Area real estate market activity increasing but sales still tough
From our weekly issue dated July 08, 2009
Doug Stohlman, of Junction Realty, who’s been in Illinois Valley since 1970, has seen the area’s real estate market go through many ups and downs.
But even Stohlman is hard-pressed to tell if the national housing slump has bottomed out, or if the situation has been improving of late.
“I’ve been busy, but it’s been a very tough market,” said the longtime broker.
Stohlman estimates that foreclosures and short sales comprise approximately two-thirds of what’s currently being sold. He explained that those types of sales are harder to close.
A short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold.
Also making the situation more difficult, Stohlman said, is the fact that the federal government has passed new rules and regulations on appraisal and underwriting practices.
“Everything takes longer,” Stohlman said.
At Oregon Mountain Real Estate in Cave Junction, Bill Reid said that the start of summer has brought some tourists to the area, along with graduates of area schools back in town for reunions.
“I have seen an increase in activity,” Reid said. “That doesn’t translate to sold houses, but I’m working on it.”
Steve Lyons, of Century 21 Harris & Taylor, agrees that real estate activity has picked up throughout the past few weeks.
“The season basically starts about the time the kids are out of school and runs through September and October,” Lyons said.
He added that due to a number of factors, it’s still very much a buyer’s market.
“Interest rates are low,” he said. “There’s a lot of stock to choose from.”
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Prices also have fallen dramatically from where they were at the market’s peak a couple of years ago. Lyons points out that there are newer homes off Hanby Lane in Cave Junction that were once offered at around $240,000. The banks are now selling some of those for as little as $137,000, he said.
Lyons said that the lower prices have proven attractive to younger people looking to purchase their first home.
“The average young people got priced out of the market,” Lyons said. “Things are coming back now, and things are more reasonably priced for first-time homebuyers.”
But Stohlman said that the area still suffers from a weak employment base. There used to be many more timber jobs and small businesses, he said, which made the market more attractive for working families.
“I think a lot of that has gone away over the years,” Stohlman said.
Southwestern Oregon’s real estate market also depends largely on what happens in California, Reid said. He added that the retirement industry remains strong.
Stohlman said that he is uncertain of what the future holds for the area’s market. Outside factors such as rising energy costs could ultimately stall the growth of smaller, more remote communities like Cave Junction, he said.
Reid said that he remains cautiously optimistic about the real estate industry’s immediate and long-term prospects.
“Buyers are venturing back in to the market,” Reid said. “Hopefully, the worst of the foreclosures are behind us, but who knows?”
But regardless of what happens, real estate agents will continue showing up to work and hoping for the best.
“My phone does ring,” said Reid. My fax machine does work, and there are people walking through the door. My lights are on, my rent is paid, I had lunch today, and I will have dinner tonight.”
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