estate market will need a strong showing for the balance of this year, just to equal the level of 2008,” Gonzales’ latest report said.
In terms of dollars, total sales volume has fared badly, too. Closings on single-family home sales reached $176.9 million in the first half of this year, a 25.3% drop over the same period in 2008.
Houses are fetching fewer dollars. The average single-family home sold for $152,010 in the first half of the year- a 2.74% drop over the same period last year.
Gonzales notes that high costs of wind-pool rates and other types of insurance, along with an overall battered economy, have helped dampen home sales. The cost of insurance “continues to scare some buyers,” he said, but is now being offset by savings on mortgage interest rates.
A tightening of the credit market presents another obstacle. Banks have added new layers of charges on mortgages, and credit requirements are much tighter than a few years ago.
Still, those who can get a mortgage are finding good deals.
Beyond that, Gonzales said, the Coast economy isn’t as bad as conditions in many other states, and an average home price decline of less than 3% seems almost positive, compared to double-digit price declines elsewhere. Jitters over the national recession are bleeding over into a local market that isn’t all that bad, he said. “We’re not in a dire market,” Gonzales said. “We’re in the perception of a dire market. And perception is reality.”
So, is the glass half empty, or half full? Real estate observers are cheered by recent events.
Some major Coast employers are doing quite well. Wind pool insurance rates are seeing some relief, and a 25-year expansion program is expected to turn the Port of Gulfport into a major container shipping facility, eventually creating 6,500 direct jobs and $1.6 billion in annual revenue.
All that will bring more people to the Coast, observers believe. And they will all need places to live, said Patrick Gibson, a Realtor with Keiko Palmero and Associates in Gulfport.
Copyright (c) 2009, The Sun Herald, Biloxi, Miss.
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