Plano Profile February 2010 : Page 46
While they are not ready to laugh out loud at the Collin County Association of Realtors quite yet, director for member services Steve Haid (left) and CCAR president Olin Jaye (see page 42) do believe the last three months of 2009 were starting to show a positive trend for home sales in Plano and throughout Collin County. Profile photo It’s news that’ll make a Realtor smile BY CINDY BOYKIN 46 Plano Profile February 2010
Real Estate
Cindy Boykin
It’s news that’ll make a Realtor smile
Finally! The Collin County Association of Realtors (CCAR) had good news to publish about the local housing market at the end of last year, and it was a welcome change.
“November was a fantastic month,” reports Steve Haid, Member Services Director for the association. “Closed sales in November were up almost 55 percent from November of 2008.
That’s huge!” Looking through a stack of printouts, Haid cites, “Up until September, closed sales had been down every month for the last two years, then we started seeing sales go up. They were up four percent in September; up around 23 percent in October; and then in November, it was up 55 percent.
“If we saw one month flip, we would never say the market is recovering.
But when you see three months in a row, something is definitely happening. Now, whether it’s going to stay that way, no one can say for sure.” But there are positive factors in the housing equation that bode well for 2010.
“For one thing,” Haid observes, “interest rates have been at historic lows. It’s a little harder to get a loan now than maybe two years ago, but when you get one, you are getting a fantastic rate.
“Another thing is, homes in our area continue to be extremely affordable.
The median home price is around $200,000 in Plano (about $174,000 for Collin County and the immediate surrounding areas). And the median sales prices remained pretty level throughout this whole down market. Whereas most parts of the country have seen dramatic dips in their median sales prices, we’re not seeing those extremes.
“The one unknown is, how long does the incentive for first time homeowners last? They have extended it twice. It hasn’t been the only factor, but it’s definitely helped people buy a home.”
Fewer foreclosures
A particularly troubling topic over the past few years has been the foreclosure rate across the country.
Olin Jaye, CCAR President and owner of Olin Jaye & Associates, LLC, a commercial real estate brokerage company, explains, “When you see an article in the paper about the real estate market, sometimes it’s misleading.
“You read things like, There were 1,400 houses posted for foreclosure on the first Tuesday of December, or whatever that figure is. You need to understand that a significant portion of the houses posted for foreclosure never foreclose. They work it out, they rework the loan, other things. So actual foreclosures are never as high as the ones you see posted.
“And they will post a house this month, post it again next month, and keep posting it every month until they work out a deal. So some of the data is a little more excitable than it actually is.” The other good news about foreclosures, at least for home sellers, is that there are fewer of these lower-priced properties on the market to compete with.
“In the first quarter of 2009, 26 to 27 percent of all the sales in MLS came in foreclosures,” Jaye says. “Now we’re down to about 15 percent. Compare that to some markets like California, Florida, and Las Vegas…Parr County was around 50 or 60 percent!” Haid agrees, “They had a huge foreclosure issue.”
Another indicator of our improving market is the housing inventory. Six months is considered a balanced market. Anything less than a five-month supply would be considered a shortage and can drive home prices up. Oversupply can bring prices down.
Haid says, “What we are seeing is actually a bit of a shortage in homes that are under $200,000, and even under $250,000 to some extent. We have about three to four months of inventory. If you go into the high-priced homes, $500,000 and over, then we’re seeing about 18 to 19 months of inventory. Overall, they come out to a balanced market.”
Emerging trends
New home construction was down in Plano last year. Selso Mata, Chief Building Official for the City of Plano, says that the city issued 226 singlefamily permits in 2009, compared to 328 in 2008.
Of course anyone who has been around since Plano’s housing boom in the 1980s realizes that even the 2008 numbers are small by comparison, but there are several reasons for this.
Frank Turner, Deputy City Manager for the City of Plano and a longtime Plano resident, recalls, “There were times when we were seeing close to 3,000 new homes built in a single year.”
Explaining the drastic drop today, Turner says, “Some of that is due to the recession and the down economy, but most of it is simply due to the lack of land. If you look at the building permits that are issued in McKinney, Allen, Frisco, Celina, Prosper and points north, you’ll see that the rapid growth rate has shifted farther north.
“In Plano, what we’re seeing is smaller infill development. We’re not going to have subdivisions of several hundred lots occurring in the future. There simply isn’t the land to support it. Those days are past us.”
So what’s ahead of us? The emerging trend is remodeling. Homeowners are investing in their homes, similar to residents of other established and highly desirable areas in the Metroplex like University Park, the M streets, and North Dallas. We are adding rooms, tearing down walls, repurposing space, and updating kitchens and baths.
Last year, Mata said the City of Plano issued 574 home remodel permits with $8,655,316 in valuation. As further evidence of the prevalence of home remodeling, Mata notes that the Home Depot on Hwy. 75 and 15th Street was the No. 1 producing store for that corporation for several years.
If you are interested in making changes around your house, Mata suggests stopping by their office located in the Municipal Building on Avenue K and picking up a packet that can assist you with your permit acquisition. They also have “plan examiners of the day” on duty at the front desk to address questions you may have.
“Just come up to the front counter and we’ll help you,” Mata says.
You can also visit buildinginspec tions.org for a wealth of information.
Of course, if you would like to turn the entire project over to professionals, there are outstanding remodelers in the area with the expertise to turn your ideas into your dream home.
Final thoughts
Turner reflects on the current situation, saying, “I remember at least three recessionary times that were significant since I’ve been in Plano. The first was in the early ’80s; the second was during the ’89–’91 time period; and the current one.
“In the first two, the real difference was waiting them out. There were significant changes in the market, but we always knew on the other side of it that Plano would resume growth, and the growth would bring about plenty of resources to meet community needs in the form of added tax values and expansion of the tax base.
“The current recession comes at a time when Plano’s rapid growth is really halted. We’re still healthy and growing, particularly in job formation and new businesses, those sorts of things, but our housing production is less than 10 percent of the high.”
But even though new housing starts are down, people are still moving here in significant numbers. They are putting down roots, upsizing, and downsizing right here at home.
As Turner points out, “What continues to make Plano an attractive place to live is the variety and diversity of the community. It’s not only a good place to live, but a good place to work, a good place to shop, a good place for recreation activities…all around a good quality of life.”
No doubt these stellar aspects of our community contribute to the positive sales reports published by the Collin County Association of Realtors in recent months. Hopefully the good news will continue in 2010.
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