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Despite slow sales, Realtors say now really is a good time to buy a house

December 15, 2007|By ARNOLD S. PLATOU

Editor's note: This is one in an occasional series of stories about the local housing market and what's happening to residents as they grapple with interest rates, tightening credit, falling home prices and other economic issues.

TRI-STATE ? The news was grim Wednesday at the monthly staff meeting of one of Washington County's smaller real estate firms.

House sales by companies throughout the county were down again.

The average sale price was down again.

And, the time it takes to sell a house was up ... again.

SuZanne Glocker, of The Glocker Group Realty Results, turned from her computer where a national reporting agency had just listed November's results, got her 10 sales agents together and gave them a pep talk.

"Growth is inevitable. We have a bright future and it's all coming back eventually," Glocker said. "The market is correcting itself and the pendulum will swing back. It's just this time, the pendulum has swung so far and so wide, a lot of people got hurt."

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For now, the picture still is mostly dark. In Washington County, the market so far this year is not even half what it was during the same period just two years ago.

Amid the general gloom is one notable shift.

For the first time in at least a decade, Washington County no longer is the king of residential real estate sales in the Tri-State area.

The market in Franklin County, Pa., has surged past Washington County's for the first 11 months of this year, rising to $279 million compared to Washington County's $263 million.

And, reversing a yearlong slide, Franklin's sales actually increased 5 percent last month while Washington County's fell 45 percent.

Meantime, the market in Berkeley County, W.Va., still is the area's third smallest, dropping to $238 million in sales thus far this year, but staying almost steady in November. In neighboring Jefferson County, the market has shrunk 25 percent this year to $139 million.

The reasons for all of the shifts are complicated and, here and there amid the numbers, is good news.

One piece is not to lose sight of the fact that many houses still are being sold, area Realtors said.

Indeed, among four area counties ? Franklin, Washington, Berkeley and Jefferson ? sales are closing in on the $1 billion mark, totaling $920 million thus far this year.

Sales set record


Nonetheless, that looks almost short against the towering heights the local market reached just two years ago.

In Washington County alone, sales of houses in the $30,000 to $500,000 market rose every year of the past 10, according to Metropolitan Regional Information Systems Inc., which tracks sales.

In 2003, sales began climbing more quickly, rising 34 percent ? to $295 million, MRIS figures show. Agents sold 1,730 houses ? 13 percent more than in 2002. And, the average price increased 18 percent to $170,685.

Then, in 2004, things jumped again. The market shot up another 34 percent, reaching $397 million. Sales rocketed to 1,940 houses and the average price climbed 20 percent to $205,138.

And then in 2005, it set the record: $578 million ? a mind-numbing 45 percent one-year gain. Buyers grabbed up a total of 2,254 houses and the average price soared again, rising 25 percent to $256,477.

Though not quite as strongly, the surge also was sweeping through other neighborhoods in the Tri-State area.

In Franklin County, the market more than doubled in value in just four years, rising from 2002's $181 million to 2005's $371 million. In Berkeley County, sales shot even higher than Franklin's, rising to $417 million in '05 ? a dizzying 160 percent climb over 2002's mark.

And in Jefferson County, sales from '02 to '05 leaped 152 percent to $290 million.

Viewing all four counties as a north-south region, the market swelled from $675 million in 2002 to more than $1.6 billion in 2005 ? a 145 percent gain.

Fueling the rapid ascent was the sudden arrival of several big metropolitan builders, area Realtors agree.

"The boom came when the builders built the big houses and everybody east of us discovered us and came here," Glocker said.

Land prices rose and, as people from Baltimore, Washington and their suburbs moved here, the demand for housing pushed local prices ever higher, too.

"Any time you put a listing in, three people would come in. It was a bidding war," she said. "A lot of agents got into the industry and really thought riches rained from heaven."

'Slapping up prices'


Even as it was growing wealth for sellers, investors and those in the real estate and building trades, it was sewing a seed of trouble.

The houses were getting too expensive for local residents, said Steve Spray, a Realtor in Franklin County and a past president of the Pen-Mar Regional Association of Realtors.

"The one thing in my estimation that's had a bigger impact on the Franklin County market than anything else is, we've had a number of builders come in here from York (Pa.), or Fairfax, Va., or other places ... and they started slapping up prices as if they were in Fairfax, Va., or Maryland," Spray said.

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