While housing in the rest of the country was in its sickbed, the Oklahoma market, at worst, had a low fever and scratchy throat.
Now, with the nation's housing in recovery, in Oklahoma sales are out jogging.
That's one way to gauge the health of housing in the nation and state.
“Housing is definitely in recovery mode,” said Joe Pryor, president of the Oklahoma Association of Realtors. “In 2007, we had about $3 trillion lost in equity and a huge swell of distressed property (with) a large percentage concentrated in five states: California, Arizona, Nevada, Florida, and Michigan — but plenty of misery all around.
“However, in Oklahoma, due to being in a different market cycle, we only lost a fraction of value, and interestingly in Oklahoma City there was no loss in land value.”
The latest statewide statistics from the Realtors show several positives in July compared with July 2012:
• Sales: 4,564, up 15.3 percent.
• Pending sales: 4,341, up 9.6 percent.
• Average sale price: $198,632, up 21 percent.
• Average days on market to sale: 68.3 days, down 11.5 percent.
Further, July ended with 22,046 houses listed for sale, down 9.6 percent, and a 6.2-month supply at the current sales pace, a reduction of 17.9 percent compared with July of last year, the Realtors reported.
Pryor, who specializes in investment sales, said investors raced into distressed markets, and that at the peak, 57 percent of all investor sales were cash. Nationally, prices for existing homes in some markets had dropped 50 to 80 percent in value, below the cost of building.
Plus, institutional investors bought tens of thousands of homes in distressed markets — giving renters the edge over homebuyers.
“However, now that prices have recovered, the owner occupant has taken over because of low interest rates as well as record affordability factors,” said Pryor, an associate with Redbud Realty & Associates in Edmond. “Refinancing at low rates has also helped stabilize homeownership because it has made those mortgages affordable, and this goes along with the loosening of mortgage lending requirements. It was in the best interest of the lenders to do this to avoid further losses through short sales and foreclosures.”
Recently rising home loan rates “set off a buying frenzy because buyers on the fence realized that rates do go up and were afraid they would be left out,” he said. But now, he said, “with rates going higher and the inevitable softening of the market that accompanies it, there will be a lag time before the pace of buying picks up again.”
With mortgages so low for so long, some potential buyers will balk, Pryor said, and experienced Realtors and lenders will find the need to help younger buyers see that rates of 5 and 6 percent are still historically low.
“It will be hugely important to keep housing going. This means protecting homeowners' rights to deductions, capital gains exclusions, and still having a government backstop to conventional loans as we reform Fannie Mae and Freddie Mac,” he said. “Housing contributes 15 percent of gross domestic product, and if you want to know how important it is not only to employment, see how Home Depot just beat street expectations for high sales and profit — driven by the housing recovery.”