A weak start to this year’s housing market could be a signal of larger underlying problems in the economy, or it could mean nothing except that cold and snow kept homebuyers indoors and sellers off the market, real estate experts said.
Time will tell.
The number of existing homes sold dropped 7 percent the first part of the year statewide from a year ago; sales also dropped 13 percent year-over-year from January through March in the region that includes Champaign and Clark counties.
This winter, Ohio was gripped by subzero temperatures. There was snow on the ground in April. The weather significantly impacted home sales, said James Roediger, broker/owner of Roediger Realty Inc. of Springfield.
“I’m totally convinced that a lot of this is the weather. People really hesitated getting their houses on the market, getting them ready for sale, primarily because the weather was just so terrible,” Roediger said.
The trend could reverse itself in coming months during the busiest time of year for home buying and selling.
“When you put your house on the market and you want to make the best presentation, you’re not pressed to do it quickly. We encourage people to do it right” such as doing landscaping and cleaning, Roediger said.
Existing homes sold year-to-date through March in the seven-county area were 919 units, a 13 percent decline compared to the same period in 2013, according to Ohio Association of Realtors. During the same months of 2013, 1,058 single-family homes and condominiums sold.
The region consists of Auglaize, Champaign, Clark, Logan, Mercer, Miami and Shelby counties. Western Regional Information Systems and Technology in Troy, which houses the region’s Multiple Listing Service, only provides a quarterly breakdown of home sales by county for more accurate estimates.
For Ohio as a whole, the number of homes sold in January-March 2014 dropped 7 percent from a year ago to 23,003, according to Ohio Association of Realtors.
While weather is seen to be the biggest factor impacting home sales, other factors at play include a low inventory of homes for sale due to weather, fewer foreclosures and still-recovering prices for some.
“The economy certainly has some bearing on it. People are sitting tight; they don’t know how (health care reform) is going to affect them, in some cases whether they have a job next year or not,” Roediger said. “We’re still recovering.”
With fewer homes on the market, average prices rose year-over-year in the region. The average sold price for January to March in the Champaign and Clark County region was $103,068, which increased more than 7 percent from a year ago average sold price of $95,979, according to the statewide real estate group.
“Housing inventory is a little bit of an issue depending on where you’re looking. There are areas where you can’t find what you’re looking for,” said Bill Case, president and chief executive officer of American Mortgage Service Co., a Cincinnati-based lender with offices in Piqua and Enon.
“You do look at the numbers and I think you will see improvement in the coming months,” Case said.
Homeowners who bought their houses in the 2005 to 2006 boom years before the national housing market crashed might be holding off on a decision to sell their property until prices recover more, said Shaun Bond, director of University of Cincinnati’s Real Estate Center. Or, homeowners are waiting until they’ve found a property to buy before listing theirs for sale and are having trouble finding one.
“For whatever reason, people are holding their homes off the market,” Bond said.
Low inventory is holding the housing market back, he said. But higher average prices could push trade-up buyers in particular to act and lock in a price and interest rate before costs to buy a house rise further.
“What’s going to be important is how inventory changes when we go through the selling season,” Bond said.
BY THE NUMBERS: Regional home sales
919 single family homes and condominiums sold from January-March 2014
13 percent drop in number of units sold year-over-year
$103,068 average sold price for January-March 2014, compared to $95,979 a year ago
*Figures cover the seven-county area of: Auglaize, Champaign, Clark, Logan, Mercer, Miami and Shelby counties
SOURCE: Ohio Association of Realtors