County housing market begins long recovery
Homes for sale are plentiful and prices are low, but loans are tougher to secure
Sunday, February 26, 2012
For more information on life in Clark County, visit www.columbian.com/portrait.
Clark County’s housing market showed weak signs of stabilizing in 2011 as first-time buyers and investors scoured the market for bargain-priced houses.
The uptick started in July, beginning with a 47.1 percent increase in year-over-year sales. It continued with a 46.9 percent increase in August, a 22.8 percent increase in September and a 24.7 percent increase in October, according to RMLS, a Portland-based data-tracking firm.
Meanwhile, home appraisals and prices continued to fall, pushed lower by homes in foreclosure and short sales — a negotiated sale in which the lender agrees to take less than is owed for a house. In October, one out of every 586 Clark County houses were in some stage of foreclosure, meaning those homeowners were either behind on the mortgage, or their home was scheduled for bank repossession or up for public auction.
Through most of the year, Clark County had the third-highest rate of foreclosure out of Washington’s 39 counties.
In October, the median price of an existing home in Clark County — half sold for more, half for less — was $177,900, down 7.3 percent from October 2010, according to Portland-based RMLS.
Real estate experts say prices could continue to fall, creating a new surge of foreclosures due to low market demand. Despite the lower home prices, fewer people qualify for home mortgage lending, which now places more emphasis on income verification and credit history.
In turn, less demand continues to drive prices lower, creating new interest among first-time homebuyers and investors who look for low-priced houses to manage as rentals, said Glenn Crellin, director of the Washington Center for Real Estate Research.
“Prices will continue to go down for another year or so,” Crellin predicted. “But we’re approaching a point where the level of activity is steady.”
Others say it could take months or years for Clark County’s foreclosures to work through the system, as home values fall and the prospect of homeownership seems too risky.
“If you owe $150,000 more than what the house is worth, assume you can make the payment. But if you’re making a business decision, how long is it going to take that to go back up? Maybe never,” said Kevin Gillette, executive director of the Community Housing Resource Center.
Gillette pointed out that even wealthy consumers have had to make choices. Sometimes that means walking away from the home.
“Let’s face it, you see millionaires doing it all the time,” he said.
Some agents foresee falling prices as a precursor to a pickup in homebuying, especially if hiring picks up among employers and mortgage interest rates remain low.
“This is absolutely the perfect storm,” said Scott Mikel, a Realtor with Scott Mikel & Associates Inc. “Prices couldn’t be better, interest rates are excellent and there’s a large inventory.”