COLUMBIA – Although national home prices fell during the first quarter of 2011, Columbia’s housing market has seen an increase of sale prices.
“We have a stable market,” Betty Tice, president of the Columbia Board of Realtors, said. “We have not had a crisis here in Columbia as compared to what we have seen in California, Arizona or some other parts of the country.”
The median sales price of homes was up by 5.7 percent in the past year: $147,950 in May compared to $139,900 the previous May, according to data provided by the Columbia Board of Realtors.
In contrast, national home prices hit a new low during the first three months of the year, according to a new industry-based report.
The U.S. National Home Price Index, a measure of U.S. home prices, dropped by 4.2 percent from January through March compared to the last quarter of 2010. The decline is even higher – 5.1 percent – when compared with the first quarter of 2010. The index was released by financial services firm Standard & Poor's on Tuesday in a quarterly report.
Although the home prices have risen, the actual sale of homes in Boone County, including Columbia, has declined by 24 percent in the first five months of 2011 compared to the same period in 2010, according to Board of Realtors data, with 654 homes sold so far this year compared to 857 during the same time in 2010.
This decrease, however, could be partly explained by federal tax credits for homebuyers that spurred sales before the program ended in April 2010.
“There is no doubt that the stimulus enhanced demand for purchase of homes, but when it stopped, there was a drop in sales volume,” Boone County Assessor Tom Schauwecker said.
According to the Standard & Poor's report, the national housing market has witnessed a second dip in prices since 2009, and currently U.S. home prices are down to the levels of mid-2002. Tice said Columbia’s case is different.
“We are an exception and not the rule,” she said.
Columbia’s housing market might have performed differently from other cities because of relatively low unemployment. According to the U.S. Bureau of Labor Statistics, Columbia’s unemployment rate for 2010 was 6.5 percent, compared to a 9.6 national unemployment rate that year. Columbia ranked among the country’s top 50 metropolitan areas with the lowest unemployment rates.
Schauwecker said he hopes that with IBM’s arrival to town and potential job opportunities at VA Mortgage Center.com the employment situation will improve further.
There's also been some relief in the number of foreclosures in Columbia and Boone County. According to data from the County Recorder of Deeds office, the number of trustee’s deeds under foreclosure recorded has been consistently high for the past several years: 231 in 2007, 307 in 2008, 298 in 2009 and 349 in 2010.
But the first five months of 2011 have seen 110 such deeds recorded compared to 152 for the same period last year. Projections by the county assessor show that total foreclosures this year will probably fall between the 2007 and 2008 totals.
Schauwecker noted that there are motivated sellers and good buyers out there, but the foreclosures tend to have some effect on the market.
“The foreclosures tend to drag down the market a bit,” Schauwecker said. “The foreclosure trend is still near historical high but down from the last two years.”
The housing market in Boone County is stable but “far from robust,” Schauwecker said.
Still, it seems to be better than some of the metropolitan areas mentioned in the Standard & Poor’s report. The report states that 12 metropolitan cities including Chicago, Minneapolis and Detroit “fell to their lowest levels as measured by the current housing cycle."