Housing market hopes to rebound after slow 2010

Tuesday, Nov. 16
November 16, 2010
Neighbors angered over blight
November 18, 2010
Tuesday, Nov. 16
November 16, 2010
Neighbors angered over blight
November 18, 2010

Bayou Board of Realtors 2010 President Synde Devillier had a gut feeling even in the early months of the year that 2010 would be a bit of a down year for the Tri-parish’s housing market.

“Things before the spill honestly weren’t exceptionally crazy-busy,” Devillier said. “They were just sort of steady, which we thought at the time was pretty good because, really and truly, the market had been slow for the past year.”

Then the BP oil spill happened and what was just “slightly below average,” became a virtual worst-case scenario.

But with 2010 nearing its climax, Devillier said she sees a small rainbow at the end of the current rainstorm and hopes the new year will show some signs of the normalcy the area had become accustomed to in the past decade.

“I think things are going to be better,” Devillier said. “I can’t think that they’d be much worse.”

The cost of building in the housing market throughout the area is not drastically different than it’s been in recent years, according to recent trends seen by Devillier.

“Prices are going to have dropped some. Dollar per square foot, we’re probably going to be getting the same as what we got last year at this time. So in other words, they are asking a little bit more, but the prices are relatively staying the same when the sale actually occurs.”

And even interest rates have stayed virtually level with just a slight increase in the past year at their current low marks.

The main source for the current downward swing, the Bayou Board of Realtors’ president said is uncertainty.

Uncertainty about jobs, uncertainty about Louisiana’s way of life ever being restored and uncertainty about whether things will ever truly be economically “normal,” again after the oil spill.

That, as a result, has far more people looking to sell than buy, which has caused a flooded market.

Devillier said strictly in the residential structures, her office has a 10-and-a-half month supply of homes on the market.

She added that number in ideal times would be a three-to-four month supply, and in most cases is at about six months in the Tri-parish area.

“If no more homes were added to the inventory and no more homes were sold, it’d take us about 10-and-a-half months right now to liquidate because we’re just not selling a whole lot right now.”

With less people buying, more people selling and roughly the same amount of people living in the community, Devillier said renting has become a popular option for people in our area in the past 12 months.

She said she expects that trend to continue into the future, thanks in large part to several large apartment complexes that have sprung up throughout the area.

But even that option has become more expensive lately due to a spike of property taxes and insurance in the area.

“Landlords, property owners and investors are having to pay more so, they’ve increased their rents,” Devillier said. “So rent is higher, but we do have a nice supply now that we have all of these nice new apartments all throughout the area. So that’s been really good, because with more supply, that’s kept the prices a little lower. But the single family residentials, those prices have had to go up a little bit to compensate for those extra costs.”

Help is on the way for some realtors in the housing market, however. BP recently gave Louisiana Realtors $5.8 million to disperse among brokerage agencies and individual realtors who have seen their business be affected by 30 percent or more in lieu of the oil spill.

Deadline to apply for portions of that money is Nov. 23, and Devillier said some Tri-parish agents have already received funding to help them compensate for their lost income.

“Basically after the spill, the phones stopped ringing,” she said. “So we are allowed to file for loss of income. … We have had several members who have applied and have seen their money, so that’s a good thing.”

That ray of hope, along with people becoming more optimistic about spending their money are the things Devillier and others are clinging to in hopes the housing market will be better in the new year after a disaster-laden 2010 year.

“With the moratorium being lifted and the elections over with what I’m going to call, ‘a balancing of politics,’ I think people are kind of not holding onto their money so tight,” Devillier said. “We might see people starting to purchase more homes. The rates have inched up just a little bit, but they are still extremely low. That might get people off their nest, because they might say, ‘Oh, I better buy fast before the rates go up.’ The moratorium hasn’t spurred a lot of new business yet, but it’s called peace of mind and that’s a big part of it when you’re talking about buying a house.

“I just think people might feel a little bit better about buying a house now,” she added. “I think it will get better. … It can only get better.”