Realtor: Area housing market is stable

Despite news of home foreclosures dominating the national business media, the housing market in the Houma-Thibodaux area is stable and will likely experience some growth, said Pamela Testroet, president of the Houma-based trade association Bayou Board of Realtors at a Houma-Terrebonne Chamber of Commerce meeting last week.

The association represents real estate agencies in Terrebonne, Lafourche and Assumption parishes and is seeking to add St. Mary Parish.

“All real estate is local,” said Testroet, an agent with RE/MAX Good Earth Realty in Houma. “For the media, it’s doom for the real estate industry. People are scared at how bad the market is. But the evidence does not support the end-of-the-world hype… A national housing forecast is about as good as the weather forecast.”

Most notably, she said, prices of homes in the Houma-Thibodaux area rose higher in 2007 at 11.2 percent than anywhere else in the nation. Louisiana ranks a low 41 on the list of home foreclosures by state in the U.S.

Average mortgage rates should stay at 6.3 percent for the rest of the year, compared to double-digit rates 20 years ago, and more homeowners are moving policies out of the nonprofit Louisiana Citizens Property Insurance Corporation.

“We have to educate buyers about how good rates are,” she said. “Buyers can take advantage of interest rates. There’s much less pressure and more choice than there was four years ago.”

“The housing market will improve throughout the second half of 2008 through 2009,” she said. “The market will still be good in Terrebonne. Interest rates are at a historic low; buyers have choice. Real estate is a good long-term investment.”

Testroet pointed out other strong points in the Terrebonne Parish housing market:

• Listings of single-family dwellings increased 17.5 percent from 2000 to 2004.

• The average sale price of residential property went up 33 percent from 2004 to 2007.

• New residential construction increased 7.5 percent from 2004 to 2007.

Buyer interest in new home construction has fallen, however. Houses under $200,000 are in greater demand; those $300,000 or higher are moving slower.

Testroet said buyers are increasingly looking at lower-interest mortgages backed by the Federal Housing Administration.

“Consumers are digesting the lower-interest rates,” she said. “(The FHA) no longer has the stigma of low income. More people are using it.”

Because of the area’s vulnerability to flooding, Testroet also urged homeowners to buy federally-backed National Flood Insurance Program policies, which can be bought from nearly any insurance provider.

But Testroet, one of 289 real estate agents in the three-parish area, remained enthused about the broader picture. Loren Scott, a well-known Baton Rouge economist, described Houma as undergoing a “boom” because of the influx of Hurricane Katrina evacuees and the area’s fabrication and shipbuilding industries, she said.

The commercial growth in Terrebonne – the banks, hotels and restaurants – is obvious.

The strong economy, Testroet said, “should lift consumer confidence to buy homes.”