Home sales hot to the end of the year cooled in January — not unusual for the dead of winter — but the new year still started ahead of 2012 with a warming trend for housing in the Oklahoma City area.
Realtors handled 1,155 sales in January, down 16.2 percent from December but up 12 percent compared with January 2012, according to the Metro Association of Realtors.
Homes listed with Realtors on average sold in 81 days, 10 days faster than a year ago but six days longer than the month before, the association reported, even with loan rates slightly lower than in December.
The average interest rate paid for a 30-year home loan was 3.51 percent here in January — compared with 3.56 percent in December and 4.17 percent in January 2012, according to the Realtors.
Shrinking inventory — even with builders in full recovery — is the biggest trend here now, said Keith Taggart, president of the Realtors group and managing broker for Coldwell Banker Select's office in Mustang.
January ended with 6,621 houses for sale on the association's Multiple Listing Service, 46 fewer than in December and 740 fewer than a year ago, a drop of 10 percent.
“Listings are still low. That's a problem we're having. We're having a listing contest in our office,” he said.
Despite the dip in sales at the first of the year, Taggart said the office he manages hasn't seen any slowdown.
“It's the best January we've had in five years in our office,” Taggart said.
Generally, Taggart said, “I don't know exactly what's happened. The floodgates have opened. What I think has been happening is (after) a lot of the economic disasters we've come through, things sort of settled down and there was pent-up demand. We have a lot of people that have been waiting.”
As for home construction, Mustang developer Robert Crout said much the same thing.
“Demand is as good as I've seen it in maybe ever,” said Crout, president of the Central Oklahoma Home Builders Association. “It's almost like there was this pent-up demand and the dam broke. And why not? Interest rates are unbelievably low right now and materials are going up.”
Crout is not a homebuilder, but a land developer. He said demand for build-ready lots is strong, especially since development slowed during the national housing crash and area homebuilding slump.
“There's really a definite shortage of lots. If you have lots, like I do, it's harvest time. I've never sold lots like this and I've been doing it for thirty-something years,” he said.
Prices on rise
Builders in Oklahoma City, Edmond, Midwest City, Moore and Norman collectively started the year ahead of 2012's earliest numbers. They took out permits in January to build 413 houses, a jump of 15.3 percent compared with January 2012.
Crout cautioned that rising costs for building materials are making new houses more expensive — although he said appraisers aren't yet factoring in price hikes. The lag is forcing builders to absorb price hikes on supplies, he said, since lenders won't underwrite loans for more than an appraisal.
But eventually, Crout said, homebuyers will pay for the effects of the rebounding national housing market, which is driving up prices for the raw materials that go into a house. And nationally, homebuilding still has a long way to go to be back to even historic pre-boom levels, he said, “so watch out” for rising house prices.
Lawrence Yun, chief economist for the National Association of Realtors, forecast “meaningfully higher home prices” of about 15 percent in Oklahoma over the next three years.
Jobs will continue to be more important to the housing industry than mortgage interest rates as the state maintains stable growth, Yun said Feb. 6 at the Oklahoma Association of Realtors' Legislative & Economic Summit at the Skirvin Hilton Hotel.
Meanwhile, he said, lenders' tight credit standards are keeping renters from becoming homeowners. Also, investors-landlords keep gaining a bigger share of single-family homes in Oklahoma and across the country.