South Dakota Housing Market: Unaffected By Slump
Despite all the doom and gloom reports about the national housing market, South Dakota realtors say the Yankton area has not been impacted.
In fact, this portion of the South Dakota housing market has actually improved in some ways, they say.
“The national news talks about how horrible the home-building is, and how horrible the sales are,” said Carol Breck, the public relations chairperson for the Lewis and Clark Board of Realtors.
“We never had those boom California home prices. We didn’t take a house we had bought for $125,000 and sell it for $500,000. We never had a bubble to burst.”
Instead, Yankton’s diversified manufacturing and health care economic base has contributed to steady growth, Breck said.
The National Association of Realtors reported recently that sales of homes fell in 41 states during the April-June quarter while home prices were down in one-third of the metropolitan areas surveyed.
Observers are calling the current national housing slump the worst downturn in 16 years. In spite of those sobering numbers, Yankton’s market is virtually unchanged this year compared to last year.
- According to figures from the local Multiple List Service, 146 homes were sold through the first six months of 2007 - only two less than last year.
- This year, more than 72 percent of the listings have been sold, compared to about 71 percent last year.
- The average time a home spent on the market was 101 days, and the average sale price was $120,037.
- In 2006, the average sale price was only $108,676.
“We could actually use more listings on the market. It seems like we have more buyers than we have places to sell them,” said Realtor Lisa Noecker of Anderson Realty.
The market for houses priced from $80,000 to $130,000 - affordable South Dakota mortgage amounts - is particularly tight, she added.
“In some of these price ranges where we’re lacking, there are probably 20 people looking at one house,” Noecker said.
In one recent case, she said a home actually sold for $12,000 above the asking price because of the intense demand.
Predatory lending hasn’t had the same presence in Yankton that it has had in other parts of the nation, according to local realtors.
With soaring foreclosures and late payments by bad credit mortgage borrowers, lenders have responded by making it harder for some people to get loans.
“In California, they’re doing crazy loans to get people into these houses because of their cost,” said Charlii Gilson of ReMax Acacia Real Estate. “I don’t see any more foreclosures here than we have in the past.”
Gilson said her mother sold her 1920s California home three years ago for more than $5.5 million. It was a two-bedroom, one bath, 660-square-foot home.
“That is not happening here,” she said.
South Dakota mortgage providers in the Yankton market are very responsible, according to local realtors.
“Predatory lending from lenders in this market - I don’t think that’s an issue,” agreed Al Schumacher, V.P. of Yankton’s First National Bank South Dakota.
But the availability of predatory mortgages through the Internet is another matter. Schumacher said he’s seen first-hand how home loans obtained over the Internet have bitten people hard down the line.
“I believe that if you’re going to finance the biggest purchase of your life, I’m not sure why you wouldn’t visit with a local lender,” he said.
Breck said the measured efforts of local businesses, and of South Dakota businesses generally, have given the state a desirable, steady market.
“I think having a scare put into South Dakota real estate buyers is unfair just because Florida and California are having problems,” she said.
“Their problems are, they grew too fast and too hard, and somewhere you have to crash because of inflation. Growth is really good for the South Dakota real estate business. We’re not dying on the vine here.”
SOURCE: Yankton Daily Press