News Column

Analysts: Local housing market slowly recovering

August 1, 2014

By Will Buss, Belleville News-Democrat



Aug. 01--Local real estate analysts say the housing market continues to improve, albeit slowly.

Homes sales recorded in St. Clair and Madison counties during the first half of the year are lower than from a year ago, however, the 301 sales in Madison County and 273 sales in St. Clair County during June were the highest recorded for one month since the recession.

"The market is slowly creeping back up," said Robb Treat, who heads mortgage lending First Cloverleaf Bank in Edwardsville. "We are kind of seeing spits and spurts, if you will, in that we will have two to three really good months and then see a little bit of a drop, then a couple of good months and then a little bit of a drop. There are no huge drop-offs like we would see in years past."

In 2007, the housing market crashed under the weight of subprime lending, leading to soaring foreclosure rates and ushering in a recession from December 2007 to June 2009. Treat said the ensuing road to recovery has been a long one.

"What we're seeing is the housing market getting better and home prices starting to go back up, absolutely," he said. "But it's not a fast recovery."

"Slow is the right word for it," said Bob Dee, president of the Home Builders Association of Southwest Illinois in Maryville.

Dee said the local home building industry remains steady, although recent permits issued for new home construction in the metro-east are lower than a year ago.

The association recorded 214 permits for new home construction in St. Clair County during the first six months of the year -- slightly lower from the 224 permits issues during the same span a year ago. In Madison County, 138 permits were issued for new home construction between January and June after 152 permits were issued in that same time throughout the county last year.

Dee said the local home building industry has not come close to the rate of construction it recorded in 2006, the year before the housing bubble burst. Between January and June of that year, 775 permits for new housing construction were issued in St. Clair County and 425 permits were recorded in that time in Madison County.

"You can't overlook the fact that we're still way down from 2006," Dee said. "Back then, it was almost free money and everyone who wanted it got it. It was pandemonium back in 2004, '05 and '06. It was just nuts."

Dee said it may be another four years before home building in the metro-east returns to that level

"When you drop that far, there was only one way to go," he said. "And that is back up."

While the number of local home sales slowly improves, metro-east real estate analysts believe conditions are still ripe for buyers.

Tricia Tialdo of Tialdo Realty in Belleville, who also serves as president of the Illinois Association of Realtors, said statistics from the Illinois Association of Realtors further support evidence of a recovery. She said interest rates remain at historically low levels and that according to the Illinois Association of Realtors, the 30-year fixed rates averaged 4.17 percent last month.

"Homes are selling faster statewide," Tialdo said in a released statement.

"We are hopeful that this trend will continue throughout the second half of the year."

Greater Gateway Association of Realtors President and Chief Operating Officer Al Suguitan, who tracks real estate transactions in Madison County, said there are many indications that the local real estate market continues to improve.

"I'm positive about this market," Suguitan said. "I think that folks and buyers who have been waiting in the market should be taking action now. I think interest rates will start to creep up in the future, just because they've been so low for so long. The only way they can go is upward."

Contact reporter Will Buss at wbuss@bnd.com or 618-239-2526.

___

(c)2014 the Belleville News-Democrat (Belleville, Ill.)

Visit the Belleville News-Democrat (Belleville, Ill.) at www.bnd.com

Distributed by MCT Information Services


For more stories on investments and markets, please see HispanicBusiness' Finance Channel



Source: Belleville News-Democrat (IL)


Story Tools






HispanicBusiness.com Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters