Fritz Pfister

The local housing market experienced a significant slowdown in home sales in 2008 for the first time since 1994. Regardless the slowdown, the local market still outperformed the state. This is a comforting fact to most people, however if you have to sell a home, and did not have success, it doesn’t mean much. Just as  unemployment rising to 7.3% might be better than other areas, it doesn’t mean much if you are out of a job.

Here are the final numbers for 2008, not the official numbers, they will be released January 26. The comparisons are year over year to 2007, in residential activity as reported by member brokers to the MLS of The Capital Area Association of Realtors.

December 2008 had 199 closed home sales down 27, or by 11.9%. Sale pending decreased slightly by 11, or by 5.1%. You can credit the historically low interest rates with boosting activity. The median sale price declined $27,500 or by 24.2% with a median sale price of $86,000. New listings taken were up by 182, or by 79%, however the increase is due primarily to the merger of the second and third ranked brokers.

The fourth quarter 2008 saw an increase of 24 new listings up only 2%, and would have declined if not for the aforementioned merger skewing the numbers. Closed home sales declined by 137, or by 16.5%. The sale pending declined by 152, or by 18%. The median sale price of $95,000 was down $7,000, or by 6.8%.

For the year there were 438 fewer new listings taken down to 5965, a 6.8% decrease. Closed home sales declined  to 3488, a decline of 536 sales, or by 13.3%. Sale pending declined to 4108, down 677, or by 14.1%. The median sale price finished at $104,000 down by only $500, or by less than one half a percent. Don’t read too much in this nominal decline, the trend is down for home prices, with the median price declining the last two quarters of 2008, and declining two of the preceding three years. Total closed residential dollar volume declined in 2008 by $63,509,793, or by 13%.

In 2008 in all property categories new listings declined by 824, or by 9.7% to 7665. Closed sales declined by 720, or by 15.8% to 3822. Sale pending declined 848, or by 16% to 4447. Closed dollar volume in all property classes declined $75,464,970, or by 13%.

In my opinion the decline in all property classes is due primarily to the slowdown in new home sales diminishing the demand for lots. The city of Springfield through November reported 96 building permits had been issued compared to 171 in 2007. That’s a decrease of 75 building permits, or a 43.8% decline. There are no reports from the outlying communities to compare.

In the MLS sales of new homes in 2008 declined by 72, or by 25% to 215. Single family declined by 20% to 157, and single family attached homes declined by 35.5% to 58. Most of the construction that you see underway are probably contract homes, as builders have pulled back the pace of spec home building, waiting for existing inventory to sell. The 162 new homes listed in the MLS represent a 9 month supply at the rate of sales in 2008.

Geoffrey Hewings Ph.D The University of Illinois Director of Economic Applications reports to the Illinois Association of Realtors that the state will see up to an additional 35,000 job losses in 2009, and the median sale price in the state will decline to $162,685. The doctor did not forecast the number of home sales statewide.

OK, what does all this mean to the local homeowner? Entering 2009 with a dim jobs outlook we will experience a continued decline in the number of home sales, and falling prices. We’ll have to see if my prediction of 3100 home sales, and a decline in home prices of one to three percent in 2009 are optimistic, or bearish.

I am a firm believer that things are never as good, or as bad as they appear. The bright side to this current housing market is that we enter 2009 with the lowest interest rates since the 1950’s, and with sales pending declining for sixteen consecutive months there is an undetermined amount of pent up demand. When the ship gets righted on the jobs front, look out, the local market will explode with activity.

There just won’t be any room for mistakes by families that must sell their homes in 2009. We know only 46% of the home listings sold and closed in 2008, and that number will decline in 2009.

On the bright side local consumers can take comfort that the agents of RE/MAX Professionals Springfield are available to serve them. For twenty consecutive years, in all types of housing markets, RE/MAX Professionals has helped more families succeed in the sale or purchase of a home. In fact the 97 agents of RE/MAX closed 178 more transactions than the 137 agents of the next two companies combined in 2008.

Now these two companies have merged in the decades old attempt to catch the leader, RE/MAX Professionals. Once again agents jump around to different offices, and many consumers don’t know where their agent works now. Not so for the clients of RE/MAX.

Also on the bright side is the free upcoming home seller seminar, Thursday January 15, at 6pm at 3149 Robbins Road in The Capital Area Association of Realtors building. Those that attend will learn the selling process from beginning to end, and will leave with a distinct advantage over home sellers that are less informed. Hosted by Fritz Pfister, a RE/MAX Professional since 1989, and of the top ten agents in closed dollar volume, have helped more home sellers successfully sell than anyone nine of the past twelve years. You might say the information you will receive at the seminar could be invaluable, and comes from a reliable source. If you must sell your home this seminar is highly recommended. Call 652-7653 to reserve your seat.

Make this a great week from Fritz and Kristie Pfister and The Pfister Success Team of RE/MAX Professionals Springfield. It would be an honor to be of service. 217-652-7653.

The opinions expressed are solely those of Fritz Pfister, and not RE/MAX Professionals of Springfield or RE/MAX International.