Wednesday, 24 October 2012

Lake real estate sees the light

Lake area -- There is hope for the future in real estate at the Lake of the Ozarks.

That’s what Re/Max of the Lake CEO Frank Christensen told about 300 people at the fifth annual Re/Max Real Estate Symposium last week at Osage National Resort.

In 2007, he noted, real estate sales at the lake were robust. Property values were increasing and there appeared to be a bright future ahead. But there was a dark cloud “that didn’t look so good” on the national scene that caught the attention of some Realtors.

“But we thought ‘that’s out there and we’re the Lake of the Ozarks.’ Well, we were dead wrong,” Christensen said.

The lake’s real estate market plunged like the national market. Sales slowed, property values diminished and foreclosures jumped.

“We learned our lesson,” Christensen said. “We’re not insulated from what happens nationally.”

But it’s a different story this year.

“We’re more optimistic. We see hope for the future,” Christensen added.

National scene
Shaun White, vice president of Re/Max, LLC, was one of the featured speakers. He, too, sees a gradual turnaround in the real estate market nationally.

“There is an improving housing picture,” he said. “There is light at the end of the tunnel.”

Several factors influence the housing market, he said, including Gross Domestic Product (GDP), consumer confidence, interest rates and unemployment. All of those suffered beginning in the late 2000s.

“If it was just a matter of interest rates, we’d have a booming market. But that hasn’t moved the needle back,” he said.

Consumer confidence is shaky today, but better; the unemployment rate has improved, but those numbers are left to interpretation; housing inventories have been up and down.

“We’re getting away from the subprime mess, and we’re getting through foreclosures and that’s very, very important,” he said.

“Is the recovery for real?” he asked. “This recovery is for real, I do feel it’s for real. But why?”

•Home sales are up for 15 months in a row.
•Home prices are up eight months in a row.
•Pending sales are up 16 months in a row.
•New-home sales are up in 103 markets.
•Foreclosures are down 33 percent from last year, though they will increase again before they fall.

But there are challenges ahead, White cautioned.

There is a fair amount of cancelled transactions affecting the market yet. Lending institutions continue to be cautious. There are legislative issues at the national level (Debt Relief Act). Inventories continue to fluctuate, and the market is affected by the supply and demand of properties.

“I believe the market will be stronger this year than last year, and will be stronger next year than this year,” White said. “I feel the market is definitely stronger.”

Local scene
“Overall, signs are pretty optimistic for real estate next year at the lake,” Christensen said. “So far, 2012 is the best in four years. There are reasons to be optimistic. And it’s still going to be a buyer’s market.”

Jeff Krantz, local Re/Max Realtor and board member, provided a PowerPoint presentation that reflected the current trends in local real estate.

“There always is hope,” he said.

In the declining years of 2006-09, real estate transactions fell from a high of 3,636 in 2006 to 1,837 in 2009. Sales volume declined from $7.27 million in 2006 to $3.54 million in 2009.

In the stabilizing years of 2009 through 2011, transactions increased from 1,840 in 2009 to 1,859 in 2011. Sales volume continued to fall slightly, from $3.43 million in 2009 to $3.3 million in 2011.

So far in 2012, through the first three quarters, transactions are at 1,629 units and sales volume is $284,346,785.

Overall for 2012, transactions are up 11 percent and new listings are down 8.5 percent compared to last year.

More accurate pricing has resulted in more sold property and that multiple offers on a single property are returning. Values are in line to start increasing and foreclosures are down in all segments of the market.

For next year, Krantz and Christensen agreed, it appears that second-home buyers will be more confident and will continue to take advantage of market conditions. Mortgage money will continue to be at “ridiculously” low rates and will bolster sales. He predicted a 10-12 percent increase in lakefront and condominium properties in 2012. “There are signs of market recovery this year,” Christensen said. “It’s encouraging to all of us, regardless. “Whenever you see this kind of recovery taking place, there’s a collective sigh of relief.”

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